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New construction activity has fallen back into contraction, according to figures released today by industry analysts Glenigan.

The value of new projects starting on site was 4% lower than a year earlier during the three months to November. Housing, non-residential and civil engineering starts were all scarcer during the period compared to this time last year.

The amount of new commercial and industrial work was flat on a year earlier during the latest period. Growth in the industrial and hotel and leisure sectors offset falling starts of both office and retail schemes.

Commenting on this month’s figures, Allan Wilén, Glenigan’s Economics Director, said: “The latest evidence on commercial construction starts is disappointing given the continued strength of the economic backdrop.”

“However the forward pipeline is much more positive. In the office sector, for example, the value of work achieving planning approval has risen by more than 50% during the last three months.”

Less surprisingly, the public sector is continuing to hold back growth. The value of the health sector is forecast to fall by a quarter during the course of 2015 alone: during the latest three months starts were almost 50% down on a year earlier. The education sector is also in decline. Despite schools funding overall being ring-fenced, government capital programmes do not seem to be making a huge impact on the ground.

Private housing activity grew modestly, up 2% on a year ago. This rise was more than offset by the drag from the social housing sector, where starts were 9% down on a year ago. The sector is bracing itself for three years of reductions in rents. Plans for increased support of housebuilding have been aimed squarely at increasing home ownership, bringing little relief for the rented accommodation model championed by Housing Associations.

According to Mr Wilén: “The Chancellor’s Autumn Statement pledges on housing appear to be a further boon to the private housing sector. In the short term, activity may undergo a pause as developers assess how best to reap the potential rewards.”

The civil engineering sector also saw an 8% annual decline in starts, as growth in utilities work was unable to offset contracting infrastructure starts.

Most parts of the UK have been dragged backwards by weakening commercial and public sector construction. Northern England and the Midlands have led growth through 2015. However only West Midlands and the North East have stayed in the black; the North West, Yorkshire and the Humber and the East Midlands have all moved into decline in the latest figures.

London and the South East, by contrast, have returned to growth after being hit especially hard by an election hiatus and the slowing in the housing market earlier this year.

No such change in fortunes for the UK’s other constituent nations: Scotland, Wales and Northern Ireland have all failed to record growth since March 2015.

The section of HS2 that connects Birmingham with Crewe is now set to open six years ahead of the original schedule in 2027.

This announcement follows last week’s Autumn Statement revealing that the overall cost of HS2 is now rising to over £55bn, £5bn more than the projection made two years ago of £50.1bn.

In the Autumn Statement the Chancellor also announced £200 million to support the operations of Transport for the North (TfN) and its delivery of Oyster-style ticketing across rail, bus, metro and trams across the region. He also confirmed at Spending Review 2015 that £13 billion would be spent on transport in the North over this Parliament. TfN and the Department for Transport have also jointly launched their Autumn Report on the Northern Transport Strategy.

Chancellor George Osborne said “bringing forward this part of the HS2 route by six years is a massive step in the right direction for the Northern Powerhouse where high speed rail will play a big role in connecting up the entire region with the rest of the country.”

HS2 Ltd Chairman Sir David Higgins added “This is another significant milestone in the development of Britain’s high speed rail network. By accelerating the second phase between Birmingham and Crewe, we will bring the capacity, connectivity and regeneration benefits of HS2 to the North-West and Scotland years earlier than originally planned. It has also been very gratifying, as we develop the plans for Phase Two, to see a consensus grow among the city regions in the East Midlands and Yorkshire on the siting of future hub stations at Toton and Leeds city centre respectively. We all recognise the huge contribution this infrastructure investment can make in helping to rebalance our economy.”

The plans, coined ‘Phase 2a’, is raising concerns among those who disagree with the building of a High Speed Rail in Britain. Many feel that bringing forward the completion date for just 40 miles of track will surely raise questions as to whether if HS2 is built, it would ever get further than Crewe.

Stop HS2 Campaign Manager Joe Rukin criticised the announcement, saying “the supposed ‘fast-tracking’ of the route to Crewe, coupled with the rising costs of HS2 and real problems with the practicality of the rest of the proposed route, will surely lead many to conclude HS2 would never get further than Crewe. Far from showing a commitment to the North of England, going ahead with this proposal punts the links to Manchester, Yorkshire and the East Midlands firmly into the long grass, and if being a rail hub equaled economic prosperity, Crewe would already be the most prosperous town the the country.”

