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Output and Employment in the Construction Industry: Fourth Quarter 2005

The total volume of construction output in 2005 fell by one per cent compared to the previous year, the first fall in the industry since 1994. Overall new work fell over the same period, despite increases in the private housing, private industrial and commercial sectors. Repair and maintenance was unchanged, with increases in the public housing and public non-housing R&M being offset by a decrease in the private housing sector. Output in the fourth quarter of 2005 was unchanged compared to the third quarter both in volume terms and in current prices.

The total volume of new work in 2005 was one per cent lower compared with the previous year but rose by one per cent in the fourth quarter compared with the previous quarter. The total volume of repair and maintenance work was unchanged in 2005 compared with the previous year, but was one per cent lower in the fourth quarter of 2005 compared to the previous quarter.

New private housing work in 2005 was four per cent higher compared with the previous year but the fourth quarter of 2005 was one per cent lower than the previous quarter. New work in the public housing sector in 2005 was seven per cent lower (on a small base figure) compared with the previous year but the latest quarter was one per cent higher than the previous quarter. New infrastructure output in 2005 was eight per cent lower compared with the previous year, and the fourth quarter of 2005 fell by three per cent compared with the previous quarter.

New construction work in the private industrial sector in 2005 was six per cent higher compared with the previous year, and rose by eight per cent in the fourth quarter compared with the previous quarter. New private commercial output in 2005 was one per cent higher compared to the previous year and was four per cent higher in the fourth quarter of 2005 compared to the previous quarter. New work in the public non-housing sector (excluding infrastructure) in 2005 fell by nine per cent compared to the previous year but rose by one per cent compared with the previous quarter.

Housing repair and maintenance work (including improvement work) in the public sector was two per cent lower in 2005 compared with the previous year and was three per cent lower in the most recent quarter compared with previous quarter. Housing repair and maintenance work in the private sector in 2005 was three per cent lower compared with the previous year but rose by two per cent in the fourth quarter compared to the previous quarter.

Repair and maintenance work in the public non-housing sector in 2005 was five per cent higher compared with the previous year, but was one per cent lower in the most recent quarter compared with the previous quarter. Repair and maintenance work in the private non-housing sector in 2005 was unchanged compared with the previous year but was two per cent lower in the most recent quarter compared with the previous quarter.

Employment
The seasonally adjusted number of employees in employment in October 2005 was two per cent lower compared with July 2005 but was two per cent higher when compared with October 2004. Total employment (including the self-employed) in October 2005 fell by two per cent compared with July 2005, but rose by three per cent when compared with the same period a year earlier.

New Consultation Lays Foundations for Government's Future Sustainable Construction Strategy

A new consultation that aims to provide the Government with a framework to guide future progress in the construction industry was launched on 2nd February by the Rt. Hon Alun Michael, Minister of State for Industry and the Regions. The draft Strategy for Sustainable Construction Report 2006 consultation will seek views from key construction stakeholders on the direction they think the industry should take with a view to developing and maintaining a more sustainable future.

The review will look at aspects such as:
* building design and the code for sustainable homes;
* new construction methods and best practice;
* improved embedded energy systems;
* waste minimisation;
* enhancement of biodiversity; and
* greater efficiency in carbon emissions and thorough assessment of the impact of climate change.

Alun Michael said:
‘This consultation shows where we think the industry should go in terms of its future development as well as indicating where businesses believe their efforts should be concentrated. I hope that the Strategy will encourage industry to propose a positive response to some of the big questions it faces.

‘The purpose of the review is to create a framework within which the industry can continue to make a strong contribution to improving the quality of our lives and take account of the dynamics of the modern built environment.’

The consultation is an update of the existing 'Building a better quality of life' produced by the then DETR. It focuses on the principle of Sustainable Development to which the Government as a whole is signed up to.

The Government produced a strategy document Building a better quality of life - a strategy for more sustainable construction in April 2000, (as part of a suite of guidance spanning across many sectors of industry and society generally).

Due to the major developments which have occurred both in Government policy and within industry it is widely believed that a review of the existing construction strategy and update is now appropriate.

The timing is right for this review, since it follows on from the publication, in March 2005 of the UK Sustainable Development Strategy which reinforces Government's overall commitment to work with the industry sectors to strengthen business. And, in a similar vein, the European Union is currently re-appraising its Sustainable Development Strategy.

Proposals for Better Payment Practices in the Construction Industry Published

New government proposals that aim to improve payments to firms in the construction industry have been published by Minister of State for Industry and the Regions, Rt Hon Alun Michael MP and Edwina Hart, the Welsh Assembly Government Minister for Social Justice and Regeneration.

