Pipeline of work offers promise
Pipeline of work offers promise
BLOG · BY TTF CEO David Hopkins · 28 May 2020
While there remains a mountain to climb, as businesses and the UK Government seek to restart construction, the pipeline of work ahead should offer some assurances.
Construction sites over the past month have been returning, and reports are business remains steady – rather than a flood – despite headlines of builders returning to site. But it is positive that with many of the larger sites reopened, by value, more than half of the sites which had been shut down have returned. Of course this return needs to be understood in the context of the implementation of safe site operating procedures. Businesses are managing the risks of COVID-19, and as could be expected, this means there will not be a uniform reopening of sites.
However, the early development pipeline should offer some comfort to businesses. Glenigans notes that while the immediate development pipeline has weakened, they were recording 80 new bidders a day being added against projects last week. They also expect the pipeline to accelerate, as projects where decisions had been delayed by COVID-19 begin to be awarded. There has also been a return in the number of planning applications published by authorities, which was averaging 1,382 a day over the last week. CPA figures also show merchants are reopening.
Getting construction moving again is important. The taps to support business through low interest loans, tax deferrals and other packages to support business will be eased off over the coming months, as outlined in the Government’s plan to rebuild. This reflects the Office for Budget Responsibility estimates that the direct cost alone to the Government of the response to COVID-19 could rise above £100bn in 2020-21. In the construction industry, the CPA Construction Scenarios (Spring 2020) report – available to TTF members – projects a 25% decline in construction this year, before a 26% rebound in 2021.
There still remains on the horizon an economic stimulus package, with one of the core considerations of the Government’ plan around investing in supporting an ‘economic bounce back’. The headline stealing construction announcements in recent weeks have centred on infrastructure, particularly HS2, but we will be lobbying for housing to feature strongly in the Government’s economic plans. Housing is a channel for economic growth directly into every community in the UK.
Looking to our neighbours, just yesterday the E.U. announced a proposal for a €750 billion stimulus package which would see the issuing of long term government bonds on international markets. This will include €500 billion in grants to member states, and €250 billion in loans. We continue to wait to see the size and focus for the UK Government’s stimulus package, but more politicians, think tanks and businesses are joining the chorus to build back green. Timber, as a sustainable building product is well placed to benefit from such a plan.
Building back better is a principle which applies not just to the UK economy as a whole, but to the timber supply chain. I would like to extend my thanks to all those who joined us on our webinars on the preservative treatment family of products, and this project will in future help deliver more value to our members as businesses. I encourage all to continue to engage with the learning resources, such as the WPA/TTF Buyers Guides we have available in our library, as we look to ensure the better use, marketing and application of wood products.
As an organisation, we are working hard to ensure that the market is assured that when they buy from TTF members they will receive Timber you can Trust.