The CEO of the UK's Construction Equipment Association says that new Prime Minister Liz Truss must act quickly to protect the sector from "irreparable damage".
CEA boss Suneeta Johal commented: “Truss is presented with the opportunity to transform the construction sector, ensure our industry is fit for the future, and provide the necessary support to lead us on the path to net-zero emissions by 2050.”
Johal said that recent months have seen several setbacks which are crippling UK businesses including soaring energy costs, and the recent announcement that the price cap is not being extended to businesses has been another blow.
“Companies are fearing their energy costs could go up by as much as 300%, which is simply not sustainable,” said Johal. “We need immediate action from Government to introduce a business energy price cap and reduce the VAT on business energy bills.”
On the issue of rising energy bills, Truss has said she will deliver when it comes to crisis by not only dealing with bills but also the long-term supply issues, and Johal said this must be extended to and include businesses.
“The rising energy costs have been compounded by the steep price increases in fuel, although this has stabilised at source, it’s not being passed on to the consumer,” said Johal. “The construction industry is also bearing the brunt two-fold with the end of the red-diesel rebate.”
The Government has committed to achieving net zero by 2050. It has also stated that its target is to decarbonise the power system by 2035. It has been estimated that around £40bn per year would be required (on average) to be invested in new low carbon and digital infrastructure over the next ten years.
Johal said there is “a significant gap” between the Government’s objectives and the practical policy that is needed to provide confidence and positive, clear signals to potential investors.
She added that introducing a long-term capital allowance regime will drive investment in greener technologies, and clean technology, which will in turn reduce energy consumption.
“Supply chain challenges remain critical, and this has been further impacted by strike action at ports – many businesses will be looking at ‘reshoring’ which could futureproof them against future supply chain issues but ‘moving manufacturing closer to home’ will require the Government to facilitate with further tax breaks making it more achievable to invest in local facilities, new technology, strategy replanning and of course, a company’s most important asset – people,” said Johal.
“There’s certainly a lot to be done and we as a sector have a considerable ‘ask’ wishlist – and will be actively talking to HMG to expedite the reforms we as an industry desperately need.”
