Institution of Civil Engineers call for immediate action to improve maintenance and guarantee Highways Agency funding

Engineers have warned that a lack of strategy, patchy maintenance and uncertain funding is undermining Britain's infrastructure, and have called for an independent commission to create a long-term transport plan.

The Institution of Civil Engineers (ICE) said that the short-term political cycle and spending decisions were leaving necessary work undone and delaying big projects.

ICE said urgent, immediate action was needed to invest in roads to tackle a maintenance backlog including millions of potholes, with guaranteed funding for five years for the Highways Agency. The engineering body also said that the government should now choose to either expand Heathrow or build a new hub airport in the south-east.

Steven Hayter, the chair of the ICE's transport panel, said: "In the last five years many of the most important issues – from aviation capacity through to severe pothole damage – are still unresolved.

"The need for a coherent, long-term transport strategy, particularly for England, is becoming urgent."

The ICE proposed an independent infrastructure commission to develop transport strategy beyond electoral cycles, although Hayter said he believed the current Airports Commission was delaying decisions to suit "parliamentarians but not the public".

Transport minister Stephen Hammond said that "big projects will never happen without consensus" and political mileage. He said: "We need to build a consensus: that's the job of the commission. I don't believe it's kicking it into the long grass."

Hammond said he agreed that "roads have suffered from a lack of investment in recent decades," and said the government was committed to spending billions on major road schemes. A green paper outlining reform to road ownership and funding is expected soon.

The ICE said other areas for urgent attention included making buses outside London an attractive alternative for travel and unlocking the potential of cycling.

A separate RAC Foundation report found there had been a "significant shift" in road policy, with 32 of 96 unfunded schemes from 2011 now being given the go-ahead. RAC director Stephen Glaister said: "It's a very welcome development that the government has been delivering on projects to enhance strategic and local road networks."

Photograph : Foster and partners/PA

Surging property market in London and the south-east boosts housebuilder

Housebuilder Berkeley has reported a 26% jump in annual pre-tax profits on the back of the surging property market in London and the south-east.

Berkeley reported revenues of £1.4bn for the year ending April 2013, up more than 30% on last year, helped by advance sales of its riverside flats and detached houses.

The housebuilder said activity outside the south-east had not recovered since the 2008 downturn, but was likely to pick up as a result of the government's "help to buy" plan, a contentious state mortgage subsidy scheme.

The group said it was ahead of schedule to pay out £1.7bn to shareholders in three instalments by 2021. It also reported that a cut in corporation tax had driven up earnings per share by more than 30% to 160p.

Tony Pidgley, Berkeley's chairman, said: "The growth in earnings this year is a direct result of a period of sustained investment since early 2009 during which Berkeley has committed over £1bn to new land and £2.4bn to construction and completed over 12,000 new homes in London and the south of England."

How self-healing concrete and 3D printing will transform buildings and many other sectors besides

Buildings will be very different because currently they are not very hi-tech. They are still made from concrete, steel and glass. The wiring and plumbing of a building will soon start to become integrated and grown like our bodies' nervous and digestive systems. More materials will be able to heal themselves and they'll clean themselves.

Some of these technologies are already being developed – such as self-healing concrete – and at the moment cost is holding back their introduction, but that will change. Obviously there are big economic gains from having buildings that can repair themselves. And practical advantages in hard-to-reach places like nuclear reactors. I would say that in around 50 years we could see buildings that could build themselves. Nature already does it – a tree builds its own wiring and plumbing, its own energy generation system – a marvel of architecture that starts from a single seed.

Also, 3D printing will change how objects are created. Everything will be integrated, objects will be made in one piece, including the wiring and the battery. I'm not sure that every home will have one but sophisticated factory-based 3D printers will be able to tweak product design by responding to consumer comments, creating a speedy feedback loop: 3D printers will change everything about manufacturing; I'm sure about that.

It means you can mass-produce without producing identical objects. You can have individualisation, you can have 1,000 of one thing – there will be fewer gains from economies of scale. It will change fashion, it will change product design. People will have to work out how to change their business models.

Materials scientist Mark Miodownik will talk about the coming materials revolution at the Saturday afternoon session of FutureFest

What is the best way for organisations to build capacity for transparency? Avoid the one-off workshop and build sustainable practices, says Claire Schouten

There is no one-size-fits-all approach to capacity development. Those of us seeking to do it need to understand the context and resources, the needs of those whose capacity we are building, and the different ways we can strengthen it.

Transparency has gained great momentum in the past 10 to 15 years. Practitioners across sectors and countries now appreciate the need for openness to help tackle corruption, justify plans and actions, and enable accountability. Standards and initiatives across aid, budgets, climate finance, contracting, construction, mining and agriculture have emerged. They call for timely, reliable, accurate and accessible information. And governments are beginning to respond – 57 countries, for example, have joined the Open Government Partnership, a collaborative effort of governments and civil society committed to transparency and open government.

