No relief for construction in Budget
Published:  26 March, 2012

LONDON: Chancellor George Osborne's Budget failed to impress construction industry leaders.

Budget changes will see expected government investment in capital projects £1.1bn lower in 2011-12 than indicated in the autumn statement.

Noble Francis, director of economics at the Construction Products Association, said: "There is little in terms of practical measures – we're talking about relatively small amounts in relatively few areas.  It's not a game changer, there's very little that is significant."

Chief executive of the Construction Products Association Michael Ankers, said:" The Government clearly recognises the constraints on our economic growth imposed by the poor quality of our infrastructure and a planning system that is not fit for purpose.

"But we are still some way from seeing any benefit from the steps being taken to bring private finance into future road building and we await the details of the revolutionary planning reforms that the Chancellor referred to."

Key points for construction:

* Pension fund vehicle to be set up in 2013 – it has already raised £2bn to invest in infrastructure projects.

* A further £150m to be invested in stalled housing schemes.

* The go-ahead for a £130m rail-building programme in Manchester.

* A 'City deal' for Greater Manchester that will permit it to claw back up to £30m per year in tax to invest in infrastructure.

* Councils will be able to bid for a share of £150m to finance development under the Tax Increment Financing mechanism.

* Stamp duty relief on zero carbon homes abolished, as part of a reform which will see a clamp-down on avoidance and a 7% levy on the sale of homes over £2m.

* Increase the Growing Places Fund by £270m, including £70m for the Greater London Authority.

* Enhanced capital allowances available from 1 April 2012 for a designated site in the London Royal Docks enterprise zone and in enterprise areas in Scotland and Wales.

* The main rate of corporation tax reduced by an additional 1% from April 2012, meaning the rate will fall to 24% in April 2012, to 23% in April 2013 and to 22% in April 2014.




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