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Contractors appeal for more public spending

Contractors Kier and Galliford Try have said construction firms will suffer the consequences of plans to slash public spending.

Cuts are expected to be rolled out in the wake of the general election as a new Government works to reduce the UK’s £178bn deficit.

However, Kier said that public spending accounted for nearly 75% of its business, while at Galliford Try it made up half of the firm’s contracts.

The warning comes after Alistair Darling announced plans to develop the tightest public spending review in 30 years if Labour remains in Government.

And Tory plans to cut public spending mean that builders would be no better off if they were elected.

John Dodds, Kier’s outgoing chief executive, said: “The uncertainties surrounding the forthcoming general election together with the public sector deficit give rise to concerns over the future levels of public sector spending.”

Galliford Try said: “The directors consider the principal risks which may have a material impact on performance in the second half are the macroeconomic conditions in the UK, Government policies, and public sector spending as they affect the group’s markets in both housebuilding and construction.”

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