The new proposals include:
* introducing a requirement that certification of the sum due, by one of the contracting parties or a third party, becomes an essential feature of contractual payment mechanisms;
* removing the section 110(2) requirement for a payer notice;
* introducing a right to apply for payment where a certificate is not issued by the due date;
* making certain payment mechanisms including pay-when-certified clauses ineffective;

Announcing the proposals, Alun Michael said:
‘These changes will improve the existing framework which clearly makes a valuable contribution to fairness in the way construction contracts are agreed and operated.

‘The 356 responses demonstrate the high level of interest and support from the construction industry and its stakeholders. This shows that continued regulation of construction contracts is needed. I welcome this support and am very grateful to all those who responded.

‘They have had to consider some difficult and complex issues, which have required careful analysis and innovative solutions. Launching this consultation last year, my predecessor as Construction Minister, Nigel Griffiths, observed that 'Fair payment practice is something everyone agrees with and a fair payment culture underpins any progressive and modern industry'. That is something all the responses have recognised.'

These proposals form part of the analysis of responses to the joint consultation ‘Improving Payment Practices in the Construction Industry’ held last year. The consultation proposed a number of amendments to Part II of the Housing Grants Construction and Regeneration Act 1996 and the Scheme for Construction Contracts (England and Wales) Regulations 1998.

Other proposals are to:
* enhance the existing right of suspension under the Construction Act to allow the suspending party to claim for loss and expense;
* prohibit the use of trustee stakeholder accounts for awards made by adjudicators;
* make ‘final and conclusive’ clauses unenforceable where they apply to decisions under the contract that are of substance to interim payments only;
* take forward the Government's existing commitment to make contractual agreements on adjudication costs unenforceable and to provide a statutory framework for allocating them, including cases where adjudicators resign in response to a challenge to jurisdiction.

The next step in the process will see the Government working with the construction industry over the coming months to ensure that, when amendments are published for further consultation, they are based upon a clear and thorough understanding of all the issues.

Key figures in the industry will act as a sounding board to assist the DTI in developing the proposals to ensure they match the needs of the construction industry and its clients, as well as the strict requirements of the Regulatory Reform Order framework. A ‘post-consultation event’ in February, to be organised by the DTI will gain further insight from the industry on the way forward.

New Construction Orders: October 2005

Orders in the year to October 2005 rose by seven per cent compared to orders in the previous twelve months period, and orders in the three months to October 2005 rose by 16 per cent compared to the same period a year earlier. Orders in the three months to October 2005 fell by two per cent compared to the previous period, with decreases in all sectors except public and housing association orders and private commercial orders. All orders figures quoted are seasonally adjusted and in constant (2000) prices.

Private housing orders in the year to October 2005 rose by 10 per cent compared to those in the previous year. Orders in the three months to October 2005 fell by six per cent compared with the previous period, but rose by seven per cent when compared with the same period a year earlier.

Public housing and housing association orders rose by two per cent in the year to October 2005 compared with the previous year. Public housing and housing association orders in the three months to October 2005 rose by four per cent compared to the previous period, but fell by 10 per cent compared to the same period a year earlier. All comparisons in this sector are affected by large variations due to its relatively small size.

Infrastructure orders in the year to October 2005 increased by 40 per cent compared with the previous year. Orders in the three months to October 2005 fell by 14 per cent compared with the previous period, but rose by 56 per cent when compared to the same period a year earlier.

Public non-housing orders (excluding infrastructure) in the year to October 2005 fell by one per cent compared with the previous twelve months period. Orders in the three months to October 2005 fell by four per cent compared with the previous period, but were unchanged when compared to the same period a year earlier.

Private commercial orders in the year to October 2005 fell by three per cent compared with the previous year. Orders in the three months to October 2005 rose by 13 per cent compared to the previous period, and by 32 per cent compared to the same period a year earlier.

Private industrial orders in the year to October 2005 rose by 11 per cent compared to the previous year. Orders in the three months to October 2005 fell by 13 per cent compared to the previous period, and by eight per cent compared to the same period a year earlier.

2012 Olympics to Create 33,500 Construction Jobs over next Seven Years

ConstructionSkills has estimated that the 2012 Olympics will create approximately 33,500 additional jobs over the next seven years, with civil engineering and a range of specialist skills in particularly high demand.

The forecast by the Sector Skills Council responsible for recruiting and training the UK's construction workforce is based on construction work directly attributable to the Games.

It indicates that the number of workers needed to complete Olympic construction projects will peak at around 7,500 in 2010 and includes a range of specialist skilled workers who will be required to build the complex mix of stadia, infrastructure and residential developments.

