A lot has changed since last year’s event - not least the man giving the big speech. Daniel Gayne headed to Liverpool to find out what Labour has planned for the built environment for the coming year
Anyone unsure of the message Labour wanted to get across at this year’s party conference would have been put right within a minute of arriving at the exhibition centre in Liverpool.
On every wall: HOPE AGAIN. On every screen: HOPE AGAIN. On every flag: HOPE AGAIN. A year ago, the omnipresence of such a cultish exhortation would have read as sign of desperation from the party spinners.
This year, its heavy-handedness obscured the fact that it reflected something real about the mood around the conference.
Around the housing and built environment fringes, there was a sense of a fresh start, a (possibly brief) moment for optimism – a marked contrast to the cognitive dissonance of last year, where Steve Reed’s ‘build baby build’ bombast fell flat among developers with real world frustrations and an exceptionally challenging market.
In one sense, not much has changed since then. Many of the same challenges around viability, affordability, and high costs of building and borrowing still persist. In another sense, we live in an entirely different world, with a freshly disrupted geopolitical environment and, of course, a new prime minister.
Labour puts the planning issue to bed, but leasehold troubles ‘far from solved’
On a more prosaic level, one of the big changes since last year is the introduction of a new National Planning Policy Framework (NPPF), which showed its impact in the relative lack of interest in the subject of planning on conference fringe panels that would usually be dominated by it.
It’s a fact that was not lost on attendees. “You kind of take a feel of what people are talking about at the conference and I’d say last year there was so much conversation about planning. This year, a lot less,” noted Mike Reeder, MP and former Mace director, addressing a panel on the housing market. One planning consultant that Building spoke to at the Big Housing Reception on Sunday evening remarked that he had been struggling to find enough events that were relevant to him.
The consensus around the fringes seemed to be that, while there could always be improvements to planning policy, Labour’s latest NPPF was a major step that should be given time to bed in.
Judging from the housing secretary’s speech on Tuesday morning, the Ministry of Housing, Communities and Local Government’s (MHCLG) attention will now turn to tackling the issue of leasehold, which Angela Rayner described as “unfinished business”. She said she would take action to stop leaseholders being “ripped off”, promising new regulation of estate agents, letting agents and managing agents, Burnham’s keynote speech included a commitment to introduce legislation to reform leasehold tenures by Christmas.
Speaking on a panel addressing the subject, Kate Hendrick, from the National Leasehold Campaign, said that some people around the country think the leasehold problem has been sorted. “It’s so far from sorted,” she said.
Brian Berry, chief executive, Federation of Master Builders
How would you describe the atmosphere at this year’s conference?
I think this conference just seems more positive and has a happier sort of feeling. It seems to be quite buzzy. I guess that reflects the fact the new prime minister has not been there so long that people can start criticising. I think it’s probably as good as it gets for the Labour Party at the moment because it’s full of hope, with a new prime minister in post and they’ve got a clear mission in terms of delivering their manifesto from two years ago. So it feels re-energised in that sense.
What are the hot topics around this year’s housing fringe events?
Clearly delivery is a key factor I’m picking up, certainly on the construction side. The government has got clear objectives of building more homes, retrofitting five million properties and planning reforms. But it’s a focus on actually getting the job done and looking at those barriers. I think there seems to be goodwill working with the government to actually overcome those barriers and that’s going to be the challenge from now onwards.
Will the Your First Home scheme help the housing sector?
The industry has been calling for help for first time buyers and the government has responded. I think the government should be commended for doing this. We’ve not had any help for first time buyers, so it would be wrong to knock it. So I think the government’s been responsive. Will it make a fundamental change? I’m less sure. Because it’s only affecting new build, which obviously suits the major contractors, I’m not sure it’s going to have a big impact on small local housebuilders. We need to go further, and the government, to be fair, has got an ambitious housing target. The key will be the planning reforms. How do we speed up the planning system? That question comes down to resources in local planning departments.
What’s one thing you’d like to see in October’s budget?
