Business
Construction output falls
RISING costs and uncertainty relating to Brexit are to blame for the sharp drop in output growth in January 2019, the Federation of Master Builders (FMB) has said in response to the latest Purchasing Managers’ Index data (PMI).
The Chartered Institute of Purchasing and Supply (CIPS) Construction Purchasing Manager’s Index incorporates survey results provided by construction firms throughout the country.
A reading above fifty suggests the construction sector is expanding, while a reading below fifty suggests the construction sector is in contraction.
The January 2019 PMI data revealed a fall from 52.8 in December to 50.6 in January, against the neutral reading of 50.0. January data pointed to a loss of momentum for the UK construction sector, with business activity growth grinding to its weakest for ten months.
All three categories of construction output recorded weaker trends than those reported in December.
Residential work was the strongest performing area, although the latest expansion was only modest and the slowest seen since March 2018. Civil engineering activity increased marginally, with the rate of growth much softer than December’s 19-month high.
Commercial work was the weakest performing area of construction output in January. Latest data indicated a decline in work on commercial construction projects for the first time in ten months. Anecdotal evidence suggested that Brexit-related anxiety and associated concerns about the domestic economic outlook continued to weigh on client demand.
New business growth eased to an eight-month low in January.
Construction firms widely commented on softer demand conditions and longer sales conversion times, reflecting a wait-and-see approach to spending by clients. Concerns about the near-term outlook for new projects resulted in more cautious staff hiring policies at the start of 2019. The latest survey pointed to the slowest rise in employment numbers since July 2016.
However, construction firms remain positive about the outlook for business activity in 2019. Around 41% of the survey panel anticipate a rise in output, while only 16% forecast a fall.
Optimism had, however, fallen month on month. Large-scale civil engineering projects were cited as a key source of optimism, while Brexit uncertainty was the most commonly cited concern.
Tim Moore, Economics Associate Director at IHS Markit, which compiles the survey: “UK construction growth shifted down a gear at the start of 2019, with weaker conditions signalled across all three main categories of activity.
“Commercial work declined for the first time in ten months as concerns about the domestic economic outlook continued to hold back activity.
“The latest survey also revealed a loss of momentum for house building and civil engineering, although these areas of the construction sector at least remained on a modest growth path.”
Duncan Brock, Group Director at the Chartered Institute of Procurement & Supply said: “The sector suffered a sharp drop in output growth in January, and the softest rise in purchasing volumes since September 2017, as Brexit continues to hamper progress and dampen client confidence.
“The biggest shock came in the form of job creation which has managed to suffer the slings and arrows of Brexit highs and lows with solid hiring since the referendum result. Employment rose at the slowest rate since July 2016 and with optimism also in short supply, the sector only needs a small nudge to tip it closer to a recession.”
Commenting on the results, Brian Berry Chief Executive of the FMB, said: “The latest PMI data show a slowdown in growth in construction with business activity growth easing to its weakest for ten months. The ongoing political uncertainty is partly to blame for this setback.
“Political uncertainty is the enemy of construction firms that rely on the spending power of homeowners to commission home improvement projects. The UK is set to leave the EU next month, and yet we are still none the wiser about what the future holds. Given these intense headwinds, it should not be surprising that the sector suffered such a sharp decline.”
Mr Berry continued: “Alongside the political uncertainty, the cost of doing business is also rising for construction firms up and down the country. Material prices have been rising steadily since the depreciation of sterling following the EU referendum.
“Looking ahead, material prices are expected to continue to cause a headache for the construction industry with recent research from the FMB showing that 87% of builders believe that material prices will rise in the next six months. What’s more the construction skills crisis means that key trades are extremely difficult to recruit and the upshot of this is rising wages in construction.
“Tradespeople know they can command higher salaries than they did previously as workers are scarce, and this means a squeeze in margins for firms. This will only worsen if the post-Brexit immigration system that the Government has planned goes ahead.
“If the sector isn’t able to draw upon crucial EU workers of all skill levels, who have so far served to mitigate this shortage, the slowdown of growth will continue.”
Business
Welsh Water slammed after thousands were left without water
DWR CYMRU has been slammed by a councillor who warned people “could have died” after thousands were left without water.
Tens of thousands of residents across the county were left without water after a mains burst at a treatment plant in Dolgarrog last week.
Welsh Water said supplies were restored to homes and businesses on Monday morning.
The chairwoman of Conwy’s finance committee slammed Dwr Cymru during a meeting at the council’s Bodlondeb HQ on Monday.
Old Colwyn councillor Cheryl Carlisle thanked volunteers and council staff for pulling together before calling for a public inquiry into the crisis.
Security guards
Cllr Carlisle claimed those in poor health had been left without water and said security guards at water stations had turned people away with small children.
“I’d like to take the time to thank everyone that’s being involved in the crisis in Conwy over the last six days, the selfless volunteers, everyone that provided water and help to the elderly and vulnerable, and also the engineers for fixing the problem and our social care staff and the other staff who have helped keep our nursing homes going, our care homes, and (looked after) the most vulnerable,” she said.
“On a different note, there will need to be an inquiry, won’t there, into the crisis response from Dwr Cymru.
“You cannot fault the engineers, but the delays in basic organisation, like setting up the water stations.
“It was 48 hours in my particular community. Without the volunteers, it would have been very, very serious, indeed, for those with health conditions.”
