Construction鈥檚 take on this afternoon鈥檚 announcements
Chancellor Jeremy Hunt delivered his autumn statement this afternoon with promises to reform the planning system and scrap plans to end a tax cut allowing firms to claim back the cost of equipment.
The government has said it wants to overhaul the country鈥檚 planning system in order to boost economic growth and productivity.
It said it would introduce a 鈥渘ew premium planning services across England with guaranteed accelerated decision dates for major applications and fee refunds wherever these are not met鈥�.
Meanwhile, the chancellor described the 鈥渇ull expensing鈥� measure which lets businesses claim 25% of the cost of investments in IT, equipment and machinery as the 鈥渓argest business tax cut in modern British history鈥�.
This afternoon鈥檚 autumn statement was delivered against predictions the UK economy will grow much more slowly than previously thought over the next two years.
The Office for Budget Responsibility (OBR) said the economy would grow by 0.7% in 2024 and 1.4% in 2025. That is down from a forecast in March of 1.8% and 2.5%.
According to the watchdog, the UK will grow by 0.6% this year - considerably better than what it expected last autumn, when it predicted the economy would fall into recession and shrink by 1.4%.
Reaction has been mixed with Peter Hogg, UK cities director at Arcadis, saying the 鈥淣ational Insurance cuts, a duty freeze on alcohol, the pensions triple lock and benefits increases will be the headline-grabbing crowd pleasers but was this a statement for business?鈥�
He added: 鈥淢aking expensing permanent will be welcomed by business and will certainly benefit the economy as a whole 鈥� though services firms will benefit less than more capital-intensive businesses.
But he warned: 鈥淭he chancellor made a big play of his 鈥榩lanning reform鈥� but, cynically, his proposal is little more than applicants paying more to get the service they should have got anyway; to think that this is going to turn the dial on housing delivery and development is fanciful.鈥�
Here is what others in the industry thought of it.
鈥淪peeding up the planning process for major infrastructure projects is vital to achieving net zero, improving climate resilience and boosting economic growth.
鈥淕overnment鈥檚 endorsement of a strategic spatial approach to the energy transmission network is a big step forward, and we welcome the ambition to get decisions on major projects made within two and half years, down from the current average of over four years.
鈥淭o achieve this ambition, government must urgently finalise a new set of clear, updated national policy statements for energy and transport and progress the other Commission recommendations it has adopted. While there are indications of progress on promoting greater access to environmental data, government needs to go further to provide firm commitments and timeframes for data sharing and to support the development of mitigations that benefit multiple projects in key sectors and locations.
鈥淚ndustry and investors will be watching to ensure government moves from commitments to action. There鈥檚 no time to lose.鈥�
Sir John Armitt, chair of the National Infrastructure Commission
鈥淭his was an autumn statement by a government that appears to have little insight into the challenges faced by those working in property and construction, having shuffled 16 housing ministers in 13 years and just cancelled HS2. Of the measures announced, full expensing is to be welcomed but is only helpful if you have projects requiring you to buy plant and machinery. It doesn鈥檛 help firms struggling to make a profit or investing in people. It鈥檚 all jam tomorrow and while planning reforms sound appealing they take time to implement and may not be supported by any future government. Where was the VAT relief on the greening of housing stock when over 31m people live in buildings that meet sub-standard EPC ratings and 拢50m to support apprenticeships is meagre. We were promised 110 measures to help industry but in fact there was little there to inspire confidence and stimulate investment.鈥�
Graham Harle, chief executive, Gleeds
鈥淎ccording to the latest data, construction starts in London are at the lowest point since 2009. Consequently, the industry is in dire need of support. Considering the Chancellor鈥檚 focus on supply-side measures, this was an ideal chance to provide this backing as well as be radical and listen to those 66% of Londoners aged 25-45 who would have welcomed development on the green belt if it meant more homes. As a representative of the SME sector, it is therefore disheartening to see our suggestions for supply-side interventions, proposals that could potentially unlock an additional 1.6 million new homes at no extra cost to the Treasury, overlooked once more.鈥�
Marc Vlessing, chief executive, Pocket Living
