Public sector demand keeps contractors in work - for now

It has been this way for the best part of two years: the top-performing firms have been propped up by public sector spending.

But every month the edge of the cliff gets a little closer. In a list of the 20 biggest bits of work won in July, only three were in the private sector but, for another month at least, the public sector yielded enough to postpone a complete wipe-out.

This month’s most thankful contractor was Morgan Sindall. The firm won £196m of work over July from a total of 40 contracts. The pick of the bunch was a £95m double deal to build an adult mental health facility at the Murray Royal hospital in Perth and another in Stracathro hospital in Angus. Both jobs are for NHS Tayside. It also picked up a £19m contract with Knowsley council for a community centre.

Second in this month’s league table was Balfour Beatty with 35 contracts totalling £139m - its biggest wins were a £28m Network Rail job in Paisley and £100m of highways works in Southampton. Laing O’Rourke was placed third, with six contracts worth £109m.

Back in July 2009, Morgan Sindall was second in the contractors list with £235m of work. Laing O’Rourke came top with a £1.2bn bonanza, after signing up to Barnsley’s Building Schools for the Future programme, which was forecast to be worth £1.1bn. The initial £360m phase of that deal survived last month’s cuts, but Barnsley council’s further plans are now a distant hope.

One interesting figure is for overall work won last month: £1.5bn. Last year, July’s total was also £1.5bn if you discount the £740m that went up in smoke as part of Laing O’Rourke’s BSF deal. The perils of counting your chickens before they hatch …

In 2008 the July total was £1.7bn. In 2007, just as the phrase “credit crunch” began to enter popular jargon, the total was £2.2bn. Although the downward trend has levelled, the pickings get thinner with every swing of the coalition axe.

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