Kerry London News

Construction Market Update 2023

Monday 3rd April
Construction Market Update 2023

The latest Purchasing Managers’ Index (PMI) data highlighted increased construction business activity in February. This increase broke two months of decline, and growth was at its highest since May 2022. This was supported by a “marked rebound in commercial work and a positive contribution from civil engineering activity”, according to data compiled by S&P Global and the Chartered Institute of Procurement & Supply (CIPS).

Meanwhile, supplier delays were at their lowest in more than three years, while input cost inflation also eased.  

Contractors partly attributed that to demand for commercial projects increasing again due to the improving near-term economic outlook. Civil engineering also returned to growth, but residential output fell for the third consecutive month.   

The PMI survey also showed that around 46 per cent of respondents expect a rise in activity in the coming year, and only 13 per cent predict a drop. Construction firms also said they’d seen “signs of a recovery in client demand”, despite increasing interest rates and the risk of a recession.  

The Retained EU Law Bill  

There are concerns about the erosion of construction safety standards due to the Retained EU Law Bill (REUL). After the UK left the European Union, thousands of pieces of EU legislation were retained to preserve existing laws. However, legislation going through parliament will see thousands of laws dating from the UK’s membership of the EU automatically expire after December. There is a lot of concern regarding crucial pieces of safety legislation, such as the recently implemented Building Safety Act, being undermined if the regulations that underpin them no longer exist.   

This legislation will automatically replace most retained EU law at the end of 2023, but many UK professional bodies are lobbying the Government to delay the changes until 23 June 2026. A coalition of groups has launched a campaign to prevent the Government from discarding health and safety laws within the construction industry.  

The following legislation could be affected by REUL: 

  • 2015 Construction Design and Management Regulations  
  • Management of the Health and Safety at Work Regulations   
  • Workplace Health  
  • Safety at Work Regulations   

Other measures, such as the Control of Substances Hazardous to Health, asbestos and confined spaces, may be subject to change. Further details regarding affected legislation can be found on the government dashboard 

The Law Society is concerned the Bill could have a devastating impact on legal certainty, making the UK a less competitive business environment. They also say the Bill could damage the UK-EU Trade and Cooperation Agreement (TCA) that many business sectors depend on.

British Safety Council Chief Executive Mike Robinson said:

“Construction and building safety have long been recognised as higher-risk areas.

The Construction Design and Management Regulations 2015 (CDM), which was based on an EU directive, creates a framework for securing the health and safety of people during and after construction projects.

The recent Building Safety Act 2022 (BSA) will soon be supported by new secondary legislation which imposes additional requirements on ‘duty holders’ – as identified by the CDM regulations – when working on higher-risk residential buildings.

But take CDM away, as could happen under the REUL Bill, and where does that leave health and safety in construction? Could a founding principle of the UK’s new BSA crumble away even before the Act is fully implemented?”


The Building Safety Act – The Building Safety Regulator  

  • Regulator to protect high-rise residents in England from unsafe building practices  
  • 12,500 buildings must be registered with the Building Safety Regulator  

The Government recently announced via its ‘Making Buildings Safer’ campaign that existing higher-risk buildings must be registered with the Building Safety Regulator (BSR) from April 2023. There are approximately 12,500 of these buildings across England. The new Regulator will require all of them to be registered from April 2023; registration should include a named person responsible for maintaining their safety.   

In response to the Grenfell Tower fire, the new Building Safety Regulator was established to protect high-rise residents from unsafe building practices in England. Under the Building Safety Act, high-rise residential buildings which are 18 metres tall or higher, or at least seven storeys, with two or more residential units are defined as ‘higher-risk’. Registering buildings will become a legal requirement, and owners and managers who fail to comply by October 2023 may face investigation and prosecution.  

Building registration follows the introduction of Planning Gateway One in August 2021. It will be followed by more robust building control of high-rise developments and the certification of occupied high-rise buildings by the new Regulator.  

The Government has provided information and support to help owners and managers of high-rise residential buildings prepare for their legal responsibilities. Further information can be found at

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This note is not intended to give legal or financial advice, and, accordingly, it should not be relied upon for such or regarded as a comprehensive statement of the law and/or market practice in this area. In preparing this note, we have relied on information sourced from third parties, and we make no claims as to the completeness or accuracy of the information contained herein. You should not act upon information in this bulletin nor determine not to act without first seeking specific legal and/or specialist advice. We and our officers, employees or agents shall not be responsible for any loss whatsoever arising from the recipient’s reliance upon any information we provide herein and exclude liability for the content to the fullest extent permitted by law.

Categories: Construction,