Pro-development policy must be a priority for the future government

Pro-development policies must take priority if the construction industry is to fully realise its investment potential in the future, a new study says

Survey respondents identified pro-growth policy changes that the next government could implement immediately to boost growth ambitions in the construction industry.

Indeed, 83% of respondents cited political and economic uncertainty as a major investment obstacle.

A pro-development policy platform to increase investment activity

One of the main goals of the entire sector is to create a pro-development policy platform that will stimulate investment activity.

Ensuring comprehensive local plan coverage was identified as a top priority by 55% of respondents, although separate research by Lichfields found that only 22% of plans would be adequate by the end of 2025.

Decisions regarding public investment occupy a high place in the industry

In addition, much emphasis was placed on the need for a long-term industrial strategy, with 40% of respondents calling for clear investment paths.

Decisions on public investment in housing (38%), investment in clean energy (39%) and improving the capacity of the national electricity grid (38%) also rank high on the wish lists of contractors, developers and consultants.

Calls for reform of existing regulations

Gavin Mason, Operations Director at Pick Everard, said: “Our research is being conducted against the backdrop of political and economic uncertainty, in a market struggling with rising construction costs, reduced public investment, increasing complexity in obtaining planning permission, a persistent skills shortage and a sector that sees more than 4,000 insolvencies a year – the highest of any sector in the UK.

“All these issues will need to be addressed by the new government, which will play a key role in improving the sector’s performance.

“The survey results clearly show that the industry is calling for constructive reform of the current regulations to deliver the construction investment that the country so desperately needs.”

Tender prices are expected to increase next year

Further survey results reveal that 96% of respondents expect asking prices to rise next year, with 76% predicting increases of 1-6%.

Influencing factors include the impact of government legislation (26%), construction industry performance (20%) and geopolitical volatility (19%).

Industry Concerns and Priorities

Assessing the current challenges facing the industry, 24% of participants called for a review of the recently passed Biodiversity Clean Gain Regulation, which came into force earlier this year.

Chapter 2 of the Building Safety Act and Part L of the Building Regulations (2022) have also been the subject of much debate within the construction sector over the past year.

Moreover, to stimulate industrial development, a reduction in interest rates (36%) and increased investment in training subsidies (24%) are urgently needed.

The latter is particularly important in the context of solving the problem of the widening competence gap in construction.