subject: Construction Confidence Down Due to Budget Cuts, Rok Bankruptcy [print this page] Construction Confidence Down Due to Budget Cuts, Rok Bankruptcy
Despite a positive third quarter, the Construction Products Association reports that confidence is down in the UK construction industry as manufacturers and contractors alike report drops in output, sales and employment.
Stephen Ratcliffe, Director of the UK Contractors Group told The Construction Index, ""This survey paints a picture quite different from the official growth figures which suggest wrongly in our opinion that construction is the engine driver of economic recovery."
News comes a month after the Coalition Government made sweeping cuts to department budgets. The public sector received a huge budgetary blow as the government made an attempt to rein in spending. Though the government unveiled a 200 billion national infrastructure plan to boost the economy and the construction industry, the housing construction sector is still hobbling towards recovery.
Huge cuts to the social housing sector have put projects on hold or eliminated them altogether. These cuts combined with news that Rok, the largest social housing contractor, filed for bankruptcy protection on Monday has made many in the construction industry ill at ease.
Rok is the latest in a string of home contractors who have been put into administration in the last few months. In September, Connaught filed for bankruptcy protection. Though these companies went under as a result of limited credit from clients and suppliers, many are concerned that the government cuts will put a freeze on the already crippled home construction sector.
PriceWaterhouseCoopers is handling Rok's administration process; however, several contractors are courting Rok's clients directly in an effort to recruit business, ensure that the projects keep moving and get a deal for next to nothing.
