With election nearing, how much can we learn about a future Labour government’s policies towards housebuilding?

Sarah Richardson

Should construction worry about a change of government? Six months ago, that question might not have seemed particularly pressing. The single biggest factor in deepening the impact of recession for the industry had been the coalition’s draconian approach to capital spending, but economic conditions dictated that a change in ruling party would see little change in that in the foreseeable future.

If anything, life under a Labour government may have offered improvement. Construction’s predicament had been exacerbated by four years of delays and U-turns on policies that could have helped the industry. Hold ups to the launch of PF2, the withdrawal of plans to roll out display energy certificates in private commercial buildings, and the Green Deal fiasco all kicked the sector when it could not have been more down.

Labour was known for being sympathetic to construction when in government - and its leading politicians had said nothing to indicate that would have changed if they re-entered Westminster.

However, with the economy improving and an election nearing, the question is becoming more relevant - and as it does, any anticipation that a Labour government would improve the sector’s fortunes seems less clear cut.

This is partly a result of the success of more recent government initiatives at stimulating the market, particularly Help to Buy. But it is also due to the worryingly anti-business-sounding rhetoric emerging from the opposition in relation to construction.

Ed Miliband began this trend with his commitment to freeze energy prices, which led some major utility companies to question how they would borrow money to invest in large scale infrastructure upgrades. The latest example is the party’s attitude towards housebuilders, articulated at length by new shadow housing minister Emma Reynolds this week.

Reynolds’ view - that major housebuilders have too large a share of the market and that it is politicians’ duty to alter this - does stop short of some of Miliband’s rhetoric around “predatory” firms, but for the sector, it may provoke just as much cause for alarm.

Reynolds’ concern over the dominance of a handful of large companies in the housing market is absolutely valid: few would argue against policies designed to encourage new entrants to a sector where demand is rapidly rising.

But the implied notion that as well as focusing on policies that would attract new entrants, Labour politicians may also seek to make the sector tougher for major housebuilders to compete in is a worrying signal. Without these major companies building at full capacity, the next government - of whatever party - will stand no chance of delivering the volumes of housing that the UK needs.

Of course - as Reynolds herself acknowledges - Labour’s policies on housing are, with an election still 16 months away, very far from fully formed. But the flavour of the language emerging from the party on both housing and energy underlines the importance of the sector making its voice heard when it still has the opportunity to influence policy, by explaining the impact changes would have on national targets for development.

This is, of course, something that Building is advocating through our Agenda 15 campaign. If the sector is to stand any chance of shaping a business environment that would enable it to effectively deliver the improvements to the built environment that the UK needs, the time to be heard is now.

Sarah Richardson, editor

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