Scottish construction bosses have called on the government to slash VAT on maintenance and repairs, following the news that the UK building industry is officially in a double-dip recession.

Preliminary GDP figures for the second quarter of 2012 showed that the UK industry suffered a 5.2% contraction in output between April and June.

The Office for National Statistics blamed the construction slowdown for a 0.7% fall in GDP, which plunged the UK as a whole further in to recession.


Commenting on the figures, Scottish Building Federation Chief Executive Michael Levack repeated a call for the government to support the industry practically.

He said: "We've now seen six months of falling output from the UK construction industry in 2012 – a reduction of more than 10% during that period. On that basis, the industry has now officially entered a double dip recession. Based on the experience of the previous recession in 2008/09, I fear we can expect further reductions in output during the months ahead.

"Our industry continues to shed jobs and capacity at an alarming rate and we now need immediate action from Government to turn this situation around. That must include radical tax measures such as cutting VAT on building repairs and maintenance to 5% and a reinforced programme of direct capital investment to get stalled building projects moving."

(NE)