Potholes before planning?
The Chancellor’s Budget Statement attempted to do three things: create certainty pre-Brexit; position the UK for an independent future; and create a feel-good factor for the electorate.
Firstly, in creating fiscal certainty, the Chancellor talked of a potential Brexit “double deal dividend”, comprising a release of the fiscal headroom being held currently and an “end to uncertainty”. His raft of spending announcements - spanning the NHS, public services, local government and infrastructure - certainly suggested a Chancellor emboldened by the OBR’s forecasts for high labour market participation rates and 800,000 more jobs by 2023, as well as a reduction in the budget deficit. He boldly talked of opening a new chapter in the country’s economic history, following on closely from the PM’s “end of austerity” conference speech.
Secondly, he attempted to position the UK for an independent future with spending measures clearly aligned with the Modern Industrial Strategy. It was pleasing to see a strategic focus on the enablers of productivity growth. These included investment in infrastructure, the regions, skills and research being maintained through spending decisions. As a business with 13 offices across the UK, we welcome the support for enterprise and the housing market across the regions as exemplified by new City Deals, enhanced funding for rail and roads, and a boost to the Housing Infrastructure Fund and the Transforming Cities Fund.
A new focus area was the rejuvenation of high streets, which the Chancellor recognised as being at the heart of many communities. The creation of a Future High Streets Fund, consultation on CPO, and Use Classes Order reforms are all welcomed and will help to ensure efficient use of land for new homes. This goes hand in hand with temporary business rate relief for independent retailers to shore up SME businesses on the high street.
The “feel-good factor” was delivered by a range of personal taxation, and place-based measures. There was a focus on fixing potholes, planting trees, and neighbourhood funding to bring forward land for discount sale housing, among other initiatives.
Despite many encouraging aspects of the budget, it dodged the big planning questions of the day. It appeared that potholes were put before planning. Thorny issues, such as the Government’s flawed standard method for calculating housing need and providing a response to the Letwin Review on build out rates, were kicked into the long grass.
It remains to be seen whether planning reforms around housing need and build out rates will be prioritised in the Spring Statement. The Chancellor might have much bigger issues to consider by this time.
Whatever happens in 2019 we would encourage him to maintain the focus on “fixing the broken housing market” and investing in infrastructure as twin enablers of productivity growth.
If you have any questions regarding the Chancellor's Budget Statement and its impact, please contact Richard Laming.
29 October 2018