Industry’s concerns over long-term bail outs

Two major figures from Europe’s demolition industry have expressed concerns that financial help for the sector from national governments could be counter-productive if it goes on too long.

David Darsey, managing director of the demolition division of the United Kingdom’s Erith Group, and Martin Krupicka, president and CEO of Swedish demolition machine manufacturer Brokk, were speaking at the recent “Demolition after Coronavirus” webinar hosted by D&Ri, where they were joined by European Demolition Association president Francisco Cobo.

Like many industries, demolition was hard hit by the Covid-19 pandemic and government intervention was essential to ease the short-term financial hardship caused by the effect of the crisis on demolition sites and projects.

Both David and Martin praised the actions of the UK and Swedish governments respectively but said there are dangers in continuing these and similar measures elsewhere in Europe for longer periods.

“I actually think most governments have done quite a bit and I would say overall that what they have done has been quite adequate to meet the market lockdowns that have been imposed,” Martin told the online audience.

“I think though in the longer term there is a risk especially in Europe where sometimes, maybe not in the UK but other parts of Europe, there might be a tendency to keep these things on for too long. In six months, we might start talking about how long is long enough and when does it become too long to have these measures in place?

“Once the lockdowns that are artificial from a market standpoint have ended, it’s important in weaker markets that companies learn to deal with that situation and not be on some sort of artificial aid for years to come.”

David added: “From the point of view of a demolition contractor in the UK I think the government, in terms of the furlough scheme, has come out and acted very quickly. It is a more than adequate scheme to help people and their families.

“What I am concerned about is the length of time that it has been made available. So rather than it being like an emergency fund, all the time you are not able to go to work, there’s assistance and funding, which at some point taxpayers will have to pay for.

“I’m concerned that people will become institutionalised and quite like receiving 80% of their salary and not having to work for it and I do think there’s a danger that if it goes through to October that’s too long.”

• The “Demolition after Coronavirus webinar” was sponsored by the National Federation of Demolition Contractors, Applied Science International, McCloskey International and Yantai Eddie. To see the full 55-minute recording, please visit here