Transparency is often hailed as a driver of economic prosperity and empowerment. In some circles, it's equated with open data, and the notion that getting 'raw material' in the public domain will increase demand and user satisfaction. Assessors of the impact of transparency work, however, have noted that without the capacity to generate, collect, manage, analyse and disseminate data, disclosure in itself is not so useful.

So how can we help strengthen capacity for transparency? From experience facilitating the Network for Integrity in Reconstruction and participating in multi-stakeholder transparency and accountability initiatives, such as the Construction Sector Transparency Initiative (Cost), I have learned a few lessons:

Understand the context

This is a now a cliché, but we still face challenges understanding politics, existing capacity and what are appropriate techniques for capacity development. Political volatility and lack of social cohesion in an organisation or community may inhibit efforts to build skills and practices. Similarly, an online tool to help an organisation manage and disclose information may not be useful in areas of low bandwidth or accessibility.

Build on local knowledge and skills

Local First is a development approach that distinguishes between locally led, locally owned and locally implemented or delivered. It focuses on allowing local ideas and perspectives to shape interventions. When analysing capacity, expand the definition and role of capacity assessment, and ensure that the assessment considers the needs, motivation and social accountability of organisations.

Foster collaborative learning and governance

Training for different stakeholders, such as local government and civil society, often happens in silos. Understanding the challenges and opportunities organisations across different sectors face can help the learning and implementation of policies and procedures. Civil society organisations may not be quick to name and shame, for example, if they understand the constraints local governments experience, and may seek to develop practical solutions together. In Cost, for example, providing training facilitated multi-stakeholder engagement and built trust that enabled smoother implementation of country programmes and disclosure of project information.

Strengthen records management and data collection

Trustworthy and accessible records are the basis for demonstrating transparency and accountability. Cost has found that the public sector in sub-Saharan Africa generally use paper for official work. Data collection is then resource intensive. In the digital environment, records are highly vulnerable and must be managed to ensure that they remain accurate, reliable, accessible, and usable for as long as required to provide the basis for openness. As organisations such as the International Records Management Trust highlight, users should be able to find records easily, trust them and use them for as long as they are needed. Integrity and quality assurance prior to disclosure are critical. In many cases, the capacity and regulatory framework needed to manage digital records are not in place and need to be developed.

Avoid the one-off workshop and help build sustainable practices.

When participants meet for a short, lecture-style training workshop in a distant location, without an opportunity to test their learning in their environment, it is not likely that it will sink in. Hands-on learning to build and use systems and implement practices to be more open can be more effective than someone telling you to do so. Dedicated investment and longer-term support can yield great results.

Learn from good practices and guidelines

Whatever sector you are in or concern you may have, there are good practices, guidelines and experience from similar organisations or contexts. The International Aid Transparency Initiative, International Monetary Fund and the Organisation for Economic Co-operation and Development, for example, have their respective standards and guidelines on transparency. The opening government guide from the Transparency Accountability Initiative offers progressive steps for greater transparency and accountability across sectors and countries.

Promote usability of data

There are currently very limited general data standards in existence. Such standards could focus on commonly used formats for the release of data, such as CSV, XLS or XML rather than pdfs. Adoption of existing coding conventions or schemes would allow for better planning, management and monitoring. There are great organisations who can help build technical capacity such as Code for Africa, Open Data Institute, Open Knowledge Foundation, Tactical Tech and the World Bank Institute.

Work on the incentives

Ultimately, we need to understand what will make an individual or organisation commit to transparency in policy and practice. This requires understanding the challenges, risks and rewards involved, investment of resources, and the value of integrity and honesty. Not easy to get this right, but a collective effort can help.

Claire Schouten is programme director of Integrity Action and a member of Cost International Secretariat and the Open Contracting Steering Group

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David Cameron urged to use his influence in G8 to save the Construction Sector Transparency Initiative from closure

An international transparency programme to tackle mismanagement and corruption in publicly financed construction projects, initially supported by UK aid, is at risk of closure due to lack of funds.

The Construction Sector Transparency Initiative (CoST), officially launched in London last October after a three-year £3.4m pilot funded by the UK Department for International Development (DfID), has failed to attract more than $500,000 in funding for the current financial year. CoST estimates it needs at least $4m annually to run and scale-up the programme.

CoST chairman Christiaan Poortman said the initiative will struggle to do more than "keep the wheels turning" unless the endorsements it has received are matched with cash.

"We will not fold immediately, but in the next six to 12 months that risk is definitely there," said Poortman. "There is a great deal of uncertainty. I think we'd be able to keep the wheels turning for six to 12 months, but without the sort of momentum we're looking for."

Drawing on the experience of the Extractive Industries Transparency Intitiative (EITI), which monitors the oil, gas, and mineral industries, CoST aims to help clean up the construction of roads, bridges, schools and hospitals by increasing the public disclosure of information about these projects and helping people use that information to hold decision-makers to account.

