UK Construction Industry Struggles to Recover from COVID-19 Fallout: Delays and Financial Challenges Persist

Posted on 23 March 2021

Prime Minister Boris Johnson's announcement of a full lockdown one year ago (March 23) had a profound effect on the UK's construction industry. With minimal notice, contractors faced the immense challenge of swiftly and safely shutting down active construction sites. Despite appeals for construction workers to be deemed "essential workers," the government ordered most sites to close, leading to project delays and cost overruns.

The lack of certainty surrounding the pandemic's duration added complexity to planning and implementing site shutdowns. Construction sites remained closed until June, and upon reopening, additional COVID-related measures such as social distancing, one-way systems, and enhanced cleaning processes had to be implemented. These measures not only took time to put in place but also extended construction timelines.

The impact of COVID-19 is not limited to ongoing projects. Future planned initiatives like Crossrail 2 and the Bakerloo Line Extension have been put on hold due to depleted funds at Transport for London. Major infrastructure projects across the UK, including Hinkley Point C, Crossrail, Tideway, and the A303 Stonehenge Tunnel, have experienced setbacks attributed to COVID-related restrictions.

The construction industry continues to grapple with the consequences of the pandemic, with efforts focused on adapting to the new normal and mitigating the impact on existing and future projects.

Hinkley Point C Nuclear Power Station

The construction of the Hinkley Point C nuclear power station has encountered significant challenges and setbacks due to the impact of the Covid-19 pandemic. As a result, the project's cost has escalated by approximately £500 million, and its start date has been pushed back to June 2026.

EDF, the company behind the Somerset-based power station, stated in January that the estimated cost would reach up to £23 billion, compared to the initial projection of a maximum of £22.5 billion in 2019. Originally, Unit One was scheduled to begin generating electricity by the end of 2025. The work that was postponed during the height of the first lockdown in 2020 remains unfinished.

In a communication to employees, Stuart Crooks, the managing director of Hinkley Point C, acknowledged the ongoing challenges caused by the pandemic. He stated, "Ten months after it began, we are still facing the full force of the pandemic. Despite increasing the number of workers on-site from under 2,000 to over 5,000, social distancing requirements continue to restrict the number of people who can safely be present at any given time." Crooks further explained that an extended construction period and the reduced efficiency resulting from operating under Covid-19 conditions have contributed to increased costs.

The Covid-19 pandemic has undoubtedly impacted the progress of Hinkley Point C, leading to delays, added expenses, and operational challenges. Efforts are ongoing to adapt to these circumstances and mitigate the impact on the project's completion.


Crossrail recently announced that an additional £1.1 billion will be required to complete the central section of the London route. The opening date for the Elizabeth Line has been further delayed and is now anticipated for the first half of 2022, although TfL commissioner Andy Byford has expressed his desire for the line to open towards the end of this year.

These developments follow extensive discussions within Crossrail's board to establish a new timeline and budget for the project, taking into account delays caused by the Covid-19 pandemic and a decline in productivity. The additional cost comes on top of the £2.15 billion funding package already provided to Crossrail when it missed its original opening deadline of December 2018. Combined with cost escalations on the Network Rail side, the overall budget for the Crossrail scheme now exceeds £19 billion.

As previously reported by NCE, the project experienced an increase in slips, trips, and falls once sites reopened, as safety protocols shifted focus towards preventing the spread of Covid-19. Steps have been taken to address this issue and improve safety measures on the project.

Crossrail continues to face significant challenges, resulting in prolonged delays and increased costs. Efforts are underway to overcome these obstacles and deliver the much-anticipated Elizabeth Line to the public as soon as possible.



The completion of the Thames Tideway super sewer project has been significantly impacted by Covid-19 restrictions, resulting in a nine-month delay and an additional £233 million in costs, as revealed in a shareholder announcement in August. Bazalgette Tunnel Limited, the project promoter and Thames Water's development vehicle stated that the project is now expected to be completed in the first half of 2025, extending beyond the original target finish date of 2024. Shareholders were also cautioned about escalating costs, with forecasts indicating a £233 million increase from previous estimates, bringing the total cost of the project to £4.133 billion.

