The Construction Products Association (CPA) has expressed disappointment at the Autumn Budget, warning that the measures announced by the Chancellor fall short of addressing the immediate pressures facing construction product manufacturers and the wider industry.
Noble Francis, Economics Director at CPA, said: ‘The Autumn Budget was always expected to be focused on the Chancellor trying to be fiscally responsible and reassuring financial markets whilst trying to address household cost-of-living issues in uncertain times, than on the house building and construction industry supply chains.
‘The Chancellor did announce the details of the “Your First Home” scheme, which will be critical in attempting to stop falls in house building for a fifth consecutive year in 2027. However, it is extremely disappointing that the scheme will not start until April 2027, meaning many potential first-time buyers and house builders will just sit and wait until Spring next year at least, worsening the current downturn in house building in the near-term.
However, the Chancellor did announce measures to address the Government’s rising cost burden on house building, which has badly damaged site viability in recent years, through no further changes to building regulations during Parliament unless they are building safety-related and removing Biodiversity Net Gain requirements for small brownfield developments. In addition, the Chancellor announced a further £1.5 billion for the Social and Affordable Homes Programme to take it to over £40 billion over 10 years. However, in this case, delivery will be considerably more important than the total amount and we have seen no activity down on the ground from it so far and we are not expecting to until 2027 Q2 at least.
The Chancellor also re-announced the British Industrial Competitiveness Scheme (BICS) scheme to help manufacturers with industrial electricity costs, starting next year though backdated to this year, but critically it excludes many major manufacturers, particularly those reliant on gas rather than electricity. This is disappointing given that gas prices for many firms feeding into the house building and construction supply chains have risen by 300% in the last year.’
Peter Caplehorn, Chief Executive Officer at CPA said: ‘Whilst the focus of this Budget was not expected to be on housing and construction, it was disappointing and inevitably makes further loss of skills and capacity in the near-term more likely.’
Amanda Long, Deputy Chief Executive Officer at CPA said: ‘Although the budget doesn’t deliver the scope of impact needed, the Government still has opportunity to engage the construction manufacturing sector as a positive strategic partner to support delivery of its ambitions on re-industrialisation, jobs and growth.’
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