UK construction and property
- Company finances | Data from Creditsafe shows that 23 construction companies entered administration in December, one for every working day of the month despite a reduction from the 34 administrations seen in November,
- Unpaid invoices | The collapse of Tolent last week has reportedly left £50m of unpaid subcontractor invoices behind.
- School buildings | Seven education unions have written to the Education Secretary warning that school buildings are unsafe. The letter follows a report last year which revealed that post-war buildings using reinforced autoclaved aerated concrete were at the end of their functional lives and are on the verge of collapse.
- Annual total construction values passed £200bn last year, a 15% increase according to analysis by Barbour ABI, with inflation adding £23bn. The company forecasts an easing of prices in the second half of 2023
- Industry forecasts | Glenigan reported that construction starts remained weak, and planning approvals fell in the three months to January. The value of major (£100m+) project awards fell by 31% compared to the previous quarter but was 17% higher than a year earlier, and approvals of major projects were up 67% annually. It also commented that “infrastructural investment does shine a light”, offsetting other constrained activity.
- Fuel rebate | The Construction Plant Hire Association has petitioned Jeremy Hunt to introduce a rebate similar to the red diesel rebate for hydrotreated vegetable oil.
- Energy saving | The City of London Corporation has suggested that property owners switch off unnecessary lighting to create “brightness zones” with curfews within the Square Mile. If the rules are passed, businesses in residential and heritage areas would switch off lights at 10pm, or 11pm for cultural and tourist areas, and midnight for commercial areas.
- Hinkley Point | EDF energy could face a higher bill for the new nuclear power station as its Chinese partner may fail to meet extra payments. In the second half of this year EDF and CGN will be asked to make “voluntary” additional equity payments under a compensation mechanism for cost overruns. It is thought that the overall cost could increase by 20% (when compared to last year) to £32bn, and an 80% increase on the original 2016 budget of £18bn, with material price increases being blamed for much of the recent increase.
- Construction pay continues to lag behind inflation with ONS data showing an annual increase of 5.3%.
- Regulations | Concerns have been raised by a number of sectors, including construction, over the Retained EU Law (Revocation and Reform) Bill. The Royal Society for the Prevention of Accidents (RoSPA) has urged the government to slow down the process. Many are concerned that EU laws underpin many other UK laws, such as the Building Safety Act 2022, and removing EU rules would threaten health and safety.
