The construction industry praised chancellor Gordon Brown’s pre-budget statement this week.

Building materials producers and contractors applauded the decision to cut energy tax from £1.7bn to £1bn and to give an 80% discount to large users of energy. The Construction Confederation said this should help head off price rises in materials. And good news for contractors came as Brown promised an extra £200m in next year’s budget to modernise schools.

Start-up companies and construction companies that have major land banks (which pay tax when they sell land), welcomed the reduction of capital gains tax. This will be cut from 40% to 22% for three-year investments and by 10% for five-year investments.

The decision to extend the New Deal for the unemployed to those over 25 received a cautious response. “We are already struggling … wouldn’t it have been better to make it work well for under-25s first?” said the Construction Confederation.

Good news for the government’s attack on cowboy builders came in two ways. Brown did not rule out cutting VAT on repair and maintenance. He also proposed a taskforce to curb the black economy.

The abolition of automatic increases in road fuel tax will help construction, which relies heavily on moving labour and materials. Industry also welcomed the announcement that above-inflation rises in fuel prices would be ploughed back into roads.

The RICS welcomed the change in planning guidelines for high-tech estates such as science parks.