It was not a budget for construction. It did not need to be – the industry is doing quite well. The recent cuts in interest rates have averted the recession that loomed last autumn. The crisis in the Far East caused significant damage to construction projects in Britain but has now been contained.
This was Gordon Brown's third budget, and, as he said, the last one of this century. His first two budgets, and his public spending review, provided significant extra resources for construction through increased funding for schools, hospitals and social housing.
There were further increases in spending in this budget, but only the £430m over three years for hospital casualty units is likely to provide work for contractors. The rest will go on technology, school books or crime-prevention schemes.
MIRAS will be phased out next year, but that shouldn't come as a surprise to anyone. Its value has been withering on the vine for many years now. With mortgage rates low and standard income-tax rates being cut further, there was a good case for scrapping MIRAS immediately. Doing so now would have made no difference to the private housing market.
The best news for the industry is obviously the cut in corporation tax. Most worthwhile companies are now making a profit and they would rather plough the benefits back to shareholders and employees than give the money to the tax man.
But construction will be less happy about the forthcoming levy on the business use of energy, although it shouldn't be surprised by it, given the government's green credentials. By being financially driven, the energy tax may cause companies to give a higher priority to sustainability than they would have done naturally.
Gordon Brown’s budget looks a remarkable achievement. It was not a budget for construction. It did not need to be – the industry is doing quite well
Another casualty of the government's green concerns and its bid to reduce greenhouse gas emissions is the roadbuilding programme, which got no mention in the budget. Road construction will remain in the doldrums for some years yet, but its time will come again – when car owners get fed up with sitting in traffic jams and dwellers in villages and small towns demand new bypasses.
Environmental campaigners will press for more taxes to reduce vehicle movement and will argue that building more roads adds to traffic flow. They are right: traffic seems to expand to meet the road space available. But voters like their cars. The pragmatic Tony Blair will resist the wilder calls for punitive taxes on vehicle ownership.
Road contractors should concentrate on maintenance and on rail schemes for the rest of this parliament. But, by 2003, a new Labour government may be deciding that industrial development requires more design-build-finance-operate or directly funded road schemes. The engineers, plant-hire companies and contractors should take a long-term view.
The big surprise for construction in the budget was that, despite its environmental emphasis, the chancellor did not impose an aggregates tax on mineral extraction. Brown has been blowing hot and cold over such a levy for two years and the threat had produced robust debate between the Treasury and the DETR.
I addressed six conferences of the Institute of Quarrying from 1997 to 1998 and, twice a year, I brief a successful private quarrying company on political and economic developments. I had continually warned them that an aggregates tax, though arguably inefficient and obviously discriminatory, was a real possibility.
In my most recent meeting with quarrymen, I was astonished to find a growing number who were no longer opposed to a tax and even some who supported it. However, it would seem that the proposed tax has been shelved, at least for the time being. Those who argued for greater voluntary commitment to environmental improvements and more materials recycling by the industry seem to have won the argument.