Editor's comment: A slow year ahead?

Editor's comment: A slow year ahead?

The figures released by the Construction Products Association this week are hardly the stuff of dreams. It is forecasting output growth of only 0.6% this year, a result of government delays in investment and a subdued private sector. And that is on the back of 2005, a year when construction output fell by 1.1%.

Following year-upon-year of steady growth, it would be all too easy to become depressed about such low growth rates. But is it just a reflection of the times we live in that any backward glance, or figure that isn’t quite positive enough, is a cause for doom and gloom?

Construction is now on a more even path than it was during the early 1990s. And that would seem to be unlikely to change unless the government radically changes its stance. It has promised to deliver hospitals and better health care facilities, to build new schools and refurbish those that need it, and to push for new housing developments in key population areas. All those things have been promised, and there’s every likelihood that they will happen – albeit more slowly than everyone in construction would like.

However, there are some sectors requiring urgent attention. Water has risen to the top of the agenda, while the Highways Agency is set to spend more cash this year delivering its current investment programme. It surely cannot be a coincidence that Balfour Beatty has launched a £32m bid for civil engineer Birse this week…

However, Balfour does seem to recognise how well a smaller, specialist firm can do within its organisation. Mansell has become a star performer as part of its stable, winning work on the basis of good tenders, but also because of the certainty of a big parental backer. With framework deals becoming increasingly larger, being part of a big stable has its advantages; with a burgeoning market, Birse, if it becomes part of Balfour, will surely be all out to capitalise on them.

Emma Penny, Editor, Contract Journal, 28 June 2006