The Office for Budget Responsibility (OBR) delivered a huge blow to Labour’s hopes of improving economic growth, though Reeves’ plan for households is arguably more concerning.
Yesterday, Wednesday 26th March, Chancellor Rachel Reeves delivered her non-budget to the House of Commons in the form of a spring statement we’ve heard almost annually since the recession in 2008. Effectively, our country has barely any money meaning we have to endure major cutbacks that will inevitably put a strain on the public purse. Not to mention the general population.
At a glance, this year’s rendition of the budget included welfare cuts, civil service job losses, an increase to defence spending and government department spending reductions. What’s more, Reeves announced Labour will be spearheading a boost in housebuilding – a pledge they have remained firm on since the snap election last July.
Along similar lines the Chancellor has likewise prioritised construction worker recruitment and has ploughed £600million into training up to 60,000 bricklayers, electricians, engineers and carpenters over the next four years. While the plans for UK housing seem positive on the surface, within the spring statement Reeves mentioned that her government will likely miss their target to build 1.5million new homes by the next parliament.
This oxymoronic tone has been echoed by housing experts who have expressed a wide range of opinions on the matter since the speech premiered. A vast amount can be found below.
Sheetal Smith, Sales and Marketing Director at Pennyfarthing Homes
‘We strongly support Rachel Reeves’ housebuilding target; however, it’s important to note that many of these homes will not be deemed ‘affordable’. There is still a significant need for government intervention to help first-time buyers. Unfortunately, the spring statement has not addressed this issue. Despite the opportunity to extend stamp duty relief, Reeves has made it harder – not easier – for first-time buyers to get on the property ladder, ultimately hindering the housing sales cycle.
‘The additional £2bn funding for Affordable Homes Providers announced yesterday is the crucial support we need. From our experience, we know that smaller sites are often not appealing to providers. Without them, we frequently face delays in planning approval, which only adds to the frustration of stalled housing delivery.’
Cllr Sir Stephen Houghton, Chair of SIGOMA
‘The government have made strong progress so far on local government funding, including the Recovery Grant targeted funding at the most deprived areas and the fair funding changes signalled as part of the long-awaited funding review. The spring statement confirms welcome news, including for investment in affordable housing. However, it is vital that the reduction in the overall increase public spending compared to the autumn budget does not come from council budgets. Local government was cut severely during austerity, particularly in the most deprived authorities, and councils will be essential in supporting the government’s missions and improving the lives of the most vulnerable and deprived communities.’
Greg Reed, CEO of Places for People
‘Labour continues to show it is up for the housebuilding challenge. This week’s additional funding will accelerate delivery and we’re already talking to government about priority sites including in Thanet and Swindon, sites referenced by the Chancellor…and where we stand ready to quickly build many new homes.
‘Quality new social housing is a known driver of growth and wellbeing, adding millions to the economy, improving health outcomes, and creating thriving Communities. This is sensible investment, and government has listened to our sector, but our voice must remain heard when times get tougher for communities. We’re really concerned about the impact of the proposed welfare reforms as many of our customers already struggle to afford the essentials.
‘A third of our social housing customers couldn’t work last year due to disability or long-term sickness. One in four struggled with debt or couldn’t afford to put the heating on. Our recent Beyond Homes campaign highlighted our steadfast support to these groups, but state intervention must remain alive enough for us to also commit to planned spend elsewhere – including upgrading existing stock and helping government to build new homes.’
Lee Bloomfield, Chief Executive of Manningham Housing Association
‘I was delighted to hear the government’s announcement earlier in the week to provide £2 billion of new funding to build 18,000 much needed affordable homes.
‘Manningham Housing Association stands ready to assist Ministers in achieving this objective.
‘We also support the government’s ambition to get more people into work and, through our community investment work, have assisted many into meaningful employment in Bradford and Keighley.
‘But this should not come at the cost of cutting support for the most vulnerable.’
Lawrence Turner, Director of Boyer
‘The spring statement took place in difficult economic and global circumstances – not least a £20billion hole in the public finances, a shrinking economy and considerable concern about potential Trump tariffs.
‘But the Chancellor’s announcement…contained some good news for the planning and development sector.
‘The OBR’s estimation is that the changes to the NPPF are set to have the biggest positive growth effect in today’s forecast, with no fiscal cost. The increase in housing supply alone, it predicts, will increase GDP by 0.2% by 2029-30, adding £6.8 billion to the economy.
‘Of course these figures are nothing more than projections: they require a series of ‘moving parts’ to be put into place very carefully before the financial (and other) benefits are achieved. I, together with my colleagues in LRG’s New Homes division, have stated many times that increased housing delivery requires more than planning consents.
‘And so it’s reassuring that the Chancellor has committed £600million for construction training to meet the severe resourcing issues, along with a £2bn top-up for the Affordable Homes Programme to help deliver ambitious levels of social and affordable housing.’
Dr Jonathan Carr-West, Chief Executive of Local Government Information Unit
‘[The] spring statement was largely concerned with macroeconomic issues – the top notes of which focused on defence, welfare and public sector reform. But, at LGIU, we know that much of what was announced today will have a potentially significant impact on local authorities and the communities they serve.
‘The halving of the health-related part of universal credit was already known, but the fact that this reduced provision will then be frozen for the rest of the parliamentary term is news. A large number of the most vulnerable people in our communities will be impacted by these cuts – the DWP estimates up to 3.2 million families. Inevitably – it will be councils that will have to find the resources to support them and pick up the pieces, putting further strain on already stretched council budgets.
‘However, there were some bright spots for councils. Several areas and local authorities will receive boosts to their local economies – thanks to the large increase in defence spending. This is to be hugely welcomed for those regions. Likewise the OBR’s projection that we are on track for 1.3 million of the promised 1.5 million houses by the end of the parliamentary term is very positive news.
‘From a local government perspective – the elephant in the room today was the fact that the shape of local governance is changing and changing fast with the introduction of mayoral strategic authorities and local government reorganisation. There was no indication anywhere in today’s Statement of a connection between the measures announced and the proposals – already well in train – for devolution and reorganisation.’
Jonathan Higgs, Chief Executive of Raven Housing Trust
‘The government’s commitment of £2billion for social and affordable housing in 2026–27 is a positive step toward tackling the housing crisis. It’s encouraging to see this presented as a bridge to a new long-term programme, with further announcements expected in June. To truly give housing providers the stability and confidence we need to plan ahead, the Spending Review must deliver on the promise of the biggest investment boost in a generation.’
Cllr Claire Holland, Chair of London Councils
‘The government is right to prioritise boosting economic growth. Whether it’s building new homes, supporting people into work or attracting investment into our local areas, councils have a critical role to play in this mission. However, the crisis in town hall finances is holding us back.
‘It’s vital the upcoming Spending Review and planned reform of council funding deliver the investment and financial sustainability boroughs need to drive growth in the capital and across the country. Without this, we risk more and more boroughs entering effective bankruptcy – a situation which would undermine economic confidence, hold back growth, and cost the public purse more in the long run.’
Whilst delivering the statement Rachel Reeves said Labour was elected to ‘bring change to our country, provide security for working people and deliver a decade of national renewal.’ Despite her optimism, the chancellors room for fiscal manoeuvre has significantly narrowed given the contents of the non-budget. Only time will tell if Labour are able to deliver positive change.
Photo by Josh Appel via UnSplash
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