Industry reacts to the UK Autumn 2024 Budget
Invest, rebuild Britain, deliver change and fix the foundations – the UK Chancellor, Rachel Reeve’s motto for the Autumn 2024 Budget, and an agenda the Government has been pushing since getting elected earlier this year. This presented itself in the form of widescale increases in tax for people and businesses. To say the least, this budget has been one for the history books; Reeve’s goal of raising taxes by £40 billion has been the highest since Norman Lamont’s budget of 1993. While the tax pinch will be felt by many across the country, the hope remains that the allocation of finances to public services and thriving sectors in the UK will result in people feeling more positively about the country.
Homes, schools and hospitals grabbed headlines post-Reeve’s announcement. The Government intend to deliver 1.5 million homes in 2024-29 and have allocated £5 billion to do so. Improving and heating homes has also been on their radar as they have put aside an initial £3.4 billion towards heat decarbonisation and household energy efficiency over the next three years. Of this lumpsum, £1.8 billion is to support fuel poverty. It is likely, however, that this is not enough. Commenting on this, Alan Fogarty, Sustainability Partner, said, “When we divide this 3.4 billion between the 250,000 affordable homes, it leaves each home with just £3,288. To put this into context, a heat pump costs about £10,000, replacing a boiler costs £4000 and changing the fabric of a house costs £15,000. So, the funding barely scratches the surface of what is needed.”
An additional £1.4 billion has been allocated to rebuilding schools; however, similar to homes, it is unlikely this will even scratch the surface. Commenting on this, Peter Hazzard, Partner and Schools and Colleges lead, said, “Education in the UK has infamously been underfunded, and school repairs demand a lot more than this. The Government has rightly paid attention to the issues around school funding but needs to either put aside a lot more, or incentivise the private sector to contribute. The private sector is already doing a lot in terms of decarbonisation work on school, and this should be encouraged further and with a clear focus.”
The budget has also reflected on the country’s ambition to be a leader in the science and technology sector, allocating £520 million for a new Life Sciences Innovative Manufacturing Fund. The Department for Science, Innovation and Technology will also receive £15 billion to work with. Andrew Somerville, Partner and Science and Technology lead at Cundall, commented, “The science and technology sector is crucial to support the NHS and grow the UK’s economy. There are life-changing drugs being discovered by some of the greatest minds in Britain. For this sector to really grow and thrive, private investment cannot be of low priority. There needs to be a healthy influx of both public and private investments coming in and tax hikes are unlikely to achieve this. Hopefully, the Government can create incentives in the next year to encourage this.”
There were moments of promise in terms of building safety. The industry is still reflecting on the Grenfell enquiry’s harrowing findings. Reeves has promised £1 billion rise in investment in the remediation of houses and buildings with dangerous cladding in 2025-26. Another £1 billion was invested to make buildings with RAAC safer. The safety of people who occupy buildings should be the utmost priority for the industry and the Government, to ensure that something like Grenfell never happens again. While the fiscal allocation to ensure existing buildings are safe is a step in the right direction, we welcome the Government to implement measures to better legislate and regulate building safety.