“HS2 is abysmal value for money, and the increasingly dogmatic support for this white elephant and its’ spiralling costs is completely unfathomable. The costs of HS2 went up 11% in the Autumn Statement and with trains not due to run for over another decade, who knows where the cost of this vanity project will end up and what else will have to be cut to pay for it? A responsible chancellor would be asking serious questions about whether HS2 is really worth it, not chucking more money at a boondoggle which would only benefit the richest in society. This is simply rewarding chronic mismanagement, and signalling that there is no need for budgetary control when it comes to HS2.”

Recent studies by the Federation of Master Builders (FMB) have suggested that a third of small construction firms are actually being put off from offering apprenticeships due to the bureaucracy involved. The report, entitled “Defusing the skills time bomb”, explains further.

Chief Executive of the FMB, Brian Berry commented “The construction industry is in the midst of a skills crisis which can only be solved if more employers take on apprentices. The Government wants to deliver three million apprentices over the next five years and this new report sheds some light on how this can be achieved. Our research shows that 94% of small construction firms want to train apprentices but a third are being turned off by a number of serious “fear factors”. These include the cost of employing and training an apprentice and major concerns regarding the complexity of the process.”

“There is strong evidence to show that small construction firms need better information and that if they were more aware of the support that’s available, a great number would train apprentices. Just under 80% of non-recruiters are not aware of one of the most important apprenticeship grants available to them and just over 75% say knowledge of financial support would make them more likely to take on apprentices.”

“Given that two-thirds of all construction apprentices are trained by SMEs, it is critical that the Government does everything in its power to remove any barriers that might be stopping these companies from training. Looking ahead, the Government’s new apprenticeship voucher could be a disaster for small firms unless it is properly road tested and made as simple and easy-to-use as possible. We’re also calling on the Government to protect our industry training board which is at risk from the new Apprenticeship Levy. The Construction Industry Training Board (CITB) needs reform admittedly but without it the very smallest firms would be left with less financial and practical support for apprenticeship training – remove this lifeline and you risk worsening the skills crisis.”

The FMB isn’t the only body voicing concerns over announcements made in the Autumn Statement. The British Chamber of Commerce have also called for greater clarity on the apprenticeship levy.

Executive Director of Policy at the British Chambers of Commerce (BCC), Dr Adam Marshall said “Businesses want to tackle skills shortages and drive up productivity, but the apprenticeship levy risks having the reverse effect.”

“A lack of clarity around the scope, rate and scale is having a huge impact on business confidence. Many firms have decided to put training and investment on hold, and are concerned about the knock on effects of the levy on their cash flow, existing training schemes, and the bottom line. It’s important that this levy doesn’t undermine other types of vocational training, which could be better suited to some businesses.”

“While businesses back the government’s drive to boost apprenticeships, they have real concerns about the current approach. The government must focus on improving the quality of apprenticeships to make them more attractive to employers, and provide clarity on how they will be paid for as soon as possible.”

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In the wake of today’s statement, the industry is currently abuzz with chatter about whether Osborne’s plans will affect the housing sectors for better or worse. Here is what some of the big names in housing are saying regarding the latest spending review.

Skills shortage threatens 400,000 home target

The construction skills shortage could scupper the Chancellor’s vision for 400,000 new affordable homes, warns the Federation of Master Builders (FMB) in response to today’s announcements in the Spending Review.

Brian Berry, Chief Executive of the FMB, said “Faced with some difficult decisions regarding public spending cuts, today the Chancellor was right to ‘choose housing’ by prioritising investment in new affordable homes. The Government has confirmed plans to build 200,000 starter homes with 20% discounts for under-40s, 135,000 shared ownership homes, 10,000 rent-to-buy homes and 8,000 specialist properties for the elderly and disabled. This amounts to a £7bn public investment in new homes – a concerted effort to give aspirational home owners a helping hand onto the housing ladder.”

