Following a chaotic build-up that included a host of kite flying measures and even the OBR’s accidental leak minutes before the official delivery, Chancellor Rachel Reeves has now presented the Government’s Autumn Budget. Professional Builders Merchant presents a number of the reactions from the construction sector – including merchants, manufacturers and trade organisations. A detailed response from the BMF, meanwhile, can be viewed here…
CEO David Young commented: “Today’s Budget offers some positive signals for construction, particularly around housing ambition, skills and the transition to a lower‑carbon economy. But it falls short of the reset the sector was hoping for. The real test will be how quickly planning is unblocked and investment flows into projects on the ground. Without faster, more predictable delivery, confidence will remain fragile.
“For Bradfords, the fundamentals haven’t changed: demand for warm, efficient, well-built homes across the South West is strong. Our customers want clarity and stability so they can plan, price and deliver work with confidence.”
David continued: “While today’s measures provide some reassurance, the broader tax environment remains challenging. Frozen personal tax and employer NI thresholds, adjustments to corporation tax and staged fuel duty increases will add pressure to household budgets and business costs. These factors could influence spending decisions and margins across the supply chain, making predictability and cost-efficiency more critical than ever.
“That’s why we’re continuing to invest in our branches, our people and our product ranges – particularly in renewables, energy‑efficient building materials and solutions that help projects run smoothly and profitably. We’ve also invested in our own fleet to improve efficiency and reduce emissions, ensuring we can deliver for customers reliably and sustainably. Our focus remains on supporting customers with practical, cost‑effective ways to keep building and improving homes across the South West.
“The Chancellor’s commitment to apprenticeships is a welcome step. Making under-25 apprenticeship training free and allocating £820 million over three years signals genuine support for workforce development. However, businesses will want clarity on how funds are accessed and whether the scheme is flexible enough to meet sector-specific needs.”
The FMB “has welcomed measures in today’s Autumn Budget,” including pulling back on the landfill tax, £48 million to boost planning capacity, and free apprenticeship training for under-25s in SMEs. However, it adds that the “previously announced wage rises will hit small business squeezed bottom lines and the lack of action on domestic retrofit and dropping of ECO scheme leaves a gap in how the country will upgrade it’s old housing stock.”
FMB Chief Executive Brian Berry commented: “Today’s announcement on landfill tax reform is a big win for small house builders, saving them thousands on new build costs. Alongside this, making apprenticeship training for under-25s in SMEs free from paying in the co-investment sum when hiring under 25’s will be a boost, alongside much needed simplification of the apprenticeship application process.”
Brian continued: “The £48 million investment to boost planning capacity is further positive step. Local planning departments are under immense strain, and this funding will help unlock stalled housing projects, but this seems a small sum of money to fix a very big problem. A well-resourced planning system is essential if we are to meet housing targets, and SMEs must be at the heart of delivery. Supporting small builders to get spades in the ground will ensure Britain gets the high-quality homes communities need.”
He concluded: “However, the rise in minimum wage will squeeze bottom lines and the freeze in tax thresholds has the potential to push many builders into a higher tax bracket. It’s also disappointing to see the Chancellor miss the opportunity to back household energy upgrades of any kind, even rolling back on the ECO scheme. Upgrading homes will be vital to keep people warm in winter and cool in summer.
“This Budget offers welcome steps forward, but overall I can see many builders feeling underwhelmed.”
Royal Institution of Chartered Surveyors
RCIS states that it recognises the “the significant challenges facing the Government and the need for a difficult financial balancing act,” and also welcomes the continued commitment to major infrastructure projects and skills across the country.” Furthermore, the announcement of “free training for all apprentices up to the age of 25 at SMEs will help young people to gain critical experience including in the built and natural environment sector.”
It adds that the government’s “continued commitment to improving the business rates system is necessary, but meaningful and wholesale reform is still needed. Business rates must be reflective of a modern economy, and those that require physical assets should only pay a fair and proportionate share of the burden.”
However, “scrapping the Energy Company Obligation (ECO) scheme with no prospect of an alternative mechanism has the potential to hamper the country’s ambition to tackle the UK’s retrofit burden. We must catalyse a market for retrofitting our existing homes to meet net emissions targets and create the high-paying jobs of the future.”
RICS Chief Executive, Justin Young, said: “The Government faces many challenges, and RICS recognises the difficult balancing act it must play. There are positive moves, such as new support for apprentices under the age of 25, which should hopefully expand the pipeline of new talent into the surveying profession. It is encouraging that the Government is prioritising necessary reforms to the business rates system, and we are committed to supporting this effort through our members’ expertise.
“Whilst these changes are welcome, there are several measures which may weaken the housing market, such as raising tax on dividends, property, and savings income by 2%. Furthermore, it seems that commitments to sustainability are weakening. RICS is working with the Government to mitigate these effects and help it deliver its objectives.”
According to the leading heating supplier, the news that the ECO (Energy Company Obligation) scheme will be scrapped to save consumers £150 annually “will impact manufacturers’ ability to avoid fines under the Clean Heat Market Mechanism, which could result in fines in excess of £60m.”