The forecast of 33,500 broadly breaks down as 6,500 managerial or administrative roles, 2,800 professionals such as architects and surveyors, and 24,000 trade or craft roles.

Sheila Hoile, Skills Strategy Director at CITB-ConstructionSkills, said: 'We believe that this analysis is the most accurate and realistic forecast available at this stage of planning.

'Building the Olympics needs to be seen in the wider context of the current massive demand on the UK construction industry.

'In the wider South East and Greater London alone there is £34bn worth of projects of over £100m each in the pipeline. This is in addition to the existing Greater London construction industry with an annual value of approximately £12bn. So the Olympics represents a huge construction programme with the work involved accounting for nearly 10% of the total picture in these regions.

'With major projects currently on site such as Heathrow Terminal 5, the Channel Tunnel Rail Link and Wembley, Britain is well-equipped for the task ahead.
However, the years 2008-2010 are critical for London, with the number of workers on site at any one time in the South East area expected to peak in 2010. Good workflow management and effective leadership are vital to long-term success,' she said.

The Olympic skills figures are the first to be produced by the Construction Skills Network, a new cross-industry alliance developed by ConstructionSkills to revolutionise construction recruitment and training. The Network will provide the industry's most comprehensive model for forecasting capacity, productivity and skills across the construction industry, and to plan for the impact of future trends on the construction workforce.

ConstructionSkills is also unveiling a dedicated team to help ensure that the construction programme to build world-leading facilities and infrastructure for the Olympic Games is delivered safely, on time and on budget, to leave a lasting legacy for London.

Working as part of the Strategic Forum Olympic Task Group, the Constructing London 2012 team will work with partners to recruit and train local people, to ensure that constructing the Olympics provides sustainable skills and job opportunities for the residents of East London.

New Construction Orders: September 2005

Orders in the year to September 2005 rose by seven per cent compared to orders in the previous twelve months period, and orders in the third quarter of 2005 rose by seven per cent compared to the same quarter a year earlier. Orders in the third quarter of 2005 fell by eight per cent compared to the previous quarter, with decreases in all sectors except public and housing association orders and public non housing orders. All orders figures quoted are seasonally adjusted and in constant (2000) prices.

Private housing orders in the year to September 2005 rose by eight per cent compared to those in the previous year. Orders in the third quarter of 2005 fell by four per cent compared with the previous quarter, but rose by five per cent when compared with the same quarter a year earlier.

Public housing and housing association orders rose by three per cent in the year to September 2005 compared with the previous year. Public housing and housing association orders in the third quarter of 2005 rose by one per cent compared to the previous quarter, and by four per cent compared to the same quarter a year earlier. All comparisons in this sector are affected by large variations due to its relatively small size.

Infrastructure orders in the year to September 2005 increased by 37 per cent compared with the previous year. Orders in the third quarter of 2005 fell by 11 per cent compared with the previous quarter, but rose by 63 per cent when compared to the same quarter a year earlier.

Public non-housing orders (excluding infrastructure) in the year to September 2005 rose by one per cent compared with the previous twelve months period. Orders in the third quarter of 2005 rose by four per cent compared with the previous quarter, and by 11 per cent when compared to the same quarter a year earlier.

Private commercial orders in the year to September 2005 fell by three per cent compared with the previous year. Orders in the third quarter of 2005 fell by 16 per cent compared to the previous quarter, and by 10 per cent compared to the same quarter a year earlier.

Private industrial orders in the year to September 2005 rose by 14 per cent compared to the previous year. Orders in the third quarter of 2005 fell by 16 per cent compared to the previous quarter, and by one per cent compared to the same quarter a year earlier.

House Price Index - July 2005

The mix-adjusted average house price in the UK in July 2005 stood at £186,207, up from £184,162 in June 2005 (not seasonally adjusted).

UK annual house price inflation in July 2005 was 4.0 per cent, down from 5.0 per cent in June 2005. Annual house price inflation in London was 0.9 per cent in July 2005, down from 1.7 per cent in June 2005.

The UK annual house price inflation rate for the 3 months to July 2005 was 5.0 per cent and 1.4 per cent in London.

House Price Inflation: Regional
The UK house price inflation rate fell from 5.0 per cent in June 2005 to 4.0 per cent in July 2005. Mix-adjusted prices rose by 1.1 per cent between June and July 2005, compared with a rise of 2.1 per cent seen over the same period in 2004.

The rise in UK prices between June and July can be largely attributed to increases of 2.1 per cent in the prices of detached houses and 1.3 per cent for bungalows.
Average prices for semi-detached houses, terraced houses and flats rose by 0.9 per cent, 0.6 per cent and 0.4 per cent respectively.

