So it was good news for construction on Monday.
Gordon Brown’s spending plans reinforced the government’s commitment to schools and hospitals and gave an extra £1.3bn to social housing. The news was not quite so good for civil servants, of course, including those in the DTI’s construction directorate, who are in the shadow of Peter Gershon efficiency guillotine. Complaints about builders make up a large part of MPs’ postbags, so if the blade does fall, surely the private sector would be drafted to do some of the directorate’s duties.
As for housing, Cinderella has arrived at the ball: investment is at its highest for 12 years. The plan is to increase the supply of social housing for rent by 10,000 units a year, or to build 75,000 of same by 2008. This is still short of the 23,000 a year that Kate Barker regarded as essential, but better than expected. And on top of that, the government is pledging 40,000 in low-cost and shared ownership. There is a big difference between allocating money and creating the conditions necessary for it to be used, as Whitehall’s chronic underspending shows. On that front, though, there’s room for optimism. More public land is being released, English Partnerships has more muscle, the urban development corporations are loosening the planning tourniquet in growth areas, and innovative deals are being struck with the private sector. And putting Jon Rouse in the driving seat of the Housing Corporation was a masterstoke: if anyone can deliver quantity, quality and genuinely mixed tenure, it’s him. The allocation of £250m of PFI credits for new-build – effectively allowing councils to build housing again – is welcome, if it suffers none of delays associated with this procurement method. That is a big if. Out of four PFI refurbishment schemes proposed in the past four years, two have been signed. But social housing is only one side of the equation. To make a perceptible impact on house prices, the private sector has got to raise output – Barker suggested by 70,000 homes a year. This will only come with less onerous section 106 agreements and a better planning system.
Ten years on, the jury's still out
A decade ago, construction was seen as a nasty, brutish and short-termist industry: a permanent battleground in the war of all against all. So how much has changed since then? Well, Neanderthal Man no longer roams the sites of the land, terrorising small contractors with the assistance of fine legal minds. But how much of this is the work of Sir Michael Latham, who in the early 1990s was charged with drawing up a peace plan? And how much is the result of a sunnier economic climate? Well, when the business cycle turns, a resumption of shock and awe by contractors or clients will seem so atavistic as to be unacceptable, and that's Latham's considerable bequest. But Latham and Egan's raison d'etre was to give the client better value for money, and frustratingly, nobody knows whether that has been achieved: the figures are just not to hand. Latham, who delivers a self-assessment on page 36, believes some projects are – which implies that many are not. And until we can point confidently to consistently reduced construction costs, the Latham Project will remain unfinished business.
Postscript
Denise Chevin, editor
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