PROPOSED GOVERNMENT spending on building roads, schools, social housing and other infrastructure is set to fall by €6.2 billion as a result of Budget cuts, builders warned yesterday.

The Construction Industry Federation (CIF) yesterday launched a report on the contracting sector which states that the Republic's big civil engineering firms are seeing work dry up as the Government cuts back on capital spending.

CIF director general Tom Parlon said the revised capital programme means projected spending on infrastructure in 2009 alone is down by €2 billion, while it will be €6.2 billion down between next year and 2013.

Roads will be a big casualty, as the Department of Transport's allocation has been slashed by €160 million, Mr Parlon said.

Projects such as Dublin's Newlands Cross junction, the Gort to Oranmore road in Galway and the Carrigtwohill to Midleton route in Cork were under threat, he added.

"However, the results of our survey of members show that delays are occurring across all headings, with particular concerns in relation to major urban regeneration projects, schools, social housing developments and health infrastructure," he said.

Mr Parlon warned that job cuts in the sector will result in a loss of skilled staff to the country, and hit the Irish industry's capacity to carry out large projects. He argued that with intense competition for projects, the Government was missing an opportunity to get value for money.