All the home countries, except Northern Ireland, saw a fall in annual inflation in July. The inflation rate in England fell from 4.1 per cent in June to 3.1 per cent in July. Over the same period, in Wales the rate fell from 10.8 per cent to 7.6 per cent; in Scotland the rate fell from 14.0 per cent to 12.0 per cent; and in Northern Ireland the rate rose from 14.2 per cent to 15.9 per cent.

House price inflation fell in all English regions, except West Midlands, between June and July. The highest inflation rates in England remain in the north, in North West (7.3 per cent), Yorkshire & the Humber (7.1 per cent), North East (6.5 per cent).
The inflation rate in West Midlands is currently 5.7 per cent. Inflation rates in East Midlands and the East are 3.4 and 3.1 per cent respectively. Inflation in the South West and South East regions were 1.5 and 1.3 per cent respectively. The region with the lowest inflation rate remains London, where inflation fell from 1.7 per cent in June to 0.9 per cent in July.

Mix-adjusted average house prices in July were £195,191 in England, £147,184 in Wales, £127,945 in Scotland and £133,849 in Northern Ireland.

The English region with the highest average house price in July remains London at £270,285. The region with the lowest average price was the North East at £134,034.
Only the East, London, South East and the South West had average prices above the UK average.

House Price Inflation: Type of Buyer
The UK house price inflation rate for first time buyers fell from 6.7 per cent in June to 6.0 per cent in July. This was due to a rise of only 1.9 per cent in prices between June and July in the properties bought by first time buyers, compared with a rise of 2.5 per cent seen over the same period last year.

The inflation rate for former owner occupiers fell from 4.4 per cent in June to 3.3 per cent in July. This was due to a rise of only 0.8 per cent in prices between June and July in the properties bought by former owner occupiers, compared with a rise of 2.0 per cent over the same period last year.

The average price paid by first time buyers across the whole of the UK was £153,168 in July, while the average price paid by former owner occupiers was £201,163.

Survey of English Housing 2004/05: Provisional Results

Housing Statistics Summary No. 25 features key findings from the 2004/05 Survey of English Housing (SEH). The results are provisional and not final. Some of the key results are:

• In 2005 it is estimated there were 14.6 million owner occupiers in England (71 per cent of the total), 3.7 million (18 per cent) social renters and 2.4 million (12 per cent) private renters.

• The private rented sector has the oldest housing stock, with 38 per cent of private renters in accommodation built before 1919, compared with just 6 per cent of social renters and 20 per cent of owner occupiers.

• 82 per cent of households live in a house or bungalow and 17 per cent in a flat or maisonette.

• The average household size in 2005 was 2.4 persons, with the highest for households buying with a mortgage at 2.8 and lowest for outright owners at 1.9.

• For households under 30 years of age, there has been a gradual shift in tenure during the past few years from owner occupation to private renting – possibly due to a worsening of affordability as house prices have continued to rise. Between 2001 and 2005 the proportion of households under 30 who were buying with a mortgage fell from 40 to 36 per cent, while over the same period the proportion of under 30 households who were renting privately rose from 33 to 40 per cent.

• Between 1993/94 and 2004/05, the proportion of mortgagors with an interest-only mortgage declined from 67 to 27 per cent, while the proportion of mortgagors with a repayment mortgage

• rose from 33 to 64 per cent. In 2004/05 only 7 per cent of new mortgages were endowment mortgages, 71 per cent were repayment mortgages and 8 per cent were a mix of interest only and repayment. The increase in the popularity of 'interest and repayment' mortgages may reflect a tendency to convert part of the outstanding loan to a repayment loan in cases where the endowment policy is no longer expected to cover the outstanding loan on maturity.

• 2.3 million households had been resident at their current address for less than one year - with 54 per cent for those renting furnished accommodation compared with 3 per cent of outright owners. 46 per cent of households had lived at the same address for 10 years or more, with 26 per cent for 20 years or more.

• 81 per cent of couples with dependent children were homeowners. By comparison, only 37 per cent of lone parents with children were owner occupiers. 45 per cent of lone parents with children were social renters.

• In 2005, 8 per cent of all households in England were BME (black and minority ethnic) households. 75 per cent of Indian households were owner occupiers, compared to 51 per cent for BME households as a whole. 53 per cent of Bangladeshi households were in social housing.

• There were about 500,000 overcrowded households in England – about 2.5 per cent of all households. In London the rate of overcrowding was 6.5 per cent. By housing tenure, the social rented sector had the highest rate of overcrowding: 5.2 per cent.

