The announcement of GDP growth masks the perilous state of the building industry as construction activity fell by 4.7 per cent which is dragging down the UK's economic recovery, says the Federation of Master Builders (FMB).

Brian Berry Director of External Affairs at the FMB said: "Unfortunately, the figures do not come as any surprise to the FMB as the SME construction sector is now in its fourth year of falling workloads with little hope of recovery in the immediate future. If the Government is serious about creating new jobs in the private sector it will have to do more to reverse the worrying decline in construction. This is the sharpest decline in construction activity since the first quarter of 2009, which is bad news for the Government’s growth agenda."

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Berry continued: "House building is still at an all time low. Last year 102,000 new homes were built which is fewer than half the number required to meet the demand from household growth. The need to retrofit our existing building stock to meet the UK’s carbon reduction targets offers some hope in the near future but unless the proposed Green Deal initiative is underpinned by a range of fiscal measures such as a cut in the rate of VAT and Council Tax reductions it is very unlikely that this will actually translate into more construction jobs."

Berry concluded: "The Government needs to recognise that every £1 spent on construction generates £2.84 in total economic activity. It’s a false economy not to invest in our future and create the conditions for growth because without a vibrant construction industry the UK won’t have the infrastructure that it needs to compete in a global economy."

(CD)