An investor report released a month before the announcement highlighted a "severe downside" forecast, outlining the potential for Covid-related expenses to result in a cost rise of £900 million. The report also warned of a scenario in which the Covid-19 impact could push the final cost up to £4.1 billion. Furthermore, a second "worst-case" scenario outlined in the report suggested a potential 24% increase in costs for the remaining work, which would amount to a total cost of £4.3 billion. The Thames Tideway project continues to face significant challenges as it navigates the effects of the ongoing pandemic.


Stonehenge Tunnel

In November, the A303 Stonehenge Tunnel project received approval from transport secretary Grant Shapps, as he granted a Development Consent Order (DCO) for the scheme. This decision was met with concerns raised by The Planning Inspectorate, which concluded that the project would have adverse effects on local roads, disconnect local communities, and pose risks to the natural and historical landscape.

The government's deliberation on the DCO application had already experienced two delays. The initial delay was due to the impact of the Covid-19 pandemic, while the more recent delay stemmed from the discovery of significant archaeological finds in the area. Documents released by the Planning Inspectorate indicate that these delays will result in a one-year extension of the opening date for the Stonehenge Tunnel.

Revisions in Highways England documents demonstrate that the planning delays will further push the start date for preliminary work on the Amesbury to Berwick Down scheme from summer 2020 to spring 2021. The main construction work will also be delayed by a year, with the new start date set for October 2021 and the completion date pushed back to 2027.

The Stonehenge Tunnel project continues to face controversy and challenges due to its potential impacts on the surrounding environment and communities. The delays in the decision-making process and the subsequent timeline adjustments highlight the complexities associated with balancing infrastructure development and the preservation of historical and natural heritage.


Heathrow Airport Expansion

The aviation industry has been severely impacted by the COVID-19 pandemic, and airport expansions have faced significant setbacks. London City Airport had to pause its expansion project during construction, reflecting the challenges faced by the industry. Heathrow Airport, one of the busiest airports in the world, has also been greatly affected. In 2020, passenger numbers at Heathrow plummeted to 22.1 million compared to 80.9 million in 2019. Cargo volumes passing through the airport also decreased by 28%.

Even before the pandemic, work on Heathrow's planned third runway had been halted due to a High Court ruling. The court determined that the government had not adequately considered climate change goals when approving the project. This ruling was later overturned by the Supreme Court. Despite this legal victory, the financial strain caused by the pandemic and ongoing uncertainty surrounding passenger numbers has forced the expansion program to remain on hold for the time being.

Heathrow airport executives continue to advocate for the need to expand and are likely to revisit the project once travel bans are lifted and the industry begins its recovery. The future of the Heathrow expansion remains uncertain, with various factors such as financial viability and environmental concerns shaping its path forward.


High Speed 2

During the first lockdown, the UK government provided a significant boost to the industry by granting approval for phase one of HS2, connecting London and the Midlands. This milestone paved the way for main construction to begin, and progress on HS2 accelerated towards the end of the previous year. Currently, tunnellers are preparing for excavation at the foot of the Chilterns, and work is underway on the construction of the UK's longest rail viaduct.

The second phase of the project, extending the line north to Crewe, received Royal Assent earlier this year, further bolstering its development. The future beyond Crewe is uncertain as the government's highly anticipated Integrated Rail Plan has been delayed until after the local elections in May.

While the construction timeline for HS2 has not been significantly affected by COVID-19 thus far, Mark Thurston, the project's chief executive, acknowledged in May of last year that HS2 stations and trains might require redesigning to adapt to a post-COVID-19 world. The project has also faced challenges related to construction, including a considerable number of complaints. Last year alone, over 1,400 construction-related complaints were received, with many of them pertaining to breaches of COVID-19 restrictions.

Despite these challenges, HS2 construction continues to progress, and efforts are being made to address concerns and adapt to the evolving circumstances brought about by the pandemic.


12 months since first Covid lockdown


Despite these challenges, the construction industry is actively adapting to the new normal and working to mitigate the impact on existing and future projects. Efforts are underway to address safety concerns, manage costs, and adjust construction plans to align with post-pandemic requirements. As the industry moves forward, it remains resilient and committed to overcoming the obstacles brought about by the COVID-19 pandemic.

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