The Scottish Building Federation has reacted to the latest ‘Trends in Lending’ report from the Bank of England by reiterating its call for intervention to address restrictive lending practices in the construction sector.

The Federation’s Chief Executive, Michael Levack, said: “Latest figures from the Bank of England show net lending to the UK construction industry has shrunk by a staggering £5.7 billion since April 2009.

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“With significant cuts in public sector spending beginning to bite, this paints a worrying picture of the short-term outlook for the building industry.

“Private sector house-building and commercial and industrial construction were all hit hard by the recession. As public sector investment is cut back, private sector construction needs to make a rapid recovery.”

Mr Levack concluded: “I struggle to see how private sector construction can be expected to recover when bank lending to the industry is being so heavily restricted.

“Politicians must intervene now to address this problem or face the consequences – namely, the very real prospect of this country’s vital construction sector descending into a double-dip recession.”

(GK/KMcA)