Why was housing ignored in the Budget?

The housing minister, Gavin Barwell MP, has been on a whirlwind tour of the country since the launch of the white paper in January 2017. He’s spoken to large and small housebuilders; housing associations, and local authorities, city regions and rural communities among others. The consensus is that he is navigating well, a tricky position of a genuine desire to deliver more homes, faster, and with a mix of tenures, while not upsetting traditional conservative interests, including the protection of the green belt.

And he is doing all of this without any new money, as evidenced by the deathly silence of any mention of housing in the Budget this week.

However, the Budget and other recent announcements signal a direction of travel that may have significant implications for the relationship between the government and those involved in housebuilding.

The first set of announcements are the plans to strengthen local authorities powers to accelerate development, including compulsory purchase orders to help speed up housing delivery

The first set of announcements are the plans to strengthen local authorities powers to accelerate development, including compulsory purchase orders to help speed up housing delivery, “to support the build out of stalled sites” and “to hold developers to account” as stated by secretary of state, Sajid Javid. And speaking at a recent Commons Communities and local government committee on the Housing White paper, Gavin Barwell discussed the idea of publishing performance tables for housebuilders, showing the number of homes they are building. And potentially fining developers for not building sites out. Build out or be punished is the message.

The second set of announcements, at first glance are only indirectly related to housing. An industrial strategy green paper sets out an ambition to support growth across the UK. In the Budget there was confirmation of £690m for local authorities to get local transport networks started, as well as devolution of further responsibility to the GLA and the regions for infrastructure investment.

The GLA has already pioneered the idea of housing zones, which see infrastructure funding used to provide a catalyst for home building in regeneration areas. The announcement of a taskforce to pilot a new approach to funding infrastructure is likely to take this a stage further. And the announcement following the Budget that there will be a £329m investment in the Midlands Engine scheme to support transport upgrades, has housing as a key target within the strategy. This follows the Autumn Statement 2016 announcement of the Housing Infrastructure Fund to support the development of new homes. Housing is now infrastructure.

It is clear that the ministers want growth, have housebuilders in their sights and that local authorities are being given the responsibility and powers to ensure delivery. An anticipated review of the Community Infrastructure Levy and section 106 agreements in the autumn 2017 budget suggests levers to push this will be developed further.

The relationship between housebuilders and the government is therefore likely to be an interesting one over the coming months.

Steve Douglas is a partner at Altair