ECA News VIEW FROM THE LOBBY by Carol Wrench, PR and public affairs manager I
It’s been a mixed bag as we pass the anniversary of the Conservative-Liberal Democrat coalition’s fi rst year in power; while there have been some very positive moves on the government’s part, these tend to lose a little of their shine when countered by continued uncertainty for the construction industry. On the one hand, government’s steps to boost apprenticeships, reduce taxes and bureaucracy and promote energy effi ciency are to be applauded. Conversely, the disruption to Feed-in Tariffs (FITs) and changes brought in by the Localism Bill have spread damaging uncertainty in the market. The January 2011 VAT hike to 20 per cent also dealt a blow to confi dence, causing consumers to tighten their ever-constricting belts by yet another notch Against a backdrop of heavy cuts to reduce the
defi cit, the government, to its credit, has sought to maintain capital infrastructure spending. However, cutting specifi c nationwide programmes like Building Schools for the Future (BSF) has hit the industry hard, and the heavy reduction in local authority budgets has, and will continue to have, an unwelcome impact on order books.
Localism has become a buzz word. While the aims of The Localism Bill – to incentivise councils and communities to back local developments instead of applying prescriptive housing targets – is laudable, we are concerned that this Bill could see a drop in supply. The move towards localism has also made it diffi cult for housebuilders and the supply chain to predict and prepare for the future project pipeline. Government plans to slash the subsidy for solar PV installations above 50kW is another worrying development. We would urge the government to reconsider where it puts its limits on FITs, as this could discourage schools and other public buildings from joining in and supporting Britain’s drive to generate electricity from more renewable sources.
Positives Thankfully, there are some very positive notes. On the upside, the reduction in corporation tax and the small business rate relief holiday have given much needed breathing space, particularly to SMEs, and have hopefully allowed businesses to take stock and better prepare for the future.
The Green Deal is also a positive – a fantastic
idea that provides massive work opportunities for the sector. However, to be truly successful, we believe it needs to come with a clear fi nancial incentive, such as a stamp duty rebate or council tax reduction for owners and landlords to boost confi dence in the supply chain.
All in all, in light of massive – though necessary – cuts, there has been some progress made during the fi rst year of the coalition. Going forward, in addition to ensuring a steady supply of public sector construction projects, we believe that the government needs to concentrate on boosting Britain’s growth, with the shift to a low carbon economy lying at the very heart of that growth. If properly incentivised, the sustainability agenda presents huge opportunities for those in the construction and wider building services industries, and an economic lifeline for recovery and development.
■ For more information on the ECA’s engagement strategy and details of meetings and consultations with government ministers, MPs, opposition leaders and leading civil servants, visit
www.eca.co.uk/lobbying
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