黑洞社区

Moat clearing worth 拢2,000, 拢100 for light bulb changing and thousands of pounds for renovations to a London flat just 17 miles from the family home. Conservative MPs, it seems, have a better track record for directing public money to construction projects than history may have led you to believe.

Unfortunately, with the public furore over the use of MPs鈥� expenses, the Tories鈥� local builders may now have to look elsewhere for work. And they aren鈥檛 the only construction firms concerned about the opposition鈥檚 attitude to building. David Cameron told the Tory spring conference at Cheltenham last month that he wanted to 鈥渞eplace Labour鈥檚 spendaholic government with a new government of thrift鈥�. This statement has set alarm bells clanging throughout the industry.

Labour confirmed in the Budget last month that the country will accumulate a 拢1.2 trillion debt mountain over the next five years 鈥� the biggest in history. The response from the Conservative party, which is looking more and more likely to win the next election was clear: public spending needs to be slashed faster than ever before.

The party is coy about how it would distribute cuts, but it is likely that a large hole will be made in the 拢35bn that the public sector spends on construction at the moment. With no upturn expected in the private sector until 2012, Cameron鈥檚 new age of austerity is looking like a long, cold winter for the industry.

Here we peer into the murk to assess which programmes are most likely to suffer, which ones could survive and how soon the cuts could come. Overleaf, we meet the Tories whose decisions could prove crucial to construction.

The likely cuts

Part of the problem for construction firms trying to work out where to put their resources is that the Conservatives have been carefully vague about what they have in mind. Cameron says the details will be worked out later 鈥� partly because the party is sceptical about the accuracy of Treasury forecasts, and partly because he does not need to make explicit commitments; the view is that Labour is doing a fine job of losing the election all by itself, so why give it targets to shoot at?

The only areas of spending the Conservatives have committed themselves to maintaining at the levels set by Labour are health and international development.

Health is to receive 拢6.1bn of capital investment in 2010/11, which means that 拢29bn of spending is under threat.

From the little the Tories have said, it seems that transport, which is due to receive 拢8.1bn of spending in 2010/11, will be one of the prime areas for cuts. Earlier this month, Yvette Cooper, the chief secretary to the Treasury, challenged Phil Hammond, her opposite number, to commit a future Tory government to the 拢16bn Crossrail programme. Hammond replied that 鈥渆very single programme, every single project will have to be reassessed and re-evaluated鈥�.

London mayor Boris Johnson claims to have been assured that the project would continue under a Conservative government. However, given its scale, and therefore the amount of money that could be saved by halting it, there is growing concern that the party could freeze the project just like it did after the early nineties recession 鈥� four years after it gave it approval.

On top of this, Theresa Villiers, the shadow transport secretary, announced last October that the party would halt any expansion of Heathrow, including the third runway, to cut carbon emissions.

Instead, the party is proposing a 拢20bn high-speed rail link between London, Birmingham, Manchester and Leeds. This is not intended to begin until 2015, so it may be safe; the Tories are planning to spend 拢1.3bn a year between 2015 and 2027 for the project. However, this would only be used for land and track: the private sector would be expected to shoulder all construction and operating risks. This means that the project would only go ahead if it attracted sufficient private investment.

Housing is another market where the Tories tend to wield the machete in times of crisis 鈥� they reduced spending in this area by 67% between 1979/80 and 1989/90. The party鈥檚 green paper on housing, launched in April, proposes to abandon the government鈥檚 target of building 3 million homes by 2020 in favour of a 鈥渂ottom up鈥� approach whereby local authorities are left to decide how many new homes they need. The incentive for them is that the government will match the total council tax received from each new home for six years.

The Conservatives say this approach should free up the market for more homes to be built, but there are concerns that without a measurable target the programme could fall behind. Simon Storer, external affairs director of the Construction Products Association, says: 鈥淭hey鈥檝e said they won鈥檛 be prescriptive, but if the numbers drop, then I don鈥檛 know what that will do to the market.鈥�

There is also likely to be a heavy shake-up of spending on schools. The party has already suggested that it would reallocate some of the money from the 拢45bn 黑洞社区 Schools for the Future (BSF) programme to a capital fund for new academies, and earlier this month revealed that it wanted to extend the academy model to cover primary schools.

What this would mean for headline spending is unclear; however, with the education budget presently 拢7.8bn, which is second only to transport, it is likely that the party that wins the election will have to rein in costs. The Department for Children Schools and Families has already been asked to find 拢650m a year of savings by 2010/11 in the Budget. One official involved with the school building programme said: 鈥淥ne way of cutting back would be to go for more refurbishments, and that鈥檚 an option we鈥檇 expect the Conservatives to consider.鈥�

One area that looks promising under the Tories is the development of green technologies. Although the tub-thumping green policies have quietened down of late, the commitment to green industries does not appear to have been undermined by the need for spending cuts. In April, the party put forward suggestions that it said would unleash 拢30bn of private sector investment, including a 拢6,500 energy efficiency entitlement for every UK home and the funding of at least three carbon capture and storage projects. The party also proposed building a network of marine energy parks along the coastline to accelerate the development of wind, wave and tidal power.

