Alongside the announcement of the budget on the 11th of March, it is widely expected that new Chancellor Rishi Sunak is will unveil the construction strategy. We begin to explore what the core components of this strategy could look like and the implications for the construction industry.
The previous construction strategy, brought in by David Cameron, ran from 2016 to 2020 and set out plans to deliver efficiency savings of up to £1.7 billion and 20,000 apprenticeships. These challenges appear comparatively small compared with the current pressure to deliver £100bn of infrastructure spending in the next five years, while also contributing to the overarching target of net zero emissions.
This strategy will be expected to balance the expectation of short term benefits that are both visible and deliverable, with the need for a long term investment strategy that helps to tackle the sector’s most significant challenges.
£100bn price tag
Throughout the 2019 election campaign, the need for an “infrastructure revolution” was a pivotal issue across the major parties. The Conservatives promised a £100bn investment into infrastructure over the next five years, which the construction industry will be expected to deliver in a timely and costly manner.
The short-term focus of the strategy will likely be focused on successfully delivering projects across the sector in the next few years. This will satisfy the public’s desire for immediate infrastructure improvements, and ensure that the UK is able to capture the benefits from the Conservative’s investment.
However, as the construction of major projects like HS2 come under increasing scrutiny, developers are under increasing pressure to operate within budget and without delays. A long term focus of the construction strategy will likely be investment in innovative technology alongside improved education and training programmes to enhance productivity in the sector. This would help improve efficiency in the construction industry, and help ensure that projects are delivered successfully for years to come.
Therefore, the construction strategy must help the industry in balancing the short term high value deliverables with the long term goals of increasing productivity and closing the skills gap.
The construction industry appears to have been dealt conflicting challenges: deliver more projects while reducing emissions. Our report on the public’s attitude to net zero emissions detailed the role that all sectors must play in tackling climate change, with construction likely to play a pivotal part in this. We have previously explored how construction fits into the target of net zero emissions, and as 2050 gets closer the pressure to reduce emissions will only increase.
Leaders in construction will expect investment in technology and methods that help the industry combat carbon emissions. These range from the use of more sustainable materials to the integration of electric vehicles and off-site construction. Due to the nature of construction and its inherent focus on tight margins, the strategy must provide guidance for the construction industry’s contribution towards the target of net zero.
Alongside the budget and national infrastructure strategy, the construction strategy has a pivotal role to play in a post-Brexit Britain. The challenge for the construction strategy lies in balancing the need for change with the industry’s focus on tight margins. While the future of the construction industry remains unknown, a truly ambitious strategy will aid the industry in taking the first steps towards its long-term challenges.