CEF comments on January Monitoring Round

Commenting on the outcome of the Department of Finance January Monitoring Round that was published this evening, Construction Employers Federation Managing Director Mark Spence said...

“The outcome of the monitoring round, as it relates to the capital budget, is simply unacceptable. It beggars belief that budgets have been so poorly managed that, at this point in the financial year, only £4.6m of an available £100.5m has been reallocated. It is equally ridiculous that this has been offset by a reduction in RRI borrowing to make the figure a more palatable £35.9m. It must be remembered that RRI borrowing was reintroduced this year given the Executive’s recognition that the existing Block Grant capital budget was in no way sufficient to meet the totality of our infrastructure need. As we face into a huge infrastructure deficit that is for instance stalling many much-needed housing developments, it is hard to take Ministers seriously when they are actively standing over such an underspend.

“Given the year of unprecedented materials shortages and price increases that have faced the sector, and the difficulties in getting many projects on site or advanced on programme, it is staggering to think that any Executive Minister could find this scenario acceptable. As our recent State of Trade Survey detailed, some 85% of our members are currently awaiting the outcome of discussions with government departments around potential claims arising from these shortages and increases - whilst government clients themselves have been claiming for months they do not have sufficient budget to cover such claims. Clearly, this argument is now ludicrous.

“Additionally, given how the monitoring process works, it’s hard to understand why so few bids were made by Departments when, as the industry has proven time and time again, there remains ample opportunity to ensure the money is spent.

“Significant questions now need to be asked about how our public finances are being managed. The proposed multi-year budget can undoubtedly make such management easier, but it will require a huge mindset shift from where we appear to be today.”