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What Does Construction Need From The Next Government?
With the election on the horizon and manifestos being a bit light on construction specifics apart from some nods at housing, some of the industry’s...
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Conservative Construction Manifesto – Great Vision…And Flawed Thinking
The Conservative party has launched its election manifesto under the title ‘Clear Action, Bold Action, Secure Future’. Most construction orientated observes have declared it to show great vision – with some flawed thinking.
Federation of Builders (NFB)executive of the National Federation of Builders (NFB), says: “A healthy construction industry is the only way a nation can grow and unfortunately, construction has taken some great hits in these last five years.
“The Conservative manifesto announced tax cuts that will benefit our sector, particularly as almost fifty per cent are self-employed. However, without pipelines of work, construction will not be able to avail from tax changes.
“It is therefore frustrating that the Conservatives would plough ahead with the recent changes to planning and housing policy which have caused new build completion to drop considerably.
“We therefore have to question how 1.6 million homes (a manifesto pledge) can be delivered, when previous more housing positive policy environments only delivered 835,680 homes over the previous five years.”
The manifesto is written across sixteen ‘Our plan’ chapters, with many policies that construction will welcome:
- Simplify planning and speed up major infrastructure project sign off, so it takes only one year.
- Reform Environmental Impact Assessments and other EU red tape which stops new housing.
- Ensure statutory consultees improve development rather than frustrate planning applications.
- Fast track planning for brownfield housing and consider full expensing of brownfield sites.
- Set land aside for smaller builders and lift Section 106 burdens on more smaller sites.
- Abolishing the main rate of self-employed National Insurance.
- Shift from university education to technical qualifications and the Advanced British Standard.
- Funding 100,000 apprentices.
- SME focussed procurement reforms.
- Abolish Stamp Duty for homes up to £425,000 for first time buyers and introduce a new and improved Help to Buy scheme.
- Protect the green belt.
- Energy bill discounts for communities welcoming onshore renewables.
- Abolish EU ‘Nutrient Neutrality’ rules.
Rico Wojtulewicz, Head of Policy and the NFB, says:
“The Conservatives have heard our manifesto asks on Section 106, infrastructure, Nutrient Neutrality and statutory consultee reforms. Reforms we have been pushing on for more than five years. However, most small builders will not qualify for support because the government continues to see them as delivering fewer than ten homes, rather than the fifty that industry has been lobbying for over this past half decade.
“We also have concerns regarding the commitment to brownfield and greenbelt protection, particularly as it is based on ‘gentle density’ in major cities and not ‘community density’ as the NFB has set out in its own manifesto. This is because development built to a maximum of ten storeys, the gentle density definition, will pass the housing crisis on to the next generation as too few homes will be built, with mixed developments made broadly unviable.
“The NFB’s ‘community density’ approach ensures that in major cities, residential and non-residential needs are made viable in a well-designed and thoughtfully planned development.”
Wojtulewicz adds: “There is much to welcome in the manifesto, particularly on apprenticeship and technical education. However, much of it was already on the table along with policies that are currently decimating SMEs, such as Biodiversity Net Gain not being reformed. Small builders will likely conclude that if the Conservatives were to win the next election, they would experience another parliamentary term of warm words but no action.”
Federation of Master Builders (FMB)
“The Conservative manifesto highlights some important steps to help boost house building in Britain but fails to tackle the key problem stopping delivery – planning reform,” says Brian Berry, chief executive.
“Britain is currently experiencing a housing crisis. The manifesto was an opportunity to set out a plan to deliver real change over the next five-years. The pledge to support smaller local builders, by requiring councils to set land aside for them, will be welcomed by FMB members, as will proposals to lift Section 106 requirements for smaller sites.
“However, if the housing crisis is to be successfully tackled, reform of the planning system is urgently needed, something the Conservative Party has consistently failed to address.”
1.6 million homes
Berry adds: “The plan to build 1.6 million homes over the next five years, delivered through increased building on urban brownfield land, is positive, however it will remain insufficient to tackle the scale of the crisis the UK faces.
“The construction sector is a key pillar of the UK economy – and a thriving construction industry is essential to delivering sustainable long-term economic growth. The next government will also need to tackle the ongoing construction skills crisis, support the rollout of energy efficiency upgrades to existing homes, introduce a scheme to set a minimum competency level for builders and installers and provide wider business support to SME construction firms facing a difficult economic climate.”
Ritchie Clapson, co-founder of propertyCEO:
“The Tory’s manifesto pledge to build 1.6 million new homes over the next five years is broadly as ambitious as Labour’s own 1.5 million target, yet both will require wholesale changes to the planning system if they're to succeed.
“Brownfield sites have correctly been flagged as the low-hanging fruit, being quicker to develop and friendlier on the environment. But any new government will need to champion the use of carefully crafted permitted development rights so such sites can be successfully unlocked.
“Critically, they will also need to stop local authority planning departments from routinely objecting to these schemes, which will require a complete overhaul of the system and greater investment in planning officers. Given the diverse political control of our councils and the sensitivity of nimbysim, some cross-party collaboration will prove essential.
“Remember that larger housebuilders won’t touch most brownfield projects, as they sit outside their skillset. They want larger, new-build projects with beefier profits. So, it will fall to the smaller existing and new developers to deliver these schemes, and any new government needs to do what it can to incentivise new first-time developers to come into the market in order for them to achieve their ambitious new homes targets.”
Atul Kariya, head of real estate and construction, at MHA says:
“Finally, it seems as though the Conservative Party is putting housing at the top of the agenda with a proposal to cut stamp duty for first time buyers. This along with the announcement that they will scrap capital gains tax for landlords who sell to sitting tenants is very welcome. Both policies may provide the impetus required to get the housing market moving.
“We were surprised at the time of the budget in March that there were no proposals on reducing Stamp Duty, given it would have a cost a fraction of the NI reductions and would have been popular with first time buyers and those moving up the property ladder and good for the economy by giving a boost to the construction sector.
“Whatever government is formed, we would urge them to turn the proposal into policy as soon as practical. This should not be a one off but a permanent relief which housebuilders and buyers can rely on in the future.”
Picture: Richard Beresford, the chief executive of the National Federation of Builders.
Article written by Brian Shillibeer
13th June 2024