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Infrastructure investment is a missed opportunity

After last week’s gloomy profit warning by Balfour Beatty and this week’s equally bleak workload trends survey by the Civil Engineering Contractors Association (Ceca), there can be little doubt that the UK remains a very difficult place for civils contractors.

Despite continued positive noise by government towards infrastructure investment - including the recent appearance at the ICE by chief secretary to the Treasury Danny Alexander - the pickings remain thin.

Competition across the UK and across the sectors is cut-throat. Margins are stretched and wafer-thin. Order books are worryingly empty with firms bracing for a difficult 2013 and a catastrophic 2014.

As several UK contractors pointed out at last week’s Ceca Southern annual dinner, the Treasury’s focus on infrastructure means we are awash with innovative financing solutions but no real plans to fund them.

But the point that Ceca makes today is that the future for the UK is not just about new infrastructure projects. They are important but investment in smaller, regional repair and maintenance is vital for UK construction and the UK economy.

“The key is to keep the momentum going,” says Ceca Southern chairman John Breheny. “To move away from make do and mend. To make a decision and get on with it.”

As I have repeatedly pointed out in this column, “getting on with it” is largely a political rather than technical challenge. It requires government to make tough, and potentially unpopular choices about where that funding will come from.

Sadly, over the last two years we have seen the coalition squander its elected mandate to make these choices. We now face two long pre-election years of stalling and indecision.

But as we see across the world, successful economies are making the bold decisions and finding ways to actually push forward with investment in infrastructure and public realm maintenance.

The good news is that we are increasingly seeing UK contractors and consultants at the heart of this global effort as they continue to shift focus away from the difficult shortsighted UK market.

They are succeeding because, as we saw at this week’s final judging interviews for the 2012 NCE Graduate Awards, UK civil engineering still has a huge amount of talent at its disposal.

Unfortunately these skills and talents will increasingly be focused on driving economies overseas. We must not allow the UK to be forgotten as a market - both for new build and for repair and maintenance. We must ensure that our home grown talent is able to drive our home market and economy.

That means government stepping up to the plate. As every civil engineer knows, when faced with a difficult problem the worst decision is always to make no decision. The coalition should take note.

  • Antony Oliver is NCE’s editor

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