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Budget Announcement: Comments from Glenigan and other construction leaders

Adrian Attwood, Executive Director, DBR

Alan Wilen, Economics Director, Glenigan

“Today’s Budget may have been one of the worst-kept secrets in recent political history, with plenty of speculation leading up to it, but it’s not all doom and gloom. While there are clear challenges, the Chancellor has struck a delicate balance, avoiding austerity while creating room for opportunity. Last-minute changes to Fiscal Rules will be transformative for the sector, unlocking crucial funds for investing in schools, health, infrastructure and social housing. Projects that have been in limbo for months may finally get the green light next year, with the Chancellor unveiling big increases in departmental capital budgets for next year. We’ll have to see what the Spending Review in the Spring delivers for the Government’s longer-term investment plans, however, it was welcome to hear some big infrastructure announcements that will certainly buoy the construction supply chain. This should bring about a much-needed boost to the sector after a subdued period – supporting optimistic growth forecasts for 2025 and 2026.”

Adrian Attwood, Executive Director, DBR

“It’s great to see the Government directing funds where they count: toward the UK’s built environment sector. Freezing employee NI contributions and income tax keeps cash in the public’s hands, improving consumer and investor confidence and buoying the industry. However, piecemeal measures that ignore unintended consequences must be avoided at all costs. I’m disappointed the Chancellor has chosen to increase employer NIC, a further blow to smaller construction firms that suffer the most risk in our current procurement model. The devastating impact on sub-contractors, suppliers and specialist firms has been well documented in recent weeks, without the sheer capital to survive overhead collapses and delays. I would like more robust support for the entire construction supply chain, not just the big players, supporting with the hefty costs of training and development and taking some of the pressure away from SMEs.”

“With labour shortages across the construction sector, an assertive and deliverable skills policy is vital to achieve much-needed growth, opportunity and, most importantly, resilience. I encourage the Government to build on today’s statement and provide apprenticeship incentives for areas with skill deficits, allowing flexibility in levy fund spending to target specialist roles. If the government really wants to encourage a growth economy, the Chancellor needs to cut the taxes that hold back small firms the most, creating economy-boosting jobs, which the UK is crying out for.”

Dr Stephen Hamil, Innovation Director, NBS

“Seeing the Government properly engaging with planning reform is encouraging. Hopefully, this will lead to a big increase in affordable, quality and sustainable homes being developed.”

“However, further planning reform is not the panacea for all Britain’s building problems. Materials costs are up, there are skill shortages throughout the construction sector, and we’re still lagging behind when it comes to digital adoption. Reeves has made it clear that the private sector will be doing most of the heavy lifting in her plans but its success will depend heavily on how the funding is allocated to ensure sustainable and safe development. The industry also urgently needs to recognise the importance of digital construction to scale up its capability and meet demand.”

“There are some leading projects that are hotbeds for tech and have moved beyond outdated preconceptions – from design through to construction. But increasingly, project teams need a wide range of skills to design and then build safely and efficiently. Scaling up the country’s tech skills is a sure route to success. Equally, offering more opportunities to those that are higher-skilled could reduce the ‘brain drain’ of experienced people moving overseas or to other industries.”

“In addition to housing, school rebuilding is in the spotlight, with both urgent RAAC remediation and critical repairs prioritised in the Budget. For all construction projects, digital technologies can help streamline the design and specification process. Done correctly this can provide building owners and regulators with an accurate digital record of the building lifecycle.”

Ben Hancock, Managing Director, Oscar Acoustics:

“We directly employ 45 people and were looking to hire more. These are well-paid jobs, with substantial training, and which don’t need a degree. These jobs are hard to come by, and the sort of roles the government should support employers in offering. However, the proposed employers’ national insurance increase could hamper that progress.

Billed as a Budget for growth, what’s been unveiled looks anything but. SME confidence has been dropping nationwide, and this Budget looks unlikely to boost sentiment.

It’s been alarming to see more and more local businesses shutting down, yet the lack of support will only see this trend continue. There are some positives for businesses like ours in construction, with the proposed infrastructure investment. Though, this has been squeezed in, the increased taxes will be a headache long before any investment filters down to contractors like us.”

Fraser Robb, Managing Director, Perega[1]:

“Labour’s new debt rules are a step towards unlocking essential investment in our creaking national infrastructure. However, funding alone won’t guarantee successful delivery of shiny new big projects, if we lack the skilled workforce to deliver them.

“It’s disappointing we didn’t see any explicit provisions for skills and training in Reeves’ commitments. Over a third[2] of construction job vacancies are currently left unfilled due to skills shortages. Traditionally high-demand roles like engineers, architects, and digital specialists are suffering from a growing dearth of applicants. With a speculated need for over a quarter of a million additional construction workers by 2028[3], if the problem isn’t fixed soon we could see the domestic talent pool dry up completely.

“It would have been encouraging to see more focus on Skills England and not simply kick the can down the road. We must address the skills crisis head-on to ensure the UK’s infrastructure strategy is realised by a capable and forward-thinking workforce.”

Rob Norton, UK Director, PlanRadar[1]:

“Labour’s increased funding for housing, paired with ambitious targets to build 370,000 homes annually, is a promising step towards addressing the UK’s housing crisis. But meeting this goal requires more than money—it demands a workforce skilled in digital tools.

“Earlier this year we saw the professional body Skills England announced to address shortfalls of the apprenticeship Levy. Reeves’ announcement this budget to increase apprentice minimum wages by almost a fifth is a sign they’re taking this move seriously. The construction sector, historically under-digitised, faces pressing challenges that digital skills could resolve, from project oversight to meeting new safety and net-zero standards.

“Skills England has a vital role to play here and I hope we will see more to come. By promoting digital skills training across the industry, we can empower construction professionals to work smarter, faster, and more accurately, building a resilient, tech-enabled housebuilding sector ready to meet the country’s needs.”

Steve Levy, MD and Founder, Shadow Industrial:

“Today’s announcement was a chance to re-energise the UK’s green retrofit agenda, and whilst tax incentives will go some way to encouraging businesses, further financial incentives are needed to shift the dial on gas energy use.

“This year’s Autumn Budget will no doubt cause pain points for businesses, notably increasing national insurance for employers, but it shouldn’t dampen spirits, just yet.

“Those thinking of expanding and investing in alternative, low-carbon alternatives, should do so with gusto. Legislation is heading our way, with a commitment to growth, and the sooner businesses are prepared, the better.

“We know that the UK is at the forefront of tech innovation, we now need to see the government start delivering on its promises and give us the right tools and tax incentives to make meaningful change.”

[1] https://www.planradar.com/gb/