The construction sector is one of the most valuable globally. By 2020, its size is estimated to reach $12tr annually - up from $7.2tr in 2011. But it's also notorious for corruption and waste, delays, and poor quality. Public works contracts and construction rank bottom of the list – which includes oil, gas, arms and defence industries – on Transparency International's Bribe Payers Index, a measure of how prone to bribery different sectors are perceived to be.

The fledgling initiative has seen some success. In Guatemala, a project to design and reconstruct the Belize Bridge in Guatemala City was halted after a CoST report uncovered problems with how the contract was awarded. In Ethiopia, the designers of a major road project were suspended for two years by the national roads authority after a CoST investigation.

However, CoST's only source of income is a grant of $1.5m from the World Bank over three years, ending in December 2014. Some of CoST's national programmes have found separate funding, but this is limited.

In an open letter published on Wednesday, 11 leaders in the international construction industry called on the UK government to use its influence in the G8 to ensure CoST survives.

"Investing in infrastructure is one of the best ways to stimulate economic growth, create jobs and promote enterprise development. But the positive impacts of these investments often fall short of their full potential as a result of corruption and inefficiency," acknowledges the letter, whose signatories include the presidents of the Royal Institution of Chartered Surveyors, Chartered Institute of Building, and European International Contractors.

"The UK government showed great vision in launching CoST, and invested close to £3.4m in the pilot project. Given this investment, CoST's widely acclaimed benefits and the number of new countries that are now eager to join, a lack of further financial support would constitute a great missed opportunity. We urge the UK government to use its influence in the G8 to ensure that the programme is given the chance to achieve its full potential."

UK prime minister David Cameron has made tackling corruption a top priority at this year's G8 summit. A special pre-G8 meeting on Saturday will focus on transparency, tax, and trade - key elements of Cameron's "golden thread" of development.

In a letter to G8 leaders in January, Cameron named CoST as an example of initiatives to bolster transparency.

"In our partnership with less developed and emerging economies, I believe we must put a new and practical emphasis on transparency, accountability and open government," he wrote. "We need to look at how to enhance transparency – including through the Construction Sector Transparency Initiative and new ideas like a global land transparency partnership."

The DfID-funded pilot was carried out in Ethiopia, Malawi, Tanzania, Zambia, Philippines, Vietnam, the UK and Guatemala. All eight remain the core members of CoST, in addition to El Salvador, which joined earlier this year. CoST estimates it costs between $150,000 and $500,000 each year to get a new national programme up and running, depending on the country.

"The world is full of initiatives and people rightly want to see proof they work," said Poortman, who acknowledged the importance of UK funding for the CoST pilot as "critical". "People want to see results and we have them now."

CoST supporters argue the initiative could provide a critical complement to the EITI. A significiant amount of the money generated through new oil, gas and mineral projects in developing countries will likely go into infrastructure, said Poortman. "We need to look not just at the income side of the equation, but also expenditures."

At the launch of CoST last year, Jamie Drummond, co-founder of anti-poverty group ONE, warned that infrastructure was a hard sell. "It is not the bednet that protects the kid from the mosquito, it isn't the vaccination that protects it from everything else....[however] living without access to roads or electricity can mean living without decent education, evening lighting, or medical supplies. It can mean the difference between life and death."

The Frank Morris case at Crossrail shows workers still fear the victimisation I and the Shrewsbury 24 went through 40 years ago

Britain's biggest trade union is locked in a campaign with the bosses of the largest engineering project in Europe over claims that workers have been blacklisted for raising health and safety concerns. When I heard from the Unite union about the situation faced by Frank Morris, an electrician who says he was sacked by Crossrail for trade union activity, it reminded me of the time I was thrown in jail, and the suffering my comrades had to endure, for being prepared to stand up to our bosses.

Believe it or not, acting was never my career choice. I got into the entertainment game because I was a victim of blacklisting. In the end I got lucky, but thousands of workers from the construction industry had their lives – and the lives of their families – destroyed as a result of this murky practice.

So when I found out about the allegations of blacklisting at Crossrail by the consortium Bam Ferrovial Kier (BFK) I got really mad, because I can't believe it's still going on. Back in 1972, long before becoming a member of The Royle Family, I worked as a plasterer. I loved the job, and the people I worked with, but there were massive problems in the trade. Between 1971 and 1973 there were 622 deaths in the industry. The situation was so bad that families were genuinely worried when their loved ones went off to work each morning. Things are still bad today: 49 construction workers were killed at work in 2011-2012. If your job is in construction you need someone who is prepared to speak out – your life might depend on it.

We were taking these huge risks for crap money. The national minimum rate for the building trade was £20 for craftsmen and £17 for labourers for a 40-hour week. So it's easy to understand why so many of us pulled together in 1972 for the first national building workers' strike. After a tough old fight, we pulled off a big victory: the basic rates of pay went up by £6 per week for craftsmen and £5 per week for labourers. We proved that organised trade unions could make the building trade fairer for workers.

