More than £100bn could be needed every year to make infrastructure climate resilient

Innovative mechanisms have been demanded to ensure up to $200bn (£130bn) is spent every year from 2035 on protecting global assets from the effects of climate change.

Markit/CIPS UK Construction PMI shows output increase

Output performing better than in April and confidence also on the rise.

The May results were released this morning for the Markit/CIPS UK Construction PMI and the results showed an increase from the April level.

Both output and confidence levels across the sector were up, with the former up from 54.2 in April to 55.9 in May.

Although this is the second-lowest reading since June 2013, the evidence of respondents suggests that the May figure has suffered from the drag factor caused by weaker new business levels in the previous two months, which generally happens before a General Election.

In addition, today’s figure is evidence of the first time output growth has accelerated since February and the level is still well above the neutral mark of 50.0.

Output gains were put down to residential building activity and the civil engineering sub-sector returning to growth.

Survey respondents also reported incoming new work has increased, in line with client confidence and the aftermath of the General Election which sees businesses more willing to part with money.

Confidence levels in the construction industry have experienced a sharp increase regarding business activity for the next year.

Of those who responded, almost 60% expect a rise in the level of output, with new project wins and a willingness to spend after the General Election given as major factors in this increase.

This level of confidence is at its highest since February 2006 and in addition, employment numbers are also on the rise – the quickest they have increased this year.

David Noble, Group Chief Executive Officer at the Chartered Institute of Procurement & Supply, spoke about the “steady” improvement.

He said: “The brakes are now off for the construction sector as it makes up for some of the losses over the last few months with a steady and comfortable improvement.

“Though nothing like the highs of 2014, the quietly confident approach after the restraint displayed before the General Election, shows business confidence is at its highest since February 2006.”

Ashraf Laidl, who is the Chief Global Strategist at www.cityindex.co.uk, added that the ‘much needed’ results also suggests positive news for the housing market.

He said: “UK construction PMI recovered to 55.9 in May from April’s 54.9, exceeding market expectations of 55.0. The rebound is much needed after the index dipped to ten-month lows in April.

“The other piece of positive news is the mortgage approvals figure for April, which hit a 14-month high of 68,100, conveying the notion of an improving housing market from both purchasing and building perspectives.”

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£1Bn transformation announced by Manchester Airport

Terminal 2 will become the primary terminal building as part of the plans.

A £1Bn investment plan has been unveiled that will transform Manchester Airport in the next ten years.

Announced by Manchester Airports Group (M.A.G), the project will provide state-of-the-art facilities at the airport and will continue the development into a ‘global gateway’.

The changes will see the airport double its capacity and Terminal 2 will become the largest at Manchester Airport.

Terminal 3 will also be enhanced, but the project will see Terminal 1 – built more than 50 years ago – eventually demolished.

The Manchester Airport Transformation Programme will see work undertaken in a phased process so that improvements are made, yet any disruption to passengers is as little as possible.

There are 60 enhancements in this programme that will help to drive economic growth and it is an important part of the Government’s northern powerhouse plans.

Manchester Airport is becoming more and more popular. Last year, passenger numbers exceeded 22 million and directly and indirectly, 45,000 jobs are provided by the airport.

The £1Bn development will see already-existing investment plans updated and re-profiled.

Work will take place within the existing footprint of the airport, benefiting from the areas within the existing terminals.

Serving more than 210 short and long haul destinations and over 70 airlines, the pace of change at Manchester Airport has been vast and the programme of works will help to accelerate this further.

Terminal 3 will be improved so that more flights can be scheduled, while Terminal 2 will benefit from expansion and reconfiguration, making it the airport’s main terminal building.

These two terminals will be linked up thanks to the introduction of enlarged transfer facilities and immigration clearance prior to a flight to America will be provided.

Customers will find the airport an even more accessible place, with further self-service check-in facilities, expanded offering of food and retail outlets, new stands and piers to give better gate facilities at departure.

Getting to and from the airport is also part of the investment, with planned surface improvement on access roads.

Manchester Airport is a huge source of economic activity, with a contribution of £1.8Bn per year, and the Chancellor of the Exchequer, George Osborne, welcomed the investment.

He said: “Today’s announcement of £1Bn of private sector investment in Manchester Airport is a massive vote of confidence in the north of England and in our plan to build a northern powerhouse.

“The investment, which will completely transform Manchester Airport and double its capacity, will help ensure that it continues to compete with global airports across the world.

“It will play a key role in this one nation Government’s plan to rebalance the UK economy and boost productivity and is fantastic news for working people across the north.”

An enlarged security hall will have the latest technology incorporated, making the process of moving passengers around the airport much quicker.

Charlie Cornish is the Chief Executive of M.A.G and he commented on how the changes set out in the Manchester Airport Transformation Programme will ‘contribute’ to the northern powerhouse.

“We’re setting out how the airport will contribute to the development of a northern powerhouse and demonstrating the dynamic, can-do spirit that sums up the region,” he said.