“Nevertheless, ‘George the Builder’ will need a new generation of ‘real’ builders to make his vision for housing a reality. We’re already seeing housing developments starting to stall because the cost of hiring skilled tradespeople is threatening to make some sites simply unviable. Unless we see a massive uplift in apprenticeship training in our industry, there won’t be enough pairs of hands to deliver more housing on this scale. That’s why we’re keen for the Government to tread carefully when applying the new proposed Apprenticeship Levy to the construction industry.”

“The Chancellor clearly recognises that the crisis of home ownership is inextricably linked to a crisis in house building. We therefore hope that in order to address both, the Government will do everything it can to increase house building capacity. SME developers will have an important role to play in delivering the smaller scale sites across the country. The last time we built in excess of 200,000 homes in one year was in the late 1980s when two-thirds of all homes were built by small developers. SME house builders now only build little over one quarter of all new homes which points to another serious capacity issue – we need more small house builders to enter the market and also for SME house builders to crank up their delivery of new homes in order to build the Chancellors 400,000 new affordable homes.”

Planning reform is needed

Greg Hill, Strategy and Change Management Director at Hill, said “Extra funding for starter homes is great news for prospective homebuyers, and will undoubtedly help to get more first time buyers and young families on to the housing ladder. Shared ownership properties too are a great way for young people to buy a home without a large deposit. It is certainly the case that the size of deposit required to buy a home acts as a major barrier to first time buyers entering the housing market and these initiatives will go some way to addressing the problem.”

“However, it still remains that a crucial issue over the coming years will be whether the UK housing industry is structurally able to supply the volume of homes needed to meet government targets. Planning reform, as well as greater investment in skills and training for careers in construction, are essential if the industry is to deliver the extra homes in the timeframes that Britain needs. We have a rapidly ageing workforce, with many tradesmen and skilled professionals due to retire in the next few years – the industry may struggle to deliver these 400,000 new homes if the gap in capacity is not filled.”

“If the industry is to build more homes, we also need to ensure that council planning departments have enough resources to make quick decisions on planning applications. The budget cuts that have also been announced today as part of the spending review could have an impact on local authorities’ ability to make decisions quickly.”

Lack of confidence in conservatives

Steve Sanham, development director at HUB Residential, said “With the government promising to subsidise homeownership for the masses, the Chancellor has effectively admitted that it can’t get the housing market under control. It appears that the housing policies of the past few decades have been an utter failure.”

“The problem hasn’t been a lack of ‘affordable housing’, rather a lack of affordability in general. Investment in infrastructure to bring new areas on line for development, and freeing up the bureaucracy of the planning system, are the only ways to bring ‘market homes’ within the reach of first time buyers. New headline grabbing affordable housing initiatives smack of more short-termism, and an inability or unwillingness of the government to grasp the big issues.”

‘Crisis Brewing For Social Housing’

Matthew Hyam, partner at BLM said “While targeting housing benefit directly might drive down the welfare bill in the short term, it will inevitably intensify the problems facing social landlords in building new affordable homes.”

“Although the Chancellor has made a huge £7bn commitment to affordable housing in this Statement, the impact of cuts on the social sector has already been immense. In the face of further financial difficulties, there will inevitably need to be a clearer focus on tenant support and arrears enforcement in order to ensure financial viability.”

“The social housing sector has been learning to cope with the effects of welfare reform for some time now and, with the dust barely settled on rent reductions and universal credit, social housing providers are in a more precarious position than ever.”

Positivity on housebuilding

Stewart Baseley, executive chairman of the Home Builders Federation said “The Government is clearly committed to increasing both housing supply and home ownership. Measures introduced in recent years have led to a big increase in house building levels but the scale of the challenge requires further action to close the gap between demand and supply. The Chancellor’s announcements today will provide extra impetus to deliver further increases in housing supply.”

Peter Quinn, Lovell director of business development said “We welcome any stimulus that will increase the supply of housing in this country. There are many parts of the country where we see great housing need and these measures will undoubtedly assist people onto the housing ladder, ‘Starter Homes’ will especially help the firs- time buyers wanting to purchase a Lovell home. However, we remain concerned that even this initiative will remain out of reach for those that cannot afford home ownership, and we need to continue to develop affordable rented housing especially in high value areas.”

Greg Hill, Strategy and Change Management Director at Hill, said “Extra funding for starter homes is great news for prospective homebuyers, and will undoubtedly help to get more first time buyers and young families on to the housing ladder. Shared ownership properties too are a great way for young people to buy a home without a large deposit. It is certainly the case that the size of deposit required to buy a home acts as a major barrier to first time buyers entering the housing market and these initiatives will go some way to addressing the problem.”

