Industry figures welcome some aspects of review but lament lack of strong commitment to housing

Sajud Javid - spending round

The chancellor’s spending review appeared to pay little heed to new housing delivery across the UK or the country’s planning departments, according to the industry figures.

Speaking after Sajid Javid (pictured) yesterday delivered his first major parliamentary announcement since becoming chancellor of the exchequer, Melanie Leech, the British Property Federation’s chief executive, said she welcomed additional funding for local authorities, “but the review offers little to support new housing delivery or overstretched planning departments.

“Local authorities have a unique and vital role in alleviating the housing crisis and rejuvenating the UK’s struggling town centres. However, despite the ambitions of many local authorities, they simply do not have the resources to focus on the strategic issues that will shape and secure their communities’ long-term future.

Leech said additional funding must be allocated to planning departments, which she said had seen the most severe cuts of any local authority service, with per-person spend on planning falling by 55% between 2010/11 and 2017/18.

“While today’s announcement may ease some of the funding challenges facing local authorities, we cannot ignore the need for a more comprehensive change in the way that local government is valued and resourced,” she added.

And Abigail Davies, a director at Savills Housing Consultancy, said since the spending review covered only one financial year 2020-21, “important announcements affecting housing providers and their customers have been left until a later date. Capital funding beyond 2021 will not be decided until a further Spending Review in 2020. This means Homes England’s grant budget and priorities will be unclear until then, leaving only a matter of months to plan before the current funding round ends in March 2021.

“Also, a decision on setting future benefits rates for things such as Universal Credit and Local Housing Allowance, will not be made until the autumn – just a few months before the four-year benefit freeze is due to come to an end in April 2020.

“This has the potential to make business planning for 2020-21 challenging for housing providers in terms of sustaining affordability of rental properties, investment in existing homes and planning to continue boosting new housing provision. The sooner clarity can be provided on these issues the better, to ensure the housing sector continues to step up its efforts to tackle the housing crisis.”

Mark Robinson, chief executive of framework outfit Scape, said the chancellor’s announcement that the overall departmental spending on local authorities would see the largest increase since 2010 was “a drop in the ocean when you set it against the 80% cuts to funding since 2008.

“Vital day-to-day services and community facilities are faltering as councils continued to be squeezed.”

And while Brian Berry, chief executive of the Federation of Master Builders, welcomed the commitment to pump more cash into Homes England – the exact amount was not specified in the chancellor’s statement – he warned such a commitment “must be part of an overarching strategy for new build homes and social housing, which will be key to securing a prosperous post-Brexit Britain.

“What’s more, we need a retrofit strategy to ensure that our existing homes are fit for the future, and to alleviate the scourge of fuel poverty,” he added.

 Construction’s key points from the spending review:

  • An unspecified amount of additional funding to help Homes England deliver more homes
  • £24m additional funding for the Building Safety Programme to support the new building safety regime
  • Upgrades to 20 hospitals this year as part of more than “£2bn of new NHS capital funding”
  • Confirmed funding of £3.6bn for the new Towns Fund
  • £400m funding boost for further education – which could help with skills crisis