A building boss has warned the next Government against a ‘slash and burn’ approach to public sector development projects.
Danny Wilson, founder and managing director of Shipley-based Stainforth Construction, said public sector contracts had provided a lifeline for many building firms by plugging the gap left by a dearth of private contracts over the past 18 months.
Although the trading climate remained tough, with margins at rock bottom, Stainforth had retained its 60 staff and was on course to maintain turnover at around £20m in the current financial year – but was braced for a drop of up to 20 per cent beyond that.
Mr Wilson confirmed the findings in a recent Royal Institution of Chartered Surveyors report which showed construction workloads fell at a slightly faster pace across the North of England at the end of 2009.
The latest RICS Construction Market Survey showed that concern over the impending General Election was stalling new projects.
Mr Wilson said Stainforth usually carried out between eight and ten major projects a year but at present was a couple short.
He said: “Things remain tough, although there has been increasing tendering opportunities.
“We’ve managed to keep going and maintain turnover and retain all our people but if the next Government adopts a slash and burn approach to the public sector it will cause serious problems in construction as private development work remains flat.
“If we win the jobs for which we’ve tendered that will keep us at our usual level, but at present we’re a couple short and that would mean a fall in turnover of between ten and 20 per cent.”
Stainforth is working on an extension and refurbishment at Burley Oaks primary school in Burley-in-Wharfedale, a £3.5m store extension at Morrisons in Malton, North Yorkshire and a £3.5m office contract in Leeds.
The firm has also carried out several projects in Scotland and is currently working in Dumfries.
Mr Wilson said: “For some reason we’ve done very well in Scotland and that has helped us to stay on track during the recession. Even so, margins have been driven down to rock bottom and are now at around one or two per cent.”
For original article see: http://www.thetelegraphandargus.co.uk/business/5009201.___We_have_to_keep_building_for_future___/