Housing projects to get help with material costs

Across the construction sector, builders are struggling to complete jobs at their quoted price

Stormont is to give housing associations up to £15m to deal with the soaring costs of building materials.

The money will be available for schemes already on site and those due to start in the coming months.

Across the construction sector, builders are struggling to complete jobs at their quoted price.

The communities minister said the move was necessary to bring "stability" to social housing construction.

"I have increased the support available to housing associations who are working with the construction sector to build new homes," said Deirdre Hargey.

"This will take into account the increased costs affecting contractors through the unprecedented upsurge in material costs across the industry in recent months.

"This support is vital to ensure we build more homes where they are needed."

The Housing Executive will now work with housing associations to establish the overall impact of material cost rises.

• Timber shortage due to unprecedented demand

• Building material costs affect public projects

There are a number of factors behind the rise in the cost of building materials, including high levels of demand and increased shipping costs.

Official figures for the whole of the UK, published on Wednesday, suggest that in August the cost of imported plywood was 78% higher than the same point last year.

Fabricated structural steel and imported sawn wood also experienced similar year-on-year increases.

Increased demand for already-scarce building materials is pushing prices up

In August, Finance Minister Conor Murphy relaxed procurement rules to allow builders to increase the prices of previously agreed public sector contracts.

He said contractors were experiencing escalating costs and delays in getting materials which they could not have foreseen when they tendered for government work.

The Construction Employers Federation said the move on social housing was welcome and was related to the finance minister's guidance.

Managing director Mark Spence said: "This is the first substantive step by any government department or client in seeking to directly address the challenges that contractors have faced for the best part of a year.

"As the challenges of materials shortages and price increases show no sign of abating, it is vital other departments now speedily step up to the plate to help relieve the unprecedented burdens that their delivery partners in the construction industry continue to deal with."