REUTERS | Ina Fassbender

Coalition agreement final version and Queen’s Speech 2010: construction implications

Since the initial coalition agreement was published, three key political developments have taken place. None of these developments have fundamentally altered the position for construction companies and construction lawyers, and all mean that some residual political and practical uncertainty remains.

The three developments are the:

  • Final coalition agreement (20 May 2010).
  • Chancellor’s statement of how the government intends to save £6 billion (24 May 2010).
  • Queen’s Speech (25 May 2010).

Final coalition agreement

For the construction industry, the final coalition agreement offered support for Crossrail, but did not end the uncertainty over, for example, Building Schools for the Future (BSF) (although Partnerships for Schools (PfS) was spared the so-called “bonfire of the quangoes”, at least for now).

Some major infrastructure projects have been “cut”. For example, the withdrawal of government support for a new runway at Heathrow and Stanstead has already lead to BAA withdrawing its planning application.

(For more detail on the final coalition agreement, see PLC’s updates on the property, environment and tax implications.)

Chancellor’s statement

The construction industry should view the Chancellor’s statement as a precursor to the emergency budget, which will take place on 22 June 2010. Until then, it may be best to hold your breath. There may be more cuts and the Treasury’s papers, supporting that Budget, may yet demonstrate that the devil (for the construction industry) is in the detail to come.

More environmentally-targeted spending may offer hope, if it is made available, to help the shortfall in other areas of work.

Queen’s speech

For the construction industry, the Queen’s Speech promised to introduce a new Bill on high-speed rail links. However, while the government plans to take action on the new planning system necessary to replace the Infrastructure Planning Commission (IPC), it is not yet clear how this will affect major projects.

(For more detail on the Queen’s Speech, see PLC’s updates on the property, environment and tax implications.)

Uncertainty remains

So, while more political detail continues to emerge, the industry is still in limbo.

2 thoughts on “Coalition agreement final version and Queen’s Speech 2010: construction implications

  1. Mark Prisk, the new construction minister, has already met Paul Morrell, the Chief Construction Adviser and Chairman of the Steering Group of the Low Carbon Construction Review Innovation and Growth Team (IGT). (The IGT is an industry-led body set up to review the construction industry to see how best it can best deliver future carbon reduction commitments.)

    We will have to wait and see whether this leads to any future developments but, as Mr Morrell acknowledged, we finally have a minister who already has a “good understanding of the construction industry” (Mr Prisk was formerly the shadow construction minister and practiced as a chartered surveyor).

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