Curious about what Labour’s 400+ seat victory means for UK construction? PBC Today recaps the key points from the Labour manifesto
After securing a stomping victory in the 2024 general election, all eyes are on the incoming Labour government.
With the housing crisis a key topic of campaigning, the UK construction industry is eager to see how Keir Starmer’s party intends to tackle the lack of affordable housing, the shortage of skills needed to deliver it and his plans for achieving net zero.
Labour leader Sir Keir Starmer announced the party’s 2024 manifesto at the Co-op headquarters in Manchester, saying that “ending the Conservative chaos is vital.”
The hefty document outlines sweeping reforms across Parliament, energy investment, social housing. But what do those in UK construction need to know about Labour’s plans?
“Clean energy by 2030, accelerating to net zero”
The Labour manifesto promises £8.3bn of investment into the UK energy sector, as well as creating a new public company, Great British Energy, to create jobs and build supply chains in “every corner of the UK”. The company will be headquartered in Scotland.
With concerns being raised about the capacity of the national grid to supply the UK’s growing energy demand, Labour has promised to upgrade transmission infrastructure.
Labour will also support the transition to electric vehicles through faster deployment of charging points and restoring the 2030 phase-out date of cars with internal combustion engines.
If elected, Labour have pledged to bring Hinkley Point C to completion, as well as increasing rollout of small modular reactors (SMR) and projects similar to Sizewell C. Fracking will be banned and no new coal licenses will be issued, but oil and gas operations in the North Sea will continue.
Green energy will see significant investment under a Labour government
Stating that “there will be no return to austerity,” the manifesto outlined plans to raise £8.5bn a year from tax rises and cracking down on avoidance in the next three years.
Investment allocated across energy and industry includes:
- £1.8bn to upgrade ports and build supply chains across the UK
- £1.5bn to new gigafactories so our automotive industry leads the world
- £2.5bn to rebuild our steel industry
- £1bn to accelerate the deployment of carbon capture
- £500m to support the manufacturing of green hydrogen
Labour is also committed to delivering the New Hospitals Programme and increasing investment in research and innovation spheres to drive industry and medical progress.
A Warm Homes Plan will aid retrofit and cut energy bills
Labour will invest an extra £6.6bn over the next parliament, doubling the existing planned government investment, to upgrade 5m homes to cut bills for families.
The Warm Homes Plan will offer grants and low interest loans to support investment in insulation and other improvements such as solar panels, batteries and low carbon heating to cut bills.
Labour will also work with the private sector, including banks and building societies, to provide further private finance to accelerate home upgrades and low carbon heating. They have also committed to ensuring homes in the private rented sector meet minimum energy efficiency standards by 2030, saving renters hundreds of pounds per year.
1.5m new homes for England over the next five years
Promising “the biggest increase in social and affordable housebuilding in a generation,” the Labour manifesto pledges to:
- Immediately update the National Policy Planning Framework to undo Conservative changes, including restoring mandatory housing targets
- Ensure that planning authorities have up-to-date Local Plans and reform and strengthen the presumption in favour of sustainable development
- Support local authorities by funding additional planning officers, through increasing the rate of the stamp duty surcharge paid by non-UK residents
- Take a brownfield first approach, prioritising the development of previously used land wherever possible, and fast-tracking approval of urban brownfield sites
- Prioritise the release of lower quality ‘grey belt’ land, as well as introducing ‘golden rules’ to ensure greenbelt development benefits communities and nature
- Require all Combined and Mayoral Authorities to strategically plan for housing growth in their areas, giving Combined Authorities new planning powers to do so
- Creating several new towns, as previously announced in late May
- Further reform compulsory purchase compensation rules to speed up delivery
- Implement solutions to unlock the building of homes affected by nutrient neutrality without weakening environmental protections
- Strengthen planning obligations to ensure new developments provide more affordable homes and prioritise the building of new social rented homes
For renters and homeowners, the party pledges to:
- Better protect existing social housing stock by reviewing the increased right to buy discounts introduced in 2012 and increasing protections on newly-built social housing
- Give first-time buyers the first chance to buy homes and “end the farce” of entire developments being sold off to international investors before houses are even built
- Introduce a permanent, comprehensive mortgage guarantee scheme, to support first-time buyers who struggle to save for a large deposit, with lower mortgage costs
- Accelerate the pace of unsafe cladding remediation across the country
- Immediately abolish Section 21 ‘no fault’ evictions, prevent private renters being exploited and discriminated against, empower them to challenge unreasonable rent increases, and take steps to decisively raise standards, including extending ‘Awaab’s Law’ to the private sector
- End “unfair” maintenance costs, unregulated ground rent charges and take steps to ban new leasehold flats and ensure commonhold is the default tenure
Greater local powers and infrastructure investment
As previously reported, Labour would create a new National Infrastructure and Service Transformation Authority (Nista) to oversee a ten year infrastructure strategy.