The one thing I’d love to see is some clear certainty about business conditions. Since Labour’s come into power, there’s been a lot of concern about future taxes, which actually for small employers creates a lot of uncertainty. National insurance contributions are being imposed and the minimum wage is going up. These are extra costs. It would be good if the Chancellor could actually say there won’t be further surprises. We know it’s a difficult time, but we do need to stop this flip-flopping around.
How would you rate the Labour government’s performance as it relates to the built environment?
It’s struggled in terms of its delivery. So the ambitions are fantastic. Everyone supported the government at the beginning in terms of house building, improving our housing stock, public services, infrastructure, but they’ve really struggled right from the beginning. But obviously, with the change of prime minister, Andy Burnham has got a golden opportunity to reset and focus on delivery. He’s got this one chance and if he messes that up, then Labour won’t do well in thenext general election. I’m not surprised that he said there will be no general election until 2029 because he wants to show that he can deliver and he’s going to face huge problems in the autumn of the budget. We know the spending commitments and how they’re going to be funded. So that will be the test, and that’s going to be the challenge with very small headroom for the chancellor to “dazzle”.
Hendrick noted that leaseholders have the right to challenge their service charges at the first tier tribunal, but described this system “not fit for purpose” and said encouraging leaseholders to pursue that route “in the state that [the FTT]” is in was “not the answer”.
She said opponents of reform have “deep pockets” and that it would be a long and difficult battle for the government.
The reality of it is leasehold will be around for a long time and we just have to be realistic
Kate Hendrick, National Leasehold Campaign
“The reality of it is leasehold will be around for a long time and we just have to be realistic,” she said, while making the case for urgent changes. “We need to abolish forfeiture,” she said. “That is the biggest threat that leaseholders face all the time. Pay this service charge or they’re going to go for forfeiture”.
On a Labour Housing Group panel, Rayner’s deputy Matthew Pennycook emphasised that tackling the problem was crucial for development. Noting that 96% of new homes in London were flatted, the housing minister said that “until we have really reformed the leasehold system, that tenure is going to remain a problem to people who are contemplating what their first home is”.
Not all are convinced by this. Speaking to Building, Barratt London’s managing director, Craig Carson, spoke of “misconceptions” around service charges and that “in our sales centres and our sales team, [leasehold] is not a question that really comes up”.
For private developers, effective demand and viability remain the big challenges.
Burnham’s demand-side stimulus a ‘natural pivot’, but ‘frank conversation’ needed on viability
There was good news related to the former as delegates headed to Liverpool, with Burnham announcing a new first-time buyer scheme ahead of the conference. Almost everyone Building spoke to around the conference struggled to remind themselves of the scheme’s name – Your First Home – perhaps because they have spent so long calling for the return of Help to Buy.
Calls for support for first-time buyers have become a staple of housebuilder’s annual reports over the past year, and so, even as they stumbled over the name, developers were keen to praise the government’s move.
“The fact that they have announced this is fantastic,” Paul Rickard, chief executive, of Pocket Living told Building. “It will definitely help.”
Craig Carson, managing director, Barratt London
How would you describe the atmosphere at this year’s conference?
This is actually my first one and the atmosphere is really, really good. There’s definitely an air of positivity.
Will the Your First Home scheme help the housing sector?
We really welcome Your First Home, obviously, the devil will be in the detail, but, nevertheless, it’s a good signal to the market. For us, it is really about getting that understanding in terms of is there going to be a cap in terms of the value of the property? Is it going to be linked to income? Is there going to be a cap on the deposit that can be put in? What is it going to cost for the developer of the scheme? Is it going to be ratcheted from an SME up to a large national? All those elements are important, but, nevertheless, it is very welcome.
What’s one thing you’d like to see in October’s budget?
There’s three asks, really. One is the demand side support - they’ve sort of addressed that but it would be good to get something more like a stamp duty element. The second is a moratorium on policy change. We’ve had so much policy change in the last five years. We need to bed that in. Then we need a real wholesale review of taxation.
How would you rate the Labour government’s performance as it relates to the built environment?
