UK Autumn Budget 2024: a clear investment pipeline means focus must shift to delivery

The UK Government has set out its direction on how it will drive economic growth in the recent 2024 Budget. Construction needs to be at the heart of this drive – and the industry must prove its ability to deliver. 

Construction underpins all the Government’s central ambitions – from upgrading public healthcare and school estates to building a world-leading life sciences sector and providing the critical infrastructure and clean energy networks to support growth. 

However, the construction sector is fragile. We face acute challenges around capacity and a strained supply chain, highlighted by ISG’s recent collapse. If not addressed, these hurdles risk putting the brakes on the Government’s ability to deliver on their promise of growth and better public services. 

A clear pipeline of demand is paramount, and Chancellor Rachel Reeve’s Budget was encouraging as a number of schemes received budget allocation. Energy announcements such as the 11 new hydrogen projects across the country will help to maintain momentum on the UK’s decarbonisation efforts.   

“Support for both retrofit and new development in housing will motivate residential markets. In the public sector, there is funding for school building, while private investors will be motivated by industrial strategy in high-growth areas such as advanced manufacturing, technology and the creative industries.” 

The Chancellor also raised the prospect of public-private partnerships, although still in limited form. The news that HS2 will indeed continue to Euston is reassuring, and the role that public-private partnership will play in this programme should help to lay the groundwork for the funding of other crucial schemes under the 10-year infrastructure strategy expected next spring.

The Government has the political licence and the economic motivation to bring private finance initiatives back to the table in a serious way. There have been clear signals sent to build private investors’ confidence in policy.   

“However, policy is only one half of the equation. The other is delivery, and the responsibility falls to our sector to make the risk associated with these investments palatable.”

As an industry, we need to meet the Government and investors halfway and demonstrate construction can deliver on expectations.   

This will come down to individual tactics like progressive assurance to establish clear checkpoints for programmes that give investors greater certainty around compliance. It will also require a coherent and collaborative strategy, including working together across the supply chain to analyse capabilities, and from there allocate the right level of risk and reward to achieve the best outcome and mitigate the impact of rising insolvencies.   

“Skills development and attracting new talent is a huge piece of the puzzle, and we must proactively engage with the new Skills England body to make sure it’s aligned with what the construction industry needs for the future.”

For the Government’s part, it’s important that the construction industry is taken seriously as the engine that will deliver and maintain the physical investment needed to allow growth sectors to thrive. The emerging industrial strategy is an opportunity for us to make the case for this – and for the Government to drive change through coordination. It’s a chance to fully understand the challenges around rebuilding Britain and how we can work together to solve them.  

As the Chancellor put it, there are no short cuts to driving economic growth. Strengthening the construction sector is a fundamental part of achieving this.   

To make the Government’s ambitious plans a reality, we now need close coordination between policymakers and public and private sectors. Delivering on the Government’s commitments isn’t just about finding the money, but about spending it well to deliver great outcomes.