“The Transformation Programme will ensure Manchester Airport plays its full part in driving economic growth and develops as a key part of the UK’s transport infrastructure, within a nationwide network of competing airports.

“We continue to work closely with our airline partners to ensure that their requirements and those of their passengers will be fully catered for, both during the programme design and build, and upon its completion.

“Over the next ten years, the airport will continue to develop as a global gateway for the UK, directly to and from the north, and these enhancements will enable us to further adapt, modernise and transform the customer service experience we are able to offer.”

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Transport Secretary confirms HS2 start date

‘Y’ network construction to begin in 2017 and Government planning Hybrid Bill.

The Transport Secretary, Patrick McLaughlin, has reaffirmed the Government’s commitment to build high-speed rail links in the north of England.

In his speech at Leeds Civic Hall, which was his first since retaining his position as Transport Secretary, Mr McLaughlin confirmed that the Government will carry on with its plans to close the ‘decades-old economic gap between south and north’ – something which is well underway with unemployment having fallen by a fifth and with the north growing faster than London per person.

With £13Bn of Government funding to transform northern transport in this Parliament, confirmation of the start of High Speed 2 (HS2) was given by Mr McLaughlin who said work will commence in 2017.

Plans for high-speed east-west rail links are well underway too, and much was said about it being important how the money is being invested, rather than simply discussing the amount. With that in mind, the Transport Secretary said that power would be moving to the cities and away from Whitehall.

Significantly, by autumn, the Transport for the North (TfN) will have a “new independent chair.” Set up to create the Northern Transport Strategy with the Government, this body and its new chair will “truly speak on behalf of the north with one voice.

“That means a shared vision for trains and buses. For passengers using public transport. For reducing road congestion, and speeding up links to ports and airports.”

An upgrade on the road network was spoken about too, which will bring “massive benefits” to the north and undoubtedly, many construction opportunities.

Moving on to HS2, Mr McLaughlin declared that the General Election result was a “massive vote of confidence” for this project and said that the ‘Y’ network will be constructed, from London to Birmingham and from Birmingham to Manchester and Leeds, with work starting in two years.

The Transport Secretary outlined the benefits to this development, adding: “HS2 will change the transport architecture in the north. But it will also change the economic architecture.

“Seven out of ten jobs created will be outside London, with the north and Midlands gaining at least double the benefits of the south. In fact, those benefits are already starting to happen.

“HSBC’s decision to move its retail bank headquarters from London to Birmingham is just one example.”

The Hybrid Bill for HS2 Phase I has been carried over from the last Parliament and was re-presented next week, with the Parliamentary Select Committee set to look at Bill number one upon resumption.

However, the Transport Secretary said that Phase II is becoming an increasing priority, and as such, a dedicated Hybrid Bill is being prepared to bring HS2 to the north as soon as possible.

He said: “We’ll make our Phase II announcements this autumn. We’re looking at ways of using the HS2 line to introduce faster regional services, and at the case for speeding up construction of the Sheffield to Leeds section.

“HS2 will allow us to reorganise and improve commuter routes across Yorkshire, and we’re moving forward with plans for new high-speed rail links, running right across the north, from Liverpool in the west to Hull in the east.”

These high-speed rail services will link the likes of Manchester, Leeds, Liverpool, Sheffield, Hull and Newcastle by providing huge reductions in travel times, increasing the number of trains available, improving customer experience and generally connecting the north economically.

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£25M Swansea Bay Tidal Lagoon contract awarded

Alun Griffiths Ltd follows Laing O’Rourke in gaining preferred bidder status.

Tidal Lagoon Swansea Bay has made another significant step in the quest to realise its ‘vision’ by awarding a £25M contract for the public realm ancillary works.

A special purpose vehicle company, Tidal Lagoon Swansea Bay was established to deliver, own and operate the tidal lagoon power plant at Swansea Bay, which is the world’s first of its kind.

Described as one of the main construction packages in this development, the contract has gone to Alun Griffiths Ltd, and it is good news for the local population because it is expected to increase the job opportunities in the area.

Comprising of breakwater surface, road, slipways, utilities and landscaping works, work on Swansea Bay Tidal Lagoon will provide further good news for the area, as materials will also be sourced locally.

Andrew McNaughton, Director of Engineering & Construction at Tidal Lagoon Power, emphasised the importance of the scheme to the people of Swansea.

He said: “In delivering the early phase works for Tidal Lagoon Swansea Bay, Alun Griffiths will take us a step closer to realising our vision.

“Their use of a local workforce and materials underlines our commitment to the community of Swansea.”

The confirmation of this contract follows hot on the heels of the decision to make Laing O’Rourke the preferred bidder to construct the turbine house and sluice structure block.

Altogether, the project is worth £1Bn and will be connected to the National Grid in 2018.

Martyn Evans, who is the Executive Director at Alun Griffiths, is delighted to be part of this ‘iconic’ project.