In fairness to them, the ambition is huge, and that is really welcome. They’ve definitely come to the table with the planning reforms […] and then the second piece on the demand side, with the announcement on Saturday, again they are listening and they are bringing in changes. So, from my point of view, it is about that ambition turning into delivery, and I feel they are on the journey for that. In terms of rating it, you always can be doing more, but they are definitely into the ’eights’ [out of 10] for me because they are listening, they are responding.
“If you look at the vast majority of SMEs, sales rates have gone through the floor, so it’s sort of a natural pivot to look at the other side of the pendulum,” said Hanad Darwish, head of external affairs at the Land, Planning and Development Federation told a fringe meeting.
For lobbyists and trade bodies, the realisation of one policy goal is simply an opportunity to move to a new battle. So it is with construction and development, where the next big push is sure to be viability (though the sector has not exactly been silent on the issue to date).
Policy sometimes doesn’t consider the cumulative effect of policy on outcomes
Hanad Darwish, Land, Planning and Development Federation
“In terms of the things that are impacting some of our members mostly on the ground, there’s viability,” said Darwish. “Policy sometimes doesn’t consider the cumulative effect of policy on outcomes. I think the layering of things – affordable housing requirements, environmental requirements, all very well meaning – I think that’s definitely an issue”. Mike Reeder agreed that MHCLG needed to have “a very frank conversation about what to be trying to achieve and what are the nice to haves”, mentioning swift bricks and rain water harvesting as examples of things which should not be made requirements.
Healey announces ‘down payment’ on Milburn report, but sector must solve wellbeing issues to bring NEETs into the sector
One of the biggest topics around the more construction-focused parts of the fringe was NEETS – an issue which the sector sees simultaneously as a crisis and an opportunity.
These conversations took place under the cloud of the Milburn report, which is expected to set out its final findings soon – after which, we can expect the government’s strategy on the issue to be made much clearer.
In his speech from the main stage, John Healey announced that Treasury would make a “down payment” on Milburn’s forthcoming work, committing to a £100m expansion of apprenticeships. He said the Local Apprenticeship Service, which will match young people with employers, would be available to any mayor in England who wants it. The Treasury said the programme will roll out across England next year and is fully funded through savings from a crackdown on fraud.
Discussion of NEETs around the fringe, however, emphasised that the challenges faced by would-be apprentices go beyond government funding.
At the Big Construction Breakfast on Monday morning, Amanda Martin, the chair of APPG for Trades People, pointed out that apprentices often lacked the means to get to construction sites or to afford to get lunch with their colleagues when they got there. She said she had been pushing for a “student loan-type thing” for apprenticeships - a supplement to living costs that they pay back when they are earning over £27,000. Martin also raised issues about the wellbeing issues in the industry putting off prospective entrants.
Victoria Hills, chief executive, Chartered Institute of Building
How would you describe the atmosphere at this year’s conference?
We’re in a different world. You often hear about a reset, but actually it does feel like there’s been a complete reset. There is optimism here that things are going to be a little bit different. That provides an opportunity for the construction sector and our members to really get part of that conversation and say ‘we’re here to help’.
What are the hot topics around this year’s housing fringe events?
Apprenticeships, NEETs in particular, and how we can get more people into jobs and meaningful work. That’s a golden opportunity for the construction industry because the careers have got longevity. People are worried about what AI means. The brilliant thing about construction is it’s not going to be replaced by AI or robotics. It’s going to be enhanced by it.
Will the Your First Home scheme help the housing sector?
That is an opportunity where our members will be saying, “Great, you know, because they’re in the business of building these homes, so that’s positive’. What I’m hearing so far from people I’ve spoken to is that it’s a helpful start, but I don’t think it’s a silver bullet, They’re going to need to do a lot more.
What’s one thing you’d like to see in October’s budget?
Reform that construction skills levy and get it more targeted to support SMEs. There’s no shortage of money. But is it being spent as wisely as it should be? That’s the question we’re asking.
How would you rate the Labour government’s performance as it relates to the built environment?
We’re not allowed to be political, but what I would say is there’s optimism here that there is going to be a focus on delivery. Last year, it was all about what was wrong and actually I feel that they’ve stepped beyond that.
