This year’s Budget brought some worthy measures for business, but lacked any real game-changers for London.
Cash for potholes, a boost to investment allowances, and an apprenticeship levy cut for smaller firms are welcome steps, but much more will need to be done at the Spending Review to help turn around poor growth forecasts.
The Chancellor announced a number of housing measures, including:
a new wave of strategic partnerships with nine housing associations to deliver 13,000 homes across England
a consultation on the simplification of converting commercial property in new homes
supporting the delivery of 19,000 new homes by improving the DLR
a call for evidence into shared ownership homes, inviting proposals from investors willing to collaborate with government to deliver a new wave
a new Help to Buy Equity Loan scheme running for 2 years from April 2021, which will be available for first-time buyers only. This will introduce property value caps, which in London will be up to a maximum of £600,000, and the government does not intend to introduce a further Help to Buy Equity Loan scheme after March 2023.
The housing infrastructure fund will also receive a £500 million boost. While we’ve welcomed this, it is only a fraction of the £20bn a year extra of extra funding that will be required to deliver the Government’s target of building 300,000 new homes a year. Next year’s Spending Review must bridge the funding gap, and put forward a credible strategy that frees up more land and embraces smarter ways of building.
Staying open for business
The announcement that visitors from the US, Canada, Australia, New Zealand and Japan will be allowed to use passport e-gates at Heathrow is welcome news for some of our best tourist markets. It’s particularly encouraging that our call for the extension of airport e-gates has been actioned, but sending a message that we’re open for business will take much more than this.
With the Budget delivered, we now need to see the Government focus on securing a deal that preserves the benefits of the single market and keeps borders open for trade and goods. In particular, now is a crucial time to deliver a fair and managed immigration system that will allow access to the varying levels of skills employers need. It’s vital we make sure the shutters aren’t brought down on international skills before we’re able to get the UK’s workforce skills ready.
More money for new transport investment in the city regions (including welcome additional development money for Northern Powerhouse Rail), for national and local roads, and to unlock housing are all welcome announcements, but we now need more detail on the upcoming Spending Review.
The Chancellor confirmed that the Government will respond fully to the National Infrastructure Commission (NIC) through a National Infrastructure Strategy next year, but much more action is needed to drive growth and boost confidence.
In particular, we’ve called for the Government to commit to spending the 1.2% of GDP on infrastructure each year that the Commission planned for. And this must now be the transport sector’s key ask of Government if we’re to secure vital investment across the country and get the green light for key projects like Crossrail 2 and Northern Powerhouse Rail.
With London’s small businesses groaning under the weight of the highest business rate bills in the country, the rates relief announced will help relatively few firms in the capital where bills are likely to be above the £51,000 limit. It falls far short of the radical overhaul of business rates needed to keep pace with changes on the high street.
Looking ahead to the Spending Review, we’ll be working with members and stakeholders to get the long-term investment our capital needs in vital infrastructure, namely transport and housing.
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