She added: “The priority lists of Dwr Cymru did not work.
“There were people on it that were still undelivered (not had water delivered) as was last night [Sunday], cancer patients, dialysis patients. This is completely unacceptable.
“Security guards turned away members (of the public) with little children. That was absolutely unacceptable as well.
“I think this has brought out the very best in people and, in just a few, the very worst. There needs to be a clear disaster plan going forward.”
Cllr Carlisle then insisted an inquiry was needed after Cllr Goronwy Edwards suggested a review.
She added: “I think it needs to be something more than a review, given the seriousness.
“People could have died, those with (serious health conditions). I don’t think we should downplay anything until everyone has come through this intact.”
Conwy Council leader Cllr Charlie McCoubrey also thanked those councillors and members of the public “who had gone above and beyond to look after their communities”.
He added the authority was now in a recovery phase with some households still without water and some schools affected.
“Clearly, with any major incident, questions need to be asked about could this have been prevented, was the response adequate, and what happens in the future in terms of how we coordinate things and prevent incidents like that happening again?”
Cllr McCoubrey said he was working with Welsh Government to get answers from Dwr Cymru.
Report by Richard Evans, Local Democracy Reporter
Business
Decision due on development of buildings at Trewern Farm
A CALL to let a 950-herd north Pembrokeshire dairy farm keep a farm shed built without permission over a decade ago is expected to be approved later this month.
In an application recommended for conditional approval at Pembrokeshire Coast National Park’s development management committee meeting of January 29, Trewern Farms Ltd is seeking permission for the retention of the agricultural building and lay down area at Trewern Farm, Felindre Farchog.
The application is part of a wider complex planning history associated with the site.
A report for Park planners says: “Trewern Farm is operated as a zero grazing style dairy farm with 304 hectares located on two separate parcels of land, one at Trewern with the remainder being at Penpedwast, adjacent to Castell Henllys. The farm has a dairy herd of approximately 950 cows.
“Trewern Farm has expanded significantly over recent years with many of the buildings and structures on site having been erected without the prior benefit of planning permission, and having since been regularised through a combination of retrospective applications and certificates of lawfulness.
“The building subject of this application is believed to have been constructed in 2014. The site currently comprises an agricultural shed immediately adjoining another shed and is used for cubicle housing.
“A slurry lagoon, silage clamps and 12 of the newer agricultural buildings are now lawful as Certificates of Lawfulness were granted for these whilst the Authority was awaiting an Environmental Impact Assessment to be submitted by the applicants for the 2015 planning application to regularise the unauthorised buildings.
“However, this is the last of the outstanding agricultural buildings which are not lawful, and an enforcement notice was served in May 2018 requiring its removal. This notice was appealed in November 2019 and is currently being held in abeyance by the Planning Inspectorate.”
It says the building referred to in the application “is described as being designed to house cattle in a series of cubicles, and forms part of a longer set of buildings running along the southern section of the farming complex,” adding: “The livestock numbers are not proposed for increase as a result of this application but will be as secured [by a planning consent] restricted to no more than 960 milking cows with 1020 maximum excluding calves.”
Local community council Nevern has previously said it has “grave concerns” about the application, asking, amongst other things, how the 960 cattle limit will be policed and important nearby woodland will be protected.
The application was previously recommended for approval at the park’s December meeting, but was deferred as not all received documentation had been published on the national park’s planning website.
The application is now returning to the January meeting, again recommended for conditional approval.
Business
Castell Howell launches new Food Show at Welsh International Culinary Championships
CASTELL HOWELL has launched a new Food Show, showcasing the food trends and innovations that the hospitality industry can expect to see in 2025 and giving visitors a preview of its growing range of Welsh food and drink products.
The new industry event is taking place alongside the 2025 Welsh International Culinary Championships (WICC) at the International Conference Centre in Newport from 20-22 January.
Castell Howell managing director Matt Lewis said: “The Castell Howell Food Show will be a new highlight in this three-day celebration of Welsh culinary excellence, hospitality skills, and innovation. As the largest wholesale supplier of Welsh Food & Drink, it gives us the opportunity to champion our excellent Welsh producers, to support hospitality customers in developing their businesses and, ultimately, to help our communities and local economies throughout Wales to thrive.
“Visitors will have the unique opportunity to engage directly with Castell Howell specialists representing every aspect of our business from insights into the latest trends, to discovering what’s in the pipeline for Welsh food and drink producers in 2025,” he said.
The Castell Howell Food Show will be a new annual event in the calendar at the start of the year, serving as a preview for its larger established trade shows, hosted at Parc y Scarlets in Llanelli and Parc Eirias in Conwy.
The Welsh International Culinary Championships, organised by the Culinary Association of Wales, bring together the nation’s most talented craft chefs, butchers, and front-of-house professionals for three days of demanding competition. The 2025 WICC also hosts the Skills Competition Wales hospitality finals, showcasing the country’s top apprentices.
Deputy First Minister, with responsibility for Climate Change and Rural Affairs, Huw Irranca-Davies, said:
“These two events promise to be a fantastic showcase for Wales’ food and drink industry. It’s an opportunity to celebrate Wales’ culinary excellence and the strength of our hospitality sector. Castell Howell plays an important role in supporting Welsh farmers, producers and the hospitality sector – and I wish them well with this new event.”
Further information about the event is at foodshow.wales
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