“We’ve got to make sure that there is reasonable notice around shifts and around compensation for short notice cancellations, statutory sick pay,” she said. “But one of the things I’ve been really pushing for is paternity leave with self-employed.” Martin framed these policies as part of a broader effort to improve wellbeing in a sector where people often spend long periods apart from their families and facing the financial pressures of being self-employed – stresses which prove too much for some. “It’s absolutely shocking that the biggest cause of death in this country is still suicide of under 50, and the construction industry is the biggest industry,” she said.
The consequences of this crisis were laid bare in an evening event outside of the conference secure zone. A panel convened by Unite the Union met upstairs in The Liverpool pub to discuss the problem of suicide among construction workers. Graham, a scaffolder, delivered a rending speech about the suicide of his son, of the same trade, and how it had affected his life. After his speech, Ritchie James, regional secretary at Unite, stressed the need for the government and industry to take action to solve the issue. “Behind every number is a family left shattered, mates who will never again share a site cabin and a trade short of the next generation of skilled hands”. He listed “long and irregular hours, extensive travel, long working hours, and high-levels of self-employment”, as among the issues facing the industry.
Infrastructure advocates see opportunity in devolution drive, but Burnham’s prevarications over Heathrow frustrate
While housing was the more dominant topic across the built environment fringes, infrastructure received some attention too. At an event organised by Centre for London, Central London Forward and Business for Bakerloo, there were discussions about the possibilities of fiscal devolution for strategic investment.
London Assembly member Elly Baker said that funding certainty was “absolutely crucial” and that more power and over funding at the London level would give the certainty needed for delivery. “Everyone knows that if you do transport infrastructure, good things follow from it,” said Chris Hogwood, chief corporate affairs officer at Landsec, making the case for investment in the Bakerloo line upgrade and extension.
Panellists discussed infrastructure investment in the context of planned fiscal devolution, particularly the government’s plans to allow local governments to retain a portion of income tax. “It’s a really interesting tax to devolve,” said Mark Williams, director of Central London Forward. “It naturally encourages whoever it is devolved to invest in projects and programs that support growth.”
However, there was some frustration about comments made by Andy Burnham on infrastructure. In an interview for the BBC, the prime minister said expansion plans were “a matter for Londoners”, refusing to back the scheme after the airport announced the £49bn project could be delayed by up to four years.
At the Centre for London event, Muhammed Butt, leader of Brent council, vented his frustration about the delay. “In that time, how many other countries would have built train lines and stations and airports and ports and everything else,” he said. “30 years down the road, we’re still talking. All right, if we’re serious about infrastructure, if we’re serious about growth, and creating those pathways for opportunity, for ambition and aspiration for our residents, we need to […] make things happen.”
Burnham makes bold pitch for ‘public control’ with big focus on housing – but no major announcements on new infrastructure
None of the media narrative ahead of the conference suggested that there would be a big announcement on infrastructure. But it’s notable, and unusual in the context of recent history, that none of the ongoing investments or big proposals got even a mention in the prime minister’s conference speech. Usually, there is some hat-tip to ‘spades in the ground’ on some or other big project.
When Burnham reached the end of his time on stage on Tuesday afternoon, it was understandable why such matters were omitted. This was big picture stuff – a bold pitch to bring “energy, water, housing back under public control”.
This included a bolstered Water Bill that would repeal the ban on public ownership of water companies, a new state-owned firm called Great British Grid, and a re-statement of his commitment to a council housebuilding revolution. “When people hear the phrase public control, I am sure some think it is anti-business,” he said, addressing critics of his more statist approach to government. “It is the opposite. Businesses need the basics to be functional and affordable too”
For those in the housing sector, it’s clear this agenda will be consequential – although the details on exactly what the future looks like remain shaky. For infrastructure developers and investors, there remains a big question mark over what ‘public control’ will actually mean and what knock-on effect it might have for consultancies and contractors working in this area.
It’s worth remembering that Burnham has been PM for less than three months and with an early election supposedly ruled out, this story has a lot of time left to run.
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