But as a loud organiser, I paid a huge price for this victory, as did many of my fellow union members. I spent 16 months in prison for my role in helping to organise the campaign, along with my friend Des Warren. He died in 2004, and we firmly believe this was a result of his mistreatment in prison. Dezzie and I were members of the Shrewsbury 24, building workers who were the victims of a miscarriage of justice. The campaign goes on today to fully clear our names.

Being released from prison wasn't the end of the persecution for us. Construction bosses had decided that they were going to take their revenge on "union troublemakers". My name was added to an employers' blacklist, meaning I was unable to secure work in the trade again.

UK employers always denied the existence of blacklists until 2009, when the offices of The Consulting Association, a blacklisting organisation, were raided and a list with more than 3,000 names was discovered. People were on the blacklist because they belonged to a trade union or had raised concerns about health and safety.

Unite has significant evidence that Frank Morris was dismissed from the Crossrail project because of his union work. If blacklisting is going on at Europe's biggest construction project, where else is it still happening?

There is no place for blacklisting in the UK; standing up for your conditions at work is a basic human right. It's about time we had justice for the Shrewsbury 24 and all the others who have suffered years of worklessness through being blacklisted.

Struggling UK construction arm may cut 150 jobs in three offices as revenue tumbles

Balfour Beatty is to close three UK regional businesses, putting at least 150 jobs at risk, after appointing a new head of its struggling UK construction arm.

The combination of a weak construction sector, a lack of major infrastructure projects and poor performance mean the group is expecting a 20% fall in revenue in the UK construction division in 2013.

The three locations to be closed are in Dartford, south-east of London, Rochdale in north-west England, and Doncaster in the north. Collectively they account for around 8% of the UK regional business, which generated £1.5bn in revenue in 2012, of a group total of £9.5bn.

The firm also said it is addressing specific operational issues across a handful of projects in south-west England, without giving further details.

Nick Pollard, who has held senior roles at Network Rail, operator of the UK rail network, and has worked as an adviser to the British government, will run the UK division from 17 June.

Shares in Balfour Beatty plunged 11% in April when it issued its second profit warning in six months, prompting the chief executive, Andrew McNaughton, to take control of the UK construction subsidiary.

The firm has undergone a review of its businesses since then, exiting mainland Europe, looking at a possible sale of its UK facilities management arm and restructuring its UK regional construction units.

Analyst Andy Brown at brokerage Panmure Gordon said it was positive that Mcnaughton could now get back to running the group, having appointed Pollard, but added that the latter must focus on improving his unit's efficiency in the short term.

"Part of the problem they've got … is that the work isn't out there, but that is something they have to deal with … because this is a cyclical industry," he said.

Output from the construction sector rose for the first time since last October, in a sign that the government's controversial plans to boost the housing market are reviving activity

Housebuilders drove a bounce back in the construction industry last month in the latest sign the government's controversial plans to boost the housing market are reviving activity.

Output from the construction sector rose for the first time since last October, according to the Markit/CIPS UK construction PMI. The news coincided with the latest attack on the government's Help to Buy scheme, this time from the City analyst Albert Edwards, who branded it "moronic" and said it will burden young people with even more debt.

Still, for housebuilders, the scheme appears to be bringing new business after months in the doldrums with Markit's survey suggesting residential building work increased at the fastest pace in more than two years in May.

That helped offset slumps for commercial building and civil engineering and lifted the headline construction output index to 50.8 from 49.4 in April, just pushing through the 50-mark that divides expansion from contraction. The index remained below its long-run series average of 53.9.

The report suggested that higher construction output was driven by a "robust and accelerated" expansion of residential activity. The increase in house building work was the fastest for 26 months.

That growth echoes reports from housebuilders such as Barratt Developments and Bovis Homes that trading has picked up after the government announced plans in the budget to help struggling house buyers.

The Help to Buy scheme offers taxpayer backing for up to £130bn worth of mortgage lending. But the scheme has faced criticism as risking creating another housing bubble in the UK. Warnings from from Bank of England governor Mervyn King and the International Monetary Fund were echoed this morning from Edwards, strategist at Société Générale.

He decries a "moronic policy" that will lead to the "indentured servitude of our young people."

He comments: "What makes me genuinely really angry is that burdening our children with more debt (on top of their student loans) to buy ridiculously expensive houses is seen as a solution to the problem of excessively expensive housing."

Despite the May revival in construction there was little sign of any new jobs in the sector. Markit's survey suggested employment levels were broadly unchanged and staffing levels have failed to rise in each of the past three months with survey respondents citing subdued underlying demand.

"While the latest survey provides some hope that rising construction output will support UK GDP in the second quarter, the sector remains unlikely to contribute positively to labour market conditions," said Tim Moore, senior economist at Markit.

George Osborne's favourite thinktank thinks small – so small, it will never help the UK economy grow beyond the margins

There is a fatalism about the OECD. Listening to officials at the thinktank's Paris HQ, there is none of the energy that bounces off their counterparts at the International Monetary Fund. The IMF wants action from governments. So does the Organisation for Economic Co-operation and Development, but only incremental action; nothing that would disturb the markets or the orthodox economic thinking that has characterised its response to the banking crisis.

