Over the next few months, Building will have a political focus: what do the parties have to offer? What does construction want and need? Here is the second instalment of our three-parter looking at election topics.
Building safety
The state of play
The deaths of 72 people in the Grenfell Tower disaster of 2017 have led to a fundamental overhaul of building safety through the landmark Building Safety Act, which became law in April 2022.
The industry has been busy getting its head around new gateway processes, building registration requirements, safety case reports for buildings, a new “golden thread” of information and measuring and assessing competence. Some measures are already proving difficult to implement whether due to a perceived lack of clarity from government or resourcing issues.
Housing secretary Michael Gove’s consultation paper at the end of 2022 on requirements to install second staircases in tower blocks over 30m in height (later lowered to 18m) drew criticism from across the construction industry over its lack of detail. It has been blamed for blocks being put on hold, particularly in London, despite the government announcing a 30-month grace period last October.
>> Also read: Countdown to the general election part one: Project delivery, housing and planning, net zero
The requirement for local authority building control inspectors to pass competency assessments and be registered by 6 April has also been causing difficulties. Amid concern from Local Authority Building Control about a shutdown in services, the government last week took the pragmatic decision to extend the deadline.
Meanwhile the four-year-long Grenfell Inquiry has seen what the counsel for the inquiry described in his closing remarks as a “merry-go-round” of “buck-passing” as firms blamed each other.
In the wider sector, disputes have raged around who is responsible for remediation works, with Gove strongarming housebuilders to contribute or face an effective ban on trading. Many of them, in turn, are pursuing their supply chains.
What are the parties saying?
In many ways, there is little difference between the Conservatives and Labour on the big building safety issues. After all, no party is in favour of unsafe buildings and nobody wants to be seen on the wrong side of the argument.
Conservatives
The Conservative government has fallen over itself to appear tough and populist – taking the side of the “little guy” against big business.
Gove’s approach to the national cladding scandal, which saw leaseholders potentially having to pay thousands of pounds to remediate tower blocks, has been to aggressively pursue private housebuilders to pay for the works instead. He amended legislation to give the government the power to stop housebuilders from trading if they did not sign an agreement to fix ‘life-critical’ fire safety defects on their own blocks going back 30 years.
Despite misgivings about the early versions of the contract, housebuilders ultimately got around the table and agreed a deal. The government has also implemented a £3bn building safety levy through a planning charge on private development and a new 4% residential property tax to raise money for building safety works.
When coupled with the huge amount of regulation through the Building Safety Act and proposed measures such as applying the decent homes standard to the private rented sector, the overall impression is that the Conservatives are not afraid to stand up (and be seen to stand up) to big business.
As some have pointed out, this focus on regulation can be seen as a shift for a party that is traditionally seen to be on big business’ side.
Labour
Labour’s initial idea to tackle the cladding crisis was to suggest a new central body or team to help tackle the issue. In January 2021 Keir Starmer called for a “national cladding taskforce” to identify and remediate dangerous buildings. This would be based on a similar body in Victoria, Australia, which has audited unsafe buildings.
By October 2021, the then shadow housing secretary Lucy Powell was expanding on this centralised solution, saying that Labour wanted to create “a building works agency to assess, fix and fund then certify all tall buildings”.
However, perhaps due to Gove’s success in getting housebuilders around the table, the idea has not been mentioned since. The government has in any case set up its recovery strategy unit (RSU) to pursue companies dragging their heels on remediation work.
Instead, Labour has urged developers to sign Gove’s remediation contracts, criticising the government’s methods and timescale but not its overall strategy. In a speech last March, Lisa Nandy said the government’s approach was “dysfunctional” because Gove had been slow to send out the contract to developers. Last January, Nandy said the Conservatives had watered down the contract too much in order to get housebuilders to sign, restricting their liability.
Labour has pledged to fix the problem “once and for all” by abolishing the leasehold system entirely within 100 days of taking power, with Nandy describing it as a “feudal system”.
The government has also pledged to ban leasehold – but only on new homes and not flats. In November, Matthew Pennycook said: “It is deeply disappointing that the government appears set on legislating only for new houses to be sold as freehold, leaving those who buy flats trapped in an archaic system of home ownership.”
Nandy has also accused the government of letting foreign developers “off the hook” for remediation costs for UK buildings. Gove has previously talked of “practical difficulties” in getting overseas firms to pay, although he has also said they are in the remit of the RSU.
What the industry thinks
A spokesperson for the Chartered Institute of Housing: “There is a significant risk that the costs of fixing social housing blocks will fall on councils’ already overstretched housing revenue accounts, and on housing associations who face multiple financial pressures.”
Victoria Moffett, head of building and fire safety programmes, National Housing Federation: “As it stands, there is still no government funding available for social housing tenants living in buildings with combustible cladding and other safety defects. This means that not-for-profit social housing providers are forced to pay for this work themselves with the money they receive from tenants through their rents.”
