The government’s Autumn 2018 Budget, delivered to Parliament on 29 October 2018 by Chancellor of the Exchequer Phillip Hammond, contained a number of announcements regarding housing and construction.
These included the extension of the Help-to-Buy scheme, the ending of PFI agreements and commitments for apprenticeships and training.
Below is a summary of the main areas for roofing and construction.
The government committed to extend the scheme for a further two years to March 2023. However, this two-year extension will be only be available for first-time buyers and for houses with a market value capped at 1.5 times the current forecast of regional average first-time buyer prices, or up to a maximum of £600,000 in London.
New house building investment
In the Autumn 2017 Budget, the government announced over £15bn of new financial support, bringing total support for housing to at least £44bn over a five-year period. This year’s Budget announces how it is implementing this commitment, including £1bn of lending to SME housebuilders and £291m from the Housing Infrastructure Fund to unlock 18,000 new homes in east London through improvements to the Docklands Light Railway.
Help for affordable homes
In September 2018, the government announced £2bn of new funding in the Affordable Homes Programme, aiming to give housing associations funding certainty to 2028-29. The government announced in this Budget that the cap that controls local authority borrowing for house building will be abolished from 29 October 2018 in England, enabling councils to increase house building to around 10,000 homes per year. The Housing Infrastructure Fund, funded by the NPIF, will increase by £500m to a total £5.5bn, unlocking up to 650,000 new homes.
The government will introduce a package of reforms to strengthen the role of employers in the apprenticeship programme. As part of this the government will make up to £450m available to enable levy paying employers to transfer up to 25% of their funds to pay for apprenticeship training in their supply chains. It will also provide up to £240m, to halve the co-investment rate for apprenticeship training to 5%.
In May 2018 the government announced that T Level courses in construction would start in 2020. T Levels are a practical alternative to A Levels. The government will provide £38m of capital funding to support implementation T levels in 2020 across 52 colleges and post-16 providers.
Private Finance (PF2)
The government believes the Private Finance Initiative (PFI) and its successor PF2 is inflexible and overly complex, with the Office of Budget Responsibility identifying private finance initiatives as a source of significant fiscal risk to government. Therefore, the government will no longer use PF2 for new projects and a new centre of best practice in the Department of Health and Social Care (DHSC) will aim to improve the management of existing PFI contracts.
VAT fraud in construction labour provision
As announced at Autumn Budget 2017, the government will introduce a VAT domestic reverse charge to prevent VAT losses through so-called ‘Missing Trader’ fraud. This occurs when traders collect VAT on their sales but go missing before passing that VAT on to HMRC. This will shift responsibility for paying VAT along the supply chain to remove the opportunity for it to be stolen by those traders. The new rules will have effect on and after 1 October 2019 and the government is publishing secondary legislation alongside the Budget to implement this change.