• In 2004/05, 61 per cent of social sector tenants were receiving Housing Benefit, a level that has been fairly stable in recent years. Only 20 per cent of private sector tenants were receiving Housing Benefit - the lowest since the Survey of English Housing started in 1993/94.

• The average rent paid by social sector tenants receiving Housing Benefit was £64 per week before Housing Benefit, and £10 per week after Housing Benefit. The corresponding figures for the private rented sector were £95 per week before HB and £23 after Housing Benefit.

New Construction Orders: August 2005

Orders in the year to August 2005 rose by four per cent compared to orders in the previous twelve months period, and orders in the three months to August 2005 rose by five per cent compared to the same period a year earlier. Orders in the three months to August 2005 fell by six per cent compared to the previous period, with decreases in infrastructure and private commercial orders more than offsetting increases in the remaining sectors. All orders figures quoted are seasonally adjusted and in constant (2000) prices.

Private housing orders in the year to August 2005 rose by 10 per cent compared to those in the previous year. Orders in the three months to August 2005 rose by seven per cent compared with the previous period, and by 16 per cent when compared with the same period a year earlier.

Public housing and housing association orders rose by four per cent in the year to August 2005 compared with the previous year. Public housing and housing association orders in the three months to August 2005 rose by one per cent compared to the previous period, and rose by five per cent compared to the same period a year earlier. All comparisons in this sector are affected by large variations due to its relatively small size.

Infrastructure orders in the year to August 2005 increased by 31 per cent compared with the previous twelve months period. Orders in the three months to August 2005 fell by 31 per cent compared with the previous period, but rose by 42 per cent when compared to the same period a year earlier.

Public non-housing orders (excluding infrastructure) in the year to August 2005 fell by five per cent compared with the previous twelve months period. Orders in the three months to August 2005 rose by 32 per cent compared with the previous period, and rose by eight per cent when compared to the same period a year earlier.

Private commercial orders in the year to August 2005 fell by seven per cent compared with the previous year. Orders in the three months to August 2005 fell by 22 per cent compared to the previous period, and by 20 per cent compared to the same period a year earlier.

Private industrial orders in the year to August 2005 rose by 13 per cent compared to the previous year. Orders in the three months to August 2005 rose by one per cent compared to the previous period, and by 14 per cent compared to the same period a year earlier.

New Construction Orders: July 2005

Orders in the year to July 2005 rose by six per cent compared to orders in the previous twelve months period, and orders in the three months to July 2005 rose by nine per cent compared to the same period a year earlier. Orders in the three months to July 2005 rose by nine per cent compared to the previous period, with increases in all sectors except private commercial orders. All orders figures quoted are seasonally adjusted and in constant (2000) prices.

Private housing orders in the year to July 2005 rose by 14 per cent compared to those in the previous year. Orders in the three months to July 2005 rose by seven per cent compared with the previous period, and by 25 per cent when compared with the same period a year earlier.

Public housing and housing association orders rose by 19 per cent in the year to July 2005 compared with the previous year. Public housing and housing association orders in the three months to July 2005 were unchanged compared to the previous period, but rose by 32 per cent compared to the same period a year earlier. All comparisons in this sector are affected by large variations due to its relatively small size.

Infrastructure orders in the year to July 2005 increased by 30 per cent compared with the previous twelve months period. Orders in the three months to July 2005 rose by 76 per cent compared with the previous period, and rose by 73 per cent when compared to the same period a year earlier.

Public non-housing orders (excluding infrastructure) in the year to July 2005 fell by five per cent compared with the previous twelve months period. Orders in the three months to July 2005 rose by 16 per cent compared with the previous period, but fell by 12 per cent when compared to the same period a year earlier.

Private commercial orders in the year to July 2005 fell by eight per cent compared with the previous year. Orders in the three months to July 2005 fell by 17 per cent compared to the previous period, and by 22 per cent compared to the same period a year earlier.

Private industrial orders in the year to July 2005 rose by 21 per cent compared to the previous year. Orders in the three months to July 2005 rose by 24 per cent compared to the previous period, and by 69 per cent compared to the same period a year earlier.

Regional Housing Investment Allocations Announced

The Government has announced how the £5.5 billion for housing investment available through Regional Housing Pots (RHPs) for the next two years, 2006-7 & 2007-8, will be split between funding for affordable housing to reduce homelessness and help more people on to the property ladder, to make more existing homes decent, and to regenerate communities.

The allocations for 2006-07 and 2007-08 reflect the funding advice from Regional Housing Boards. These proposals will also be the basis for the forthcoming bidding round for the Housing Corporation's National Affordable Housing Programme.

