Key figures have hailed “positive” measures for construction as the government’s Industrial Strategy looks to boost material production, skills and development.
Prime minister Keir Starmer unveiled the 158-page plan on Monday (23 June), claiming it represented “a turning point for Britain’s economy”.
Key measures included increasing the support available to help steel makers, and certain other businesses, cut their energy bills.
Elsewhere the strategy promised extra cash for skills development alongside reforms to the planning, procurement and migration systems.
Rebecca Larkin, head of construction research at the Construction Products Association, said the latest government proposals contained “many of the same announcements we’ve seen over the past couple of weeks”.
But she added: “The key measure from today’s document is undoubtedly the proposal to reduce industrial electricity costs, which are currently among the highest in the G7 and Europe. Energy-intensive heavy-side construction products such as bricks, cement, ceramics, concrete and steel go into all sectors of construction – so the topline message is clearly positive.
“Details on eligibility will come later, though, and the impact on overall construction costs will depend on the extent to which a reduction in energy input costs offsets the higher costs elsewhere in the supply chain.”
Viki Bell, chief executive of the Construction Equipment Association, welcomed the “long-term thinking” behind the latest government plan.
“Plant and equipment manufacturers require stability, infrastructure and skilled personnel to thrive, and this strategy demonstrates a clear understanding of industry needs,” she added.
“The commitment to reduce electricity costs is a potential game-changer for manufacturing… as the government consults on eligibility, we will be looking to ensure construction equipment manufacturers are included.”
Bell said a promise of extra cash for the British Business Bank, revealed in this month’s Spending Review, “shows an ambition to unlock capital and support regional growth” that was important for kit makers.
“This strategy is a positive step and we look forward to working with government to ensure our sector is part of its delivery,” she added.
Suzannah Nichol, chief executive of Build UK, stressed that construction was an energy-intensive sector.
“While headway is being made on using more renewable sources, the cost of energy to the delivery of construction products remains significant and any reduction in those costs will be welcomed,” she added.
Gareth Stace, director general at UK Steel, said the government was right to reduce industrial power costs.
“The Industrial Strategy is a step in the right direction towards competitive electricity prices and a better, more effective business landscape, but we are climbing slowly up the foothills of the mountain we need to climb,” he added.
“The Industrial Strategy must be the first of many changes if we are to fully unlock the potential of the UK steel industry to back the growth and stability of our economy.”
Business and trade secretary Jonathan Reynolds said the proposals would “ensure the UK is the best country to invest and do business”.
He added: “Not only does this strategy prioritise investment to attract billions for new business sites, cutting-edge research and better transport links, it will also make our industrial electricity prices more competitive.
“Tackling energy costs and fixing skills has been the single biggest ask of us from businesses and the greatest challenge they’ve faced – this government has listened, and now we’re taking the bold action needed.”
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Greg Pitcher