How soon could they cut back?

The Tories have committed themselves to introducing an 鈥渁usterity Budget鈥� within days of coming to power. However, in practice, large programmes would be protected from immediate cuts owing to their lead-in times.

This is particularly true of new-build education projects under the 拢45bn BSF initiative, which are increasingly being bundled together in large packages under the Local Education Partnership model. Although a new government would not be bound by Labour鈥檚 Comprehensive Spending Review, which outlined spending commitments until spring 2011, sources involved with the BSF programme say the money that was outlined in this is already committed, with councils busy hiring consultants and taking schemes through planning. One source said: 鈥淚t may not be physically impossible to stop the money, but it would be politically unwise.鈥�

Cancelling a scheme like Crossrail would incur penalties as contracts have been let, which would need to be cancelled. Most significantly, the 拢100m programme partner role and 拢400m delivery partner role 鈥� cancelling these would be expensive, although rather cheaper than pressing ahead with the link itself 鈥�

Tory Trumps: who you need to know

Oliver Letwin

Oliver Letwin

Chairman of conservative research department, MP for West Dorset

Special powers 7

A key figure in formulating Conservative policy, Letwin has a track record for advocating spending cuts. He was sent into internal exile during the 2001 election campaign after he expressed the wish to cut spending by 拢20bn a year.

Political experience 8

A member of Margaret Thatcher鈥檚 policy unit from 1983 to 1986. First elected in 1997. Shadow chancellor from 2003 to 2005.

Closeness to Cameron 6

Letwin publicly backed Cameron, a fellow Etonian, for the Tory leadership when Michael Howard stepped down. He was given the newly created role of chairman of policy review when Cameron formed his first shadow cabinet in December 2005.

Ability to escape expenses scandal 3

Claimed more than 拢2,000 to replace a leaking pipe on the tennis courts at his constituency home. Letwin says he had been served with a statutory notice by the water company.

Knowledge of construction 4

He is familiar enough with public spending programmes, but has had little direct contact with the industry.

Pub trivia value 8

In 2002 he was robbed by two strangers after letting them into his London house at 5am to use his bathroom. He retrieved his credit cards after chasing them down the street in his pyjamas.

Mark Prisk

Mark Prisk

Shadow construction minister, MP for Hertford and Stortford

Special powers 6

As the shadow minister with the construction brief, Prisk has the best chance of speaking on behalf of the industry. However, he is not among the most influential members of the opposition.

Political experience 5

He was elected in 2001, so has never served in government. But he has been on the Conservative frontbench in opposition since 2002 in roles including shadow paymaster general and shadow financial secretary to the Treasury.

Closeness to Cameron 4

Steadily promoted under Cameron but there is no special relationship.

Ability to escape expenses scandal 10

Nothing particularly outrageous.

Knowledge of construction 9

A chartered surveyor by profession, Prisk has also been the Tory spokesperson on the industry for the past four years.

Pub trivia value 6

Despite his role as shadow construction minister, since 2001 Prisk has actively campaigned against the second runway at Stansted, which is next door to his constituency.

Francis Maude

Francis Maude

Shadow cabinet office minister, MP for Horsham

Special powers 9

Dubbed the 鈥渆nforcer鈥� in Tory circles, Maude has been tasked with preparing the strategy for the Tories鈥� first 100 days in power.

Political experience 8

First elected to the House of Commons in 1983, Maude served in ministerial roles under Margaret Thatcher and John Major. He also chaired the government鈥檚 deregulation taskforce from 1992 to 1997.

Closeness to Cameron 8

After the 2005 general election, when he was chairman of the Conservative party, Maude worked with Cameron to come up with an A-list of parliamentary candidates. He is considered a left-leaning Tory.

Ability to escape expenses scandal 3

Maude allegedly claimed 拢35,000 in mortgage interest payments on a London flat that was close to a house he already owned.

Knowledge of construction 5

Indirect contact with the industry as minister for corporate and consumer affairs between 1987 and 1989 and his work on deregulation.

Pub trivia value 7

Accused of hypocrisy for promoting family values while he was non-executive chairman of the Jubilee Trust, which held a 21% stake in an American pornographic actress Jill Kelly鈥檚 adult DVD business.

Michael Gove

Michael Gove

Shadow secretary of state for children, schools and families, MP for Surrey Heath

Special powers 7

As shadow schools secretary, Gove will be at the heart of policy on the future of the 拢45bn BSF programme, one of the biggest sources of public sector work for construction.

