Further stabilisation? Tinkering at the edges? Attempting to cushion living standards in the face of an ongoing energy price shock? Kicking the can even further down the road in terms of the larger challenges the country faces…?
Chancellor John Healey has delivered his first Budget. PBM presents some of the reactions from merchant firms and wider construction industry.
John Carter, CEO
“Clarity on Your First Home is good news for the industry. The sliding scale on developer contributions means the scheme will be just as accessible to the SMEs who take on smaller sites as it is to the PLCs delivering new homes at scale. The 20,000 new homes that the Government is targeting through the scheme will boost demand across the supply chain and create work for tradespeople across the country.
“The Government has recognised that the cost of building a home is at a record high, so the commitment not to make major changes to building regulations is certainly welcome. However, the decision not to extend the zero rate of VAT on installing energy-saving materials for retrofit is a missed opportunity to both bring down household energy bills and keep tradespeople in steady work. VAT relief on retrofit is something we have been calling for through our Let’s Get Britain Building NOW campaign and we will continue to make that case to Government.”
David Young, CEO
“The Budget was one of a positive, growth focussed outlook, easing some, but not all, of the pressures for businesses. As a Southwest based business, I welcome the additional powers and funding being given to regions. The Southwest has always been a region built on entrepreneurship, skilled trades and long-term investment.
“The construction sector has been waiting for a clear signal that housing delivery remains a national priority, and (the) Budget provides some welcome ambition. Commitments around housebuilding, planning reform and infrastructure investment have the potential to unlock projects that have been stalled for too long. That is good news not only for builders and developers, but also for communities across the Southwest that are crying out for more homes.
“For merchants, builders and tradespeople, confidence is often just as important as specific measures. While challenges remain around costs and market conditions, a stable policy environment gives companies the foundation they need to look ahead rather than simply manage the present.
“I look forward to understanding more about the Government’s plans and funding for getting more young people into work and training next month. Any measures that encourage more people into construction careers, support apprenticeships and strengthen technical education will be welcomed by the sector.”
Dan Marsden, Director of Renewables
“It’s encouraging to see additional support for consumers to cover the cost of heat pumps with the new loan scheme announced yesterday. However, with no confirmation of extending 0% VAT on energy saving materials beyond 2027, and a Boiler Upgrade Scheme funding cap at £400 million minus inflation, we call on government to confirm their revised renewables installation targets to give businesses and installers renewed investment confidence.
“Wolseley has invested significantly in supporting installers and customers with the transition to renewables. This includes transforming our supply chain and logistics network to deliver renewables at the pace and scale needed to decarbonise homes across the country, as well as supporting the future workforce with comprehensive training packages.
“We are laying the groundwork for a thriving renewables industry across the UK and stand ready to further our investment with stable, long-term policy framework. We hope the Government will soon outline how it will continue to support the industry to grow.”
National House Building Council
Paul Turner, CEO
“The introduction of the Your First Home equity loan scheme is a positive step towards helping more people onto the housing ladder. Supporting first-time buyers is essential to stimulating demand and giving house builders the confidence to invest in new developments.
“We also welcome the commitment to avoid major changes to building regulations during this Parliament. Greater regulatory stability will give house builders much-needed certainty, allowing them to plan ahead, invest with confidence and focus on delivering high-quality homes.
“News that government has added £1.5bn to the Social and Affordable Homes Programme (SAHP) in the Budget is great news for the sector, given how oversubscribed the first round of bidding was earlier in the year. The wider industry is stretched, with demand for affordable housing at record levels and NHBC’s Q3 registration figures showing the pipeline of new homes continues to shrink. “With new home registrations down 13% year on year, this kind of intervention is essential.
“The removal of biodiversity net gain requirements for brownfield sites is another welcome measure today that could help unlock development on land that has previously been difficult to bring forward, supporting regeneration and the delivery of much-needed new homes.