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Housing experts from De Montfort University Leicester (DMU) are teaming up with a 91-year-old tenant and a leading housing organisation to help architecture students design homes of the future.

Leicester School of Architecture and DMU’s Centre for Comparative Housing Research (CCHR) are working alongside social housing and care provider emh group and extra care scheme tenant Mona Walkden, 91, to comment on the proposals of Architecture students for an international competition.

The European Federation of Assisted Living is challenging Architecture students to design new homes for the elderly.

By 2060, more than half of Europe’s population will be past retirement age – a fact which presents huge challenges to the housing sector to ensure homes are fit for purpose, accessible and affordable.

To help students understand the issues, April Knapp, regional development manager of emh group, and 91-year-old tenant Mona Walkden came to DMU to talk to students about design and needs of tenants for a special session.

Mona, who lives in Leicestershire, said “I found it very interesting. I think atmosphere is so important and my feeling as that I would like them very much to look at fitments and see how difficult it is for elderly people in wheelchairs to use sinks and open cupboards as often there are problems.”

“I’m very fit for my age but I live with people who are disabled and it gives you an insight into the problems they face. I feel that my job is to try to get the best living accommodation that you can possibly get for tenants.”

Chan Kataria, emh group Chief Executive, said “With an ageing population, the need for more suitable housing for the older generations has never been more acute.”

“We have started to address the situation with Oak Court, our extra care scheme in Blaby, Leicestershire, which is pioneering health and housing integration, but thousands more homes are needed across the country in order to meet the future needs of a rapidly changing society.”

Dr Jamileh Manoochehri, from the Leicester School of Architecture welcomed the invitation from Prof Richardson to take on the task of designing for an aging population.

Dr Manoochehri said “The Architecture students are considering what constitutes dwelling and they are taking up the challenge of designing accessible dwellings that continue to feel like home. “

“Each student is working on a different approach, some are concerned with overcoming the physical limitations that come with aging and others are investigating means of countering the isolation of the aging population by making use of the typology of the courtyard, or by designing homes that accommodate pets; and by establishing natural links between the interior and the natural world outside.”

Professor Jo Richardson, director of DMU’s CCHR, approached emh group to help set up the event. The CCHR has carried out research on the future of housing and in particular highlighted the increasing need for affordable rental accommodation.

Prof Richardson said “The changing population demographic is a huge challenge not only for the housing sector but health, business and the economy.”

“This will be an opportunity for our students to learn from Mona and April’s experience and expertise.”

“We are pleased to be able to use our close links with leaders in the field such as emh group to benefit students in their studies.”

Judges will be looking for high-quality ideas which address issues but also fit into people’s lifestyles and allow independent living as far as possible.

Judges will consider entries from across Europe. The winner, who will receive 10,000 Euros in prizes, is due to be announced in March.

See more here.

The construction industry has launched new guidance to encourage better management of occupational health risks. HSE is urging the industry to put an end to the hundreds of construction workers that die of occupational diseases every month.

Inspectors issued more than 200 health related enforcement notices during the recent Health and Safety Executive’s (HSE) construction inspection initiative.

This highlighted the widespread misunderstanding of what ‘occupational health’ means in the construction sector and the employers’ misguided perception that health is more difficult to manage than safety.

The new guide ‘Occupational health risk management in construction’ PDF has been written by the Construction Industry Advisory Committee (ConIAC) Health Risks Working Group and formatted with the assistance of the Institution of Occupational Safety and Health (IOSH).

It gives practical advice on what ‘health risk’ means for the construction industry, and the role of occupational health service provision in preventing or controlling those risks.

Ian Strudley, Chair of the ConIAC Health Risks Working Group and HSE Principal Specialist Inspector said “The misunderstanding of occupational health within the construction sector means that whilst the industry focus on managing the more familiar safety issues, serious health risks get ignored. We cannot let this continue.”

“When figures show that construction workers are at least 100 times more likely to die from a disease caused or made worse by their work as they are from a fatal accident, the industry must take action.”

