CPA report reveals that manufacturers experienced a 40% increase in energy prices over last year

Increases in energy prices are threatening the schools and hospitals programmes in the UK by adding £1.62bn to the cost of construction products in the last year.

A report by the Construction Products Association shows that product manufacturers and suppliers have experienced an average increase of 37% in gas prices and 42% in electricity prices on the last 12 months.

CPA chief executive Michael Ankers said: “The impact of this is being felt across the whole of the construction industry. UK companies have also experienced far sharper increases in energy prices than their competitors on the continent and this is having an adverse effect on the competitiveness of companies in the UK.”

The survey said that the problem did not look set to end as gas pieces were expected to increase by a further 21% and electricity prices by 13% in the next 12 months.

Ankers said that the extra energy costs were equivalent to the cost of building 17 major hospitals, 65 schools in the Building Schools for the Future programme, or 11,000 new social homes.

“Spiralling energy prices are set to add £2.4bn to the cost of construction in this country over a two year period, 40% of which falls directly on the public sector as the industry’s major client,” he said.