We asked the President of Ance, Paolo Buzzetti, to join Samoter in analysing the situation in the construction market and expectations in the sector.
Samoter: On an international scale, the construction market seems to show some timid signs of recovery. What is your impression in this regard and how do you view the situation on the Italian market which, on the other hand, is showing no signs of recovery?
Paolo Buzzetti: The construction market was very badly hit everywhere by the international crisis but the consequences and especially government reactions were different from country to country. For example, Italy – unlike other European countries – did not see the property bubble burst and this is because Italy still has a shortcoming of about 350,000 homes. This does not mean that the crisis spared us in one way or another – it is actually generating devastating effects on the fabric of companies and workers. Last 14 May, on the first anniversary of the general construction states, we simultaneously launched all over the country a cry of alarm that we hope will not remain unheard: in the last year alone, the building industry has lost 137,000 jobs and, if we consider all allied fields, this figure rises to 210,000, while investments in constructions fell by 18%. Yet the worst moment is arriving precisely now: while many companies continued working in 2009 thanks to orders won in previous years, today we are counting the cost of continual cuts in investments and the lack of action which may otherwise have buffered the haemorrhage in the sector by playing an important role going against the trend. And all this while France and Spain – in less than a year – have skilfully and efficiently implemented anti-crisis decisions concerning infrastructures: Spain selected and completed 31,000 medium-small projects worth a total of 8 billion euros and France selected, funded and finalised small infrastructural projects worth 7.5 billion euros.
Samoter: The budget that the Italian government is currently defining does not seem to contain measures that in one way or another acknowledge the role of the construction sector as the driving force behind recovery, as you have frequently pointed out. What is Ance asking the government to do right now?
Paolo Buzzetti: The situation in Greece has undoubtedly reminded everyone about the need for more responsibility and sacrifices to ensure the stability of public accounts but, alongside this, we cannot hide our concern over a budget that, in many ways, does not provide many incentives for economic growth. One example above all is the tightening of the stability pact with local authorities. For some time, together with Local Councils, we have asked that the restrictions of this pact be slackened for better-performing local authorities, since they are the main cause of the dire delays in payments by public administration to companies for works already completed. The effect of the budget, on the other hand, will be a loss of investments totalling a further 1.3 billions. It is unacceptable that the costs for balancing public accounts should be borne by construction companies owed money by public administrations and already badly hit by tight credit. Today we are also asking the government to implement decisions at last capable of inverting the trend in the building industry to support growth and competitiveness of the country: effectively start the development of the Cipe Plan, spending available resources in an efficient manner, launch the Home 1 and 2 plans through the simplification of regulations already announced, apply fiscal levers and ensure transparency and regularity in the work market.
Samoter: Government attention seems to be especially focused on major works, which undoubtedly enjoy excellent visibility but involve a limited number of companies. Would it not be better, on the other hand, to think in terms of a plan for small-medium projects that would start up many more sites and ensure work for a larger number of small-medium companies in the construction sector?
Paolo Buzzetti: Major infrastructural works are necessary for the country but, as we have forcefully repeated for at least a year, small-medium projects across the country in sites that can be quickly set up are those truly capable of effective turn-around impact with positive benefits for the industrial construction system. Last June, the government welcomed our proposal by approving, within the scope of Cipe, a Plan embracing a series of small-medium projects ready for site set-up that Ance had already mentioned thanks to its association system. In any case, today, more than half the finance for these projects still has to be assigned – concerning, among other things, safety of school buildings, the efficiency of road connections and the hydro-geological system. Works that are also essential for improving the quality of life that cannot be ignored in favour only of major projects.
Samoter: In conclusion, how do you view the next six months and what are you expectations for 2011?
Paolo Buzzetti: Unfortunately, initial data for 2010 does not give us much reason for hope. It is evident that we are still some way from a general turnaround. To get going again, the wind has to blow in our direction in the form of effective action implementing decisions already taken and spending the money already set side. There is, however, also the possibility of grasping a positive aspect even from this time of crisis, that can and must become the occasion for launching a series of vital reforms to modernise the country and make it more competitive. I refer, to mention only one of the most important, to the system of public tenders that sees all the main public and private sector protagonists engaged in the formulation of proposals to modify the current standards with the objective of simplifying them, streamlining procedures, modernising and improving the efficiency of the administrative machine and preventing disturbance and infiltration by criminal operations. We believe that, with everyone’s efforts, the situation can improve – so let’s get moving to grasp the recovery right away since we simply cannot allow ourselves to start 2011 still in this situation of stagnation.