Tied in a straitjacket of its own making, it only whispers how some of its 34 member countries might implement a series of technical measures, which it meekly says may provide support for jobs and growth "at the margins". The recovery is what it is, live with it, seems to be the message.

For George Osborne, the OECD's economic outlook is like a warm embrace. Keep on track with public spending cuts, it says. Let the UK's welfare system, already reduced in value in real terms, be spread more widely to catch those who lose out when Whitehall pulls the funding plug.

OECD boss Angel Gurría talks about a lost generation of young people who have struggled to find a job in the aftermath of the crisis. He warned European countries to end labour restrictions that protect inefficient industries and jobs, allowing new firms and jobs to appear.

Britain, for good or ill, is already well down the road to the kind of freewheelin' labour market the OECD envisages. As the coalition government has found, those who seek to cut red tape have found little. Businesses that claim to be chained by long strands of red cloth tend to mean that taxes are too high, especially business rates and employers' national insurance.

Labour has already recommended cutting these to encourage small- and medium-sized businesses. But the OECD, while talking loudly and often about its concern for jobs and small businesses, remains obsessed with reducing the annual budget overspends by indebted government to the exclusion of all else. That's where its fatalism lies. Deficits must continue to fall until they are balanced and for that reason growth will be slow.

The IMF is not a radical outfit, but it has at least called on the chancellor to relax his deficit obsession in favour of some spending on infrastructure.

As the TUC says today in a report, key sectors of the economy have been allowed to gather dust. In a new report, it criticises government inaction as the nation's builders sat idle, calling it a tragic waste of resources. There are homes to build. The time for technical solutions has passed.

Analysis adds to concerns that UK businesses are losing competitiveness by refusing to spend on new equipment

Britain suffered one of the biggest falls in investment among the G8 last year, adding to concerns that UK businesses are losing competitiveness by refusing to spend on new equipment.

According to an analysis by the House of Commons library, Britain invests a lower percentage of GDP than any other of the leading western industrial nations. The figures, obtained by Labour, show that while most G8 countries have increased investment as a proportion of national income since 2010, Britain suffered the biggest fall of any G8 country apart from Italy.

In France and Germany, capital investment has remained largely stable at 19.9% and 17.2% of GDP respectively. In Britain it fell 0.8 percentage points between 2010 and 2012, to 14.3% of GDP. The US, Japan, Canada, Italy and Russia have higher levels of capital investment than the UK.

David Cameron hosts the G8 countries in County Fermanagh in July and is expected to stress the need for the world's leading economies to make greater efforts to generate growth.

The Treasury's independent economic forecaster, the Office for Budget Responsibility, has pencilled in a strong rise in business investment next year in response to growing optimism that the UK recovery will be gathering strength in 2014. However, the OBR has been forecasting a bounce in business investment for each year of this parliament only to see its targets missed.

Ed Balls, Labour's shadow chancellor, said: "Britain has a poor historical record on investing for the long term but things have got worse not better over the last three years. Since 2010 we've seen the biggest fall in investment as a share of national income of any G8 country other than Italy."

"Alongside action now to ensure we have a strong and sustained recovery, we need long-term reforms to make our economy stronger, more balanced and better able to attract new investment and create skilled jobs for the future."

In March Labour published a report by former Institute of Directors boss Sir George Cox, who found businesses wanted the government to play a constructive part in fostering long-term investment.

Figures from the Office for National Statistics showed that business investment was a significant drag on growth in the first three months of the year. The ONS confirmed that Britain avoided a triple dip recession with growth of 0.3% in the first quarter, but a breakdown of the figures showed that investment dropped 0.4%, mainly offset by stockpiling by British businesses.

A Treasury official said several surveys highlighted a nascent recovery in business confidence and activity leading to the expected increase in investment next year. "There are positive signs that activity is picking up across the economy."

The chancellor, George Osborne, is keen to move away from Britain's traditional dependence on the City and government spending as the chief drivers of economic activity. In the first two years of the coalition he focused on providing support for manufacturers and increasing the amount of credit available to firms for investment.

However, separate ONS figures showed that a 0.2% increase in activity across the services sector in March relied heavily on a buoyant banking sector and a modest rise in government spending.

David Tinsley, UK economist at BNP Paribas, described the reliance on stockpiling as "unimpressive". Capital Economics analyst Martin Beck said talk of rebalancing the economy looked "forlorn".

Cameron Robertson: At the 2011 festival, the Bullring – also known as Campo Pequeno – hosted mock bullfights, tomato fights and wrestling. We meet Jake Owen and his construction team as they rebuild the venue – rebranded the Temple – for this year's festival

Rising private rents, lack of affordable housing, benefit cuts and low levels of home-building force costly short-term solution, investigation finds

The UK has spent almost £2bn housing vulnerable homeless families in short-term temporary accommodation, according to figures that demonstrate the scale of Britain's housing crisis.