Housing Minister, Baroness Andrews, said the £3.9 billion being made available for social rented housing and low cost homeownership schemes across the regions represents an increase of around 20 per cent over 2004-05 and 2005-06.

'This significant investment reflects an increased focus on helping people unable to afford adequate housing as well as those having difficulty getting onto the housing ladder.'

'We are very grateful to the Regional Housing Boards for their hard work and for the significant role they have played in helping to give a clearer understanding of housing issues in the regions.'

The remaining £1.6 billion will be provided to local authorities mainly for improving existing housing with around £700 million of this used to support the Government's drive to bring all council housing up to a decent standard by 2010.

For the first time, the Housing Corporation's main bidding round will be open to developers and other non-registered bodies. Grants will go to those who can best deliver the range of housing that is needed while offering value for money.

The final affordable housing allocations will therefore depend on the outcome of the bidding round. The ODPM and the Housing Corporation will be in discussion with the Regional Housing Boards during the bidding process to ensure the final allocations reflect the commitments made in Homes for All, including:

* the delivery of 75,000 new social homes over the 3 years to March 2008, to help tackle homelessness and reduce the number of households living in insecure temporary accommodation; and
* maintaining the level of funding of affordable housing in rural areas.

Decisions have also been taken on the split between regions of funding to Disabled Facilities Grants for 2006/07 and 2007/08. The regional totals are given in the attached table. Allocations for individual local authorities will be announced alongside Regional Housing Pot allocations later in the year.

Government Outlines Operation of New Powers to Bring Empty Homes Back into Use

The Government's drive to bring more long-term empty homes in England back into use was bolstered recently with the launch of consultation on how Empty Dwelling Management Orders (EDMOs) should operate.

EDMOs will enable councils to take over temporary management of longer term unoccupied houses and flats so they can be let out to tenants. Properties will revert to their owners on an agreed date or sooner if the owner so requires - provided due notice is given and arrangements to repay any reasonable costs incurred by councils are settled.

EDMOs are included in the Housing Act 2004 and are designed to operate as a back up to existing services already provided by local authorities, such as leasing arrangements.

Housing Minister Baroness Andrews, said management orders would only be used if owners were not willing to cooperate or showed no valid reason why the property should remain empty.

'Empty homes have blighted our communities and attracted anti-social behaviour for far too long. The new management orders are an ideal opportunity to bring these properties back into use so as to provide much needed accommodation locally.'

The consultation asks for views on a number of issues, including whether dwellings should be exempt from the new provisions for six months from the time they become unoccupied - the minimum time period provided by the legislation - or a longer period.

'It is important that when it comes to providing a timescale for action against unoccupied dwellings, homeowners have a reasonable amount of time to consider what they want to do with their property without fear of unwarranted intervention.'

The Housing Act 2004 also provides for dwellings to be exempt indefinitely according to their use, or intended use, and sets out a number of circumstances in which such exemptions might apply, as in the case of second homes and other properties not occupied continuously. The consultation paper seeks views on how these proposed exemptions should be implemented.

The consultation closes on 14th October, with the new powers expected to come into force by the end of the year.

New Construction Orders: June 2005

Orders in the year to June 2005 rose by five per cent compared to orders in the previous twelve month period, and orders in the second quarter of 2005 rose by nine per cent compared to the same quarter a year earlier. Orders in the second quarter of 2005 rose by nine per cent compared to the previous quarter, with increases in all sectors except public non-housing and private commercial orders. All orders figures quoted are seasonally adjusted and in constant (2000) prices.

Private housing orders in the year to June 2005 rose by 15 per cent compared to those in the previous year. Orders in the second quarter of 2005 rose by 24 per cent compared with the previous quarter, and by 26 per cent when compared with the same quarter a year earlier.

Public housing and housing association orders rose by six per cent in the year to June 2005 compared with the previous year. Public housing and housing association orders in the second quarter of 2005 rose by 23 per cent compared to the previous quarter, but fell by seven per cent compared to the same quarter a year earlier. All comparisons in this sector are affected by large variations due to its relatively small size.

Infrastructure orders in the year to June 2005 increased by 12 per cent compared with the previous twelve month period. Orders in the second quarter of 2005 rose by 13 per cent compared with the previous quarter, and rose by 17 per cent when compared to the same quarter a year earlier.

Public non-housing orders (excluding infrastructure) in the year to June 2005 fell by seven per cent compared with the previous twelve month period. Orders in the second quarter of 2005 fell by four per cent compared with the previous quarter, and by 14 per cent when compared to the same period a year earlier.

