Public Sector (Non-Domestic) Construction Market - UK 2010-2014

AMA Research
January 18, 2010
80 Pages - SKU: AJLA2573790
License type:
Countries covered: United Kingdom

AMA Research have published the 3rd Edition of the report "Public Sector (Non-Residential) Construction Market - UK 2010-2014", which provides a comprehensive review of public sector (non-residential) construction - with a particular focus on the future impact of a slowdown in public sector investment from 2011.

The Government’s commitment to construction programmes within healthcare and education has helped to underpin growth in the market over the past few years; however, it now seems certain that public spending will be cut after the general election in 2010 as a result of the massive escalation in public sector debt. Whilst frontline services such as hospitals, schools and police services have all been safeguarded from cuts by the main political parties, the construction industry remains concerned that any significant cut-backs in capital spending will prolong the construction downturn in the face of continued decline in private sector commercial output.

Key areas in the report:
  • Overall review of the UK construction industry with forecasts to 2014.
  • Detailed assessment of major sectors within public sector construction including education, healthcare, defence and law and order.
  • In-depth analysis of Government funding of public sector areas including education, healthcare and defence.
  • Review of Government targets and current progress of construction initiatives and programmes within the education and healthcare sectors.
  • Review of the major influences, including future public sector spending levels, public sector debt and sustainability issues.
  • Key market trends and impact of economic downturn on the public sector construction market.
Areas of particular interest:
  • Public sector accounts for around 40% of all new work in 2009 - compared to around 25% in 2006/07.
  • Analysis of future workloads and capital expenditure in major public sector markets in 2010-2014.
  • Analysis of Conservative Party policy on education, healthcare, defence and custodial sectors.
  • Key drivers of growth in the public sector construction market and forecasts over the next few years.
  • Analysis of measures and proposed funding cuts laid out in the 2009 Pre-budget Report.
Some of the major contractors featured include:
  • Balfour Beatty, BAM Construct, Carillion, Galliford Try, Interserve Project Services, Kier, Laing O’Rourke, Morgan Sindall, Wates, Willmott Dixon.
Key areas covered in the report include:

CONSTRUCTION MARKET OVERVIEW
  • Value of construction new work output - trends and forecasts in non-domestic sector from 2008- 14.
  • Construction output by sector in 2009 and 2010-2014.
  • Public Sector Construction market - output and analysis by sector including healthcare, education, defence and other public sectors. Public sector accounting for around 40% of all new work, compared to around 25% in 2002-07 period.
  • Public sector construction new work now valued at almost £13 billion. Outlook for 2010-14.
FUNDING OF PUBLIC SECTOR WORK
  • Public Sector Investment - current and forecast public sector investment - split by sector (Education & Health, Defence, Transport etc.)
  • Education Output - Government Targets and progress of key education building programmes - BSF, Academies Programme, Primary Capital Programme. Progress to date on major spending programmes, targets up to 2011.
  • Healthcare Spending - Total Healthcare Spending, NHS Spending beyond 2011, Healthcare Capital Investment
  • Healthcare Output - Government Targets and progress of key healthcare building programmes to date - NHS LIFT, Express LIFT, Procure 21 & Procure 21+
  • Other sectors - Defence, Custodial, Police, Arts, Sport - capital spending levels, key influencing factors.
PROCUREMENT OF PUBLIC SECTOR WORK
  • Overview of the Private Finance Initiative - analysis by sector in 2009. Future direction and prospects for PFI.
  • PFI in Education - BSF.
  • PFI in Healthcare - NHS LIFT.
  • Procurement in other Public Sectors - Defence, Police Service, Prison Service, Fire & Rescue Service etc. - key programmes, capital values, role of PFI, future prospects etc.
CONSTRUCTION MARKET SUPPLY
  • Structure & Size of the Contracting Industry - consolidation activity.
  • Leading Clients in the Public Sector Construction Market - key players, future plans.
  • Leading Contractors and Consortia operating in the Public Sector Construction Market - profiles of major players, areas of specialisation.
FACTORS AFFECTING PUBLIC SECTOR CONSTRUCTION
  • Planned future public sector expenditure 2009-2014.
  • Impact of public spending cuts on public sector construction - key programmes, areas of major risk etc. - 2008 and 2009 Pre-budget Reports.
  • Impact of a Conservative government on public sector construction - priorities, targets for cuts etc.
  • Sustainability Issues - BREEAM in education, healthcare, defence & custodial sectors.



Additional Information

AMA Research has recently published the 3rd Edition of the report “Public Sector (Non-Residential Construction Market in the UK”, which should be of particular interest to all construction professionals and provides a comprehensive review of public sector (non-residential) construction. Between 2002 and 2007, new-build public sector construction accounted for about a quarter of the industry’s output. In 2009, with private sector activity sharply down, this proportion increased to over 40% of new-build output, with public sector funding boosting the performances of sectors such as health and education, driven by the Government’s continuing programmes such as Building Schools for the Future and the Academies Programme, the Primary Capital Programme, NHS LIFT and Procure21. In terms of future workload, public sector markets continue to hold up well, particularly in education where framework agreements remain solid. However, the picture for the second half of 2010 is less certain, as capital expenditure is expected to fall in the medium term, influenced by huge public sector debt. The report presents an overall review of the UK construction industry with estimated forecasts to 2014 and gives a detailed assessment of the major sectors such as education, healthcare, defence and law and order. We also review current progress of government programmes within these sectors and discuss the future of capital funding in these areas beyond 2011.

The Government’s commitment to construction programmes within healthcare and education has helped to underpin growth in the market over the past few years; however, it now seems certain that public spending will be cut after the general election in 2010 as a result of the massive escalation in public sector debt. Whilst frontline services such as hospitals, schools and police services have all been safeguarded from cuts by the main political parties, the construction industry remains concerned that any significant cut-backs in capital spending will prolong the economic downturn in the face of continued decline in private sector commercial output.

The main emphasis of this report therefore is the future impact of a slowdown in public sector investment in 2011 as a result of the budget deficit and how this will affect construction output. In addition, the impending general election in 2010 will also have significant implications for the public sector construction market and we review in detail the outlook for the sector under a conservative government, should they be elected.

Analysis of market developments has been based upon both quantitative and qualitative assessments of both primary and secondary source data. Interpretation of relevant data has been undertaken to explore and support trends within the public sector construction market and to provide a basis for forecasts of future prospects.

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