Rising private rents, a shortage of affordable housing and benefit cuts have forced local authorities, particularly in London, to place increasing numbers of households in bed and breakfast accommodation, hostels and shelters.

With the number of houses built in Britain falling to new lows, according to figures released last week, a four-month study by the Bureau of Investigative Journalism, has revealed that £1.88bn has been spent on renting temporary accommodation in 12 of Britain's biggest cities over the past four years.

Campaigners have said welfare changes will exacerbate the problem. Official figures show that in London alone 7,000 families dependent on benefits stand to lose more than £100 a week under the benefit cap, and many are expected to become homeless as a result.

Leslie Morphy, chief executive of the homelessness charity Crisis, said: "For the sake of cutting just a few pounds a week from their benefits, families and individuals are being forced out of their homes, to be put up in B&Bs or temporary accommodation that costs us all far more."

A separate investigation by the Bureau of Investigative Journalism has uncovered evidence that London councils are rapidly accelerating the rehousing of homeless households outside their home boroughs. Some 32,643 homeless households have been rehoused out of their borough since 2009.

In the year to April, 10,832 households were rehoused in this way – a 16% rise on the previous 12 months. Most left the more affluent districts of inner London for the cheaper outer suburbs, although an increasing number of London's homeless are being moved to towns outside the capital, such as Dartford in Kent, Slough in Berkshire and Spelthorne in Surrey.

The "destination" boroughs have said the influx of households has put a significant strain on local services. Councillors in Enfield in outer London, where more properties and B&B rooms are secured by London authorities than anywhere else, have said the demand from inner London authorities is pushing up private rents and placing untenable pressure on school places.

"The pressure will not abate," said Edward Smith, a Conservative councillor in Enfield. "Before long we will have to build more secondary schools."

The Labour leader of Slough council, Robert Anderson, said: "If authorities put people in our area with complex needs, or even just families; they need to inform us. If we know where they have come from we can make sure the borough does not shirk responsibilities and just pass on their more difficult clients. You can't just pitch up halfway through a year and expect to get a school place. It's not McDonald's."

The housing minister, Mark Prisk, insisted on Sunday night that councils should be careful about placing families in B&Bs far from their home borough. "There is absolutely no excuse for families to be sent miles away without proper regard for their circumstances, or to be placed in unsuitable bed and breakfast accommodation for long periods of time," he said. "The law is clear: councils have a responsibility to take into account people's jobs and schools when securing homes for those in need."

But Prisk also defended the policy of removing families on benefit from central London. "Nor is it right that those living on benefits should be able to live in parts of the capital that those who aren't reliant on this support couldn't afford to," he said.

Households accepted as homeless by their local council will often be placed in temporary accommodation until a more permanent home can be found for them.

As latest government figures show there were 53,130 households living in temporary accommodation at the end of 2012 – 9% higher than the previous year – a leading law firm is preparing a class action against councils that keep families in B&B for longer than the statutory maximum of six weeks. It is believed a third of British local authorities are in breach of the limit, largely because of a shortage of suitable temporary accommodation.

Official guidance says B&B accommodation should be avoided wherever possible. Lack of privacy and amenities for cooking and laundry means it is "not suitable" for families with children or pregnant women "unless there is no alternative accommodation available and then only for a maximum of six weeks".

Bureau data shows the amount spent on temporary accommodation across 12 of Britain's biggest cities was up 5.7% to £464m last year. And London councils have budgeted for further significant overall rises this financial year.

Since 2009, London councils have secured 5,827 properties and B&B rooms in the three London boroughs of Enfield, Waltham Forest and Haringey alone.

The borough suffering the worst homelessness crisis in the country appears to be Newham, in east London which has spent £185.2m placing people in temporary accommodation since 2009.

Number of people out of work increased 15,000 in the first quarter of the year as jobless rate pushed up to 7.8%

Unemployment jumped and average wage rises dropped to their lowest rate on record in the three months to March, underlining concerns at the slow pace of the UK's recovery.

There was an increase in unemployment of 15,000 in the first quarter of the year, while during the same period regular pay rose by just 0.8%.

Total pay rises, which include bonuses, came in even lower than average pay rises, said the Office for National Statistics, increasing by only 0.4% at a time when inflation remains stubbornly high at 2.8%.

The worsening unemployment picture sent the jobless rate up from 7.7% to 7.8% and left the total number unemployed at 2.52 million.

Chancellor George Osborne has come under increasing pressure to stimulate economic growth from a wide range of critics, though they differ in their remedies, especially in areas such as construction.

A report for the London Assembly this week found that there are 150,000 skilled construction workers in the capital claiming jobseeker's allowance, at a cost of £2.1bn in benefits. A similar picture of empty and half-built construction sites is repeated across the country as the industry, which accounts for 7% of economic activity, remains in the doldrums.