Political experience 6

Gove entered parliament in the 2005 election, but has been a member of the shadow cabinet since 2007. He was also formerly chairman of right-wing think tank Policy Exchange.

Closeness to Cameron 7

One of the 鈥淣otting Hill set鈥� of younger Tories, which also includes Cameron, Gove was put into the spotlight, as housing spokesman, as soon as Cameron took over the leadership.

Ability to escape expenses scandal 3

Gove is accused of 鈥渇lipping鈥� his designated second home to a house in his constituency, for which he claimed about 拢13,000 for stamp duty, after claiming 拢7,000 for furnishing a London property. Gove strongly denies flipping, but has agreed to pay back money for a cot mattress which he allegedly claimed for despite children鈥檚 items not being covered by expenses.

Knowledge of construction 9

Gove鈥檚 role as housing spokesman and his current remit tracking the government鈥檚 school building programme have contributed to his knowledge of the industry 鈥� as, one would hope, has his position as a 黑洞社区 columnist.

Pub trivia value 6

He played the part of a school chaplain in family comedy A Feast at Midnight, released in 1995.

Justine Greening

Justine Greening

Junior shadow minister for the Treasury with responsibility for planning, MP for Putney

Special powers 6

Being young, attractive and blonde is a rare thing in the Tory party (unless you鈥檙e Boris, of course). Greening is being given a high-public profile, and has appeared on Question Time and Any Questions.

Political experience 3

First elected in 2005; has since held a series of junior roles.

Closeness to Cameron 5

Steadily promoted but no specific links to the inner circle.

Ability to escape expenses scandal 10

No known accusations.

Knowledge of construction 4

Has served on the work and pensions select committee, but has had no specific involvement with the industry prior to her current role.

Pub trivia value 3

She is the youngest female Tory in the House of Commons.

Grant Shapps

Grant Shapps

Shadow housing minister, MP for Welwyn Hatfield

Special powers 8

Considered a party high-flier, Shapps has become a darling of the press and has used his position to gain more political lift with party managers.

Political experience 6

First elected in 2001, Shapps was promoted to shadow housing minister in 2007. He has never served in government but does attend shadow Cabinet meetings.

Closeness to Cameron 7

Shapps publicly supported Cameron鈥檚 leadership bid and signed his nomination papers. Cameron then appointed him vice-chairman and gave him responsibility for campaigning.

Ability to escape expenses scandal 10

No known accusations.

Knowledge of construction 8

Shadow housing minister for the past two years, Shapps has firmly established himself as an authority on housing and regeneration.

Pub trivia value 7

Shapps spent Christmas Eve 2007 in a sleeping bag outside Victoria station to draw attention to the plight of homeless children.

Neil O鈥橞rien

Neil O鈥橞rien

Director, Policy Exchange think tank

Special powers 8

Policy Exchange is considered to be the think tank most closely consulted by today鈥檚 Tory policy makers 鈥� particularly Cameron. Maude, Gove and Cameron鈥檚 adviser Nicholas Boles all previously worked at the organisation.

Political experience 5

Before being appointed director of Policy Exchange, O鈥橞rien headed Open Europe, a think tank concerned with free market reform in the EU.

Closeness to Cameron 8

Policy Exchange has been described as 鈥淐ameron鈥檚 favourite think tank鈥�. O鈥橞rien and Cameron also share an education 鈥� both studied PPE at Oxford 鈥� although O鈥橞rien is not regarded as as naturally a Cameronian as Anthony Browne, his predecessor at Policy Exchange.

Ability to escape expenses scandal 10

Not being an MP definitely helps with this one.

Knowledge of construction 2

O鈥橞rien has had no direct experience of the industry, but hopefully can avoid repeating a Policy Exchange report that said regeneration was a waste of money and that northerners should go and live in the South.

Pub trivia value 5

O鈥橞rien ranked above John Major in the Telegraph鈥檚 last list of the UK鈥檚 top 100 Tories.

Philip Hammond

Philip Hammond

Shadow chief secretary to the Treasury, MP for Runnymede and Weybridge

Special powers 6

Hammond is establishing himself as a key Tory speaker on public spending, including on major projects like Crossrail.

Political experience 6

First elected in 1997, Hammond was promoted to the Tory frontbench a year later and to the shadow Cabinet in 2005.

Closeness to Cameron 7

Firmly ensconced in the shadow Cabinet.

Ability to escape expenses scandal 10

No known accusations.

Knowledge of construction 8

The son of a civil engineer, Hammond has served as a spokesperson on trade and industry and as shadow secretary for work and pensions. He is also a director of Castlemead Homes.

Pub trivia value 0

He keeps his private life private.