AUTUMN STATEMENT: Industry Comments

Responding to today’s Autumn Statement, Cara Jenkinson, Cities Manager at climate solutions charity Ashden, said:

“With just a few days to go till COP28, the Chancellor has once again missed an opportunity to show leadership on climate action. After rolling back on net zero targets last month, there has been a stony silence on energy efficiency – leaving people exposed to cold homes and high bills. The energy efficiency industry once again faces an uncertain future, jeopardising the chance to create decent jobs across the country.

“Although Jeremy Hunt put forward support for green industry in his speech, the elephant in the room once again is energy efficiency – despite it being one of the quickest, easiest and least costly things we could do to improve people’s lives. Why would a Chancellor not do this?

“A long-term investment in energy efficiency now would reduce our exposure to volatile gas prices, cut the cost of expensive upgrades to our energy grid, and improve the mental and physical health of millions of people facing fuel poverty.”

“As a nation we have the solutions to massively improved energy efficiency, we just need to back them. If the Chancellor wants to entice future voters, leaving out support for businesses that can keep the British public warm, save them money, and keep our carbon emissions down is not the way to do it. By omitting support for organisations like these in the Autumn Statement, Jeremy Hunt is just leaving ordinary citizens and innovative businesses out in the cold.”

David Hannah, Group Chairman of Cornerstone Tax comments,

“The Chancellor needed to use this opportunity to provide liquidity support to the construction industry to enable them to build speculatively and increase the housing stock more rapidly in this country. The decision to commit an additional £110m to deliver nutrient mitigation schemes to unlock 40,000 new homes in cities including London, Leeds and Cambridge is positive news. Earmarking £32m to address the planning backlog and beginning a consultation to allow any house to be converted into two flats marks an important step in freeing up the rental sector’s supply problem, potentially easing the strain felt by both landlords and tenants.

“At another level the crisis in the private rental sector, could have been eased by removing the second home surcharge from bona fide private rental sector investors giving them a reduction in their acquisition costs and also reinstating full relief for mortgage interest payments in common with other businesses that have to borrow money to provide their services.

“This double measure would have both reduced the costs of purchase, whilst allowing landlords to freeze, or even potentially cut, rents which have had to have both these penal measures “costed in” over the last few years. It would also stimulate purchases in the market at a time when owner occupiers are unable to purchase because of affordability issues.

“The above would have provided a robust solution to providing homes, stimulating the property market at the lower end and restoring what has been a politically motivated but economically disastrous strategy from a government that, as little as 14 years ago, was begging the private rental sector for help during the crash.”

Graham Harle CEO of Gleeds responds to Autumn Statement

“This 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’t help firms struggling to make a profit or investing in people. It’s all jam tomorrow and while planning reforms sound appealing they take time to implement and may not be supported by any future government. Reducing business rates is helpful for a struggling retail sector and abolition of aspects of national insurance for self-employed tradespeople looks good but is worth little more than a few hundred pounds for the average plumber or electrician.

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 £50m to support apprenticeships is meagre. We were promised 110 measures to help industry but in fact there was little there to inspire confidence & stimulate investment.“

Ben Harwood, managing director of national real estate consultancy, Naismiths, said:

“This statement is okay for business, but in terms of benefits to the construction industry specifically there isn’t much in it – albeit glimmers of potential.

“Mr Hunt states that the economy has outperformed expectations since last autumn. This paints a picture of somewhat improvement, and while inflation and interest rates have reduced and this is positive, it is as expected for property and construction stakeholders.

“The industry has been riding this wave for some time, and as rates have been stabilising this has naturally meant an uptick in construction activity. But this does not negate the fact that all sectors of construction have and continue to feel the brunt of a still uncertain and turbulent market, especially the residential development sector, which I would have liked to have seen more support in the autumn announcement by way of more certainty for homebuyers.

“More measures for first time buyers if announced, would have had a trickle down effect on the private open sales market – providing more assurance to new build residential property developers and in-turn financers of large residential schemes.

“For large residential portfolio holders and residential retrofitting contractors, the announcement regarding a new permitted development rights consultation, which would allow any house to be divided into two flats, provided the exterior remains unaffected, is welcome. This will help to open up more property investment and development opportunities and increase affordability for buyers or renters of such schemes for cheaper flat properties when compared to a house.

“Investment zones support announced is in favor of infrastructure and manufacturing, which I believe later down the line will see advantages in property growth through the building of more advanced facilities. Building on Mr Hunt’s commitment to support R&D is absolutely welcome.

The “changes worth £280 million a year to simplify and improve R&D tax reliefs”, will go some way to helping also drive digital innovation in construction businesses, something that Naismiths will benefit from in support of the continued development and investment of our Naismiths Analytics platform.

“Finally, the uplift in the minimum wage by 9.8% and a cut of 2% to the main employee National Insurance rate is a clear pull for laboring talent generally on lower wages and will help to support a skills short industry.”

Celia Greaves, CEO and Founder of the Hydrogen Energy Association, said:

“Overall, there were some encouraging announcements in the Autumn Statement. We welcome the news about tax relief on capital expenditure which should lead to more vital investment in the UK energy sector, as well as the measures to support our most innovative industries – both of which will bring benefits to the hydrogen sector.

“Regarding measures to cut grid access delays, the HEA is pleased to see this announcement as access is clearly important for green hydrogen projects.

“We now hope to see the investment into hydrogen from the already announced funding helping to retain and grow the UK industry.”