The Spring Statement announced increased spending on defence and cuts to public sector funding while reinforcing the government’s growth strategy through an OBR forecast of growth thanks to planning reform, which it identified as having zero cost to the Treasury.
The National Federation of Builders (NFB) says that while the government’s commitment to tackling the housing crisis is commendable, it must do more to support SME housebuilders or continue to face challenges.
Richard Beresford, chief executive of the NFB, said: “Planning reform doesn’t just unlock housing, it facilitates infrastructure, amenities, commercial spaces, new places, and in the case of new towns, where land is purchased at existing use value, the potential for truly affordable housing.”
“There is still a lot of work to do, but the government is showing that they are serious about ensuring planning reform drives sustainable growth and strengthens the economy.”
The OBR highlighted that planning reforms, primarily relating to the green belt, are expected to increase new housing input by 170,000 additional homes, with almost 300,000 homes being delivered annually by 2029/30.
The government also announced its intention to unlock public land for the next generation of homeowners, with a taskforce to be set up to achieve this ambition. It highlighted that alongside unused defence land, rail estate will play a major role in creating a pipeline for development and placemaking.
Rico Wojtulewicz, head of policy and market insight for the NFB, commented: “Labour are serious about tackling the housing crisis but must learn from past failures on strategic policies such as land release. If these sites primarily go to large builders, workforce challenges will persist because small constructors train 73% of construction apprentices.”
“The chancellor must lean on MHCLG to start reforming planning for SME builders. Beyond training the workforce to a higher standard and offering greater employment security, SMEs are the learner pipeline for those ending up in the non-new housebuilding workforce, such as Repair, Maintenance and Improvement (RMI), which delivers twice the level of output as new housing.”
“The OBR does not appear to have accounted for the risk that planning reforms focused on the biggest builders that do little to nothing for SMEs, will consequently shrink the RMI workforce capacity. Therefore, as things stand, any growth in new build would likely to be cancelled out by struggles in the RMI sectors.”
“The government can view the Spring Statement in one of two ways, a vindication of their strategy, or as an indication that hard work is still required. We believe it is the latter, but those conversations with industry need to happen sooner rather than later because for 99% of the industry, things are not improving.”
