Chancellor Jeremy Hunt has delivered his autumn statement. A key moment in the political calendar, the statement outlines the current state of the UK economy and a few policy changes. The statement is usually more constrained than the budget but that doesn’t mean it isn’t important. Rumours of what Hunt would announce included changes to income and inheritance tax, assistance for first-time buyers and stamp duty rebates. But with the news out this is what you need to know.
Opening his speech Hunt professed that rather than entering a recession the government were responsible for growing the economy and called the statement “A statement for growth” that cuts taxes and rewards work and backs British Business with 110 growth measures.
Economic improvements to come
Over the past year, inflation has led to rapid price rises, making living more expensive and with increased interest rates borrowing has become more expensive. The Office for Budgetary Responsibility has approved Hunt’s economic policy to get the economy back on track, meaning that the measures taken in the Statement should help get the housing sector back to its previous highs.
Hunt has introduced four changes to ease the cost of living for the worst off in the country. Universal credit will increase by 6.77%, the local housing allowance will increase to the 30th percentile of local market rents, and alcohol duty will be frozen. The triple-lock pension continues and the state pension is to go up by 8.5%. While this doesn’t directly impact the new homes business, with the cost of living crisis easing it’s a sign of better things to come.
Remove planning red tape
This is a move that all parts of the political spectrum have been calling for. At the Labour Party’s Conference this year they committed to reconsider Green Belt lands and more developments are being approved near these areas and on local authorities’ ability to veto developments.
The government have a target of 300,000 new homes each year and there are numerous reforms that are going to be needed to get the country there.
Labour blocked nutrient neutrality reforms earlier in the year. However, the government continues to push for this reform. £110 million will be invested in nutrient mitigation schemes, and £32 million invested in eradicating planning backlogs, £450 million in the local authority housing fund for 2400 new homes and consult on a new permitted development right to convert a house into two properties.
Hunt also says that commercial planning applications should be processed quickly. “A prompt service or your money back – just as would be the case in the private sector”. This should help the new homes sector. For business applications, local authorities will be able to recover the full costs of major business applications if they meet faster deadlines.
Investing in skills
The government have already reformed education and schools. The statement will see more apprentices enter into fields like engineering with a boost of £50 million. Further details of this are to be revealed but it should be expected that more skilled labourers such as those in the new homes sector.
The government have announced new investment zones in the North and North Wales creating 65,000 new jobs, and presenting new opportunities for desirable housing developments. There will also be a £150m Investment Opportunity Fund
Business investment and growth
Full expensing has been turned into a permanent measure. For every £1 invested in IT, machinery and equipment, there’s 25p taken off of a business’ tax bill.