Page 39 - Contractors World -UK & Ireland Vol 2 No 4 (May 2012)

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Page 39
Contractors World - UK & Ireland Vol 2 No 4
Fuel Costs Threaten
Infrastructure Recovery
Rising fuel costs are putt ing a f ledgl ing
recovery in the infrastructure sector at
risk, according to the UK’s civil engineering
contractors.
The 12 t h annua l C i v i l Eng i nee r i ng
Contractors Association (CECA) costs trend
survey has been published. The survey shows
that the cost of fuels continues to race well
ahead of general inflation in the economy,
putting companies delivering improvements to
the UK’s transport and utility networks at risk.
In April CECA members from across the
country provided detailed information about
how their costs for 20 key inputs have changed
over the course of the last year.
T h e s u r v e y r e v e a l e d t h a t , wh i l e
employment cost inflation is well below the
historic average, prices for the diesel and gas
oil that power the industry have continued to
escalate, up an average of 8.5 and 8.4 per cent
respectively.
While this represents a slight reduction
on last year’s figures (10.4 per cent for both
fuels), the rises are still far in excess of general
inflation in the economy. With tender prices
only just starting to rise again after three
years of steep falls, the impact of these fuel
price rises continues to squeeze struggling
contractors’ margins.
Commenting on the results, CECA director
of external affairs Alasdair Reisner said, “the
government has correctly recognised that the
infrastructure sector will play a central role in
rebuilding the economy, reducing congestion
and improving the delivery of services to
businesses around the UK.
“However, while much is being asked of the
industry in terms of delivery of these essential
infrastructure improvements, the companies
involved are seeing sharp cost increases
at a time when their tender prices remain
depressed.
“While industry will seek solutions to this
squeeze, it cannot sustain this situation for the
long-term.
“Over the coming months CECA will be
seeking to work with government and others,
to consider potential innovative approaches
to tackle fuel cost escalation for the sector.”
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