As the UK braces for the chancellor’s Spring Budget 2024, the construction industry shares their hopes and fears
The housing crisis, skills shortage and cost of living crisis rumble on, as chancellor Jeremy Hunt gears up to announce the 2024 Spring Budget.
In what is potentially the last Budget announcement by this Government before a general election, reports indicate that the chancellor will extend a 5p per litre fuel duty cut on petrol and diesel, announced by Rishi Sunak in 2022, for a further year.
The chancellor has expressed his desire to bring down the tax burden, which is estimated to rise to historically high levels, regardless of any announcements in the Spring Budget 2024.
“Planning reforms are key to increasing supply”
Oliver Boundy, executive director of development at Anchor comments: “It is no secret that the UK is in the midst of a housing crisis, there is a huge shortage of affordable homes and while conversation on this often centre around younger families and first-time buyers, there is a risk of those in later life being forgotten. We have seen that the demand for appropriate housing is equally high for older people as younger.
“For us, planning reforms and increased grant funding for affordable homes are key to increasing supply and meeting the high demand for older people’s housing. We would welcome a new planning classification for housing for older people. On this note, we would like 10% of sites in Local Plans to be allocated for age restricted housing. Finally, we would like to see last-time buyers given equal weighting to first time buyers when it comes to Stamp Duty – we believe this will help to incentivise ‘right sizing’.”
The Spring Budget is an opportunity for the Government to be bold
Dr David Crosthwaite, chief economist at BCIS, describes the the Spring Budget as “even more important in light of recent news that UK GDP was down 0.3% in 4Q 2023 and that the economy went into recession. Construction performed the worst out of all sectors. All eyes will be on the government to see what difference, if any, they could make.
“Therefore, it’s vital the chancellor introduces some measures that will stimulate the economy and give the industry renewed hope and optimism.
“We have continually called for ‘clarity and consistency of policy and regulation’ in the government’s approach to overseeing infrastructure investment and its delivery. As the recent publication of the long-awaited Infrastructure Pipeline showed current plans are patchy and inadequate.
“It failed to nail down the detail that would give more certainty to a sector still reeling from the repercussions of costly financing, budget erosion and super inflation.
“An action plan for investment that will stimulate growth across energy, water, transport and communications is essential.
“This should include the recommendations, as set out by the National Infrastructure Commission: investing in public transport; improving underperforming parts of the national road network; developing a long-term rail plan; reducing the number of properties at risk of flooding; adding low carbon technologies to the electricity system, to create a new strategic energy reserve.
“It’s been a year since the Shortage Occupation List (SOL) was introduced to help resolve labour issues in construction. But we’re yet to see if the additions to the list six months ago concerning the extra construction roles can make a difference.
“Meanwhile, the government still lacks a clear strategy for ensuring we have the additional 224,900 workers required to meet UK construction output between 2023 and 2027, especially the green-collar workforce we so desperately need to help the UK achieve its net zero targets.”
Rectifying RAAC would be a strong show of supporting infrastructure
“The government could give a much-needed boost to housing by investing in a significant programme of social housing as a part of a wider joined-up housing policy.
“From safeguarding vulnerable residents in social housing to ensuring our schools and hospitals are habitable, we also ask that the government prioritises vital repair and maintenance (R&M) work, across the public and private sectors.
Switching focus to embodied carbon
“We continue to advocate for the mandatory reporting of whole life embodied carbon, as the missing vital step towards decarbonisation.
“And although we’re encouraged to see the government invest in improving energy efficiency in homes and buildings, through the allocation of funds that include the Social Housing Decarbonisation Fund, operational carbon is just one part of the picture.
“A recent report, Carbon Blind Spots, from the MMC (Modern Methods of Construction) consultant Akerlof, has found that Scope 3 emissions (embodied carbon) are responsible for an enormous 94-98% of emissions from the UK’s top contractors.
“The government needs to support the industry in its efforts to reduce carbon emissions in the built environment, through incentivising data sharing and subsidising the costs that manufacturers incur to produce verified Environmental Product Declarations (EPDs) on their materials and components.”
