The construction industry has criticized the lack of new funding presented in the Autumn Statement, from infrastructure and net zero targets to local planning capacity.
Experts also suggested that the “small” planning reform presented in the autumn statement will do little to boost house building.
However, a promise to speed up consent for major infrastructure projects received modest plaudits, as did the extension of blanket spending, which allows companies to claim capital allowance for investment in plant and machinery.
Here Construction news rounds out the construction industry’s response to the Chancellor’s Autumn Statement.
Investment and planning in infrastructures
Colin Wood, Aecom chief executive for Europe and India, said: “The lack of significant new investment to boost the UK pipeline is disappointing”, adding that “infrastructure is, after all, the basis for broader economic growth.”
Construction Cost Information Service chief executive David Crosthwaite agreed, saying: “The national infrastructure and construction pipeline, which is already behind schedule, is still nowhere to be seen, and the government says which will publish a national infrastructure strategy next year.
“Investment in infrastructure and removing barriers to private sector investment is very important to drive economic growth. With the Autumn Statement, construction companies operating in an uncertain market have simply returned to that prolonged uncertainty .
Build UK chief executive Suzannah Nichol was also disappointed, saying: “While we understand the importance of keeping inflation under control, investment is needed to deliver growth and increase productivity across all sectors. Our industry is ready to build the housing and infrastructure the country needs and it is vital that the government commits now to deliver its construction and infrastructure.”
However, Wood said he was “encouraged by the steps announced today to accelerate infrastructure delivery and create greater certainty for investors and developers”.
His position is shared by Murphy Group chief executive John Murphy, who said: “We welcome the government’s plans to work more closely with industry and focus on the four key themes of speed, certainty, simplicity and delivery when dealing with the infrastructure requirements of the country.”
James Corrigan, managing director of infrastructure at Turner & Townsend in the UK, expressed skepticism about plans to speed up infrastructure consent.
“What is currently unclear is how all this will be delivered in practice. [The] sector and ministers must collaborate closely […] to ensure realistic sequencing of investment and development. Without this, we risk setting unattainable targets and hitting capacity bottlenecks in delivery,” he said.
Net zero investment
Elsewhere, Aecom’s Wood noted there were no “dedicated new measures” to support the decarbonisation of the UK housing stock, while UK Green Building Council deputy chief executive Simon McWhirter suggested the government had not responded to “the furious reaction to its ecological policy”. last month”.
“This was an opportunity to realize that [the] scale of their mistake by strengthening protections for struggling households and small businesses and controlling energy bills and carbon emissions,” the latter added. “It’s not that the government hasn’t been presented with the ideas to address the problem. The industry has been offering policy proposals ready for the oven.”
McWhirter pointed out that policies “like modernizing stamp duty with a ‘renovation discount’ incentive for homes would accelerate home insulation, reduce our reliance on polluting fossil fuels and motivate people to switch to low-carbon heating and installing solar panels, all while ‘supporting British businesses’ by creating a large-scale, long-term retrofit market’.
Mark Robinson, group chief executive of SCAPE also called on the government “to be more rigorous in its approach to achieving net zero, as without strong policies and incentives, climate action may be sidelined in favor of other pressing priorities.”
He added that “the construction industry has a huge role to play in decarbonising our society, and has made significant progress, but we all need to work together to accelerate our impact, for the benefit of communities up and down of the country”.
Tax and R&D
Build UK’s Nichols welcomed the tax changes in the Autumn Statement for small businesses. “At a time when cash flow and liquidity are a challenge for so many construction companies, and supply chain resilience is more important than ever, we welcome the government’s decision to ease the tax burden of businesses and permanently expand the totality of capital expenditures,” she said.
Marie-Claude Hemming, chief operating officer of the Civil Engineering Contractors Association (CECA), also praised the extension of total capital expenditure. ,” she said.
Wood, for his part, said: “The ongoing total spend allows UK plc to invest with confidence, not only in the development and modernization of buildings, but also in newer technologies, particularly in the renewables market.” .
However, Hemming added: “As much of our industry hires out its plant and machinery, we welcome the opportunity to continue working with the government to develop policy to include assets for hire within this subsidy”.
He also said the civil sector has “substantial concern about the merging of R&D spending and SME schemes”, noting: “The [government] Guidance published today suggests contractors can still claim tax credits for some R&D, but we need to see more detail as industry has been concerned the proposed changes could make this difficult in reality, potentially reversing the recent strong growth in innovation in the sector. .”
Planning
Allan Wilen, chief economist at data aggregator Glenigan, said: “Moves to free up the planning system will be welcomed by the industry. By allowing councils to increase planning fees on mainstream applications, it is hoped that authorities can better equip their planning departments and make quick planning decisions.”
However, others said the reforms were minimal, adding that it was still unclear how they would work in practice.
Michael Dempsey, legal director of the infrastructure and planning consent team at Adleshaw Goddard, said: “The proposal that councils should be able to recover the full costs of major planning applications is attractive, particularly as it appears not it will be free of danger for the municipalities themselves.
“However, I do not see how this will do anything to incentivize planning authorities to process applications more quickly. Many are chronically under-resourced and cannot process applications at the speed required. A more direct solution and, I think much more effective would be additional funding to councils in this regard. I wouldn’t be surprised if some councils end up worse off with these proposed rate arrangements.”
The sentiment was shared by Peter Hogg, UK Cities Director at Arcadis, who said: “The Chancellor made a big game of his ‘planning reform’ but cynically his proposal is little more than applicants paying more to get the service they should have anyway; to think this will turn the dial on housing delivery and development is fanciful.”
Meanwhile, Alistair Watson, UK head of planning and environment at global law firm Taylor Wessing, criticized the “minor planning reform which would only come into force sometime in 2024”, arguing that it presented “more questions than answers”.
He added: “It’s a tiny, tiny amount shy of the planning reform that’s actually needed and nowhere near what the property sector, well most of the country, has been asking for years and has been promised for years.
“This supposed urban reform announced today will not bring the development and infrastructure that the government says it wants the real estate sector to deliver.”
