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Autumn statement must use construction to kick-start economy

The Construction Products Association is urging the Chancellor of the Exchequer to use his Autumn Statement on next week to kick start economic growth.

The Association is calling on the government to:

  • Re-balance the economy between current and capital budgets, without increasing overall public spending. Government should focus more on capital expenditure, as this will provide the most benefit for economic growth

  • Encourage take-up of the Green Deal by ensuring that a 5% rate of VAT is applied to all Green Deal compliant work. At a time when government is trying to reduce energy use, it is perverse that energy saving work is subject to 20% rate of VAT while fuel itself is subject to the 5% rate

  • Make greater use of private finance streams from cash-rich corporations that are looking to invest in areas that are relatively low-risk. This could occur through government backed bonds or Tax Increment Finance (TIF);

    Michael Ankers, CPA chief executive says: “We are at a critical turning point in our economic recovery and it is essential that the Chancellor uses the Autumn Statement to set out practical ways in which government can encourage a private-sector led economy.

    “Government has indentified construction as being one of the key industries that can boost economic growth and help drive the UK economic recovery. Yet, at present, our forecasts show that the industry will experience no growth until 2014.

    “Our proposals for the Autumn Statement are sensible measures that will greatly improve the prospects both for our industry and the economy as a whole, without undermining the government’s plan for reducing the fiscal deficit.”

  • About Fiona Russell-Horne

    Group Managing Editor across the BMJ portfolio.

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