Industry reaction to the Autumn Statement

The Chancellor Philip Hammond has delivered his first Autumn Statement as he set out his stall to prepare the UK economy for the impact of leaving the European Union.

UK Construction Online has gauged reaction to the measures outlined on Wednesday to see if those involved in the industry believe if they will be beneficial.

The mini budget covered the government plans to reinvigorate its house building programme that would see one million new homes built over the course of this Parliament.

Letting agents in England are also to be banned from charging fees to tenants in a move to make renting more affordable and ease the housing crisis. Currently tenants are liable to pay a range of administration fees including references, credits and immigration checks.

Jeremy Blackburn, Head of UK Policy at the Royal Institution of Chartered Surveyors (RICS) said the Chancellor had delivered a “wait-and-see” statement but appeared to demonstrate a greater understanding of the housing sector than his predecessors.

He commented: “with increasingly unaffordable house prices, the majority of British households will be relying on the rental sector in the future. Now it seems that through the relaxation on grants to deliver a wider range of housing types, Hammond will drive an affordable rental agenda and can get Britain building in a way that benefits a cross section of society, not just the fortunate few.”

Peter Vinden, Managing Director of The Vinden Partnership – a leading multi-disciplinary consultant company to the built environment said that there was a great deal of work to do if the government were to achieve its ambitious housebuilding targets.

He said: “The Chancellor confirmed the infrastructure and housing spending that we have been expecting for a few weeks now. These are positive steps but there is still major work to be done if the government is to hit its target of building one million new homes by the end of this Parliament.

“The Autumn Statement probably won’t do too much to sway those decision makers within the industry from sitting on their hands but improved infrastructure both transport and digital should help to improve regional economies and create employment.

“Such is the nature of politics that the government can’t reveal its hand too much on Brexit negotiations and we are unlikely to find out too many details until the process gets underway.  That being the case, the uncertainty that clouds the UK economy is unlikely to lift anytime soon.”

Shraga Stern, Director of construction firm, Decorean, called for a “real change” in the government’s approach to housebuilding citing the need to overhaul the planning system. He said: “The government must enforce changes to the planning system and regulations, which act as a stumbling block for many smaller developers. As the UK’s population continues to grow, we echo Mr Hammond’s thoughts that for many ‘the goal of home ownership is out of reach’. However, we have heard this all before and hope that this Autumn Statement acts as a stepping stone to providing a shelter over people’s heads and somewhere comfortable and affordable to call home.”

IEMA’s Chief Policy Advisor Martin Baxter felt there was little to shout about in terms of environment and sustainability policy but broadly welcomed the investment in infrastructure, industry and skills.

He said: “Today’s Autumn Statement has provided some level of confidence for business in terms of investment at a time of uncertainty, which is a welcome move. Investment in infrastructure, industry and skills is a strong trinity of themes that together, will bolster the UK’s resilience, competitively and productivity. Given this direction, we are looking to the government to ensure that environment and sustainability skills are absolutely central to this programme. We are disappointed that this hasn’t thus far appeared to be prominent. We look forward to seeing this come through in the imminent industrial strategy, the emissions reduction plan and the 25-year environment plan.”

Richard Steer, Chairman of Gleeds, felt there was little to get excited about as Brexit uncertainty and party politics left the chancellor slightly hamstrung. He said: “This was a budget produced by a Chancellor who has one hand tied behind his back by the Brexit result and the other by the PM trying to keep her party in line. There is still so much economic uncertainty that it is difficult to be excited by re-heated announcements of increased infrastructure spending and more housebuilding.

“Mr Hammond announced a National Productivity Investment Fund of £23Bn to be spent on innovation and infrastructure over the next five years. By closing the UK’s productivity gap, the Chancellor plans to create the “high wage, high skill economy we want”.

Mr Steer said that the new productivity fund sounded attractive on face value but was concerned that the measure may prove to be just rhetoric.

He said: “The new productivity fund sounds good but we have heard this type of thing before and, whilst it is argued that it will be funded by increased borrowing, the main issue is confidence in the UK and this was not a budget that is going to help enhance the value in the sterling which effects costs, or persuade private sector funders to invest.

Mr Steer felt that the jury would remain out on the housebuilding initiatives with the measures being little more than a “wish list” without knowing whether UK would have free access to skilled labour.

David Hawkes, the Chartered Institute of Building (CIOB) Policy Manager commended the Chancellor for placing productivity at the centre of his Autumn Statement.

He said: “It’s clear that the Chancellor recognises that improving productivity is vital to economic prosperity. In construction, we know what can be done to improve productivity, but require certainty for firms to invest in innovation, skills and training in order to support it. For this reason, we welcome the £23Bn National Productivity Investment Fund, to be spent on improving innovation and infrastructure over the next five years.”

He also welcomed the regional investment outlined by Mr Hammond, saying that reducing the investment and productivity gap between London and the rest of the UK was vital to the success of the economy.

Mr Hawkes added that this would be only be successful if the investment was tied to training and job creation.

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