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How can UK construction ensure it’s ready for an infrastructure spending boost?

Last December’s election of a Conservative majority government paved the way for increased political certainty and a clear direction on policy. This combined with a £100bn long-term infrastructure investment programme, signals that the clouds hanging over the construction industry could finally be showing signs of clearing. However, the speed at which this translates into tender price growth will depend on how quickly the public sector can turn stalled programmes from 2019 into shovel-ready projects.

2020 brings the potential for much-needed transformation

Tender Price Forecast

A challenging outlook for the construction sector in 2020, made worse by Brexit gridlock in 2019, led us to downgrade our 2020 London tender price forecast to 1%.  Forecasts for national markets and infrastructure have also been downgraded.  However, this reduction in the rate of price inflation is likely to be short-lived, and we are increasing projections for buildings to 5% growth a year from 2022, as investment from a range of public and private sources is channelled back into the UK. 

Preparing for an infrastructure spending boost

The construction sector needs to start preparing for its role in delivering the new government’s promises.  Whilst the Conservative’s £100bn programme will increase the pace for the delivery of schools, hospitals and other vital infrastructure, it should also create a firm foundation for much needed industry transformation. However, it is crucial that the sector recognises and responds to the wider challenges that public-sector clients will be setting in the future.

This means delivering in a way that is consistent with Government strategies like the presumption for offsite construction, working in integrated teams and shifting industry thinking to make full use of innovative building technologies to increase productivity and value. This will be crucial in driving high performance across the entire industry.  

Download our full Winter 2020 Market View to find out more.

Questions about this article

Simon Rawlinson

Partner - Head of Strategic Research and Insight +44 (0)20 7812 2319 Ask me a question

Agnieszka Krzyzaniak

Market Intelligence Lead, Construction Ask me a question

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