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Transport fuels civils growth

NEWS

TRANSPORT SPENDING is expected to fuel strong growth in civil engineering output over the next three years, according to two construction forecasts published this week.

However, this growth is expected to slow to between 6% and 10% this year after an exceptionally strong 2001 which saw workload increase by between 12% and 15%.

The buoyant conclusions for the industry come from both the Construction Products Association (CPA) and Construction Forecasting & Research (CFR).

Both point to massive new build and maintenance projects in the pipeline as fuelling civils growth in 2002 and 2003. These include Heathrow Airport's Terminal 5, the Channel Tunnel Rail Link, the Birmingham Northern Relief Road, light rail schemes in Nottingham and Tyne & Wear plus ongoing rail renewal and maintenance work.

The CPA warned that its forecast relied heavily on the government sticking to transport spending commitments and on the 'swift resolution of the current crisis in the rail industry'.

Its forecast shows that infrastructure output will have risen by 12.6% to £6.5bn in 2001. It expects output to rise by another 9.1% this year and 10.6% in 2003 and 7.2% in 2004.

By comparison, CFR's research shows that output will have risen by 15% to £6.69bn last year. It predicts increases of 6% for 2002 and 2003 as rail spending is boosted by spending on the privately financed upgrade of London's Underground.

Privately financed roads, the CFR forecast says, should also add £200M a year to the roads programme over the next few years.

Energy spending, it adds, will also underpin strong growth, with gas fired power station construction spurring a 10% rise in energy construction work in 2002, and further growth expected on the back of major wind farm projects.

The weakest growth area for civil engineering is expected to be the water sector as water companies appear to be spending at rates below those programmed.

CFR predicts that water orders will fall sharply this year as a series of major privately funded projects in Scotland come to an end and water companies in England and Wales continue to underspend on capital works.

The CPA forecast supports this view, predicting a 15% drop in water output in 2002 with no increase expected until 2004.

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