Nick Raynsford: Let me mark your card

Both David Cameron and Nick Clegg have made much play of having set up a “strong and stable government” for the next five years. But in fact, the expectation that the Con-Lib coalition will last a full five-year parliamentary term is not at all convincing. The deal will almost certainly hold together for at least a year. Both parties have too much to lose from not getting their main objectives in the coming parliamentary session – electoral reform for the Liberal Democrats and spending cuts for the Conservatives. An early collapse of the coalition would also leave Cameron and Clegg open to the charge of a serious error of judgment in thinking they could form a stable government.

But the inherent tensions between the two parties, which disagree fundamentally on so many issues – Europe, nuclear power, defence and proportional representation, to name four of the most obvious – will inevitably rankle as the going gets rough. If either party sees its electoral prospects seriously threatened by continued participation in the coalition, the temptation to jump ship will become hard to resist.

This is the background to the most bizarre condition of the coalition agreement – that a dissolution of parliament should be conditional on at least 55% support from MPs. This is constitutionally suspect and almost certainly unworkable. British prime ministers who lose a vote of confidence in the House of Commons, even by a single vote, are expected to resign. Unless another party, or group of parties, is able to form an alternative government, an election ensues. Putting a block on the option of an election in such circumstances would create precisely the paralysis that the coalition was supposed to prevent, and parliament is unlikely to authorise such a provision. So for a variety of reasons it would be prudent to anticipate a further general election at some stage from autumn 2011 onwards.

What are the implications for construction from this probably temporary coalition? At the time of writing we have only tentative hints about where government policy will change, where spending is most likely to be cut, and the detailed responsibilities of individual ministers. The picture is likely to evolve over the next few days and weeks.

Sadly the impressive track record of the HCA’s Kickstart, Homebuy Direct and National Affordable Housing programmes may not be sufficient to save it from the ideologically driven quango cull

 

On spending, we know that the government is committed to substantial reductions in public expenditure, but the balance between “postponement” or cancellation of capital spending and revenue cuts has not yet been determined. Nor is the degree to which individual government departments will shoulder their share of the “savings” yet known. Expect a great deal of lobbying, special pleading and shroud-waving over the coming weeks before the new chancellor George Osborne’s first Budget is presented.

Initial indications are that “big ticket” capital programmes – schools and hospitals – will come under the spotlight as targets for cuts (see Jack Pringle, page 26). Large infrastructure schemes will also be examined for savings but the mayor of London’s strong advocacy for Crossrail will make it difficult for the government to propose cancellation or major surgery without a political row within Conservative ranks. Heathrow Terminal 6 and the third runway are binned, but no decisions are likely for some time on alternative options for the necessary increase in runway capacity in the South-east. The nuclear programme will, paradoxically, probably benefit from the agreement between the parties to disagree on this issue – the coalition terms allow the Lib Dems to make the case against nuclear power (but not to vote against it) when the National Policy Statement is presented to parliament. By definition this allows work to proceed on preparation of the policy document.

Turning to institutional change, there is a strong vein of anti-quango rhetoric running through both Conservative and Lib Dem policy statements and manifestos. This could prove dangerous to the survival of bodies such as the Infrastructure Planning Commission and the Homes and Communities Agency. The former is widely seen in development circles as crucial to securing planning consent for difficult infrastructure schemes. The latter proved highly effective in mitigating and helping to reverse the impact of the recession in the housing sector. Sadly the impressive track record of its Kickstart, Homebuy Direct and National Affordable Housing programmes may not be sufficient to save it from the ideologically driven quango cull.

Of equal concern to the housing sector will be the “localist” agenda which featured prominently in Lib Dem and Conservative manifestos. Abolition of regionally determined targets for housebuilding and their substitution with the untested and heavily criticised set of proposals put forward by Grant Shapps, the new housing minister, in the run-up to the election, could have a very damaging effect on the delivery of land and planning consents for housing. It could also damage the confidence of a sector recovering only tentatively from a deep recession. A complication here is the parliamentary timetable. It is relatively easy to stop things happening, but getting new structures in place takes a long time. Legislation usually requires 9-12 months to get through both Houses of Parliament, and implementing new planning systems is a notoriously long-winded process.

It is relatively easy to stop things happening, but getting new structures in place takes a long time

 

Another election could well intervene before any new planning procedures begin to operate. This could prove damaging to a homebuilding recovery.

One refreshing change in the formation of the new government has been the absence of wholesale changes to the responsibilities and designations of government departments. Apart from a (rather pointless) renaming of the Department of Children, Schools and Families as the Education Department, it appears that the existing structures will survive. So we won’t have to spend ages trying to decipher the new abbreviations! BIS remains responsible for construction and Mark Prisk has been given the ministerial brief, which he covered in opposition. This will be welcomed in an industry that has felt frustrated by the absence of consistent ministerial responsibility in recent years and has found Mark to be a thoughtful, approachable and responsive shadow minister.

Although there is no prospect of a minister with sole responsibility for construction, let alone one who sits in the Cabinet, the continued existence of the chief

construction adviser should help ensure good channels of communication between the industry and government. And Paul Morrell has made good progress on the vital political issue of decarbonising construction, which both coalition partners see as a priority. This at least is one policy area on which cross-party agreement is likely to be sustained.