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Budget 2020: £1bn cash pot for cladding removal and £12bn for new affordable homes

Rishi sunak
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The government has significantly increased the cash for the removal of all dangerous cladding from high-rise blocks by pledging £1 billion to tackle the problem

Announced in today’s budget (11 March) by the chancellor Rishi Sunak, the fund will be available to help replace non-ACM combustible cladding, such as ‘high-pressure laminate, wood and other class C/D cladding’.

The pot is in addition to the £600 million already set aside to take down ACM-style panels similar to those put on Grenfell Tower.   

Announcing a £600 billion infrastructure-led promise to get ‘Britain building’, the budget also included news of a £12 billion multi-year extension to the government’s Affordable Homes Programme and £1.1 billion of allocations from the Housing Infrastructure Fund to build nearly 70,000 ‘homes in areas of high demand’.

Sunak also trailed a forthcoming shake-up of the planning system, which he said would be delivered by housing minister Robert Jenrick tomorrow.

This ‘comprehensive reform’ looks set to open up the door to even more permitted development as hinted at in a tweet by Jenrick at the weekend: ’We’re changing the law so you have the freedom to add additional storeys to your home. We’ll be publishing details shortly.’

The budget also included a pledge to spend £1.5 billion over the next five years to improve the quality of the further education estate.

However, other than roads and flood defences, there was little detail on major infrastructure spending, such as rail links and aviation. Other than a drive to plant trees equivalent to a ‘forest the size of Birmingham’ and the creation of two carbon capture and storage clusters, the environment and the climate emergency did not get much attention either.

Nor was there mention of the widely called for reduction of VAT for refurbishment work -– a key demand of the AJ’s Retrofirst Campaign.  

Former RIBA president and chair of HTA Design Ben Derbyshire said: ‘We would have liked to see more far-reaching policies deployed in the interests of meeting the legally binding obligation of net zero by 2050.

‘Equalising VAT on new-build and refurbishment, investing in a national retrofit initiative on existing stock, and mandating targets on embodied energy in new building are essential.’

Charles Bettes, managing director, at architect gpad london, added: ‘The government needs to prioritise refurbishment and retrofit of existing housing over defaulting to new build.

‘With regard to VAT, new build remains zero-rated while retrofit is still taxed, and the fact the budget does not address urgently-needed policy change is disappointing. It’s also crucial that we plan in future adaptability and look at both new build and refurbishment as part of the bigger, long-term picture.’

Hew Edgar, head of RICS UK government relations and city strategy, agreed: ‘Delivering green, new housing required an ambitious approach to VAT – not superficial tweaks to stamp duty – so we’re disappointed the chancellor didn’t support the property industry to retrofit thousands of buildings, turning them into places people would have loved to call home.’

The budget did however include cash breaks for businesses hit by the coronavirus, which the chancellor said could eventually see up to a fifth of the population off work. For firms with fewer than 250 staff, the first 14 days of sick pay will be refunded by government. 

RIBA chief executive Alan Vallance said: ’Given ongoing concerns about the impact of coronavirus, and the predominance of SMEs in our industry, it is positive to see specific support in the budget outlined for smaller businesses and employers.’

He added: ’The significant spending on affordable, safe homes and infrastructure announced today is welcome, though arguably a decade overdue. To meet ambitious housing targets, we need to work on building high-quality, safe and sustainable homes.

’We will continue to urge the government to spend public money wisely, and ensure that every penny delivers real long-term value for communities as well as our economy. Social value must be at the heart of all procurement processes and spending plans.’

Comment

 

Julie Hirigoyen, chief executive, UKGBC 
Just days ago, the chancellor billed today’s budget as one that would ‘be about reaching net-zero and protecting our environment’. Clearly that did not ‘get done’. While coronavirus is rightly at the forefront of everyone’s minds right now, the transition to net-zero is also incredibly urgent, with this upcoming decade crucial to achieving it.

Yet government plans remain incredibly light on detail – especially with regards to buildings, energy efficiency and heat – all of which are crucial planks of a net-zero economy. Instead, the can has been kicked down the road again with the promise of ‘more detail’ in the Treasury’s Net Zero Review due to be published ahead of COP26 in November. 

Alfonso Padro, director of education, HKS Architects
We are delighted to hear that the government is investing £1.5 billion to dramatically improve the entire further education estate. Investment in further education is vital in the current climate to help develop the skills needed for the UK to thrive in a post-Brexit world.

We are facing a shortage of vocational skills, for example in the construction and creative industries, and this needs to be tackled imminently. The government needs to focus the funding on not only creating spaces where this training can take place but also aligned with wider teaching curriculums and adaptable spaces that can respond in the future as the demand for skills shifts. 

Peter Johnson, chairman, Vivalda Group
[The £1 billion cladding fund] is very welcome news, as the government has been dragging its feet on this issue for many months. This announcement should bring much-needed respite and relief to the thousands of tenants still living in potentially unsafe buildings.

Fixing our broken high-rise housing market has been a shameful episode in the government’s period in office, which has finally been sorted. At last, they’ve provided the funds to ‘get it done’, as the chancellor might say. We now need to pull together as an industry to bring this sorry taste of affair to a close – and bringing confidence and credit back to the embattled cladding sector.

Earle Arney, founder, Arney Fender Katsalidis
With the UK economy taking a battering from the coronavirus, Brexit and other challenges, Chancellor Rishi Sunak’s first budget statement has some promising initiatives, particularly shoring-up businesses and ‘levelling up’ the country through investment into infrastructure. However, prosperity must start with people being housed properly. Although I am encouraged to hear the chancellor announce that ‘comprehensive reforms’ to planning will be set out tomorrow by Robert Jenrick, it’s long overdue and I fear it will be yet more tinkering under the hood rather than overhauling our planning system, which we must surely do if we are ever to repair the housing crisis.

The new chancellor must realise housing development is caught in the handbrake of local politics and that responsibility for planning the homes we need must be moved to higher authorities, with an understanding of the bigger, national picture. I would have liked to have seen budget set aside to enable the creation of independent development authorities, along the lines of the Olympic Delivery Authority, equipped with the tools and political clout to deliver high-quality homes at scale and speed across the UK. Only by courageously addressing the issues can we get all the wheels moving efficiently and get on with delivering the homes needed to underpin sustained geographically balanced growth.

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