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On the 30 October 2024, Rachel Reeves made history in becoming the first woman to deliver the budget in the UK. This was also the first budget presented by a Labour Chancellor since 2010, ending a 14-year period of Conservative-led budgets. Whilst most of the Budget’s key details had been announced to the press prior to Rachel Reeve’s delivered her speech, the Chancellor was clear that the Autumn Budget would restore economic stability, increase investments and the provision of infrastructure, as well as transforming planning rules to get Britain building.

 

The Chancellor wasted no time in setting out where she felt the Government fell short and highlighted that “the only way to drive economic growth is to invest, invest, invest”.

 

This article explores some of the key measures introduced in the Budget and their potential impacts for the planning and development sector.

 

Infrastructure Investment:

In line with the theme of ‘investing’, Rachel Reeves highlighted a number of significant measures aimed at improving the UK’s infrastructure delivery. It was revealed today that the Treasury will change debt rules to free up more borrowing for infrastructure investments, freeing up fundings of circa £50 billion. Rachel Reeve’s confirmed Labour’s significant plans for transport infrastructure, such as confirming a commitment to fund tunnelling work to take HS2 high-speed rail line to Euston station in central London. In an attempt to get economically inactive jobs up and running, £240 million will be allocated over 16 projects to ensure these can be completed, which will provide jobs and stimulate growth.

 

In line with the Government’s Net Zero strategy, the Budget highlighted a number of Green Infrastructure Projects that would come forward, such as £2 billion in investments to the automotive manufacturing sector to boost the growth of Electric Vehicle sector. While not mentioned by Reeves in her speech to Commons, the full budget document confirmed that the government would invest over £200 million in 2025/26 to accelerate the delivery of electric vehicle charging points, and £120 million in investments for the purchase of new electric vans.

 

In addition to the above, Reeves confirmed that funding for 11 new green hydrogen projects across the UK, as well as plans to invest £3.9 billion in funding for carbon capture and storage programmes in 2025/26. An additional £3.4 billion has been allocated to The Warm Homes Plan over the next three years which will ensure greater household energy efficiency and support heat decarbonisation.

 

Housing Initiatives:

Housing delivery and the provision of affordable housing was always going to be a matter for discussion. Labour has committed to providing 1.5 million homes over the next parliament period. This ambitious target includes plans in the NPPF out for consultation to prioritise up to date local plans and five year housing land supply targets. In the Budget, Rachel Reeves committed £5 billion in investments to deliver plans on housing next year. As part of this investment there will be £500 million for the provision of the Affordable Home Programme to build up to 5,000 extra homes.  

 

In addition to this, the Chancellor pledged £3 billion in support for SME’s and the Build to Rent sector, in the form of housing guarantee schemes. Additionally, Right to Buy discounts will be reduced, and Local authorities to retain receipts from the sale of any social housing so that it can be reinvested into their existing stock and new supply. There has been much talk about the impact of dangerous cladding following the Grenfell Tower Report, and the Budget has allocated £1 billion to accelerate the removal of dangerous cladding, which will speed up the remediation of social housing. Social housing providers to be allowed to increase rents above inflation under multi-year settlement and there will be a stamp duty surcharge, paid on second home purchases in England and Northern Ireland which will increase from 3% to 5%

 

Planning Reforms:

In an attempt to ‘get Britain building’, Rachel Reeves confirmed that Labour would seek to transform the planning rules, to unlock development. In addition to the £3 billion in extra support for SME’s and the Build to Rent sector, as outlined above, Rachel Reeves allocated £46 million of additional funding to support the recruitment and training of 300 graduates and apprentices into Local Planning Authorities, to tackle the planning backlog and accelerate sites that have been ‘stuck in the system’.

 

Education:

Rachel Reeves confirmed that Labour would increase funding to the Department for Education to hire more staff, rebuild schools and to fund school breakfast clubs. £1 billion was also allocated to support children with special educational needs. Following the much-publicised issues some schools have had with Raac (a type of concrete now found to be unsafe), Labour have allocated £2.1 billion to maintain schools and to repair the school buildings affected by Raac. £1.4 billion was allocated to rebuilding 500 state schools and an extra £300 million allocated annually for school maintenance. In addition, the Chancellor Rachel Reeves has confirmed that the value added tax exemption will be removed for private schools from 01 January 2025.

 

Overall, the budget has not provided a many surprises but plans to “invest invest invest” will have implications on infrastructure, housing, and education. Details of what exactly the planning reforms will entail will likely be provided following the publication of feedback from the NPPF consultation. If you require any further advice or would like to know how DHA can assist in “unlocking” your development proposals, be that in infrastructure, housing or education, please do get in touch.

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