Government warned firms risk collapse unless they get quicker access to cash

The construction taskforce set up to deal with the coronavirus pandemic has told the government it needs to do more to support the industry – or face a mass of insolvencies.

Construction minister Nadhim Zahawi and HS2 minister Andrew Stephenson received the dire warnings on a conference call yesterday with industry representatives, including Suzannah Nichol, the Build UK chief executive, and Balfour Beatty boss Leo Quinn.

The group said: “Everyone was extremely concerned about liquidity and cash flow. Although the government’s financial support was welcomed, it was made very clear that the loans and grants available might not be suitable for everyone or would not reach many businesses in time to save them.”

The call was revealed in BuildUK’s daily coronavirus update for the construction sector.

It added: "Clients and consultants were clear that work on projects in the pipeline must continue, with future construction work being dependent on planning and design work being undertaken now.

"Contractors were particularly concerned about the shortages in supplies of goods and materials, which was causing sites to slow down or stop even where they were able to open."

>> CLC backtracks on new 2m ruling

>> Survey results: How the coronavirus pandemic is affecting construction

Firms also raised issue with the three-week minimum period that applies to furloughing workers, which was preventing construction and manufacturing businesses from calling workers in at short notice or for short periods of time.

Meanwhile, a taskforce has been set up to help support the construction sector through the coronavirus pandemic.

The group, which has been put together by the Construction Leadership Council (CLC), is being backed by the business department (BEIS).

A BEIS spokesperson said: “A working group from the CLC meets daily to help co-ordinate the construction industry response to Covid-19, as part of the Government’s cross-industry engagement around coronavirus."

The members include 12 trade associations representing both large and small firms in the construction sector including contractors, product manufacturers, merchants and associated professional services.

This includes BuildUK, the Construction Products Association and the Civil Engineering Contractors Association, while the group is chaired by CLC chair Andy Mitchell.

Other members include Mace boss Mark Reynolds and Federation of Master Builders chief executive Brian Berry.