Autumn Statement 2023 coverage
>> Hunt slashes taxes as OBR sharply downgrades growth forecast
>> Hunt announces 拢110m nutrient mitigation fund to 鈥榰nlock 40,000 homes
>> Government promises planning reforms to speed up decision-making
>> Autumn statement 2023: Key measures at a glance
>> Autumn statement 2023: Industry reacts
>> Developers to be offered 鈥榩remium planning service鈥� to speed up council decisions
鈥淭he government heard the furious backlash to its green policy rollback last month; and this was a chance to realise scale of their error by shoring up protections for struggling households and small businesses and get energy bills and carbon emissions under control. It鈥檚 not that the Government hasn鈥檛 been presented with the ideas to address the problem. Industry has been offering oven-ready policy proposals such as modernising Stamp Duty with a 鈥榬ebate to renovate鈥� incentive for households that would accelerate home insulation, cut our reliance on polluting fossil fuels, and motivate people to switch to low carbon heating and install solar panels 鈥� all while also 鈥榖acking British businesses鈥� by creating a large-scale, long-term retrofit market to support industry and deliver skilled jobs throughout the country. We hope it will be announced in the Spring Budget.鈥�
Simon McWhirter, deputy chief executive at the UK Green 好色先生TV Council
鈥淲ith current strains on the public purse and the potential to re-stoke inflation, the likelihood of significant investment in infrastructure was always limited. Even so, the lack of any new meaningful investment to boost the UK鈥檚 pipeline is disappointing. Infrastructure is, after all, the foundation for wider economic growth.鈥�
Colin Wood, chief executive, Aecom Europe and India
鈥淭he chancellor has taken some significant pro-business steps today, but the downgraded growth forecasts prepared by the OBR show the scale of the challenge he faces. Reducing employees鈥� NI is a great way to make work pay 鈥� and we also welcome the extension of the Restart programme and reform of fit notes as these steps will help ensure that we make the most of the UK鈥檚 labour force. Making full expensing permanent is also great news for business and will drive investment 鈥� but only in the sectors that can really benefit from it. Services firms 鈥� the bulk of the economy 鈥� benefit far less.鈥�
Neil Carberry. chief executive, Recruitment and Employment Confederation
鈥淚n light of the OBR鈥檚 central forecast being downgraded, the Autumn Statement was really quite underwhelming for the construction industry, which has been crying out for some clarity, commitment and consistency in policies.
鈥淐rucially, the already delayed National Infrastructure and Construction Pipeline is still nowhere to be seen, with the government saying it will publish a National Infrastructure Strategy next year.
鈥淚nvestment in infrastructure, and removing barriers to private sector investment, is hugely important to driving economic growth. With the Autumn Statement, construction firms operating in an uncertain market have simply had that uncertainty prolonged yet again.鈥�
Dr David Crosthwaite, chief economist at 好色先生TV Cost Information Service
鈥淲e 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.
鈥淗owever, the planning system can only work more effectively, and be held to account for delivering swifter outcomes, if it is resourced properly. The planning system has been under-funded for at least a decade and its expertise in handling major projects hollowed out.鈥�
Melanie Leech, British Property Federation chief executive
鈥淲ith one eye on the General Election next year, this was always likely to be an Autumn Statement primarily aimed at helping working households and businesses. For UK construction product manufacturers, it is the 鈥楩ull Expensing鈥� announcement that will resonate most with them. While these announcements are helpful, the Chancellor could have gone further with industrial policy by providing a clearer strategy on key growth areas. Equally, more could be done on housing supply and home buying, as well as energy efficiency in housing such as introducing a green stamp duty. While the announcements on improving infrastructure delivery are welcome, how effectively they will translate into reality on the ground is yet to be seen.鈥�
Noble Francis, CPA economics director
鈥淭oday鈥檚 Autumn Statement included some welcome developments on planning and opportunities for regional rebalancing, but a continued lack of clarity around future infrastructure projects continues to create uncertainty across the supply chain as we wait for the urgently required publication of an updated National Infrastructure and Construction Pipeline.鈥�
Richard Robinson, chief executive UK & Ireland, AtkinsR茅alis
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