Budget and building, ex. DBW

Posted on 05/03/2021 by IHBC
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DBW bannerDesigning Buildings Wiki (DBW) – host platform for the IHBC’s open-access Conservation Wiki and the ‘construction industry knowledge base’ – has posted an update on the Budget from 3 March 2021….

…£12 billion initial capitalisation for the National Infrastructure Bank…

… increase in funding for certain types of skills development…

DBW writes:

On 3 March 2021, the Chancellor set out a plan to provide support for jobs and businesses as the country looks beyond the COVID-19 pandemic of 2020-2021.

The Budget coincided with the publication of the government’s new Build Back Better: our plan for growth strategy setting out how infrastructure, skills and innovation will drive the UK economy.

Several aspects of the announcements are associated with infrastructure, construction, housing and other related subjects:

  • An increase in corporation tax for companies making an annual profit of £50,000 or more, tapered from 19% up to 25% for companies with annual profits of £250,000 or more from 2023.
  • The furlough scheme was extended until September 2021.
  • The introduction of a new Recovery Loan Scheme.
  • The extension of the self-employment scheme to the end of September, and inclusion of the newly self-employed.
  • Extension of the stamp duty holiday to 30 June for homes under £500,000, and until 30 September for homes under £250,000.
  • £12 billion initial capitalisation for the National Infrastructure Bank.
  • A new mortgage guarantee scheme will enable homebuyers to secure a mortgage up to £600,000 with a 5% deposit.
  • Beginning in April 2021, a new super-deduction will cut companies’ tax bill by 25p for every pound they invest in new equipment, which means they can reduce their taxable profits by 130% of the cost. This is worth £25 billion to companies over the two-year period the super-deduction will be in full effect.
  • The UK will issue at least £15 billion in green bonds to help finance the transition to net zero and the government will launch the world’s first sovereign green savings bond for retail investors.
  • And to help progress the Prime Minister’s green industrial 10 point plan, new port infrastructure will be built to support the next generation of offshore wind projects in Teesside and Humberside. Additionally, English Freeports will be based in East Midlands Airport, Felixstowe & Harwich, Humber, Liverpool City Region, Plymouth, Solent, Thames and Teesside and will be special economic zones with different rules to make it easier and cheaper to do business.
  • There will be an increase in funding for certain types of skills development, with £126 million of new money to enable 40,000 more traineeships. Incentives for firms that take on an apprentice will double with a payment of £3,000 per hire.
  • £10m seed funding for a new MMC Taskforce.

Reaction
Eddie Tuttle, Director for Policy, External Affairs & Research at the Chartered Institute of Building (CIOB) said: ‘We are pleased to see that the Chancellor has extended the self-employment scheme to the end of September 2021 to offer certainty to businesses in the sector as well as protect the large numbers of newly self-employed construction workers. However, we are concerned that the Government has missed an opportunity to truly support the industry by failing to suspend the implementation of the VAT reverse charge, which will have potentially severe consequences for the cash flow of firms that have been hit hardest by lockdown. Perhaps most disappointing is the complete lack of mention of decarbonisation of the built environment and absence of any reference in the Budget to the struggling Green Homes Grant scheme. The UK’s built environment accounts for approximately 40% of our total carbon emissions, and any attempt to forge a green industrial revolution must address the energy efficiency of buildings as a matter of priority if it is to succeed.’

Association for Consultancy and Engineering (ACE) CEO Hannah Vickers added: ‘The built environment sector is the engine room of the economy and the freeports and city deals announcements are exactly the sort of holistic, low carbon regeneration programmes we need to simultaneously create jobs, level up opportunities and hit net zero. But the Infrastructure Bank must also play its part. The Treasury’s scoping document setting out how the Bank will operate is encouraging, taking on board the Construction Leadership Council’s Regeneration proposals. The trick for the bank will be to use its powers to enable ambitious integrated regeneration investments across the UK, whilst avoid getting fixated on individual project deals.’

ICE’s Director of Policy Chris Richards said: ‘If the Government wants to make real headway on their levelling up agenda, they will need to take a radical approach to fixing the problems that hold back parts of the country from realising their economic potential. The UK Infrastructure Bank will move us closer to addressing those problems, but only if it is given the mandate to take a trial-and-error approach to ideas from local and regional leaders. As the Government develops the scope of the Bank, prioritising the delivery of outcomes from day one, not prudent financial management, should be the main effort…’

https://www.designingbuildings.co.uk/wiki/Budget_2021

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