Construction Industry Reaction To Autumn Budget
The 2023 Autumn Statement left some construction stakeholders disappointed, as Stamp Duty changes were omitted while planning reforms were met positively
Many construction industry stakeholders expressed disappointment that the anticipated changes to Stamp Duty and other support measures for the housing market were not outlined in last weeks Autumn Statement
Potential adjustments to Stamp Duty were rumoured to be a part of the 2023 Autumn Statement, leaving industry stakeholders disappointed.
“We hoped today would be the day, but it looks like we’ll be waiting until at least March for the long-awaited Stamp Duty announcement. It’s clear that one way or another, Stamp Duty changes are on the horizon,” said Jonathan Stinton, head of intermediary Relationships at Coventry Building Society.
“The Chancellor can either orchestrate the change through a considered reform, or he can ignore it and let the temporary relief lapse. Let’s hope it’s not the latter because that choice would see homebuyers paying an extra £2,500 on an average-priced home,” he added.
Hunt’s Stamp Duty stance has divided opinion
Other stakeholders feel they understand why Stamp Duty was left out of the 110 growth reforms outlined today in the Common Chambers.
“Given the Government focus on inflation-reducing tax measures, it is perhaps not a huge surprise that they decided to eschew any Stamp Duty amendments in the Autumn Statement, as this would likely have contributed to a fresh level of inflation in the housing market,” commented Parminder Sidhu, partner and head of residential property at Wedlake Bell.
“While there may be further announcements on Stamp Duty to come, either in the Spring Budget or an electoral manifesto, given that we are likely less than a year from another General Election, it’s unlikely that any reduction in Stamp Duty will be realised under this Government,” he continued.
Hunt looks to accelerate planning
The Chancellor also announced plans to reform the planning system to allow for faster planning applications for potential developers. This policy has been met more positively by some industry stakeholders.
“We labour under a planning system which is no longer fit for purpose. However, local authorities have insufficient resources to dedicate to an expensive planning system that has built up a level of bureaucracy, which means that large applications need to be delivered in a van,” said William Poole-Wilson, founder of design and strategy architects, WILL+Partners.
“Most local planning authorities don’t have the technical competency to know whether a design is missing an opportunity or has a technical flaw. Therefore, some significant upskilling will be needed to help ensure that all major projects are vetted,” he added.
An inefficient planning system and the delivery of the right infrastructure are the biggest blockers to delivering homes
Melanie Leech, chief executive of the British Property Federation, also welcomed the planning reforms.
“We know that two of the biggest blockers to delivering the homes, workplaces and vibrant communities needed across the country are an inefficient planning system and delivery of the right infrastructure, and the Chancellor is right to focus on these as part of a wider plan to boost business investment and stimulate growth,” she said.
The construction industry needs to turn its focus to sustainability
Neil Baines, managing director of Steven Hunt Associates, commented: “After the recent political turmoil and set against a backdrop of serious unrest, today’s autumn budget has put into focus the need for more support for businesses and support for individuals still affected by high energy costs.
“While the Chancellor has recognised the importance of the Net Zero agenda, it goes without saying that more needs to be done to demonstrate that the climate emergency and measures to help cut fuel bills are at the top of its agenda, with policies and incentives that prioritise the decarbonisation of the construction industry for businesses and for homeowners.
“Clients’ preferences are shifting towards green construction methods, and we need investment in helping people cut energy use to lower fuel bills – while the UK construction industry faces a unique set of challenges in 2024, we need to prioritise sustainability, of which this budget doesn’t do enough. With this in mind, I welcome the £4bn worth of investment over the next 5 years into more strategic investment into manufacturing with a net zero focus.”
Hunt also announced the freeze on Local Housing Allowance (LHA) as part of the 2023 Autumn Statement. LHA is the rate used to work out what a person can claim in financial help from the government when renting from a private landlord.
The Chancellor announced a £1bn investment to guarantee that LHA rates would encompass the bottom 30% of market rents for the first time since 2020.
Credit - www.pbctoday.co.uk
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