Soaring costs risk stalling recovery for builders

SCOTLAND’S construction sector is showing signs of recovery but faces a new threat from rising material and labour costs.

The Federation of Master Builders (FMB) has reported a surge in jobs as the economy picks up.

Workloads and inquiries to builders north of the Border have risen more quickly than the rest of Britain, the survey shows.

The number of builders who felt positive about their workload rose from 13 per cent to 30 per cent, while the number who felt negative about work prospects fell from 39 to 13 per cent.

However, experts said the overall responses about workload remain negative, which means more builders are struggling than prospering, while facing increasing bureaucracy and costs.

Grahame Barn, director of FMB Scotland, said: ‘Scottish builders have been drowning in red tape, have had to cut back on employees, worry about their families’ financial security and are rightly concerned about the future.’

Material costs and salaries are expected to rise in the next six months, which means many builders may increase their prices, a move that may have a knock-on effect on new-build house costs.

But builders may benefit from the Scottish Government’s Procurement Reform Bill, which will make it easier for small firms to bid for public sector projects.

The FMB also welcomed a plan for ‘project bank accounts’, which will guarantee that firms get their money on time when working on major public developments. Mr Barn said: ‘ Removing payment delays allows small businesses to take back control of their budget.’