Martin Back, UK economist at Capital Economics, said the labour market data provides "something of a reality check" following recent positive news on the economy. "There was a triple whammy of bad news, with employment in the three months to March down by 43,000 and unemployment, on the ILO measure, up by 15,000. Meanwhile, the squeeze on real earnings has intensified, with average earnings including bonuses falling by 0.7% year on year in March, the first drop since 2009."

The employment minister, Mark Hoban, conceded there had been a "disappointing increase" in the headline rate of unemployment, but said other indicators showed the government was making progress. "There are record numbers of women in work, fewer young people unemployed and more vacancies available for those looking for work. We are also seeing continuing falls in the number of people claiming jobseeker's allowance, which is positive."

The number of job vacancies rose in the three months to March to 503,000, the highest total since 2008, though well down on the 950,000 jobs on offer in 2007.

The number of people claiming jobseeker's allowance in April fell to its lowest level since May 2011 at 1.52 million, down 7,300 from March 2013 and down 67,800 from a year earlier.

Analysts said some of the drop in the claimant count could be ascribed to the slight improvement in the economic picture this year and the success of benefit offices in shifting workers back into work.

Hoban said: "These statistics also show that the UK's employment rate, which currently stands at around 71%, compares favourably to the US, where it is 67%, and the EU and the eurozone, where it is even lower – at 64%."

Louise's story

Louise Thomasson never imagined she would still be doing her part-time student job six months after graduating with a first in English. Since last autumn, the 22-year-old from Bolton has applied for more than 100 jobs, but is still looking for that elusive break into graduate work in marketing.

"I've put a lot of effort getting a first because I though it would at least help my CV stand out a bit from all the other grads that are applying, but it doesn't seem to have made any difference."

Thomasson, who has £24,000 in debts, expects not to be as well off as friends who didn't go to university when she lands a job. The young graduate was given yet another reminder of how tough the labour market is when she went to an assessment day for an admin assistant job paying the minimum wage. "When I turned up, it looked like the boardroom of The Apprentice. There were people there who had done masters. There were people who had come from prestigious universities. One of them had set up their own charity. It was quite intimidating and I was sort of startled by the kind of calibre of the people who had turned up."

She didn't get through to the next round, and for now continues to work 20 hours a week in a sales job at an electrical equipment superstore and do two days a week volunteering. Although she finds her situation bleak, she is not giving up. "I did work very hard in my degree and I do have a passion for what I do."

Selling televisions would be a welcome break for Lisa Brownlie, who has not had a job since she left school without qualifications two years ago. "The jobs I have been applying for have been any job I can get hold off supermarkets, sales, anything." She has been called to interview only twice, failing both times because she lacks school certificates. "Me with no qualifications against 10 other people that have something, I've got no chance," she said.

Brownlie recently passed a maths NVQ and is close to finishing two courses in English and customer service at Rathbone, a Manchester-based charity that helps young people not in education, work or training. Although the charity gives her £40 a week to meet lunch and travel expenses and she lives rent free with a friend's parents, money is tight.

Once she has finished her exams, she hopes to study childcare. "I would like to focus on younger children because I think the first couple of years of a child's life are the most important."

Chancellor boosted by rise in exports as G7 finance meeting starts

Britain's export performance and construction industry continued to improve in March, giving George Osborne a much-needed lift ahead of the G7 meeting of finance ministers that began on Friday.

Exports rose at a faster pace than imports to bring down the monthly deficit in goods and services, while construction output recovered from an unusually cold winter that interrupted building in most parts of the industry.

The chancellor, who is under pressure to to boost growth and relax his plans for further public spending cuts, is expected to be relieved that while goods exports to other EU member states were flat, sales to non-EU countries were up 10% on the previous month. Exports to the US soared 21% on February's level.

Speaking as he welcomed finance ministers and central bank governors from the world's most powerful economies, Osborne said he was keen for his peers to focus on what more central banks can do to help growth at a time when most governments are trying to cut spending and reduce bloated debts.

"(This is) an opportunity to consider what more monetary activism can do to support the recovery, while ensuring medium-term inflation expectations remain anchored," he said.

Christine Lagarde, the boss of the International Monetary Fund, incoming Bank of England governor Mark Carney and US Treasury secretary Jack Lew were among those arriving at Hartwell House in the Buckinghamshire countryside for the G7 meeting on Friday.

Osborne has also pledged to make tax evasion a key issue at the G7 summit, but Lew made it clear the Obama administration's priority was tackling the current slowdown in global growth.

Lew said Japan had "growth issues" that needed to be dealt with and that its attempts to stimulate its economy needed to stay within the bounds of international agreements to avoid competitive devaluations.

"I'm just going to refer back to the ground rules and the fact that we've made clear that we'll keep an eye on that," he said.

The yen hit a four-year low against the dollar earlier on Friday, beyond the psychologically important 100 yen mark. It also traded at a three-year low against the euro.

Lew is also concerned at Berlin's stubborn refusal to take a more lenient attitude to highly indebted southern European countries, which he said was holding back the eurozone's recovery and stifling efforts to spur global growth.

