Principal Thoughts: A housing-heavy Autumn Budget 2017 – but have we got the skills?

Posted on: 2017-12-04

What’s still needed to make the dream of home-ownership for all come true

Welcome to the latest edition of Ashley Wheaton’s ‘Principal Thoughts’. This time, Ashley looks at the Autumn Budget’s focus on housing – and asks whether more still needs to be done.

Philip Hammond says he has a dream, one of home-ownership for all – and, so, housing was put front and centre of his first Autumn Budget last week. The Government committed a massive £44 billion capital funding, loans and guarantees to support housing over next five years; and promised that by the mid-2020s there would be 300,000 homes built every year, the highest level since the 1970s.

The key points for construction and property included:

• £1.5 billion for the Home Building Fund, targeted at getting SME housebuilders building again
• £2.7 billion to more than double the Housing Infrastructure Fund
• A £630m small sites fund, to unlock the delivery of 40,000 homes
• A £1.1 billion fund for a new Land Assembly Fund – to unlock strategic sites, including new settlements and urban regeneration schemes
• £8 billion of new financial guarantees, to support private housebuilding and the purpose-built private rented sector
• £2 billion investment in affordable housing, including social rented homes
• £400m for estate regeneration
• Up to £1 billion more HRA headroom for councils in high demand areas, to help them start building again

There was a strong theme of reform and tackling unused planning permissions and empty homes – as well as building more homes on new sites. Former cabinet minister, Oliver Letwin will chair a review of how land is being used for housing, undertaking an evaluation of the gap between the number of housing permissions granted each year and the number of homes built; they are currently 270,000 residential planning permissions unbuilt in London alone.

And the Chancellor warned of government intervention if developers continue to sit on unused land and fail to take advantage of planning permission. It’s interesting seeing this tougher level of action in driving house building – and for many, it’s about time, the sector has been talking about the need to unlock this untapped housing potential for a while.

These could all be positive steps for solving the housing crisis in the UK. However, although these moves are welcomed, they fall short of what’s needed to unlock a major change in housebuilding in the immediate future.

RICS parliamentary affairs manager Lewis Johnston commented in The Architect’s Journal, ‘While the chancellor is right to say there is no single magic bullet to increase housing supply, it requires a lot more than the proposals he has put forward, which amount to a series of marginal and delayed nudges at a time when housing supply needs an almighty immediate shove.’

I believe improving the quality of housing is as important as increasing supply. There’s a real danger that with this rush to build a substantial number of new homes that there will be large numbers of lower quality housing estates created. This type of development often fails to create or encourage communities – there’s growing evidence of the adverse impacts of these housing estates – and they may even need to be rebuilt before the end of the century. High-quality buildings and mixed-use communities not only encourage better health and well-being, and are more sustainable – they also lead to higher returns for the landowner, albeit over a longer period.

However, the biggest issue, without a doubt is that the property and construction industries might not have a future at all unless they can address the continuing skills problem. About one-fifth of all vacancies within the Built Environment remain hard to fill – with the situation only set to get worse. A recent OnePoll survey commissioned by RICS found that 53 per cent of construction workers and managers are concerned skills shortages are a serious challenge, especially as we progress closer to Brexit.

Vocational, and continuing, education will be key to ensuring skilled talent continues to enter and develop in all areas and levels of the Built Environment. Vocational and specialist degrees, apprenticeships and even increased CPD can all help with developing industry skills, keeping abreast of the latest technological developments – and, ultimately, enabling new recruits to make a difference in the sector straight away; while supporting companies to enhance effectiveness, retain talent and cope in a rapidly changing world.

Therefore, it was encouraging to see an extra £20 million put forward to support the new T-Level technical qualifications; especially as construction has been picked as one of the first three T-levels to be developed. And overall the Government is providing £204 million of funding to support innovation and skills in the construction industry.

There is no one single solution to this problem. Looking ahead, it’s important for everyone involved in the sector – whether companies, industry professionals, educational establishments or the Government – to be constantly promoting and helping to develop careers within the Built Environment. Only then can we close the skills deficit, achieve our housing targets and future-proof our Built Environment.

At UCEM, we are committed to contributing to a better Built Environment sector through excellence in online learning. We deliver accredited apprenticeship programmes, as well as undergraduate and postgraduate degrees. For more information take a look at our Study UCEM page.

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