Issue 490 | 28 July 2025 - Turner & Townsend alinea

UK construction and property

Tariff impacts | A report by insurance specialist QBE on tariffs and the construction sector suggests that levies will remain in place and will increase processing times at ports, leading to project delays. The report notes that the UK relies on transatlantic trade for nearly a fifth of its timber.
Safety communication | The Regulator of Social Housing and the Building Safety Regulator have signed a Memorandum of Understanding on how they will communicate safety risks to ensure consistency.
Gateway 2 guidance | The Construction Leadership Council (CLC) has published advice on submitting Gateway 2 applications. The average amount of time to achieve sign-off is nine months. The CLC’s guidance can be found here.
Skills mapping | Procurement body Scape has reported that different regions require vastly different skills. Wales, for instance, tends to be focused on green energy whilst, in the East Midlands and Central South regions, the focus is more on transport infrastructure. The report can be found here.
Retentions | Build UK is planning to include information on retentions to its database on payment performance, as company accounts filed on or after 1^st April 2025 will show what retention monies companies are holding.

Eurozone activity | Economic activity in the Eurozone rose by more than expected last month, easing concerns of a slowdown caused by trade tensions. The Flash Composite PMI rose from 50.6 to 51.0. Despite a contraction, manufacturing showed signs of stabilisation.
ECB rates | The European bank maintained the base rate as policymakers waited to see if the bloc will attract further tariffs from the US.
US/Japan trade |The US agreed to a trade deal with Japan that will see Japanese exports taxed at 15%, below the 25% that was threatened. A quarter of Japan’s exports to the US come from its critical automotive sector, which accounts for almost 3% of its economy.
US/EU trade |Donald Trump and the European Commission have reached a tariff agreement that will impose 15% tariffs on imports from the bloc and will result in the EU spending on US energy products and weapons.

Borrowing costs |Government borrowing rose by more than expected in June, rising to £20.7bn from £6.6bn a year earlier. Higher spending on public services and debt interest payments outstripped income.
Retail sales volumes rose 0.9% last month encouraged by warmer weather. The increase comes after a fall of 2.8% in May, which was more than expected.
Consumer sentiment | The S&P Global UK Consumer Sentiment Index (CSI) remains below the neutral mark of 50.0, but is largely unchanged. Finances have deteriorated, but job security seems to have returned, despite income growth slowing to a four-month low.

Steel tariffs | The latest proposal for a trade agreement between the EU and the US does not include the removal or reduction of the retaliatory 50% tariff imposed on steel imports to the US.
Material sales | The latest State of Trade survey by the Construction Products Association found that 90% of manufacturers reported salary increases and that the majority of manufacturers anticipate the construction recovery to continue over the next 12 months.
Builders’ Merchant salesvolumes increased between May 2024 and 2025, but takings were stable as prices softened. Volumes rose by 2.1%, but prices fell by 2.1%. In the year, sales of the two largest categories fell: timber and joinery products by 3.5% and heavy building materials by 2.0%.
Clean energy transition | The UN’s Secretary-general said that fossil fuels are “running out of road” as the majority of new electricity capacity added last year was made up of clean energy.

“Climateflation” | A report by the Autonomy Institute thinktank warned that Britain is at risk of worsening “climateflation” as increasingly extreme weather could increase food prices by more than a third by 2050.
Sewage | The number of times sewage is discharged by water companies will be halved by 2030 according to a pledge by the environment secretary. Serious pollution incidents by water companies in England rose by 60% in 2024.
Climate change cases| The International Court of Justice has made a non-binding ruling that countries could sue each other over climate change, including historic emissions of planet-warming gas, and seek damages for the impacts of climate change, such as destroyed buildings or infrastructure.