Little more than 24 hours after the Prime Minister’s resignation has brought further uncertainty to the country and to UK construction in particular, we sought the early views of leading industry figures as to what the repercussions for the sector could be.
Kelly Boorman, National Head of Construction at RSM UK:
“Starmer’s resignation doesn’t come as a shock to the market, however, it does bring further political uncertainty for the construction industry. Projects committed to in the short term are unlikely to be impacted, but mid and longer-term infrastructure priorities, housing targets and potential policy changes could create additional uncertainty for the industry. Investors are likely to pause decision making, and government may delay decisions on major project spend. With pipelines already seeing contraction, and many businesses re-assessing viability of development as a result of the Middle East conflict, further political uncertainty will only add to delays in decision making and delivery of projects, creating additional instability in supply chains.”
Nathan Emerson, CEO at Propertymark:
“Housing must remain at the heart of the political agenda. Landmark reforms continue to progress through Westminster, and they must deliver on their promises.
“We have seen some of the most significant changes to the rental sector in over 30 years with the implementation of the Renters’ Rights Act, alongside a commitment to build 1.5m new homes to meet growing demand.
“Meeting future housing requirements requires clear political ambition and consistent leadership, especially as we embark on further reforms to the home buying and selling process.
“Propertymark will continue working closely with the UK Government to help deliver positive change for current and future generations. However, concentrating on the ‘here and now’ and ensuring consistency must be the core priority as any leadership transition proceeds.”
Bradley Lay, TrueNorth Capital Group founder:
“The immediate concern for construction firms isn’t necessarily who replaces Keir Starmer, it’s the paralysis that leadership transitions create. Major infrastructure decisions, planning reform and investment programmes often stall while everyone waits for clarity.”
Lay believes many firms are underestimating the combined impact of political uncertainty, changing cost dynamics and weaknesses within traditional contracting models.
“The reality is we’re seeing three structural shifts happening simultaneously.
“Firstly, political uncertainty creates hesitation across the market. Developers, investors and lenders all become more cautious when they don’t know what future tax policy, regulation or public spending priorities might look like.
“Secondly, energy prices have fallen sharply following the end of the conflict in Iran, but supply chains haven’t yet caught up. Tender prices are still reflecting higher material costs which creates opportunities for firms with strong supplier relationships and disciplined procurement.
“Thirdly, and perhaps most importantly, the repeated collapse of major contractors demonstrates that parts of the traditional main contractor model are fundamentally broken.
“These failures aren’t isolated incidents. Too many businesses are chasing turnover rather than profit, relying on wafer-thin margins and using supplier credit as working capital. Eventually that catches up with them.
“Having reviewed hundreds of businesses through our own acquisition pipeline, there is a clear pattern. Specialist subcontractors with strong balance sheets, recurring relationships and proprietary expertise are proving far more resilient than large volume-driven contractors.”
“Nobody knows exactly what the next six or twelve months will look like politically. But successful businesses aren’t built around predicting the future perfectly. They’re built around being able to absorb uncertainty when it arrives.
“Political uncertainty will eventually pass. Material prices will stabilise. More businesses, unfortunately, will fail. But the companies that thrive will be those with strong balance sheets, predictable cash flow and management teams that understand the difference between revenue and profit.”
Through TrueNorth Capital Group, Lay is actively acquiring specialist businesses operating across MEP, external envelope and facades, and manufacturing and offsite construction.
“Our acquisition criteria are simple. We look for predictable cash flow, defensible market positions and management teams with long-term thinking.
“Strategies that depend on political stability, cheap materials or competitors remaining solvent aren’t strategies at all. They’re dependencies.
“The firms that emerge strongest from the next few years will be those that build operating models capable of handling uncertainty rather than hoping uncertainty disappears.”
Brian Berry, Chief Executive of the FMB:
“Over the course of Sir Keir Starmer’s time as Prime Minister it was welcome to see a pro-building agenda placed at the heart of his government’s plans. But words only go so far, and ambition has not yet resulted in delivery on the ground. Small builders continue to face tough trading conditions, with rising costs, employment troubles, planning delays, weak consumer confidence and stalling housing numbers all holding back growth. The next Prime Minister must keep the nation’s small builders at the heart of the Government’s work. They will need a much stronger focus on delivery, cutting barriers to building, and creating the conditions for small local firms, who make up the majority of the industry.”
Neil Carberry, Chief Executive of the Recruitment and Employment Confederation:
“More change in Whitehall could be a challenge to the stability firms need, but business are adept at getting on with it. Whoever is Prime Minister, one thing will remain true though: only private sector growth can address the fiscal challenges the government faces and put money in the pockets of people across the country. What firms really need is a government that will back them to deliver growth, rather than making trading more difficult by heaping up ever more regulatory and taxation costs. That means making sure that government works with business to achieve its aims, rather than imposing solutions that sound good to Westminster think-tanks and more radical union leaders, but do not help ordinary workers and companies who are trying to drive the country forward. Pragmatism on the unworkable approach to guaranteed hours set out by the Employment Rights Act would be a good first step in working out whether any new Prime Minister really has growth and prosperity at the heart of their plan.”
Neil Louth – Group Executive Director, LRG and CEO, Acorn Group:
“Whether Andy Burnham becomes Prime Minister or not, the priorities are clear: build more homes, reform Stamp Duty, support aspiration and create the conditions for growth. The country does not need political slogans; it needs practical leadership that delivers results. If we can increase housing supply, remove barriers to moving and restore confidence, the benefits will be felt across the entire economy.”