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Press release

27 OCT 2021

RICS response to the UK Autumn Budget & Spending Review 2021

Responding to today’s budget, Jonathan Hale (Head of Government Affairs at RICS) said:

“While the next phase of business rates relief is welcome, this seemingly endless tinkering underlines the need for a longer-term reform to support high streets and help restore them into the thriving commercial centres that communities want to be proud of. The devil will be in the detail and our surveyors will need clear, unambiguous guidance from government to help businesses to make the most of this new support.

“Chancellor Sunak didn’t mention the need to retrofit, rather than demolish, existing buildings – a key to unlocking Net Zero carbon emissions for construction in Britain – but the £3.9bn pledged to decarbonise homes and offices, which included support for low income homeowners to transition their heating, is a good start.

“The £5bn for cladding replacement – which we already knew was coming since February – will give more leaseholders greater peace of mind that their homes will be made safe but it’s still well short of the £15bn needed that is estimated to fix every building, but the additional funding to deliver a hundred and eighty thousand much needed affordable homes is welcome.”

 

Detailed response on other announcements:

Housing

We welcome the announcement of £1.8 billion of funding to convert unused brownfield land for the development of new green homes. We are pleased to see the announcement of plans to deliver urban ‘pocket parks’ on derelict land through a new Levelling Up Parks Fund too, and additional funding to support a planning system which is currently in need of more resources. We believe that the Government could have gone further on the green housing agenda, through specific financial measures aimed at encouraging greater take-up of home retrofitting. We have consistently called on the Treasury to introduce a temporary five-year reduction on VAT for home energy efficiency improvement works, as there is a pressing need to reduce emissions from our existing housing stock. While the Chancellor’s Budget speech did not specifically reference retrofitting, the £3.9bn pledged to decarbonise homes and offices is a good start.

Infrastructure

We are encouraged to see the government’s clear focus on regeneration within this Budget and a recognition of the vital importance of transport infrastructure to support the needs of local communities. The Chancellor confirmed £5.7 billion for London-style transport settlements in Greater Manchester, the Liverpool City Region, the Tees Valley, South Yorkshire, West Yorkshire, West Midlands and the West of England which will provide a welcome boost to many cities.

Business rates

RICS has maintained that reform of business rates could help to regenerate the nation’s high streets at a time when the impact of the pandemic has created additional pressures for many businesses. Up to 400,000 retail, hospitality and leisure properties will be able to benefit from a new, temporary £1.7 billion of business rates relief next year, and the government will also freeze the business rates multiplier in 2022-23, a tax cut worth £4.6 billion over the next five years which will support all ratepayers. While we welcome these announcements on business rates, it is slightly disappointing that the Government has not taken the opportunity to deliver a comprehensive reform of stamp duty land tax.

Cladding remediation

On cladding remediation, the Government confirmed £5 billion to remove unsafe cladding from the highest risk buildings, partly funded by the residential property developers tax which will be levied on developers with profits over £25 million at a 4% rate. We have previously called for further clarity on the timing and level of funding that will be provided to each of the devolved nations to meet the costs of remediation, to help give greater peace of mind to impacted residents across the UK.

Skills agenda

Finally, on the skills agenda, we are pleased to see an increase of £3.8 billion on skills spending over the course of this parliament in a bid to help more people learn, upskill or retrain. We are hopeful that this funding can further support the education of those looking to pursue future careers within the built environment.

 

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