The 2018 Budget And Construction
A couple of weeks ago, we wrote this post about the Construction Industry and the then upcoming 2018 Budget. The post included a few things which could be good for the Construction Sector if they were in the speech.
Well, the Budget has now happened, so we’ve been looking into what it said which would be great for the industry over the next few years. There are a number of different things which were included over the course of the speech. Here’s a few of them.
House Building Boost.
In our previous post, we pointed out that it would be great to see the house building sector addressed – it is growing, but still not meeting the Government targets for the number of new builds a year. According to Building.co.uk, the Budget has led to another £500 million funding for house building. This is great because the extra funding can lead to an increase in the number of homes being built, which will mean there is more chance of the sector reaching the Government’s annual targets.
This wasn’t everything for the housing market in the Budget either. The BBC have highlighted the abolition of stamp duty for shared home ownership for first-time buyers too. Although this isn’t necessarily great for construction, it will help the overall housing market. Which has to be a good thing for the industry overall, as there might be more demand for houses.
Large Scale Funding.
This was also something mentioned in the previous post. A boost for large scale funding projects would help grow the other areas of Construction, not just house building.
This part wasn’t so obviously mentioned. However, in the Budget documentation online, there is mention of a National Infrastructure Strategy, which could be published next year, with another edition in 2020. This could contain improvements which should be made to the Construction Industry, so it’s worth waiting to see what that might hold.
Something For The Skills Shortage.
The skills shortage is something that’s mentioned a lot on this blog – mainly because it’s such a large issue with the Construction Industry at the moment. An article on Politics Home talks about the new measures which can help small companies take on apprentices. The main point of this is that small companies will have their levy contribution halved – from 10% to 5%. There are other measures too, but this one might help smaller companies take on apprentices, as it will cost less.
The Economy Looks Alright.
In our last post, we said that good news for the economy would be great for the Construction Industry. There wasn’t anything bad about the economy in the Budget, so that’s a start. According to Gov.uk, the economy has grown again this year – so that may help the construction sector in a more roundabout way. Because if people are better off, they might be more likely to buy a house or invest in something.
End To Private Financing.
An article on Money Marketing mentions that the Private Financing Initiative (or PFI) has also been abolished. This means no more new contracts will be awarded in this way. Given that this is the way Carillion managed to win so many contracts before collapsing at the start of this year, at least it might be a preventative measure to stop anything like that happening again.
All in all, it looks like a decent Budget for the sector. There are a few things which can help the Construction Industry address some issues and continue to grow. Therefore, the next 12 months could be alright for the sector – although it’s too early to guess at that yet.
There is still a lot of uncertainty in the industry – and the country as a whole – so at this point, it’s probably better not to make any long-range forecasts for the sector. However, if all of these measures have the good effects that they could do, this might be beneficial for the industry over the next 12 months.
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