“However, while these measures are encouraging, there is still a significant challenge ahead. Delivering more quality homes requires not only the right policy environment but also a skilled workforce capable of building them to the highest standards. We must skill up if we want to build up. Continued investment in construction skills and apprenticeships will be critical if we are to increase housing supply without compromising quality.”
David Hopkins, Chief Executive
“The Government’s renewed commitment to housebuilding is welcome. The additional £1.5 billion for social and affordable housing, together with measures to make it easier for councils and housing providers to deliver new homes, sends a positive signal to a construction industry that has faced a difficult few years.
“We need to start this moving now. But we mustn’t lose sight of the fact that how we build those homes matters just as much as how many we build. If the Government is serious about meeting its housing ambitions while delivering on its commitment to net zero, then we need to see much greater support for low-carbon construction, particularly timber housing.
“Timber offers a practical, proven way to build high-quality homes while reducing embodied carbon. We already have the knowledge, products and expertise within the UK timber supply chain to help deliver these homes at scale — and at the speed needed to kick-start construction.”
Paul Rose, CEO
“We welcome the government’s recognition that households who rely on heating oil, many of them in rural areas, have faced a difficult year due to the conflict in the Middle East.
“However, most of today’s support is focused on gas and electricity. Oil heated homes will see some benefit on their electricity bills, but while gas households will also see standing charges abolished there is no equivalent help for households on heating oil.
“The £100 payment for homes in council tax bands A-D is welcome, but households that are asset rich, but cash poor will miss out — and that could include many in rural areas. The government has committed to helping communities outside major towns and cities so it must make sure the 1.7 million homes that use heating oil are not left behind.
“The Budget also cuts the future planned heat pump grant funding through the Boiler Upgrade Scheme (BUS), which has been the main driver for growing the heat pump market. Yet at the same time the government is proposing to continue to fine boiler manufacturers who don’t produce a target number of heat pumps through its Clean Heat Market Mechanism.
“Given the dependence of the heat pump market on public subsidy, this approach will only serve to damage the ability of our industry to invest, and is likely to lead to higher prices for customers.
“For consumers, despite cuts to BUS, the government’s message is still that heat pumps are the preferred solution. However, many older rural homes will face thousands of pounds to make the switch even with the grants available. It was disappointing there was no mention of renewable liquid fuels as an alternative solution when 16,000 people supported them in the Alternative Clean Heating consultation. These fuels could cut emissions from oil heated homes quickly, using their existing boiler and tank, which removes the high upfront cost.
“We continue to urge the government to publish its full response to the consultation to give clarity to oil heated households.”
Tim Balcon, CEO
“Today’s Budget reaffirms the Government’s commitment to the biggest transfer of power, funding and responsibility from Westminster in a generation, including greater local control over skills and a new local apprenticeship service.
“The priority for construction is ensuring that investment translates into a stronger workforce. This is an opportunity to meet construction’s workforce needs by linking new investment in local social housing, infrastructure and growth to the skills people need for lasting careers. The Construction Jobs Plan unites industry, mayors and training providers to help employers invest more in people and skills.
“The sector needs 41,000 additional workers every year. Clear regional work pipelines will give employers the confidence to invest. Devolution must help employers build a highly skilled workforce and enable people to thrive throughout their careers.
“CITB is working through the Construction Skills Missions Board to deliver this. We will respond to the Millburn review and White Paper when published in 2027.”
Adam Daniels, Chief Executive
“We want to build homes and help people onto the housing ladder so are encouraged by the content in the Budget which brings much needed and welcome support for first-time buyers. Likewise, we welcome the additional funding to deliver more affordable homes, especially for councils and registered providers, and the introduction of a new VAT relief on land sold to registered social housing providers to expedite the construction of social housing.
“However, we would caution that the delivery of the Government’s wider housing agenda remains at risk unless the housing development viability challenge is urgently addressed. This must include reducing regulatory burdens, bearing down on construction costs, and backing innovation such as advanced modular manufacturing of new homes.”
Main image: Chancellor of the Exchequer John Healey prepares to deliver the Budget at 11 Downing Street. Picture by Kirsty O’Connor, No 10 Downing Street.
