At a glance
⚙️ 2026 UK construction pipeline put at £39bn, but overall output growth is being revised down and skills shortages are biting.
🚆 Government has set out a £725bn, 10‑year public infrastructure pipeline across 780 projects, underpinned by a new Infrastructure Strategy.
🏛️ Draft Commonhold and Leasehold Reform Bill and an independent Building Safety Regulator mark a significant reset in the housing and safety regime.
🌱 Renewables now supply 44.9% of UK power as ministers review net zero progress and Ofgem nudges the price cap up for Q1 2026.
💰 Market forecasts see the UK construction sector growing to around USD 391bn by 2031, led by infrastructure and data‑driven demand.
Today’s update: the latest forecasts point to a cooler but still expanding construction market, with civil engineering and infrastructure carrying more of the load as private housing and RMI soften. At the same time, Westminster is tightening the regulatory screws on housing tenure and building safety while setting out a long-term infrastructure and net zero pathway. Here’s what you need to know to stay ahead today.
Ongoing Stories
Following earlier coverage of pressures on the UK construction and infrastructure pipeline, new 2026 forecasts now peg the project pipeline at £39bn with growth trimmed back to 1.7%, reinforcing concerns over delivery capacity and client confidence.
Building on recent scrutiny of infrastructure delivery risks, the government’s new 10‑year Infrastructure Strategy confirms £725bn of public funding across 780 projects but highlights persistent planning delays and delivery pinch points.
Returning to the theme of planning and regulatory reform, publication of the Draft Commonhold and Leasehold Reform Bill and the formal establishment of the Building Safety Regulator as an independent body signal a further tightening of the housing and safety framework developers must navigate.
Continuing the sector’s net zero narrative, fresh data showing renewables at 44.9% of the UK energy mix and a new nuclear sector survey frame the decarbonisation challenge against emerging grid constraints and data centre demand.
Extending recent analysis of market resilience, new output and market-size forecasts point to steady medium‑term growth to 2031, but with regional divergence and ongoing weakness in repairs and maintenance.
Top 5 Headlines
⚙️ Civil engineering dominates a £39bn 2026 UK construction pipeline as growth is revised down
New analysis puts the UK construction project pipeline for 2026 at £39bn, with civil engineering accounting for £23.8bn across 29 major schemes, including the £10.2bn Lower Thames Crossing and major road investments in Northern Ireland. Overall construction output growth for 2026 has been revised down to 1.7% from 2.8%, with infrastructure forecast to grow 3.9%, private housing limited to 1.5% and private housing R&M expected to contract by 1%. Office and commercial work is set to rebound, with 23 projects worth £6.3bn in the 2026 top‑100 pipeline versus 9 projects worth £1.6bn in 2024, but skills shortages and weak client confidence remain key constraints. For contractors and supply chains, this confirms a shift towards infrastructure and commercial work, but on tighter margins and with intensified competition for labour and capability. (Source: Build in Digital, Morson Group, Construction Wave)
🚆 £725bn, 10‑year public infrastructure pipeline set out in new UK Infrastructure Strategy
The UK government has outlined at least £725bn of public infrastructure funding over the next decade, covering 780 projects under a new 10‑year Infrastructure Strategy and national pipeline. Recent moves include Royal Assent for the Planning and Infrastructure Act, new transport safety and climate adaptation strategies, and a strategic nuclear agreement between Nuclear Transport Solutions and Westinghouse to codevelop a HALEU fuel transport package for UK‑US supply chains. Despite the scale of the commitment, professional bodies continue to flag planning delays and delivery pinch points that could limit the impact of this funding. For the sector, the strategy offers rare pipeline visibility but underlines that planning reform and delivery models will be as critical as the headline spend. (Source: Morson Group, CIHT, ICE, American Nuclear Society)
🏛️ Draft Commonhold and Leasehold Reform Bill aims to end leasehold flats and reshape tenure