Affordable housing
State of play
Before the general election starting gun has even been fired, the housing crisis is already centre stage, with affordable housing emerging as one of the most important – if not the most important – of issues.
Against the backdrop of growing council housing waiting lists and rising levels of homelessness, this comes as no shock. According to National Housing Federation (NHF) figures, an estimated 4.2 million people in the UK would benefit from having a social home.
Research by Heriot-Watt University for the NHF and Crisis charity estimates that England needs around 340,000 new homes per year, of which 145,000 should be affordable and 90,000 should be for social rent.
In its 2019 manifesto, the Conservative party pledged to build 300,000 new homes per year by the mid-2020s, “to make inroads on the affordability of housing”, the then chancellor Phillip Hammond said.
The government remains committed to its annual target but is a long way from reaching it. Recent data from the Department for Levelling Up, Housing and Communities (DLUHC) indicates that 234,600 net additional dwellings were registered in England during the year ending in March 2023.
While housebuilding peaked at 248,591 net additional dwellings in 2019/20, the number of new homes delivered has fallen since the pandemic.
Factors contributing to the shortfall in delivery include planning bottlenecks caused by limited resources in planning departments, labour shortages, supply chain disruptions and the escalating costs of building materials.
What are the parties saying?
In British politics, the tenure of homes built has typically created a dividing line between Labour and the Conservatives. Under Clement Attlee, Labour built more than a million homes, 80% of which were council houses.
Between 1979 and 1990, Margaret Thatcher’s government supervised the building of 2.6 million homes, 18.9% of which were “council” properties. However, since she introduced right to buy in 1980, over 4.5 million council homes have been sold off.
Conservatives
The Conservative Party has not disclosed extensive details about its manifesto plans for affordable housing. However, in January, Downing Street announced that it was considering a controversial “British homes for British workers” policy, which would give UK families higher priority for social housing.
Last summer, housing secretary Michael Gove said he would like to see 30,000 social homes built each year – “tens of thousands” for the social rent tenure in particular. He also advocated for allocating more funds from the government’s £11.5bn 2021-26 affordable housing programme specifically towards social rented housing.
This month, Gove announced a £3bn boost to the government’s affordable homes guarantee scheme, which provides low-cost loans to housing providers. This expansion will support the delivery of 20,000 new, affordable homes. It is worth noting that, while this will make it cheaper for registered providers to borrow, it does not resolve underlying financial constraints.
Labour
Labour has pledged “to save the dream of homeownership” by building 1.5 million homes over the course of the next parliament.
Shadow housing secretary Angela Rayner has said Labour will deliver the “biggest boost to affordable housing for a generation”. However, of the 300,000 new homes proposed per year, the party has not said how many affordable homes it will build or stated yearly spending figures on affordable housing.
Their strategy for achieving this includes reforming planning rules and stopping developers from “wriggling out” of their Section 106 responsibilities.
The party will create a specialist government “take back control” unit. This will advise councils and housing associations on how to negotiate with developers to ensure affordable housing obligations including Section 106 agreements.
Labour will also increase the flexibility of affordable homes programme funding to facilitate housing delivery.
Rayner has said that Labour will also look at making changes to the right to buy policy, to decrease the number of social homes being sold off without like-for-like new social housing being built to replace them.
Shadow housing minister Matthew Pennycook has said that Labour would reduce the discount on right to buy properties, which was increased in 2012 under the Liberal Democrat-Conservative coalition government.
Labour also plans to give local authorities in England new powers to buy land at lower prices to boost their housebuilding efforts. If Labour is elected, Keir Starmer has said he will reinstate mandatory housing targets for councils, reversing the Conservatives’ policy.
What the industry thinks
Jamie Ratcliff, chief communities and sustainability officer at Sovereign Network Group (SNG): “I’m quite positive that we’re going into a general election where for the first time since the 1950s both main political parties are going to be fighting it on a pro-housing supply footing. There’s still detail to come but I think that intention is a positive foundation.”
A Clarion spokesperson: “We believe housing should be treated as national infrastructure, with a long-term plan to ensure its consistent delivery. Having a stable regulatory environment will also boost investment in the sector.”
Education and skills
The state of play
The construction sector is presently grappling with a notable shortage of skilled workers, leading to rising costs and impacting overall capacity to meet demand. The lack of expertise in retrofitting also presents challenges to initiatives focused on achieving net-zero goals and modernising the housing stock.
In the pre-Brexit era, the UK addressed this issue by bringing in hundreds of thousands of skilled EU workers annually to fill the gaps. With reduced access to the EU’s labour market, UK firms have turned to hiring individuals from outside the EU.
Net migration to the UK, now primarily from outside the EU, has surged. However, the country still faces challenges in having the right individuals in the right positions to fulfill employer demands. The government asserts that the solution lies in training more individuals within the UK to bridge job market gaps.
