|Ministers must find more ways to stimulate construction to boost economic growth and tackle the housing crisis in the UK, according to the Federation of Master Builders (FMB).|
The latest Office of National Statistics GDP data showed output in the sector rose by just 0.3% in the final months of 2012 although the UK economy as a whole shrank by 0.3%.
This follows a fall of 2.5% between the second and third quarters of 2012, which as a whole was a bleak one for construction.
Brian Berry, chief executive of the FMB, said that he believes that the government now realises the wider economic benefits that capital investment via construction can bring, however it must do more to unleash the potential in the industry.
‘Our members are ready to help Britain build its way back to growth, in the process helping meet the spiralling housing crisis and improving energy efficiency in homes and businesses. But we can't do this alone. government must meet construction firms halfway, and find imaginative new ways of increasing activity in the sector, particularly for small, local builders who may not immediately benefit from major infrastructure investment,’ he explained.
‘For example, the Treasury could incentivise domestic energy efficiency improvements with a reduction in VAT on such work to 5%. Home owners would then be more likely to improve insulation, fit high performance glazing and more efficient boilers,’ he added.
He also called for ministers and local authorities to urgently look at bringing new housing online by freeing up additional land for development and refurbishing empty or derelict stock.
‘Easing planning red tape and pushing investment through the new Business Bank will help smaller construction companies begin to start providing the 250,000 new homes Britain needs every year to just to keep pace with demand,’ said Berry.
The FMB's latest State of Trade Survey results indicated that many firms feared they may have to introduce price rises as overheads continue to eat into profit margins, and around 30% of those surveyed said it was likely they may have to lay off workers in 2013.