John Healey given stark warning over promise to re-industrialise Britain as Labour set lofty goals

The Government must restore confidence within the construction industry if it wants to re-industrialise the nation, a trade body warns in an open letter to the Chancellor.

New figures showed that sales of ready-mixed concrete were down 9.3 per cent from this time last year, with mortar sales, which closely track new housing starts, dropping by 5.1 per cent.

Prime Minister Andy Burnham has vowed to re-industrialise the country under his leadership.

Labour still plans to build 1.5 million homes during this administration.

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But trade body the Mineral Products Association, whose members provide the raw materials for building projects, says that, within the sector, there is “currently zero confidence to invest in people, sites or equipment for the future”.

It warns that, despite Government promises to boost housebuilding and accelerate infrastructure delivery, “activity on the ground continues to move in the opposite direction”.

In an open letter to Chancellor John Healey, MPA chief executive, Paul Adeleke, said that domestic cement production was at 1950s levels, while sales of ready-mixed concrete were “at levels last seen in the 1960s”.

He writes: “Given the scale of this continuing decline, industrial capacity is now being lost. Plants are being mothballed, drivers are being taken off the road as trucks sit idle and skilled people are being made redundant.

“There is currently zero confidence to invest in people, sites or equipment for the future. This has to change.

“Without MPA members, nothing in your manifesto gets built, and nothing in the National Infrastructure and Service Transformation Authority pipeline gets delivered.

“That’s why this long-term decline is so concerning - aspirations of building enough houses, schools and hospitals, or modernising infrastructure in the future will become even harder to realise.

“As you look towards your first Budget, it is essential that our industry can have the confidence that capital budgets will be protected and that the work they have planned as businesses will actually happen, especially after recent road project cancellations.”

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The MPA says that the latest data “provides compelling evidence that the housing downturn has deepened”.

The problems were particularly acute in London, where ready-made concrete sales have dropped by 27 per cent in the first half of 2026 when compared to the previous year.

It is now 55 per cent below 2022 volumes.

This reflects “weakness in both residential development and new commercial office construction”, it says.

The MPA says that economic uncertainty, affordability pressures, rising construction costs, planning delays and increasing regulatory pressures “continue to hold back private investment across much of the construction sector”.

High energy costs also needed to be tackled, it said. The UK has some of the highest-price industrial electricity in the developed world.

Large infrastructure projects had proved more resilient, with HS2, nuclear plant Sizewell B and offshore wind developments providing demand.

But the recent cancellation of major road schemes in order to fund defence costs, along with pressure on capital spending ahead of October’s Budget, both undermined confidence, according to the MPA.

Mr Adeleke welcomed verbal commitments from Mr Burnham but said action was needed to reverse the nation’s industrial decline.

He said: “Hearing the new Prime Minister talk of ‘reindustrialisation’ is very welcome. “However, we are currently experiencing the very opposite: ‘deindustrialisation’ as demand falls and operational sites close. Reversing this and securing the sovereign capacity to supply the foundational materials of the economy must be a priority.

“This means tackling specific things holding us back such as the UK’s uncompetitively high industrial energy costs and the sclerotic planning and regulatory environment. But it also needs Government to drive the market forward and restore confidence.

“Measures to do this could include financial support to get housebuilding going, improved delivery on infrastructure, as well as incentives for private investment.”

Aurelie Delannoy, Director of Economic Affairs at the MPA, said: “The latest figures show that the housing downturn has deepened, with sales of key materials needed to build homes falling below last year's levels.

“Activity is expected to remain subdued for the remainder of the year, as energy-related cost pressures exacerbate an already difficult situation.

“For our industry, the first half of the year has been bad enough to effectively guarantee that 2026 will be a fifth consecutive year of declining demand. “While some infrastructure projects continue to support demand, they cannot compensate for the widespread weakness in housebuilding and commercial construction.

“A handful of major projects can help to sustain activity for the businesses directly involved, but they do not replace the broad-based demand that comes from a healthy housing market.”

The MPA says it will take stronger housing demand and a more consistent pipeline of infrastructure projects to restore business confidence and encourage long-term private investment.

Lex Russell, managing director at Cemex UK Materials but speaking in his capacity as MPA chair, said: "The latest figures paint a deeply concerning picture for our industry. Sustained low demand is placing jobs, investment and long-term manufacturing capability at risk.

“The solution is clear: we need policies that unlock housing delivery, accelerate infrastructure projects and create the conditions for growth. Our sector stands ready to deliver."

The Government has been contacted for comment.

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