“We are delighted to be appointed by Tidal Lagoon Power to help deliver this exciting, innovative scheme, securing local jobs both now and in the future,” he said.

“This is a major contract for our business and the lagoon will be an iconic piece of infrastructure for Wales. We’ve heard so much about the project and having now seen it at close quarters, I am convinced that the reality will be every bit as compelling as the vision.”

More works packages are set to be tendered throughout the summer months.

 

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Markit/CIPS UK Manufacturing PMI figures released for May

Figure above the neutral mark for the 26th month in succession.

New figures from the latest Markit/CIPS UK Manfacturing PMI were released this morning with a rise in new orders and outputs reported in May.

The PMI, which is an indicator of the overall health of the manufacturing sector, is up to 52.0 in May, which is above the 50.0 figure that signals growth.

This has slightly improved from the 51.8 in April, though this was previously reported as 51.9. It means that the PMI is above the neutral 50.0 mark again – making it 26 consecutive months where this has been the case.

Although the intermediate goods sector has seen another decrease in output, today’s report showed consumer goods sector has continued to perform well. Investment goods producers also saw better results in May than in April.

Data for the report was collected between the 12th and 26th May, and another positive aspect was the performance of UK manufacturing production which saw a 27th consecutive monthly increase.

Following last month’s rate of new orders sliding to a seven-month low, May’s results showed an increase in these, with improved client confidence and domestic demand being attributed as reasons for this increase. New product launches have also had a positive effect.

The rate in growth of jobs rose slightly and is at its weakest level of increase since a rise in manufacturing employment started to be reported again. However, it should be pointed out that May’s small increase signified the 25th consecutive month that job growth has been reported.

Rob Dobson is the Senior Economist at Markit, who compiled the survey, and he said that the Government must invest further in manufacturing.

He said: “Expectations of a broad rebound in UK economic growth during the second quarter of the year are called into question by the readings. Manufacturing looks on course to act as a minor drag on the economy, as the sector is hit by a combination of the strong pound and weak business investment spending.

“The strength of sterling is a double-whammy for economic growth by constraining manufacturer’s export performance and also driving a surge in cheap imports.

“Where growth is being reported by manufacturers, this remains heavily dependent on the domestic market, and consumer demand in particular.

“The challenge therefore remains for the new Government to take the necessary steps to revive manufacturing, boost investment spending and improve export competitiveness if any headway is to be made on achieving the long promised rebalancing of the UK economy.”

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Communities Secretary to urge release of surplus land for housebuilding

Greg Clark wants more sites allocated for building 150,000 in the next five years.

Communities Secretary, Greg Clark wants the various Whitehall departments to “loosen their grip” on sites that are not in use so that housebuilding can be accelerated, and he will set out these plans this week.

As well as Whitehall, the Communities Secretary wants all of the councils in the country to investigate all sites that they are in control of and see if any of these can be released to increase the new homes for their various communities.

Brownfield sites will be targeted by Mr Clark, who wants to make sure that the land provided for housebuilding is enough to see 150,000 new homes constructed by 2020.

Ahead of the Housing Taskforce meeting for the first time, Mr Clark said: “The chance to own your own home should be available to everyone who works hard and aspires to. This is what a Government for working people is about – making sure people have the security they need to build a brighter future for them and their families.

“The scale of our ambition is clear: to release enough surplus and redundant public sector land for 150,000 homes over the next five years.”

He underlined that councils should investigate how to “make better use” of their surplus land, adding: “I want to see departments going further and faster than before, starting right away, to loosen their grip on sites that are standing idle and to turn them over for housebuilding.

“Councils are significant landowners and town halls should be looking at their estate, particularly brownfield sites, and thinking about how they could make better use of their holdings by releasing land for new homes for their communities.”

According to figures recently released, new housing starts are at their highest level since 2007 and already, the amount of land released is enough to create more homes than the Prime Minister targeted in 2011.

Already, there is enough land to build 103,000 homes – 3,000 more than the original target – but now the ambition is to provide land in the next five years to create 150,000 homes.

The drive to gain possession of the land needed is well underway, with 150 sites targeted for building on by the Homes and Communities Agency and the Department for Communities and Local Government, which could see 14,000 new homes constructed.

In the last five years, 146 sites have been identified and at the meeting of the Housing Taskforce, Mr Clark will encourage ministers to look in detail at sites to guarantee any possible plot for housebuilding is released.

Councils are cooperating already, with Bristol City Council, Surrey County Council and Cheshire West and Chester Council amongst those who have already released land or are in the process of doing so.

Housing Minister Brandon Lewis, echoed Mr Clark’s thoughts, urging councils and town halls to release land.

He said: “Housebuilding is at an eight-year high, with construction starts up 5% over the last year alone. We must maintain this momentum.

“A key way we’re doing that is by looking again at the land Government departments own, with enough land released over the last Parliament for 103,000 homes.

“Over the next five years, we’re going to go further and faster – but where Whitehall is leading, town halls should follow, ensuring their land can be put to good use to deliver new homes across the country.”

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