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The Conservative manifesto indicates that there will be additional spending on construction, but this will not be a spending commitment until it is included in the budget in March or subsequent spending reviews.
The £100bn investment in the UK’s infrastructure over the next five years has not, as yet, been allocated to specific projects. However, it does include:
Much of this will require construction spending but is unlikely to have a major impact until towards the end of the parliament.
In some areas such as education, it is not clear how much, if any, of the additional money will be spent on construction. Although there is mention of new schools and some of the commitments may require alterations and extensions to existing schools, the focus of the education spending is on revenue expenditure.
The spending on health would also appear to be mainly revenue, although some of the commitment to car parking may require construction. There was also a commitment to 20 hospital upgrades and 40 new hospitals but again, if these are included in the government’s spending plans in the budget, they are unlikely to impact on construction demand immediately.
On housing, there is a target of building 300,000 homes a year by the mid-2020s and an intention to make the planning system simpler. The manifesto also pledges support for modern methods of construction. There is no spending commitment, however.
In our forecast of demand, these areas will have an effect on the Infrastructure and Other Public New Work sectors in the final years of the forecast period.