Shelley Frost, Executive Director – Policy at IOSH said “There have been huge advances in improving safety in the construction sector over the last 15 years but the industry has yet to generate such advances in improving the picture in occupational health.”

“Every week, 100 people die from construction-related ill health in the UK. Less than half of construction workers also stay employed in the industry until they are 60.”

“This new guide raises awareness of the occupational health issues in construction, demystifies how to best manage them and provides information as to where firms can get help and assistance.”

“Ultimately, if the advice is followed, it could help to lower incidence rates of occupational ill-health and transform the perception of working in construction to that of an attractive and respectful industry with great career choices.”

The guidance is freely available on HSE’s and IOSH’s website:

http://www.hse.gov.uk/aboutus/meetings/iacs/coniac/coniac-oh-guidance.pdf
http://www.iosh.co.uk/techguide

The Queen has officially reopened the transformed Birmingham New Street station.

Accompanied by His Royal Highness The Duke of Edinburgh, Her Majesty unveiled a plaque marking her visit – the first to New Street in her 62-year reign and her first visit to the city since her Diamond Jubilee tour in 2012.

The Queen and The Duke of Edinburgh were greeted by a host of dignitaries – including Sir Peter Hendy, chairman of Network Rail and Mark Carne, chief executive of Network Rail – after arriving at the station on the Royal Train.

They were shown an exhibition of the station through the ages since it was first built in the 1880s and were introduced to many of those involved in building the latest incarnation. They also met staff who help meet the needs of the 170,000 passengers who use Birmingham New Street every day.

The new station, including the new Grand Central shopping complex, was unveiled in September this year after a five-year, £750m Network Rail project.

Today’s opening ceremony, which took place on the station’s stunning concourse under its vast atrium, included speeches from the Lord Mayor of Birmingham, Councillor Ray Hassall, and Sir Peter Hendy before her Majesty unveiled the special plaque which will take pride of place within the station.

The Queen also attended a short service of dedication, led by the Bishop of Birmingham, The Right Reverend David Urquhart, for the PALS War Memorial outside the new station. The PALS were volunteer soldiers from the city who were involved in World War I after signing up to the army in September 1914.

Sir Peter Hendy, chairman of Network Rail, said: “It was an honour to welcome The Queen to Birmingham New Street and be part of a very special day for Birmingham. For such an impressive and transformed station, it was fitting that it was officially reopened by Her Majesty.

“Birmingham New Street is helping to boost the regeneration of the city centre as well as provide the millions of passengers who use it with a modern, 21st century station. With the Grand Central development above it, it is a unique station which is vital to the continued development of Birmingham and the wider region.

“Our Railway Upgrade Plan is providing a better railway for passengers and this station is the latest example of how these improvements are benefiting millions of people and helping boost our economy at a local and national level.”

Transport Secretary Patrick McLoughlin, who attended the reopening, said: “Birmingham New Street is a truly remarkable development that is not only providing better journeys for passengers, but also driving economic growth and regeneration across the West Midlands and beyond.

“This is just one example of the record investment we are making in the rail network across the UK as part of our long-term economic plan.”

Chris Montgomery, Network Rail’s project director who oversaw the redevelopment of Birmingham New Street, said: “The Queen officially reopening Birmingham New Street station is the culmination of many years of hard work by thousands of people involved in the project. This is a proud day for the project team, for Network Rail and for Birmingham.”

Sir Albert Bore, leader of Birmingham City Council, said: “Birmingham New Street station has undergone a magnificent transformation and, together with the Grand Central development, has transformed the gateway to our city.

“I am confident this project will pave the way for continued regeneration, creating many more jobs and opportunities for the people of Birmingham.”

The Queen and Duke’s visit was broadcast on the station’s largest ‘media eye’ at the front of the station for the public to watch while many also gathered inside.

The redeveloped Birmingham New Street station opened its doors to passengers on 20 September 2015 after a five-year, £750m transformation.

Boasting an iconic new atrium over a huge passenger concourse – five times the size of London Euston’s – the station has been rebuilt while trains continued to run as normal for the 170,000 passengers a day who use it.

With brighter, de-cluttered platforms, improved entrances, a range of new facilities and an abundance of natural light over the new concourse, Birmingham New Street, one of Britain’s busiest inter-change stations, is also a retail destination in its own right.

