Newly announced government spending cuts amounting to more than £6bn will help restore business confidence through economic recovery, according to the Federation of Master Builders.
FMB director-general Richard Diment said the new government’s reallocation of £150m for adult apprenticeships and £170m for social housing demonstrates the government understands the issues remain a priority even in such difficult circumstances.
“It further shows that the government understands that construction is the most efficient industry for the public sector to invest in, with every £1 spent generating £2.84 in wider economic benefit,” said Mr Diment.
But he said the FMB would be looking closely at all the details of spending cuts and reallocation of growth funds.
“The initial direction is encouraging and we hope that the government will continue to recognise the importance of targeted investment when the wider departmental spending reviews take place in the autumn,” he added.
He said a targeted cut in the VAT rate on just the labour element of housing repair and maintenance work could create an extra 55,000 jobs and £1.4bn of extra economic activity in this year alone.
The Construction Products Association also welcomed the £170m for the delivery of social homes, though it noted that this would be funded mainly from savings in the housing budget.
