BMP predict sustained industry improvement

by Graham Ridout



Construction can look forward to a sustained improvement in activity over the next three years, according to the Building Material Producers' latest forecast.

BMP is predicting that there will be a 1.5 per cent increase in construction output this year followed by further growth of 3.5 per cent in both 2001 and 2002.

Despite the upbeat predictions, chairman of the forecast panel Charles Novotny warned: "Even with this steady increase, gross construction output will still only be at around 9 per cent of GDP, compared to the European average of 12 per cent. Under-investment in our built environment threatens to place the UK at a competitive disadvantage and harm our quality of life."

Novotny added that concern persists in three principal areas. First is that investment in new social housing is at a 50-year low. Secondly, the number of new homes being built is being affected by changes in planning guidelines and the push for more developments on brownfield sites. And thirdly, the high value of sterling continues to place UK product manufacturers under intense competitive pressures in the domestic as well as export markets.

BMP said the rise in output will be fuelled by new office and refurbishment projects; repair and maintenance in both private and public housing; health and education work funded by traditional means or by private finance initiatives; and rail work.