Wolfgang Schäuble, the German finance minister, dismissed criticism earlier this week that austerity hurt growth, insisting it established the confidence needed in the public finances to boost investment.

Stock markets continued to soar with the FTSE 100 reaching a 6.5 year high. The Dow Jones Industrial index maintained its stellar performance after it added 27 points by 18:00 BST to 15,054.

Analysts said the rise in share values, with the FTSE up 12% so far this year, was largely due to a lack of rival investment opportunities as central banks pumped cheap money into the world economy, depressing interest rates.

Osborne has come under fire from the IMF for not doing enough to boost growth and holding back the world recovery. Like Schäuble, he could come under pressure to relax his austerity measures to promote growth.

The UK narrowly avoided a triple dip recession after figures showed the economy grew by 0.3% in the first three months of the year, but analysts cautioned that the construction industry, which grew by 12% in March, had performed badly since the financial crash and was still 2% down over in the first three months of the year.

Trade also remains a drag on the economy despite a recent recovery. A £9bn shortfall in goods was only partially offset by services exports to leave the overall trade deficit of £3.1bn, down from the previous month's £3.4bn deficit.

Martin Beck, UK economist at Capital Economics, said: "The generally good run of recent data can't disguise the fact that, in its domestic and overseas performance, the UK economy remains pretty sluggish."

Analysts Lombard Street Research said: "The British economy is sickly. Although initial estimates of GDP suggest activity

increased in the first three months of the year, a self-sustaining recovery remains elusive. Output growth in the recent past seems to have been somewhat stronger than official ONS data imply; but there is no sign that the economy is returning to a 'normal' pace of expansion.

Polly Toynbee (Labour's golden policy key? Build, build and build more, 30 April) highlights Labour's problem in talking about borrowing. They should take head-on the Tory myth that too much borrowing by the last Labour government was what led us into trouble, and that more borrowing will lead to more problems. The difference between borrowing for current expenditure and borrowing for investment needs to be emphasised. Much government borrowing at the moment goes on benefits to people out of work or paid minimal wages.

As well as housing, borrowing to invest in massive home energy efficiency schemes and other sustainable energy projects, good cycle routes and sustainable transport would bring returns to the government in reduced unemployment benefits, lower housing benefit payments, reduced need for winter fuel allowances and lower healthcare costs, as well as in receiving more revenue from income taxes, housing rentals and, for example, larger payments by train operating companies for access to better rail infrastructure. These benefits to central finances could occur on a timescale comparable with the present government's forecast of when the deficit will be reduced. Labour should say, clearly, we will reduce the welfare budget and the government deficit, not by hitting lower- and middle-income people, but by sensible investment.
Martin Quick
Stroud, Gloucestershire

• The news that the economy is not officially in a triple-dip recession (Report, 26 April) should not be allowed to mask the intolerable human cost of the downturn. Behind the statistics and rhetoric are thousands upon thousands of people being denied the opportunity to be economically active. This breeds resentment, fear and is corrosive to community cohesion. In the last few months, Newcastle city council, with partners, has created a massive capital programme to invest in infrastructure, including roads, pavements, housing and ultrafast broadband. We have also acted decisively with the private sector to unlock major development projects stalled by the failure of banks to lend. We are doing this to create much-needed jobs, instil business confidence and give people a sense of hope in the future. It's time the chancellor switched from his destructive austerity programme and followed our example.
Cllr Nick Forbes
Labour leader, Newcastle city council

• Monday's public accounts committee report on UK infrastructure spending and many of its recommendations are timely (Report, 29 April) but what the UK urgently needs is better cross-party consensus on major projects, improvements to the existing infrastructure strategy and more collaborative methods of infrastructure funding to obviate the failings of PPP.

Foreign investors are reluctant to invest in the UK because of dithering over south-east airport capacity and, despite leading the world in the implementation of PPP, we still deliver two-thirds of infrastructure projects late or over-budget. At a time when the UK should be benefiting from low rates of borrowing, the current PPP model fails to capitalise on this, which in turns feeds through to higher financing cost. Private sector and government need to work a lot harder to develop more effective development and financing strategies that provide better value for money.
Ian Kennedy
Co-founder Institute for Infrastructure Studies

• Ed Miliband has been criticised for his admission that Labour's blanket cut in VAT would lead to a temporary increase in government borrowing. Any moves to cut VAT ought to be directly targeted at stimulating activity in those sectors of the economy struggling most – and where the Treasury is currently losing millions in tax revenue as consumers opt to pay cash in hand to rogue traders. This is one of the key challenges facing legitimate building firms in this country. With VAT at 20%, many property owners are choosing not to have building works done or else employing cowboys willing to "lose the VAT".

As borne out by experience in France and the Isle of Man, a targeted cut in VAT on building repairs would stimulate construction activity and increase tax revenue. Rather than causing an increase in government borrowing, this policy would enable the Treasury to give an immediate stimulus to economic growth and bolster government coffers into the bargain.
Michael Levack
Scottish Building Federation