Private commercial orders in the year to June 2005 were unchanged compared with the previous year. Orders in the second quarter of 2005 fell by two per cent compared to the previous quarter, but rose by one per cent compared to the same period a year earlier.

Private industrial orders in the year to June 2005 rose by 15 per cent compared to the previous year. Orders in the second quarter of 2005 rose by 19 per cent compared to the previous quarter, and rose by 47 per cent compared to the same period a year earlier.

Land Use Change in England: Residential Development to 2004 - July Update

Updated estimates of residential change in England up to 2004 indicate that:

* In 2004, on an updated provisional estimate, 70 per cent of new dwellings were built on previously-developed land, including conversions. This compares with 67 per cent in 2002 and 2003. Before 1997 the level fluctuated around 57 per cent. (The estimate for 2004 has been revised from 67 per cent previously published.)
* In 2004, on an updated provisional estimate, new dwellings were built at an average density of 40 dwellings per hectare. This compares with 34 dwellings per hectare in 2003 and 25 dwellings per hectare before 2002. (The estimate for 2004 has been revised from 39 dwellings per hectare previously published.)

Reasons for updating
Information on individual sites with a change of land use is collected by Ordnance Survey during their map revision work. Some changes may not be recorded until some time after the change took place. The Office of the Deputy Prime Minister makes provisional estimates based on information available at the time but these are subject to revision as more information is received. The previous publication, Land Use Change in England: Residential Development to 2004 (LUCS 20) was based on change recorded up to the end of 2004. This update includes information on change taking place up to 2004 but recorded in January to March 2005.

1. Proportion of dwellings on previously developed land
* In 2004, on a provisional estimate, 70 per cent of new dwellings were built on previously-developed land including conversions. This estimate has been revised, from 67 percent published in LUCS20.

* The Regional targets for proportions of new dwellings on previously-developed land are mostly 60 per cent or higher. The achieved rates in Table 2 exclude most conversions.

* Provisional 2004 estimates show that the South West and East Midlands are the only regions with proportions below 60 per cent, while London was highest at 94 per cent.

2. Densities
* In 2004, on a provisional estimate, new dwellings were built at an average density of 40 dwellings per hectare in England. This compares with 34 dwellings per hectare in 2003 and 25 dwellings per hectare between 1996 and 2001.

* The 2002, 2003 and 2004 estimates are revised from estimates published in LUCS20.

* On a provisional estimate, densities of new dwellings in 2004 increased in all regions except Yorkshire and the Humber where they were unchanged. They reached at least 32 dwellings per hectare in all regions. Before 2002 all except London were below 30 dwellings per hectare.

* Average density in the area covered by the Density Direction that is London, the South East Region and Hertfordshire, Bedfordshire and Essex, increased from 30 dwellings per hectare in 2002 to 48 dwellings per hectare in 2004.

Further analyses of other land use changes and some updates will be included in an additional Statistical Release to be published in October 2005.

Symbols and Conventions
Unless otherwise stated, tables and figures relate to England.
The following symbols have been used throughout:
P provisional estimate

About the data
These statistics are based on changes in land use recorded for the Department by Ordnance Survey during their map revision work between 1985 and the first three months of 2005. They relate to both new use and previous use of land, and changes between uses.

Comprehensive information about the total amount of land devoted to different uses is not currently available. A simplified land use classification, with nine categories, has been applied on an experimental basis to England as at 2001– see: http://www.odpm.gov.uk/stellent/groups/odpm_planning/documents/page/odpm_plan_023322.hcsp

ODPM is working with Ordnance Survey and other partners on ways of creating a more detailed classification.

National Statistics are produced to high professional standards set out in the National Statistics Code of Practice. They undergo regular quality assurance reviews to ensure they meet customer needs.

Adequate Skills Missing in Increasingly Tight Labour Market

In the current edition of Construction Management and Economics, Andy Dainty and Stephen Ison of Loughorough University with Geoff Briscoe of Coventry University, reveal that established workers and new entrants do not seem to have sufficient skills to carry out the work.

The research, carried out by a team from Loughborough and Coventry Universities, looks at the supply of skilled labour from the point of view of SMEs in the UK construction industry. The findings reveal a complex interplay of factors that have combined to shape the industry's skills crisis in recent years. This has important, practical implications for firms attempting to operate in increasingly tight labour market conditions. The primary concern of small construction firms was with the quality of skills available in the labour market. The researchers conclude that the standard of both the existing labour force and new entrants to the industry has resulted in an industry manifestly unable to meet its clients' requirements.

