The Office for National Statistics has reported that the last quarter of 2010 saw output fall by 2.5%. This can be attributed to falling demand, inflation and the poor weather. The Construction Products Association say expectations for 2011 are mixed with the majority of building material manufacturers expecting sales during the first half of this year to be below or the same as 2010.

A number of industry commentators have predicted the end of the construction recovery. Commenting on the latest RICS Construction Market Survey, RICS chief economist Simon Rubinsohn said: "The bigger picture here is of an industry under significant pressure as public spending cuts begin to bite, while there is little sign of a private sector recovery across large parts of the country."

Douglas McWilliams, Chief Executive of the Centre for Economics and Business Research, commenting on his organisations latest review said "We expect house prices to grow tentatively over the coming years, given that household incomes are being squeezed and banks are still wary of lending. There is currently significant uncertainty in the market caused by the Government's spending cuts and a choppy recovery, which has greatly impacted transaction levels."

The Construction Skills Network report shows that, despite the industry performing better than expected in 2010; the sector is expected to contract by 1% during 2011 with employment levels likely to drop by up to 76,000 before the sector returns to growth. Judy Lowe, Deputy Chairman of CITB-ConstructionSkills, said: "The next couple of years will be really tough for the industry. But ... there are signs of longer-term confidence returning to the market."

After all of this depressing information, I've tried to find something positive to add. So would quote from the Glenigan weekly newsletter "the value of projects being restarted has increased, and this should feed through into a growth in private sector construction over the year." I'll also quote Noble Francis writing in the Barbour ABI Construction Review for January "There is still £97 billion of work available this year. House builders, rail and energy contractors will all be looking for growth."

To quote the Construction Products Association "The last three years have seen the lowest levels of house building in this country since 1924. Furthermore, in 2011 the Association forecasts that only 110,000 homes will be built, less than half the 240,000 a year required to meet our ever increasing housing need."

A report recently published by RICS and entitled 'The Future of UK Housebuilding' provides a useful insight for anyone working in the sector. The report considers key challenges, drivers for change and presents some future scenario.

The executive summary states "The future of housebuilding is likely to be largely driven by the combination of Government policy on sustainability, legacy of the economic downturn, and the rapid evolution of innovative technology in the short- and medium-term. The current policy is markedly focused on the introduction and implementation of the Code for Sustainable Homes and achieving Zero Carbon Homes in a few years time, which at the time of writing is still set for 2016. These innovative technologies are multi-faceted, encompassing offsite production, modern methods of construction (MMC), renewable energy and microgeneration, new materials, and ICT. In the longer term, the future of UK housebuilding is likely to be driven by a more complicated profile of forces including demographic shifts, policy evolutions and climate change. Some issues such as increased global competition (in particular the consequent foreign entries to the UK market), and aspects of sustainability other than energy (such as water, waste and ecology), are likely to become increasingly dominant."

Returning to the short term, Communities and Local Government has published details of the new financial deal for council housing. Grant Shapps said "This deal brings to an end a centralised system which meant councils didn't know what funding they would get for housing from one year to the next and were unable to take key decisions about their housing stock."

Mark Lee, Assistant Director Localism Team at the Department for Communities and Local Government recently presented a briefing on progress to members of the Construction Products Association.

The bill reflects concepts of decentralisation contained in both the Conservative and Liberal Democrat manifestos and is a core part of the government's policy. It delivers 20 Coalition Agreement commitments, covering 40 different policies and is being prepared by 31 teams from within DCLG, Defra and WAG. Its objective is to deliver more growth by reducing bureaucracy and cutting legislation by 5%. For planning, the intention is to make the process quicker, delivering more development at a lower cost.

In this brief summary I will focus on the Planning issues. As has been well publicised this sees a transfer of decision making down the chain to Local Authorities, or lower if possible, with an end to national housing targets. Localised plan making will be required from Local Authorities, with input from Parish Councils and Local communities in the form of 'neighbourhood plans'. Although there will be no regional strategy, there will be a duty to cooperate between Local Authorities and also between public bodies. Exactly how this will be implemented has still to be decided.

National Policy Statements covering policy on big issues such as energy and infrastructure will be developed. The Infrastructure Planning Commission will be replaced with the 'Major Infrastructure Planning Unit' (MIPU) which will take over the role of approving planning applications for nationally significant infrastructure but with the final decision resting with the minister for state responsible for that department (e.g. DECC for power stations).

The current system of PPG and PPS will remain, but the intention is to shrink these making them shorter and more focused. They may be merged into the National Planning Policy Frameworks which is currently being developed to cover issues such as housing supply and heritage buildings.

Consultation continues on a number of aspects of the bill and this will probably be critical in influencing its final shape and its impact on the construction industry.

Listed below are some forthcoming events that might be of interest, three are full day training courses being run by Competitive Advantage in collaboration with The Building Centre. The fourth event on Digital Marketing is organised by CIMCIG and will take place simultaneously in 3 locations using web technology:

Construction Industry Overview

8^th March: 9.00 - 16.00 at the Building Centre

Effective Specification Selling

15^th March: 9.00 - 16.00 at the Building Centre

Digital Workshop for Construction

17^th March: 15.00 - 17.00

London, Bristol, Leamington Spa

Key Account Management

22^nd March: 9.00 - 16.00 at the Building Centre

For information on more events see the Competitive Advantage website.