On 27 January, the government published the Draft Commonhold and Leasehold Reform Bill for pre‑legislative scrutiny, proposing a ban on leasehold for new flats and promoting commonhold as the default ownership model. In parallel, ongoing planning reforms seek to streamline approvals, boost self‑build and strengthen spatial development strategies, while local planning activity continues at pace, illustrated by recent applications such as those in North East Lincolnshire. If implemented, the changes will materially alter residential product structures, exit strategies and legal risk for developers, investors and lenders. (Source: GOV.UK, Homebuilding, Shojin)
🏗️ Building Safety Regulator becomes independent as levy and tenancy deadlines loom
From 27 January, the Building Safety Regulator has been established as an independent body within the Ministry of Housing, consolidating oversight of higher‑risk buildings and building safety regulation. Key dates ahead include a new tenancy regime from 1 May 2026 and the Building Safety Levy, due to apply from October 2026 to developments of 10 or more homes. With a sizeable regulatory backlog still shaping the 2026 agenda, project sponsors and developers face a more complex compliance environment and additional cost considerations on pipeline schemes. (Source: Pinsent Masons)
🌱 Renewables hit 44.9% of UK power mix as grid strain and price pressures build
Renewables supplied 44.9% of UK electricity over the 12 months to January 2026, led by wind at 24.2%, with biomass at 7.1%, solar at 6.1% and hydro at 1.1%. Ofgem has increased the energy price cap by 28 pence per month for January–March 2026, a 0.2% annual rise for a typical household, while the UK Interministerial Group for Net Zero, Energy and Climate Change has highlighted both progress and ongoing challenges at its 26 January meeting. A new nuclear industry survey is also seeking views on the sector’s future role, against a backdrop of intensifying grid strain from ageing assets and surging data centre demand. These trends will shape where and how new energy and digital infrastructure is delivered, with knock‑on impacts for land, power availability and connection times on major projects. (Source: Cladco, Ofgem, GOV.UK, Nuclear Industry Association)
💰 UK construction market seen reaching USD 391bn by 2031 despite near‑term softness
New market analysis estimates the UK construction sector at around USD 325bn in 2026, projected to grow to USD 391bn by 2031 at a 3.77% CAGR, underpinned by infrastructure, data centres, housing and renewables. Output growth is forecast at 2.8% in 2026 and 4.2% in 2027, with new housing output expected to climb 4.9%, although Q3 2025 data showed slight declines and subdued repair and maintenance work. Regional growth is strongest in Northern Ireland at 6.1% CAGR, while infrastructure and public sector work remain comparatively resilient against affordability and planning challenges in private housing. For investors and contractors, the data supports a cautiously optimistic medium‑term view, but with sharper regional and sectoral winners and losers. (Source: BusinessWire, Mordor Intelligence, ONS, Arcadis via Morson Group)
Also in the news
⚙️ No major new UK construction project awards or contract wins were reported on 27–28 January, with industry attention instead on 2026 awards programmes and lessons from previous schemes. (Source: Geomechanics, Construction News, Construction Enquirer)
🚆 Recent transport safety and climate adaptation strategies are being integrated into delivery plans for the new infrastructure pipeline, adding further requirements for scheme appraisal and design. (Source: CIHT)
🏗️ Planning notices such as North East Lincolnshire’s 22 January publication underscore that, despite national reforms, local authorities remain a key gatekeeper for project timelines. (Source: Shojin)
🌱 The Interministerial Group’s latest communique reiterates the need to balance affordability with decarbonisation, shaping future regulatory and funding decisions for low‑carbon projects. (Source: GOV.UK)
💰 Analysts highlight that infrastructure and public sector workloads continue to offset softness in private housing, reinforcing the case for diversified order books into the late 2020s. (Source: Mordor Intelligence, BusinessWire)
The Daily Build is written for people shaping the UK’s construction and infrastructure pipeline, from boardrooms to site offices. If this briefing is useful, consider forwarding it to colleagues who need a fast, factual start before their 9 a.m. meetings.