Improvements to rail connectivity in the north of England, fixing five million potholes over the next five years and better preparing communities for extreme weather events such as flooding and drought are all part of this strategy. The A27 bypass will be deferred, as it is “poor value for money”.
The manifesto also stated the intent to bring the railways into public ownership.
Labour pledged to update national planning policy to ensure the planning system “meets the needs of a modern economy, making it easier to build laboratories, digital infrastructure, and gigafactories.”
Along with devolved powers to local authorities, Local Growth Plans will add a statutory requirement for town regeneration schemes to include supporting infrastructure, such as road improvements, more housing and GPs.
The manifesto also teased at reforming the immigration system to reduce dependence on foreign workers, as well as unspecified new training plans for construction to reduce the skills shortage.
Increased investment in green energy skills will mean “good skilled jobs for tradespeople in every part of the country.”
The construction industry’s response to the Labour manifesto was broadly positive
Sean Keyes, CEO of Sutcliffe: “The Labour Party’s pro-business manifesto is commendable. Businesses thrive on low inflation, financial stability, low taxes and a solid, steadily growing economy. A pro-business Labour government would allow us to focus on what we do best: building more homes to meet demand and achieve the targets outlined in Keir Starmer’s manifesto.
“I will hold Labour to the promise of surpassing the current house building levels, which so far has not been achieved in my lifetime and I do not want businesses to be taxed in hidden ways that will inevitably slow down economic growth. I am of the opinion that the Labour party will triumph on July 4th and we can address the housing shortage in this country, improving the quality of life for millions.”
Planning reform a good start, but more is need on the skills shortage
Justin Young, chief executive of the Royal Institution of Chartered Surveyors (RICS), said: “Labour is right in identifying planning reforms as a policy lever for boosting economic productivity in today’s manifesto, with numerous academic studies having found positive correlation between GDP growth and housebuilding completions. But the opportunities that arise from reform go well beyond housing. Legislation that makes the delivery of any infrastructure is welcomed; red tape is currently acting as a significant barrier to growth. One such example can be found in Cambridge, where the failure to deliver a new water reservoir is threatening to stall the UK’s fast-growing, £94bn-a-year life sciences industry, which has a critical mass in the city.
“As well as speeding up decision-making, planning reform is needed for our housebuilding sector to function efficiently, which is needed if build targets are to be met. Forty years ago, SME housebuilders were responsible for around 40% of housing delivery annually, but by 2024, that number is below 10%. To make matters worse, the number of SME housebuilders has decreased by 80% over the last 30 years. When taking these facts into account, it becomes very apparent why we continue to face a housing crisis and fall short of our housing targets. A simplification of the planning system – which is currently expensive to navigate and riddled with uncertainty – should help reverse this decline by delivering significant certainty.
“Policymakers must also address the skills shortage – otherwise the UK will be unable to deliver on its 300,000-homes-a-year target and £805bn infrastructure pipeline. To overcome these challenges, RICS wants the incoming government, whoever that may be, to consider and implement workable policy solutions. We are calling for the creation of a cross-department skills taskforce, responsible for identifying gaps and opportunities in the workforce, as Labour has set out to do with their proposed Skills England body.”
Brian Berry, chief executive of the FMB, echoed this sentiment, commenting: “Proposals to establish ‘Skills England’ offer hope to tackle the current skills crisis in the building industry. Pledges to boost apprenticeship numbers as well as Labour’s Warm Home Plan will be a major boost to rolling out retrofitting of homes across Britain. There is, however, potential to go further with the creation a dedicated Housing Department and a Secretary of State for Housing who can attend Cabinet meetings.”
Rental reform must work in tandem with building more houses
Abolishing Section 21 has been a common discussion point in all of the major manifestos, but there are warnings that it could destabilise the rental sector.
Mark Bailey, Landwood Group Partner, said: “The announcement of Labour’s pledge to ‘immediately’ abolish Section 21 is intended to benefit renters, but fails to recognise the significant challenges faced by landlords. Regardless of this, removing the ability of a landlord to obtain possession if and when required, is likely to reduce the amount of private housing available to rent as private landlords exit the market[…] As a result, the quality of housing for renters in need may decline even further.
“With more than a third of the UK population renting, it is crucial to consider the impact on private rental housing stock and the sustainability of those providing these homes.
“Looking ahead, landlords may implement stricter tenant vetting to avoid complex evictions and prioritise secure, long-term leases. This could make it harder for new renters to find homes and potentially drive up rents, as landlords seek to mitigate these new risks.
“As we reform the rental market, we must strike a balance that protects renters’ rights while also ensuring the sustainability and availability of private rental stock. The best way to deliver more rental stock and affordable rents is to build more houses. Which is, unsurprisingly, the same answer to the question of how to make home ownership more affordable.”