Frustrated employers question how long it will take to bring these individuals into the workforce. While some appreciate the government’s efforts to involve industry more in training, there are companies that resent the shift towards a model where employers bear greater responsibility for equipping the workforce with the necessary skills.
The Grenfell fire and subsequent Hackitt review exposed systemic deficiencies in the training of construction professionals and the industry’s regulatory framework. This tragic event underscores the imperative for a thorough reassessment of training practices and regulatory measures.
There is also a growing view within industry that successive moves to expand university education have not delivered the skilled workforce that employers need.
A more recent government emphasis on apprenticeships signals the initiation of a process to reverse a historical trend where vocational skills were arguably undervalued. Many in construction believe that there is a pressing need for a coordinated and concerted effort to prepare the workforce for the demands of construction jobs.
There have also been problems with the roll-out of the much heralded apprenticeship levy, with significant sums levied from businesses going unspent. The Department for Education (DfE) has reported an underspend for the financial year 2022-23, resulting in the return of £2.178bn in apprenticeship funding to the Treasury.
With increasing demands being placed on business to both design the skills curriculum in their areas, and to offer training, many SME businesses have struggled to meet the challenge. A 2022 report by the Federation of Small Businesses found that only 17% of small firms in England engage with schools or colleges on any kind of skills programmes.
What are the parties saying?
Conservatives
Much of the Conservatives’ emphasis in recent years has been on a series of attempts to revive vocational education. At a conference last year the education secretary, Gillian Keegan, said: “Without skilled workers, it often feels like you’re driving with the handbrake on.”
Robert Halfon, minister for skills, apprenticeships and higher education, has noted that UK employers “spend about half of the European average” on training for their employees. And he has pointed to Germany as a model to follow.
Despite having led the move to dismantle the polytechnics in the 1990s, it is the Conservatives who are now the biggest critics of the expanded university system.
In a recent speech Rishi Sunak unveiled plans for a crackdown on “rip-off” degrees being offered by some universities that do not lead to decent job prospects for students.
The stated ambition is to get more young people into what is an often bewildering range of apprenticeship routes. But the Conservatives’ apprenticeships agenda has coincided with a decline in registrations in some areas.
The Conservatives also launched T-levels to much fanfare in 2020, as a vocational equivalent to an A level. But last year the inspection body Ofsted warned the qualifications still need “considerable work” before they can fulfil their potential, highlighting shortages of qualified staff to train students, problems finding suitable placements and high drop-out rates.
At the 2023 Conservative party conference, Sunak cast doubt over the future of T-levels, by announcing his proposal for a new “Advanced British standard” to replace both A-levels and T-levels.
Labour
Keir Starmer responded to Sunak’s attack on the last Labour government’s target for higher education expansion in England by accusing the prime minister of seeking a “levelling down of working-class aspiration to go to university”.
Bridget Phillipson, Labour’s shadow education secretary, characterised the Conservatives’ record on skills as “apprenticeships down, qualification reforms botched then junked and a levy on employers that doesn’t deliver for companies or communities, for individuals or for our economy”.
Labour’s 2023 report on skills was chaired by former education secretary David Blunkett and proposed establishing a national skills taskforce, to bring together employers, trade unions, central and local government, as well as further and higher education. It also called for reform of public procurement guidance “to ensure contracts include mandatory clauses relating to upskilling”.
Perhaps most pertinent to construction, with its significant SME presence, the report called for improved support and incentives to help SMEs take up apprentices, “including the acceleration of ‘shared apprenticeships’ with larger employers, and consideration of a skills tax credit”.
Encouraging for those keen on promoting lifelong learning, the report also called for a “learning and skills passport” in order to “build… a profile that could be added to at any time and in a variety of ways, throughout working life”.
What the industry is saying
Karen Mosley, managing director of HLM Architects: “We need a more fluid system where employers co-curate courses.” She also highlights the challenges for SMEs in resourcing apprenticeships and dealing with the a wide range of education providers: “It needs to be simpler for employers, students and parents to understand.”
Election focus
As thoughts turn towards the next general election, the UK is facing some serious problems.
Low growth, flatlining productivity, question marks over net zero funding and capability, skills shortages and a worsening housing crisis all amount to a daunting in-tray for the next government.
This year’s general election therefore has very high stakes for the built environment and the economy as a whole. For this reason,
Building is launching its most in-depth election coverage yet, helping the industry to understand the issues in play and helping to amplify construction’s voice so that the government hears it loud and clear.
We kick off this month with a three-parter looking at the state of play across three key topic areas.
Building is investigating the funding gaps facing the next government’s public sector building programmes, looking at the policy options available to the political parties.
In the coming months our Building Talks podcast will focus on perhaps the hottest political topic: the housing crisis. The podcast will feature interviews with top industry names who side-step soundbites in favour of in-depth discussions.
As the main parties ramp up their policy announcements, we will keep you up to date with their latest pledges on our website through our “policy tracker”.
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