Full details can be found in the current issue of Construction Management and Economics, Volume 23 Number 4, published by Taylor and Francis.

For further details regarding the research, contact Dr Andy Dainty, Department of Civil and Building Engineering, Loughborough University, Loughborough, Leicestershire, LE11 3TU, UK
Tel: 01509 228742
Email: mailto:a.r.j.dainty@lboro.ac.uk

For further details regarding articles in the journal Construction Management and Economics, contact Dr Will Hughes, Editor, Dept Construction Management & Engineering, University of Reading, PO Box 219, Reading, RG6 6AW, UK,
Tel: 0118 931 8201
Email: mailto:w.p.hughes@reading.ac.uk

For further information about subscriptions contact Nicola McArthur, 4 Park Square, Milton Park, Abingdon, Oxfordshire, OX14 4RN, UK
Email: mailto:nicola.mcarthur@tandf.co.uk
Web: http://www.tandf.co.uk/journals

New Construction Orders: April 2005

Orders in the year to April 2005 rose by six per cent compared to orders in the previous twelve month period, but orders in the three months to April 2005 fell by six per cent compared to the same three months a year earlier. Orders in the three months to April 2005 were unchanged compared to the previous three months, with increases in public/ private housing and private commercial orders being offset by falls in public non-housing, private industrial and infrastructure orders. All orders figures quoted are seasonally adjusted and in constant (2000) prices.

Private housing orders in the year to April 2005 rose by 10 per cent compared to those in the previous year. Orders in the three months to April 2005 rose by 9 per cent compared with the previous three months, and by four per cent when compared with the same three months a year earlier.

Public housing and housing association orders rose by 10 per cent in the year to April 2005 compared with the previous year. Public housing and housing association orders in the three months to April 2005 rose by 36 per cent compared to the previous three months, and by seven per cent compared to the same three months a year earlier. All comparisons in this sector are affected by large variations due to its relatively small size.

Infrastructure orders in the year to April 2005 increased by five per cent compared with the previous twelve month period. Orders in the three months to April 2005 fell by 13 per cent compared with the previous three months, but rose by 19 per cent when compared to the same three months a year earlier.

Public non-housing orders (excluding infrastructure) in the year to April 2005 rose by five per cent compared with the previous twelve month period. Orders in the three months to April 2005 fell by 18 per cent compared with the previous three months, and by 13 per cent when compared to the same period a year earlier.

Private commercial orders in the year to April 2005 were five per cent higher than in the previous year. Orders in the three months to April 2005 rose by 11 per cent compared to the previous three months, but fell by 20 per cent compared to the same period a year earlier.

Private industrial orders in the year to April 2005 rose by one per cent compared to the previous year. Orders in the three months to April 2005 fell by 17 per cent compared to the previous three months, but rose by 16 per cent compared to the same period a year earlier.

House Building: January to March Quarter 2005

This statistical release presents figures on new house building starts and completions in England and its regions up to the quarter ending March 2005. House building figures are also provided for the other UK countries.

Summary
• Provisional figures for England for 2004/05 show:
• 173,500 starts, up 8 per cent on the figure for 2003/04
• 154,600 completions, up 8 per cent on the figure for 2003/04
• In England during the quarter to March 2005 there were:
• 40,300 housing starts, down 5 per cent on the same period in 2004.
• 33,600 housing completions, up 5 per cent on the same period in 2004.

Most of this increased house building activity was in London, where in 2004/05 there were 23,920 housing completions up 23 per cent on the previous year. Outside London, completions were up 5 per cent.

Provisional 2004/05 figures for Wales show:
• 9,700 starts, down 4 per cent on the figure for 2003/04
• 9,500 completions, up 15 per cent on the figure for 2003/04

Recent trends in house building in England
There have been upward trends in housing starts and completions in England since 2002/03. At this time, starts and completions were running at about 37,000 and 34,000 per quarter. These rates have increased to 43,000 and 38,000 per quarter respectively up to the end of 2004/05 with starts tailing off slightly over the last financial year.

Regional trends

North and Midlands
Starts are levelling off after recent upward trends in the North West, Yorkshire and the Humber and the East Midlands. Trends in completions remain fairly level.

London, South East, East and South West
London, South East and East have seen upward trends since 2002/03. In the South East, starts and completions were running at around 6,400 and 5,600 per quarter in 2002/03. These rates have now risen to 7,500 and 6,500 up to the quarter to March 2005. Starts however, have shown a downturn in the year up to the most recent quarter.

London has seen large rises in starts and completions since mid 2003/04, although the trend has levelled out up to the most recent quarter. Starts and completions per quarter have remained level in the South West.

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