Martyn Bridges, Director of External Affairs, said: “ECO 4 started on the 1st April 2022 and continues until 31st March 2026. In that time, it has fully funded just under 39,000 heat pumps up until the end of September 2025, an average of around 1,000 appliances a month. In today’s budget, the chancellor announced that ECO will not continue after the 1st April 2026, saving households around £150 annually on their energy bills.
“As these appliances were all eligible to be counted towards the target quota that manufacturers have to meet to avoid fines under the Clean Heat Market Mechanism (CHMM), then the CHMM targets need re-appraising. Removing on average 12,000 funded heat pumps from the market would potentially result in fines in excess of £6m for manufacturers as they cannot meet their quotas.”
Hamid Salimi, Residential Product Manager, commented: “Daikin welcomes the government’s plan to reduce energy bills by an average of £150. Bringing down the cost of electricity will undoubtedly ease the cost-of-living crisis. This will make low-carbon heating and cooling more affordable and encourage households and businesses to make the switch.”
Allan Wilen, Economics Director, commented: “We all knew the Chancellor needed to ensure the Government’s finances appear on a firm footing, and she made the most of the situation to do so. It is welcome that the Chancellor also reiterated the Government’s commitment to £120 billion of capital investment previously set out in the Spending Review. But it’s vital the government rapidly delivers on these commitments and does not damage already fragile investor confidence, both for the UK construction sector’s survival and to ensure stronger UK productivity and economic growth. That, for me, has to be the primary objective.
“The situation’s pretty serious, as much as it’s been downplayed this afternoon. Without increased investment, the UK will not secure the economic and productivity growth needed to deliver a rise in living standards and to improve the Government’s own finances over the longer term. There is a danger that the plethora of new taxes announced by the Chancellor may deter private sector investment and frustrate other government objectives.
“The new property tax on higher value homes, whilst targeting the top end of the property market, could have a disproportionately disruptive impact on the wider housing market. This could deter new house construction, especially in parts of the UK such as London, where property prices are highest. This will throw a spanner in the works regarding the Government’s ambitious housing target, especially when there’s an increasing movement of people looking to live in the capital.
“Drawing on what I’ve heard from those at the frontline of UK construction and real estate, Stamp Duty has been repeatedly raised as a distinct blocker to shifting the current stagnation within the property market.
“For a government looking at all opportunities to balance the books yet deliver a fluid and prosperous residential market, it must be time to listen to the built environment sector and look at some of the current measures that are stifling buying and selling movement in the property market and, in turn, deterring related investment.”
Malcolm Farrow, Director of Marketing and External Affairs, said: “Amid the widespread speculation ahead of the Budget regarding a potential VAT cut on gas and electricity bills, our position was clear: if the government acted, it had to be fair and include off-grid homes too. It appears the Chancellor has changed course and focused mainly on reducing electricity bills. Its approach to achieving this is scrapping the ECO scheme which, amongst other measures, is expected to reduce household bills by £150.
“Questions over the exact details remain, and the statement suggests more clarity will be outlined in the upcoming Warm Homes Plan. Whilst oil heating currently remains one of the cheapest forms of heating, households are still grappling with the wider cost of living, so any reduction in their overall energy costs will be welcome.
“However, the Chancellor also set out that everyone is being asked to contribute more through rising taxes to balance the public finances. In the wider context of the drive to net zero, it’s clear the need for affordable low carbon heating solutions is even more critical. We cannot expect consumers to face rising taxes and high living costs, while simultaneously taking on the heavy financial burden of expensive new heating technologies.
“This is why we welcome the government’s recent consultation on Alternative Clean Heating consultation which recognises this challenge. We are ready to engage positively to show how renewable liquid fuels can provide a pragmatic solution, by both removing the high upfront costs associated with other technologies whilst keeping long term energy bills down.
“But the government does need to provide more certainty. The recent speculation, inconsistency and delay in off-grid policy decisions are unhelpful for both industry and consumers who are trying to plan for the future. That’s why the government needs to urgently publish the Warm Homes Plan. This will help provide the clarity needed to deliver a transition that is fair, practical, and affordable.”
The British Property Federation
Chief Executive Melanie Leech said: “There wasn’t a single thing said in the Chancellor’s speech that wasn’t leaked in its chaotic build up. However the lack of surprises doesn’t hide the disappointment that many in the development industry will feel after today.
“Whilst she spoke positively about the importance of business investment and maintained full expensing and the headline rate of Corporation Tax, there was little to cheer from an investor perspective.
“Indeed, confirmation of the large property business rates surcharge will impact critical national infrastructure like logistics businesses and priority sectors identified in the Government’s own Industrial Strategy.
“While it was always going to be a challenge for the Chancellor to both balance the books and support economic growth, it is disappointing that there was nothing introduced to alleviate acute development viability issues. Overall, no surprises, but nothing to cheer either.”
