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Thursday 16 July 2020
Rishi Sunak’s Summer Economic Update elicited bouquets and brickbats from housing sector representatives.
The Summer Economic Update, announced recently, was a response to the COVID-19 emergency and the economic consequences of pandemic response measures.
The Chancellor’s announcement included:
The third phase focuses on rebuilding, with an announcement due in a Budget and Spending Review this autumn.
Summer Economic Update response
“Social landlords are the biggest investor in employment support and skills after the Government, and sadly since lockdown they have been supporting many young people get financial help and claim Universal Credit. We’re pleased to see the Government has listened and the extra funding for some of these schemes is very welcome - we know they make a real difference.
"But helping young people into work alone is not enough to give the next generation a fresh start. We have known for years that the severe shortage of social homes is stopping young people get on in life. Homelessness among young people has risen dramatically, increasing numbers of young people are unable to move out of their parents’ homes and many are forced into debt because of the high cost of rent. This has all been exacerbated by the pandemic. Waiving stamp duty will help some people, but it doesn’t solve the problem of the shortage of homes or help those who are really struggling.
"We welcomed the Government's confirmation that funding for the Affordable Homes Programme will go ahead as well as funding for a social housing retrofit pilot. But significantly more long-term funding… is needed to kickstart a building boom of social homes at the scale we desperately need. This is the only way to create enough affordable homes, rebuild left-behind communities across the country, and create local jobs, as well provide young people with access to enough training and employment support.”
“The announcement of £50 million to retrofit social housing, plus £2 billion towards a new ‘green homes grant’ for lower income households is a good start, although much more investment is needed. It also brings the potential to create much-needed jobs. This must be the first step in addressing the climate change emergency and has the potential to reduce fuel poverty.
“Government must ensure it is followed quickly by a clear plan and resources to get the housing stock up to the targeted energy efficiency levels by 2035 — and meet the Government’s firm commitment to achieve that enormous task. We’re seeing just the first instalment of a promised £9.2 billion investment in the Conservative Manifesto and we now look to the Spending Review in the Autumn for the Government to demonstrate a clear commitment to delivering a zero-carbon future for the nation’s housing stock.
“The temporary cut in stamp duty might provide an opportunity to stimulate the housing market but, without increasing supply, this is likely to lead to an increase in already high house prices.”
“The Chancellor has recognised the huge potential of energy efficiency to create jobs, and the money announced for upgrading buildings is a much needed first step.
“In respect of homes, we urgently need more detail on how the Green Homes Grant scheme will be implemented. Done well, it has the potential to kickstart a retrofit revolution across the country, but, done badly, this could cause more harm than good to people’s homes and to the industry. It’s crucial to avoid the mistakes of previous retrofit schemes by ensuring that all measures and installers under the scheme are properly accredited and deliver real improvements.
The allocation of £50 million to social housing is also a welcome announcement, although frankly just a drop in the ocean compared with the Conservative manifesto commitment of a £3.8 billion Social Housing Decarbonisation Fund — far more of which should be brought forward immediately.
“Furthermore, given that the announcement contained a range of financial incentives and tax cuts, it missed the opportunity of tying these in more directly with the green buildings agenda. UKGBC has previously called for a VAT cut on refurbishments and variable stamp duty rates as incentives to drive up consumer appetite for more efficient homes, which would stimulate demand for these cash grants.
“This is all positive and a move in the right direction, but when viewed against the German Government’s £36 billion spend into climate change-cutting, economy-boosting measures and France’s £13.5 billion at tackling the climate emergency; £3 billion doesn’t seem to be in the right ball park for our ‘world leading’ green recovery.”