The report, UK Government Construction Pipeline - KPMG Analysis, shows that the value of the region’s pipeline allocation sits behind that of national, South and North projects.
The Midlands, which for the purposes of the report covers the West and East Midlands and the East of England, has 445 projects within the UK Government’s construction pipeline. This equates to 20 per cent of the total pipeline. However, the combined value of these projects comes in at only 9 per cent, with £10.9 billion allocated out of a total £118.7 billion.
|% of pipeline(2,262)||% of value(£118.7bn)|
The breakdown within the Midlands is as follows:
However, the picture is somewhat improved when considering the impact of certain national projects on the region, such as the investment set aside for HS2, some of which will effectively be ‘spent’ within the Midlands.
The analysis shows that ten sectors have committed funding in the Midlands, with transport, police forces, education and health with the highest allocated funding by sector. Ministry of Defence and Justice comprise of 224 projects (50 per cent of the region’s pipeline), with a combined allocated value of £1 billion. Of the remainder:
Of the total 445 Midlands projects, some 339 do not have a stated construction start date, which accounts for 32 per cent of the total pipeline value. This could raise questions about the completeness of the data. Nationally, some 1,784 projects did not specify a construction start date.
The question of completeness is a major concern of the national report, which concludes that with a quarter of its projects disappearing since December 2014, more needs to be done to improve the consistency and accuracy of the UK Government construction pipeline.
The figures reveal a total UK-wide decrease of 886 (28 per cent) construction and infrastructure projects since the previous pipeline analysis in December 2014 (from 3,148 to 2,262 in August 2015), relating mainly to the Defence, Justice and Police sectors (860 projects alone relate to these sectors).*
|Total 2015 to 2017 (£ billion)||36.9||37.8|
|2017 to 2020Estimated (£ billion)||41.5||50.2|
|Beyond 2020 Estimated (£ billion)||40.3||39.7|
|Total Allocated Value (£ billion)||118.7||127.8|
|Total Number of Projects||2,262|| 3,148
KPMG understands that the remarkable decrease in the number of projects is largely due to potential projects being removed from the pipeline to avoid pre-empting decisions in the forthcoming Spending Review. There are also a number of projects that have been completed since the December 2014 iteration.
Most of the decrease in value attribute to projects completing mainly in two sectors, with a £6.7 billion decrease in transport projects and £2.8 billion decrease in housing and regeneration projects.
Mike Froom, partner for infrastructure, building and construction in the Midlands at KPMG, said: “We have had under investment in infrastructure in the Midlands for too many years now and the frustration of projects not reaching fruition continues with the number of potential projects removed from the pipeline. Whilst we have seen great examples of businesses growing in the region by expanding their penetration in overseas markets we need government to recognise that the region needs better infrastructure – particularly with regards to transport.
“The opening of Grand Central in Birmingham this weekend shows the impact that investment in transport can have, both on infrastructure itself, but also on the profile and reputation of a city and region. Increased investment, whether it be in rail or in other areas, such as our roads or airports, will make it easier to do business in the area, increase inward investment, and grow and improve employment opportunities. Businesses cannot do this all by themselves and a vital way government can support business is by improving local and regional infrastructure and providing certainty over delivery.
“The current discussions around devolution across the Midlands are much welcomed when it comes to infrastructure investment – by giving those who understand the needs and challenges of an area the ability to make decisions on how to improve its infrastructure, we will no doubt see more fit for purpose and well thought through solutions.”
Notes to editors
* Note that this is first time the region cut of data has been done: there is no comparator for Midlands projects as at December 2014 available
The regional split is made up of:
For further information, please contact:
Frances Shennan, KPMG Press Office
T: +44 (0)121 335 2575
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