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Public sector projects are keeping contractors busy across the UK. Now, as the Kelly Review of construction capacity reveals, demand is boiling over in the North-west and London.

The long-awaited results of the government review into public sector demand on UK construction have finally been revealed.

Details from the Office of Government Commerce’s Kelly Review, presented to industry leaders last week, are shown on this spread.

They reveal that between 2004 and 2008 the hotspots where public demand is highest are the North-west and London. The database includes 728 projects, worth a total of £31.5bn, nationwide. Of those, 130 schemes are in the North-west and 90 are in London.

The review is intended to help contractors and suppliers prepare bidding and production plans. A main contractor, for example, might decide to open an office in the North-west to take advantage of the boom. This ensures there will be sufficient competition and materials to deliver the government’s ambitious programme.

The OGC and Davis Langdon, the consultancy that set up the database, are keen to stress that the findings are fairly crude. The database is not complete: council projects worth less than £5m have yet to be added and not all projects valued at £5-20m have been included so far. As John Connaughton, partner in David Langdon, put it: “There is a lot more devil in the detail to be found but the findings do indicate there are some regional issues.”

We need more analysis. We don’t want programmes cut because of fear of capacity restraints
Industry leader

The OGC is due to investigate the North-west market further to verify its information. If this confirms the likelihood of capacity problems in the region, the OGC will talk to government departments about the need to streamline their construction plans or to try to find ways of encouraging more contractors into the area.

The audience that attended the Kelly Review launch at a central London hotel last week was impressed by the findings, but agreed that more work is needed before the database can be considered comprehensive.

One leading industry figure said: “We need more analysis to understand the results because we don’t want departments to cut back on programmes just because they fear capacity restraints. But it does show the government understands it needs to be more open with the industry [about details of its build programmes].”