As the FT notes:
The value of work awarded to UK construction companies crashed during the past year, raising concerns that the impact of government spending cuts will be far worse than previously feared.
Several things come immediately to mind. First of all I note that the building industry claimed that the fall in construction activity that had such an impact upon GDP figures in the last quarter was overstated. Clearly that was not true: the fall is real.
Second, as is now very apparent, decision by the Conservative government to basically withdraw funding for investment by the state is having an immediate impact upon well-being. We will pay an enormous long-term price for this. Thatcher's legacy was a massive underinvestment in the necessary resources required to deliver state services. Cameron is clearly doing the same. And yet we cannot do without schools, roads, hospitals, transport infrastructure, and soon. We are also abandoning large part of coastline, and increasing flood risk. All this will be the Cameron legacy. And in the meantime, people lose their jobs and demand declines in the economy, and recession looms on the horizon.
Third, expect stagnation at best, and recession more likely, when the next round of GDP figures come out.
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The UK government’s determination to be the flagship for liberalisation means that contracts get awarded to EU firms. Actually we are just about the only Member State following the procurement liberalisation Directive. 87% of procurement in the EU is still being spent with domestic firms – that’s the choice the other Member State govts are making.
When an EU firm gets contracts, it can bring in its own workers from inside or outside of the EU (providing they have been working for the firm before – but who can and would be checking that? Not the bypassed workers here) .
The firm can then circumvent UK industry agreements. No wonder their bids are cheaper!
Once again, in relation to my comments on your other item, no earn/spend cycle as wages are repatriated …etc etc, and the welfare bill grows for workers here.
Construction particularly has long been lost as a work option for UK people.
Liberalisation, that has seen all our industry foreign owned and public service contracting going to transnationals, if services are not actually sold off, must be questioned. It has been basic unquestioned economic belief for too long, and avoided, again, by ‘the Left’.