Industry reacts to Labour’s ‘big build’ announcement

Source: Labour Party website
Source: Labour Party website

The construction sector has given its take on Labour leader Keir Starmer’s pledge to “get Britain building” with a plan to build 1.5 million homes over the next five years.

Shadow Chancellor Rachel Reeves has doubled down on this plan which will be funded through reforms to stamp duty, which the Labour party said it would increase for overseas property buyers.

The Federation of Master Builders (FMB) has spoken up, pointing out that this push must include small builders to ensure regional growth is felt across all parts of the UK.

Brian Berry, chief executive of the FMB, said: “’Big build’ is a welcome ambition for an industry that has been mired by issues for decades, resulting in small local, builders delivering fewer and fewer homes, to the detriment of local communities.

“The return to gentle densification, last seen in the 18th and 19th centuries has all the building blocks to help SMEs regain their share of the market, which has been dominated by a few major companies over recent years. It’s encouraging that Labour is tackling the emotive issue of the green belt, with the so called ‘grey belt’ which has restricted sensible and sustainable development for too long.”

He continued: “The announcement on new towns is a good idea to promote regional growth and deliver new homes, but it’s essential that local builders are part of this process. By bringing SMEs on board with new town development this will ensure high quality and diverse housing is delivered, while also creating wider benefits, like vocational skills opportunities.

“Coupled with Monday’s announcement to reform the antiquated planning system, announced by Shadow Chancellor Rachel Reeves, this could all add up to a renaissance for small, local builders.”

However, David Hannah, group chairman of stamp duty experts Conerstone Tax has expressed concern in the methods Labour would be using to fund the new homes.

David said: “Raising the non-residents surcharge past the current rate would be extremely problematic in the current climate, it can only lead to a collapse in house building by private developers and further increase unemployment.

If a potential Starmer government were to do this, they would absolutely need to extend the current exemptions beyond Crown Employees as the surcharge is hitting unintended targets including, overseas charity workers and UN staff. Whilst the intention to make more of Britain’s households homeowners is clearly a good one, there must be careful thought put into how any government would achieve this, rather than increasing a blanket charge for all overseas residents on stamp duty.” 

The National Federation of Builders, (NFB) agreed and said development corporations were the ‘perfect mechanism’ to deliver this. It also wants large sites, where 100 or more homes are planned, to be subdivided by 20 to 30 builders.

NFB housing and planning head Rico Wojtulewicz said: “We need to assess the green belt. It is supposed to stop urban sprawl not just any green area you want to protect.”

Meanwhile, the Royal Institution of Chartered Surveyors (RICS) supports the Labour Party leader’s pledge to reform local planning laws to make it easier to develop land. RICS has now called for an evidence-led review of the green belt looking at ‘brownfield’ and ‘grey field’ sites.


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