At a Glance
🏗️ RICS reports UK construction workloads fell again in Q1 2026, with a headline balance of -12%, confirming a weaker pipeline.
⚙️ Contractors face sustained margin pressure from rising construction costs alongside new labour and safety levies due by October 2026.
🏛️ Planning reform under the Planning and Infrastructure Act 2025 is reshaping routes to consent, including a time-limited path that bypasses viability tests.
🚆 The UK’s 10-Year Infrastructure Strategy and March 2026 pipeline update reaffirm a £725bn decade-long investment envelope focused on delivery, not new schemes.
🌱 Government energy statistics show renewables hit a record 52.5% of UK electricity generation in 2025, with capacity still climbing into 2026.
Today’s update: softer market demand, planning reform and rising renewables are pulling the sector in different directions, with contractors squeezed between cost inflation and a still-substantial long-term infrastructure and energy pipeline. Viability concerns in housing are now running alongside record low-carbon generation, forcing developers, investors and supply chains to rethink risk, returns and resourcing. Here’s what you need to know to stay ahead today.
Ongoing Stories
Following earlier coverage of the Planning and Infrastructure Act 2025, today’s data highlights the new time-limited planning route that allows some schemes to secure permission without viability assessments, creating a temporary window for developers struggling with current market economics. (Source: DLUHC)
Returning to the wider UK infrastructure pipeline, the March 2026 update now details 734 planned projects under the 10-Year Infrastructure Strategy, reinforcing workforce demand signals rather than adding new capital commitments. (Source: HM Government)
Building on previous references to the 10-Year Infrastructure Strategy, today’s focus is the £24bn capital allocation for National Highways and local authorities in 2026–2030, underlining that road and local network upgrades remain core to the decade-long plan. (Source: HM Government)
Top 5 Headlines
🏗️ RICS data confirms renewed slide in UK construction workloads
The RICS UK Construction Monitor for Q1 2026 shows a headline workloads balance of -12%, indicating activity contracted further at the start of the year. Respondents also point to continued cost pressures, suggesting tender pricing and margins remain under strain. For contractors and their supply chains, this underlines a tougher short-term market even as a long-term pipeline remains in place. (Source: RICS)
⚙️ New tax and safety rules add to contractor cost headwinds
Commentary on 2026 rule changes highlights new umbrella company regulations and the forthcoming Building Safety Levy on new residential buildings, due to start in October 2026. These sit on top of existing cost inflation, tightening compliance obligations and increasing labour-related overheads. Contractors face a double squeeze on profitability and working capital, making commercial discipline on bids and contracts more critical. (Source: PBC Today)
🏛️ Planning reform reshapes routes to consent and viability
The Planning and Infrastructure Act 2025 reforms, reinforced in a March 2026 government planning update and ministerial speeches, are now live in the system, including a time-limited route that can remove the need for viability assessments on some schemes. At the same time, wider planning delays and viability concerns continue to hold back the development pipeline, particularly in housing. Developers and investors may gain short-term opportunities from streamlined routes but still face structural uncertainty on timing and returns. (Sources: DLUHC, DLUHC)
🚆 £725bn infrastructure strategy keeps focus on delivery, not new launches
Government’s 10-Year Infrastructure Strategy, published in June 2025, continues to frame a £725bn investment programme, including £24bn for National Highways and local authorities between 2026 and 2030. The March 2026 pipeline update confirms 734 planned projects and stresses future workforce needs rather than unveiling additional large schemes. For civils contractors and consultants, the priority is now positioning for delivery capability, skills and productivity against a relatively fixed investment envelope. (Sources: HM Government, HM Government)
🌱 Renewables hit 52.5% of UK electricity mix in 2025
The Energy Trends March 2026 release shows UK renewable electricity generation rose 6% in 2025 to 152.5 TWh, a record 52.5% share of the power mix. Updated June 2026 data confirms continued growth in renewable capacity and generation into this year. This sustained shift towards clean power strengthens the case for grid, storage and flexibility investments, and will shape demand profiles for new energy and network infrastructure. (Sources: DESNZ, Energies Media)
Also in the news
🏗️ Market analysis notes that, despite subdued current workloads, the UK still holds a strong pipeline of large-scale construction projects across sectors, requiring firms to balance short-term caution with long-term capacity planning. (Source: Glenigan)
🏗️ Additional industry commentary points to ongoing construction cost escalation and wage pressures, reinforcing concerns that many contractors’ margins remain vulnerable through 2026. (Source: Libra Construction)
🏗️ Housing market forecasts for Q2 2026 indicate softer demand and slower price growth in some segments, adding further pressure to development viability and land value assumptions. (Source: Knight Frank)
🚆 Legal and advisory commentary on the 10-Year Infrastructure Strategy underscores the scale of funding and resilience investment required in UK energy and infrastructure systems over the coming decade. (Source: Freshfields)
🌱 Sector briefings on 2026 UK energy policy outline forthcoming measures to support low‑carbon projects and grid upgrades, reinforcing the central role of clean infrastructure in the investment outlook. (Source: Slaughter and May)
The Daily Build is written for people shaping the UK’s construction and infrastructure pipeline. If this edition is useful, consider forwarding it to colleagues who are planning bids, investment cases or project teams this week.