Thursday, October 21, 2010

black wednesday

I received this letter (see below) today from Ruth Reed, RIBA president. I found it very helpful, particularly the bit about how the RIBA intend to protest against the cuts and defend the construction industry, in particular, and everyone else in general, against a double dip recession and the evisceration of the welfare system. For a slightly more emphatic reaction you might want to read this. And this.

Dear Member,

As I'm sure you are aware, the Government today delivered its highly anticipated Comprehensive Spending Review which outlined where cuts to the public sector budget will be made.  An overall cut in capital spending of 29% was announced with ministries such as the Department for Communities and Local Government taking a significant hit from their budget.

Schools have seen a cut of 60% to their capital spend with a sum of £15.8billion retained to improve the schools estate over four years, enabling 600 to be rebuilt or refurbished. The Government has acknowledged the terrible waste caused by BSF and it is important that procurement is reformed if the mistakes of the past are not to be repeated.  I will be fighting for architects to be in the front line of the briefing team to help clients get the best value for their schemes.

On housing, the new homes bonus is intended to provide an incentive for Local Authorities to build new homes with a commitment to build up to 150,000 affordable homes through existing budgets. This is 25% less than current delivery.

For infrastructure a small sum of £1billion will be put towards a green infrastructure bank with the private sector intended to pick up the rest and this is much less than experts have been recommending.

With a move to localism, much more pressure will be on Local Authorities to deliver, yet a budget cut of 28% is going to make this hard.   More flexibility for Local Authorities to borrow through tax incremental financing and the homes and business bonuses may provide some extra leverage for spending.   
Great opportunities to reform the planning system now present themselves.  Governments has been talking about this for years, but while the arguments in favour of reform have not altered, there has never been a better time to implement that change.

In general, the Comprehensive Spending Review has provided some clarity in areas of departmental budgets and in areas such as schools capital spend.  Further scrutiny and much more detail will be needed before the real impact of these measures on architects and the wider construction industry can be seen.

With very best wishes,

Ruth Reed, RIBA President

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