The 2015 Budget announcement has included new policies designed to boost the housing sector and give greater control to employers over apprenticeship funding.
As part of his final Budget before May’s General Election, Chancellor George Osborne unveiled plans for a Help to Buy ISA, offering to top up first time buyers’ savings by 25% and make it faster to save for a deposit on a house. Available from autumn 2015, the ?bonus’ will require an initial sum of œ1,000 to be placed in the ISA before potential funds of up to œ3,000 can be paid out. The funds can then be used for home purchases of up to œ450,000 in London and up to œ250,000 outside London.
Speaking on March 18, Mr. Osborne said: “The Government is committed to providing continued support to the construction sector which is why in the Budget, I announced a new Help to Buy ISA for first time buyers to help them save for their first home.”
The Government also revealed plans to introduce 20 new housing zones, which could provide up to 45,000 homes on brownfield sites across the country.
Both the new ISA and housing zones have been welcomed by some members of the construction industry as a further sign to continued efforts to boost the house-building sector, which has experienced dwindling activity in recent months.
Dr Diana Montgomery, chief executive of the Construction Products Association, said: “As we have continued to highlight the need for Government to clarify its plans to support house-building, we are pleased with the innovative ?Help to Buy ISA’ scheme. This should stimulate home-buyers’ interest in the near term and house-builders’ confidence in the medium term – a tonic to the flattening demand we forecast for the private housing sector after the uncertainty of the General Election.”
Andrew Halstead-Smith, group marketing manager at Ibstock Brick, said: “Following growth in the construction industry, the commitment to keep Britain building with plans for 20 new housing zones is a welcome boost. This announcement, coupled with the creation of the Help to Buy ISA for first time buyers, further supports our housing market.”
However, there has been some criticism levelled at the Government by those claiming that the plans do little to boost the supply of new homes. Iain McIlwee, chief executive of the British Woodworking Federation, said: “The promise of 20 new housing zones and a Help-to-Buy ISA might help the housing market a bit, but policy is focussed too much on demand side factors than really getting to grips with the serious problems of undersupply – fundamentally we need to build more houses. Where was the support for the smaller builder? Where was the incentive for councils to invest more intensely in building in their regions?
Despite these reservations, there are signs that the announcements – particularly the Help to Buy ISA – have already prompted action, with Travis Perkins announcing the creation of 4,000 new jobs, supporting 400 new branches across the country over the next four years.
John Carter, chief executive of Travis Perkins, said: “Travis Perkins’ ability to create 4,000 new jobs reflects confidence in our businesses, the markets we operate in and the UK economy as whole. This confidence is supported by a number of actions taken by the Government over the past two years, including the new Help to Buy ISA, that are continuing to support construction activity and improvements in consumer confidence.
Another area covered in the Budget to effect construction is apprenticeship reform, with the launch of a new digital apprenticeship voucher to give empl
