Rishi Sunak today delivers his third budget alongside a spending review. Here are some of the housing things we may (or may not) see from the chancellor today.
Rishi Sunak will deliver his third budget this afternoon as the government comes under growing pressure to control rising costs for materials, labour and energy which have hobbled the post-pandemic recovery of housebuilding.
But as the chancellor stands up at the despatch box at 12.30pm, he will once again be speaking to parliament against a challenging backdrop of public finances ruined by successive covid-19 lockdowns.
Expectations of big spending pledges have already been set low, with the focus likely to be on reining in spending to reduce the government’s £2.2tn deficit, the highest since the Second World War.
However, with borrowing during the first half of this year being around £44bn lower than the £152bn predicted by the Office for Budget Responsibility in March, Sunak has been provided with some much needed wiggle room.
Many announcements have already been made, including a £1.8bn brownfield housing fund and £2bn residential developer property land tax.
But the budget, along with its accompanying spending review document, is likely to contain more detail of the announced pledges along with one or two surprises.
Here is a run through of some of the things it may be worth looking out for today:
Details of the £2bn brownfield fund
The Treasury over the weekend - in one of many trailed announcements that has enraged the speaker of the House of Commons Sir Lindsay Hoyle - released details of a fund for new homes on brownfield site.
The government briefed that Sunak will announce £1.8bn in funding to turn brownfield sites into housing. The Treasury said 160,000 homes could be built on the land, which is the size of 2,000 football pitches.
However it is not clear how this scheme will work, who is eligible and what form the finance will take. We are unlikely to get this level of detail today. It will be particularly important to note whether the funding is actually new, or whether it will be taken from other housing pots, such as the £11.5bn affordable homes programme, which Sunak is also set to ‘re-confirm’ today.
How much will each housebuilder pay under the £2bn Residential Property Developer Tax?
The government also last week re-announced plans for a £2bn tax on residential property over 10 years on developers to fund fire safety remediation works.
Housebuilders have been doing back-of-a-fag-packet calculations to try and work out how much they will have to pay.
Ministers have promised to publish details of how this tax will operate, and what the hit will be for housebuilders today.
A national retrofit programme?
The government’s Heat and Buildings Strategy last week outlined measures totalling £3.9bn to decarbonise our buildings, with incentives for homeowners to install heat pumps dominating the mainstream media headlines.
However many felt it fell short with the absence of a national retrofit programme, something that groups including the Construction Leadership Council and the Federation of Master Builders have called for, a major concern.
It may be wishful thinking, but might Sunak announce anything further on this today?
New demand-side measures to boost homeownership
The Help to Buy equity loan scheme comes to an end in two years and some are speculating that ministers, given their commitment to increasing home ownership, will want to announce new measures to replace it. Gove has hinted at further plans to make it easier for first-time buyers to secure finance.
It might be a bit soon for this to be announced today, but it would not be very surprising if some money was made available to help people on to the housing ladder.
What’s happening with the Homes England review?
For the past few months Peter Freeman, the chair of Homes England, has been reviewing the quango’s aims ahead of what previous housing secretary Robert Jenrick said would be a “reset” of the agency.
Homes England will be expected to focus more heavily on regeneration and would be the obvious vehicle for the £1.8bn brownfield fund. It remains to be seen whether we learn more about the result of Freeman’s review and the agency’s future direction today.
Incentives to improve social housing delivery and stock maintenance
Housing secretary Michael Gove at the Conservative Party conference earlier this month talked about the need for “proper incentivisation” to ensure social housing providers are improving existing homes and increasing housebuilding.
Those in the social housing development sector will be interested to know whether concrete action is likely to come from this desire or whether Gove was merely responding to public concerns about the condition of stock, which has been highlighted in a recent ITV documentary series. Is it thought it is unlikely we see something along these lines in the budget or spending review today.
Details of the digitisation of the planning system
It is not thought likely that we will find out much about Gove’s overhaul of the government’s proposed planning reforms today, however we may get more detail about the plans to “digitise” the planning system announced by the Treasury earlier this week.
Housing developers will be keen to know how the £65m digital transformation of planning will affect their day-to-day business in interacting with local authority planning departments.
The government has said £65m will be invested in new software to help make planning more simple, with the first phase involving 175 councils in England. Any more light shed on these plans, and how they tie into the wider planning reform agenda, would be welcome.
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