The new station will eventually feature 43 shops at concourse level. Above it sits the new Grand Central shopping complex, including one of the UK’s largest John Lewis department stores.

Many workers at a Celsa Steel plant have sustained injuries following a ‘deafening’ blast at the plant that shook nearby buildings.

Six fire crews were sent to tackle the blaze in the basement of the plant, on East Moors Road in Cardiff.

Workers at the plant told Wales Online the explosion was “very loud, deafening”. One worker commented “We were just in the office we heard a huge explosion and the whole building shook we all went to get out of the building.” Another added “There was a big bang, a big boom of smoke and that was it.”

An anonymous local businessman told the BBC:

“We heard a very loud explosion and then saw smoke coming up. It was a massive explosion, really something. The building we are in shook. We are only 100, 200 yards away from where it happened.”

The chief operating officer for Cardiff and Vale University hospital, Alice Casey stated “We have implemented our protocols for supporting major incidents and our teams are preparing to treat those injured.

“There may be delays for non-urgent patients attending the emergency unit at University hospital of Wales and we would ask the public to think carefully if they need to attend the unit and to make use of other health services.”

Celsa directly employs 725 people at its Cardiff site and supports around 3,000 jobs.

The North West residential sector saw a significant boost in the number of new build properties commissioned in Q3 this year, leading all regions with 5,275 units.

According to the latest Market Insight report from construction data experts Barbour ABI, £621 million pounds worth of property development was commissioned in Q3, with £608 million from the private sector. This is a significant figure that will likely provide a boost in confidence across the industry and region, as investors are giving the go-ahead to a significant amount of residential projects.

Greater Manchester had the leading amount of residential investment in Q3 within the North West, with major projects commissioned including two city centre £40 million projects, the New Union Street and Axis Tower developments, constructing 302 & 172 apartments respectively.

Six of the top ten largest residential projects commissioned in the region in Q3 were private developments for flats, which has been a major area of residential growth within the region.

Commenting on the figures, Michael Dall, Lead Economist at Barbour ABI, said “With a lack of housing across the North West heavily publicised, it’s welcoming news that the region leads the UK for new build units in Q3.”

“With the mismatch between housing supply and demand, property prices have continued to rise at a significant pace in the region. Home movers, investors and housebuilders will welcome the news, as major residential investment has been poured into the North West in the last quarter, which will hopefully help to alleviate the housing shortage.”

“If there’s one concern coming from these latest figures it is from a social housing perspective. Only ten of the 87 projects came from the public sector in Q3, however it’s likely that affordable housing will be provided within many of the up-coming private residential developments.”

News that we are experiencing strong growth in constructing has been brought into disrepute by new figures released by the Office for National Statistics (ONS).

The Markit/Cips Purchasing Managers’ Index for construction that was released last month clearly indicated a reassuring reading of 58.8; 50 being the point which separates expansion from contraction. Whilst down from 59.9 recorded in the previous month, the report still highlighted strong growth in construction, an industry that is accountable for around 6% of the UK’s GDP.

However, the latest GDP estimate made by the Office for National Statistics revealed quite the opposite to that being reported by Market/Cips, suggesting that construction output actually reduced by 2.2% in the three months to September.

So which report is right!?

Chief UK and European Economist for IHS Global Insight, Howard Archer commented the clear contradictions between the reports raised “considerable doubts” about the overall accuracy of the official construction data given by the ONS. He pointed out that other data compiled by Bank of England regional agents on construction also pointed towards growth within the sector, rather than reduction.

Vice President and Senior Economist of Markit, Tim Moore reaffirmed their own results, saying “The sector remains in rude health. Rather than acting as a drag on the economy, as suggested by recent GDP estimates, the sector is continuing to act as an important driving force behind the ongoing UK economic upturn.”

The ONS had been due to release a report comparing their own figures and those of Markit on 11 September, but this had to be cancelled for “operational reasons”.

Mark Robinson, the chief executive of the Scape Group warns that regardless of whether the industry has experienced growth or not this year, something must be done to attract new talent into construction if we are to sustain a healthy and vibrant industry long-term. He said “Much of the skilled workforce is due to retire in the next five to 10 years and if we can’t train enough new talent to replace them, the construction industry will struggle to deliver the new homes and infrastructure that both the community and the economy badly needs.”