Construction Output Figures
Oral Answers to Questions — Business, Innovation and Skills
9:30 am

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Kelvin Hopkins (Luton North, Labour)

What assessment he has made of the latest construction output figures; and if he will make a statement.

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Vincent Cable (Twickenham, Liberal Democrat)

The latest Office for National Statistics figures show that the seasonally adjusted volume of construction output fell by 2.5% in the third quarter of 2012. The volume of new construction orders, however, rose by 5.4% in the third quarter of 2012.

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Kelvin Hopkins (Luton North, Labour)

I thank the Secretary of State for his answer, but the fact is that construction is in deep recession, with output falling by 10% between the fourth quarter of 2011 and the third quarter of this year. Industry is, indeed, in crisis. Is it not time for the Government to boost construction, including a programme of local authority house building to house the almost 2 million households on waiting lists?

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Vincent Cable (Twickenham, Liberal Democrat)

Certainly, the construction industry has had a torrid time ever since the collapse of the bubble in residential and commercial property. I know that there is a lot of distress in the sector, but there is some indication of orders improving. As the hon. Gentleman knows, the Government have taken action in the past few months. In September, we launched the programme of guarantees for social housing bodies to proceed with construction and raise capital for that purpose, and the autumn statement announced £5.5 billion-worth of new commitments, mainly through guarantees, for infrastructure projects.

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Philip Hollobone (Kettering, Conservative)

The Government themselves procure construction projects. A local business in my Kettering constituency is the sub-contractor on a major Ministry of Defence contract, yet its payment terms from the principal contractor have gone up from 60 days to 90 days to 120 days. Will the Secretary of State work with other Government Departments to make sure that sub-contractors are paid on time?

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Vincent Cable (Twickenham, Liberal Democrat)

The hon. Gentleman raises issues in respect of late payment and the sub-contracting chain. One of the things that we are doing as part of the industrial strategy is, perhaps for the first time, bringing together the construction industry as a whole to work through supply-side issues, including late payment.

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Anne McIntosh (Thirsk and Malton, Conservative)

Will my right hon. Friend look at the high level of regulation, particularly with regard to construction sites? Does he have any news on how we can deregulate further in order to allow construction to proceed more rapidly once planning permission has been given?

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Vincent Cable (Twickenham, Liberal Democrat)

The red tape challenge is designed precisely to look at areas where regulation is excessive and inappropriate. On health and safety, however, construction sites are notoriously dangerous and we need to maintain basic standards.