Background
The Government's Autumn Budget process provides an opportunity for industry and business groups to set out priorities for supporting economic growth, investment and productivity. As part of this process, stakeholders are invited to submit evidence and recommendations to HM Treasury ahead of the Chancellor's Budget statement.
The FMB's submission focuses on the challenges facing small and medium-sized construction firms and the role they can play in delivering the Government's ambitions for economic growth, housing delivery, energy efficiency and skills development. The submission highlights ongoing pressures from rising costs, labour shortages and barriers to investment, while identifying practical measures that could unlock growth across the construction sector.
Executive summary
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The FMB welcomes the Government's commitment to economic growth and housing delivery but warns that SME construction firms continue to face significant cost pressures, labour shortages and weak demand.
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The Government should reverse plans to remove the landfill tax quarry exemption, which could significantly increase the cost of new homes and place additional pressure on SME house builders.
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Greater support is needed for local authority planning departments to improve capacity, speed up decision-making and help smaller developers navigate the planning system.
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The Treasury should review the cumulative financial burdens placed on SME house builders, including planning-related costs and regulatory requirements that affect project viability.
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Access to finance remains a major barrier to housing delivery. Government should ensure that new funding initiatives and finance schemes are accessible to smaller developers.
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Retrofitting homes should be recognised as an economic growth opportunity that can lower energy bills, improve housing quality and create jobs across the country.
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VAT incentives for energy efficiency improvements should be simplified and expanded to encourage more homeowners to invest in upgrading their properties.
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Government should introduce financial incentives to stimulate demand for retrofit work and support homeowners undertaking energy efficiency improvements.
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Investment in retrofit skills and training is needed to ensure the construction workforce can meet future demand and help deliver net zero objectives.
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SMEs need greater support to take on apprentices, including assistance with administrative requirements and additional funding for support services that help employers navigate the apprenticeship system.
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The Government should reduce the financial risk of employing apprentices through grants, tax incentives or other measures that encourage small firms to invest in training.
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Ministers should carefully consider the cumulative impact of taxation and employment costs on sectors, such as construction, that are central to delivering the Government's growth agenda.
