Brian Berry, CEO of the Federation of Master Builders (FMB), discusses his views on the recent Queen’s Speech, and how it compared with industry expectations.
My previous two columns have touched on my hopes for a reformed planning process to help out small and micro housebuilders stuck with a burdensome planning system. I had hoped to see this in the Queen’s Speech, but the Government delivered something quite different. We got the Levelling-Up and Regeneration Bill, which firmly puts the public in the driving seat.
It’s clear that this step down from a fully-fledged planning bill was to realign the narrative of levelling up and appeal to Conservative voters in their traditional heartlands. But does it help small local builders who, as I’ve discussed many times before, are a vital piece in the levelling up puzzle?
LEVELLING-UP AND REGENERATION BILL
The Levelling Up and Regeneration Bill might turn out to be a disappointing step change in the direction of the Government. We had expected a fully-fledged planning bill which could have simplified the planning process for micro and SME builders who currently face delays, with 61% of our members citing planning as a barrier to delivering homes.
The move to digitise the planning process is welcome, which I hope will bring about clarity on development status for builders and residents alike. Moves to make who owns land more transparent will also help small developers. It could be that more local engagement, when harnessed correctly will help housebuilders. It could allow for fast tracked planning permission for certain projects identified by the residents of a street, through so-called ‘street votes’ which will boost the density of current housing stock and potentially deliver more homes. But we await detail on what these votes will truly mean.
Greatly increased community engagement, focussing on design, material and layout does, however, have the potential to slow down and disrupt the viability of new homes – developments are complex. SME housebuilders already sit at the heart of their communities, delivering projects reflective of their local areas. Putting local communities in a commanding position when it comes to laying out local plans could be troublesome. We’ve all been to town hall type meetings and observed the tendency for the loudest voice to win out over that of the moderate ones.
FMB members already play an active role in engaging local residents, as they are often building in their own communities. Micro and SME builders deliver high-quality homes, reflective of their local areas. They use local tradespeople and train up local school leavers; they are central to their communities and any move to add delays to an already burdensome planning process puts a declining sector at further risk.
I would hope to see SMEs properly factored into new government plans, and I welcome previous constructive engagement I’ve been able to have with the Chief Planner. I completely understand, indeed I’m enthused, that new homes should be high quality, more beautiful and part of the fabric of the local area. But SMEs already deliver this day in day out and have done since time immemorial. Unfortunately, over the last 40 years the sector has been on a downward spiral and successive governments have done little to stop this. I hope the Levelling-Up and Regeneration Bill, if properly executed with plenty of engagement with SMEs, will be a turning point.
NEW BUILDING REGULATIONS ARE HERE
Significant changes to building regulations have come into force, in June. Their introduction has been a rocky road, with many FMB members, 52% of them, not prepared or unaware they were coming. This wasn’t by any means their fault, my members are on site, toiling away, which means communications need to be consistent and clear. Unfortunately, this didn’t happen, and it was left to the industry to work out the changes, in the absence of support from the Government. You can find a free guide to the regulation changes on the FMB website (www.fmb.org.uk).
The changes are designed to improve the energy efficiency of buildings to help the country move towards its targets for net zero by 2050. What this means is that the Government wants newly built properties to be more energy efficient. These changes are the advance party, ahead of the main event, the Future Homes Standard, which will be coming in a few years.
The hope is that introducing interim measures now will make the changes coming in or around 2025 less severe for builders and also go some way to cut carbon emissions in the meantime. While the FMB welcomes the interim changes, the new measures do nevertheless present another hurdle for SME housebuilders. Costs will inevitably go up and this will be passed on to the consumer, and as we know there isn’t much money in our pockets at the moment, so how will the housing market fare?
WHAT NEXT FOR THE MARKET?
You would have to be a brave person to make predictions for what may come later this year. The Bank of England predict a recession and the recent Office for National Statistics (ONS) figures for March show GDP has declined, not increased, as predicted. From our own FMB State of Trade Survey for Q1 2022 we can see the market is ticking along, but there was still a lot of pent-up money post pandemic and the impact of the hardships of energy bill increases has yet to be fully felt.
After many years of uncertainty, you would hope for some stability ahead, but I’m afraid we may be in for a difficult second half of the year. Let’s see if the Government can do something ambitious to keep the market going and ultimately keep momentum up on their flagship policy of levelling up.