Last week, Michael Gove in the blue corner dismissed the pre-Budget report. Nick Raynsford, in the red, explains how his party’s policies will pave the way to recovery for construction

Politicians tend to divide into two categories when balancing the conflicting pressures of getting the right solution and advancing the interests of their party. Some – and I hope I fall into this group – try to understand the issue from all angles and, where necessary, work with colleagues from other political parties to ensure the best outcome. Sir Michael Latham and I come from different parties but have always been able to work together in the best interests of the construction industry.

Other politicians, however, can never resist the temptation to milk issues for party political advantage and seem incapable of recognising any merit in proposals coming from opponents. Michael Gove’s article in last week’s Building places him squarely into this category. As a former leader writer for The Times, Gove can be forgiven for indulging in a journalist’s love of florid language, but it is depressing that a senior politician evidently thinks it is sufficient to dismiss the pre-Budget report with a few colourful but simplistic phrases, without making any attempt to analyse the complex challenges that have to be addressed. I give him the benefit of the doubt that he was aware the article was to appear in Building rather than The Grocer, though his remarks appeared to have been written with little attention to the specific concerns of the construction industry.

So, let’s take a hard look at the problems. As is well known, the global downturn had its origins in the American sub-prime mortgage market crisis, and housebuilding has been hit hardest as a consequence. Mortgage lending, new homebuilding and home sales have all plummeted in the past year. Measures to restore lender and homeowner confidence are vital. The steps taken to recapitalise the banks were essential but, as the chancellor recognises, more needs to be done to get the banks lending again and bring investors back. Hence the measures announced in the pre-Budget report and subsequently, which were designed to stem the rise in repossessions and ensure that banks pass on the benefits of falling interest rates.

Some politicians cannot resist the temptation to milk issues for party political advantage. Michael gove is squarely in this category

But although the downturn originated in the housing market, it has had a far wider impact. Hence the need for measures to stimulate consumer spending to avoid recession leading into prolonged slump. Commentators may disagree about the best mix of incentives, but there can be no doubt that the actions set out in the pre-Budget report, including the temporary VAT reduction, are serious attempts to influence consumer spending positively. Doing nothing because of fear of increased borrowing, which appears to be the Gove recipe, is not a credible policy.

There is also the obvious importance of public investment programmes, which are vital to the construction industry. In contrast to the recessions in the seventies, eighties and early nineties, when governments tended to cut capital spending, the pre-Budget report makes clear the government’s commitment to supporting and enhancing public investment. In addition to the maintenance of key projects such as Crossrail (which in an earlier incarnation fell victim to the early nineties recession), Alistair Darling is bringing forward spending on labour-intensive programmes such as home renovation and energy efficiency work and providing substantial resources to the new Homes and Communities Agency to sustain social and affordable housing. Intelligent use of the agency’s powers will also hopefully maintain capacity in the industry, so that when recovery comes we do not suffer the same problems of serious skills losses that faced the construction industry in the mid-nineties.

The one disappointing announcement of recent weeks on the subject of public sector investment has been the cancellation of the Thames Gateway bridge and various tram and light rail schemes in London.

I give him the benefit of the doubt that he was aware the article was to appear in Building rather than The Grocer

Gove curiously failed to mention these cancellations, which will adversely affect London’s and the Thames Gateway’s development prospects – is this because the decisions were taken by a Tory, Boris Johnson?

Nobody can doubt that the construction industry and the whole British economy face difficult times. There is a risk of a drawn-out and damaging slump if the correct responses are not put in place now. Only time will tell if the measures taken by the government and the Bank of England this autumn will be sufficient to avoid that scenario, but at the very least the pre-Budget report is evidence of a government trying to take the right steps to facilitate recovery.