Delivery capability key to turning devolution into construction growth
Mace Consult has published its latest quarterly UK Market View, highlighting the opportunities devolution could create across housing, transport and public services, while warning that greater local powers alone will not translate into projects on the ground.
The latest data underlines the challenging backdrop. Construction output declined by 1.0% in the three months to August and is 1.6% below a year ago, while new orders fell 11.8% in Q2, marking a third consecutive quarterly decline. At the same time, construction material price inflation reached 6.4% in August, its highest level since March 2023.
In this context, the report explores how greater local control over housing, transport, regeneration and public services could help strengthen regional construction pipelines. However, Mace Consult warns that success will depend on funding certainty, local delivery capability and effective coordination between central and local government.
Ceri Evans, Global Director of Cost and Commercial Management, Mace Consult, said:
“The UK construction market is entering a period in which opportunity and delivery risk are moving in parallel. Devolution, planning reform and changes to the methodology behind public sector appraisals could unlock a stronger pipeline across housing, transport and public services, giving local leaders greater influence over investment. But policy ambition alone will not put projects on site.
“Clients and local authorities will need clear funding, realistic programmes, robust supply-chain due diligence and early commercial engagement. Those that combine local ambition with disciplined decision-making will be best placed to improve certainty, manage inflation and convert the emerging policy opportunity into successful outcomes.”
The report also examines planning and infrastructure reforms that could help more projects progress, including stronger support for suitable housing developments near well-connected transport links and the reduction of the government’s discount rate from 3.5% to 3.0%.
With weaker demand being balanced by renewed cost pressures, Mace Consult has left its 2026 tender price inflation forecasts unchanged at 3.5% for national real estate, 4.5% for national infrastructure and 3.5% for London.
Ultimately, the report concludes that converting policy ambition into successful projects will require early commercial engagement, realistic delivery plans and robust decision-making.
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Your questions answered
What does the latest Mace Consult UK Market View say about construction growth?
Mace Consult’s latest UK Market View highlights how devolution could create opportunities across housing, transport and public services. It also warns that greater local powers will not automatically translate into projects without funding certainty, strong local delivery capability and effective coordination between central and local government.
How could devolution support regional construction pipelines?
Greater local control over housing, transport, regeneration and public services could help strengthen regional construction pipelines by giving local leaders more influence over investment. The report says this opportunity will depend on realistic programmes, disciplined decision-making and the capability to turn policy ambition into deliverable projects.
What are the main pressures facing the UK construction market?
The report points to weaker output and new orders alongside renewed cost pressure. Construction output declined by 1.0% in the three months to August, new orders fell 11.8% in Q2 and construction material price inflation reached 6.4% in August.
What are Mace Consult’s 2026 tender price inflation forecasts?
Mace Consult has left its 2026 tender price inflation forecasts unchanged at 3.5% for national real estate, 4.5% for national infrastructure and 3.5% for London, with weaker demand being balanced by renewed cost pressures.
How can clients and local authorities improve project delivery certainty?
The report identifies clear funding, realistic programmes, robust supply-chain due diligence and early commercial engagement as important foundations for delivery. Combining local ambition with disciplined decision-making can help clients and local authorities manage inflation and convert emerging policy opportunities into successful outcomes.
How can Mace Consult support organisations responding to these market conditions?
Mace Consult can support clients through advisory, cost and commercial management, PMO and planning, and programme and project management services. These capabilities align with the report’s emphasis on early commercial engagement, realistic delivery planning and robust decision-making.