Thursday 20 June 2019

Builders demand raft of measures to save industry

Grainne Cunningham

The construction industry yesterday demanded that the Government introduce a range of urgent measures to save the sector and warned that a failure to bring forward an economic stimulus package in the immediate future will result in the loss of thousands of jobs.

The Construction Industry Federation (CIF) called for a range of measures, including a first-time buyers grant and a stamp duty 'holiday' to kick-start the second-hand market. And the lobby group said the current situation could be made worse if the upcoming supplementary budget focuses on taxes and cuts rather than boosting commercial activity.

"The very stark message from our members today is that they will be laying off substantial numbers of people if there is not a stimulus package," said director general Tom Parlon at an emergency meeting of major construction employers.

"The last thing we should be doing is taking further money out of the economy. Obviously, there will be tax increases but they must be balanced against maintaining economic activity."

Construction chiefs have invited both Government and Opposition TDs to a four-hour lobbying session tonight to detail their plans on how to halt the rapid decline in their industry.

"Until now individual members were reluctant to talk openly, but they realise they are fighting for their own companies . . . if we do not stop the haemorrhaging of jobs, the economy will spiral downwards," Mr Parlon said.

Yesterday the CIF proposed a series of one-off measures to stimulate the construction industry. These included introducing a "substantial" first-time buyers grant and a residential stamp duty holiday to kick-start the second-hand market, both for a limited period only.

Other proposals include reinstating all of the cancelled ready-to-go labour intensive infrastructure projects, overhauling public procurement procedures and eliminating delays arising from statutory bottlenecks.

The Federation has also proposed fast-tracking local authorities' projects capable of generating employment while eliminating National Development Plan projects which do not give immediate payback in terms of jobs and revenues.

Windfall

Mr Parlon estimated that the Government stands to reap a tax windfall of some €1.25bn in uncollected VAT, which is currently tied up in unsold houses and apartments nationwide. An estimated €35,000 in Vat per completed unit does not accrue to the Exchequer until the contract is signed.

While conceding that public confidence is poor, Mr Parlon said mortgage rates are low and both Bank of Ireland and AIB have indicated they have €1bn each in mortgages available.

Meanwhile, the concerns raised by construction chiefs were echoed by the Manpower Employment Outlook Survey, also released yesterday, which reported particularly bleak job prospects in the construction sector.

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