Pressure grows for government to boost construction
More signs were in evidence this week that the government is preparing to bolster construction to sheer up the faltering economy. Inside Housing reported that the government is hatching an urgent plan to spark a house building boom and have asked Whitehall officials to examine ‘within weeks’ how more homes can quickly be built to provide an economic boost, but without further government spending.
A senior Whitehall told Inside Housing: ‘This is really good news as the direct economic benefit of housing and house building has clearly been recognised at the highest level of government. The thrust is how to get more homes without any actual direct investment.’
Options being considered are said to include using government guarantees to encourage private sector investment in housing, and the possibility of using housing association balance sheets to support further development through extending the £1.8 billion affordable rents programme.
Last week chief secretary to the Treasury Danny Alexander convened a meeting with representatives of leading housing associations to discuss how to build more homes.
Meanwhile the construction sector is urging the coalition must take measures to encourage investment in major projects and has hit out at the government’s failure to kick-start investment in infrastructure despite consistent pledges to boost the sector since coming into office in 2010.
Launching a roadmap for encouraging institutional investment in infrastructure construction, John Cridland, director general of the Confederation of British Industry, said he was encouraged by the strategy from ministers, “but six months on, progress has been slow,” reports Building.
The comments came after the prime minister told the Treasury to consider using government guarantees to de-risk elements of construction schemes in order to make it possible to raise private finance from risk-averse institutions.