Stamp duty, infrastructure and Small Business Rate Relief were just some of the subjects mentioned in the 2014 Autumn Statement.
Reforms to Stamp Duty Land Tax (SDLT) will aim to reduce distortions in the housing market and ensure it will be cut for 98% of the people who pay it.
The Builders Merchants Federation (BMF) managing director John Newcomb said: “Moving away from the current slab system, which punishes anyone buying a property for one penny over the tax threshold, to a system of marginal rates that will operate in a similar way to income tax is much fairer.”
Glenigan economics director Allan Wilén added: “The reforms will narrow the deposit gap faced by first-time buyers and should help re-invigorate housing market activity, which has been cooling in recent months.
“The Chancellor’s move, combined with the prospect of real rises in household incomes, should help to sustain the recent growth in new private housing activity during 2015.”
Small Business Rate Relief
The Chancellor also decided to double Small Business Rate Relief until April 2016. Around 385,000 of the smallest business will continue to receive 100% relief from business rates.
Mr Newcomb said the guarantee of up to £500m of new bank lending to small and medium-sized enterprises (SMEs) via the British Business Bank and the extension of the Funding for Lending scheme for another year, with a fresh focus on smaller firms, were welcome initiatives that should benefit builders merchants and their customers.
Construction Products Association chief executive Dr Diana Montgomery added: “The Funding for Lending extension will benefit our SMEs, as will the increased research and development tax credit for small firms. We’re also keen to learn more of the funding directed to manufacturing research.”
The government has published the National Infrastructure Plan 2014, setting out progress on delivery and a clear plan to the end of the decade for each of the economic infrastructure sectors.
Dr Montgomery said: “The most important element of the Statement for the construction industry was National Infrastructure Plan 2014. Construction is an enabler of UK economic growth, and that is never more evident than in the delivery of the new infrastructure the country needs for the 21st century.
The Statement also revealed the government has committed £15bn to improve the national road network.
Dr Montgomery said the government needed to set up the Highways Agency with ring-fenced funding to help provide the market with the certainty it requires.
To make progress towards full employment and create a more highly-skilled labour market, the government is abolishing employer National Insurance contributions for young apprentices.
Although this acknowledges the need to develop a new generation of skilled young people across all sectors, Dr Montgomery said it should be noted that often apprentices in construction and manufacturing are above the 25-year-old threshold.
The Chancellor confirmed that industrial and commercial energy consumers that use highly efficient combined heat and power plants will receive relief from Carbon Price Support starting from April 2015.
Combined Heat and Power Association director Tim Rotheray said the news will give confidence to the UK’s most energy efficient businesses so they are able to grow, invest, and protect jobs in key manufacturing sectors: “It is policy measures like these that are needed to ensure the UK builds a more efficient, less wasteful energy system and supports industrial competitiveness. Building on this valuable measure, the Department of Energy and Climate Change now needs to put in place a long-term policy to support new CHP investments.”
A new £5m fund has been provided to deliver independent evidence directly to the public about the robustness of existing shale gas regulation.
The government will also allocate £31m of funding to create research test centres through the Natural Environment Research Council to establish knowledge of energy technologies.
Mr Newcomb said: “The one disappointment was on VAT. The Chancellor once again missed the opportunity to introduce a reduced 5% rate on all building RMI work, which would have a major impact on releasing pent-up consumer demand in this sector.”
Innasol CEO Silvio Spiess said he was disappointed to see that green policies were not on the agenda: “We were hoping to see an increased commitment to renewable energies - particularly renewable heat. Heating constitutes 78% of the average domestic energy consumption and 55% of average business energy consumption, so committing to renewable heat would not only help the UK progress towards carbon targets, but also aid in reducing fuel poverty.”
John Alker, director of policy and communications at the UK Green Building Council, said the government missed an opportunity to link Stamp Duty payments to the energy performance of the property.
He argued this would have incentivised householders to take action and firmly establish energy efficiency within the house buying and selling market.