CONSTRUCTION & RENOVATION
How will the UK Government budget changes affect the construction industry?
Chris Heaton, marketing manager at cork coating specialist CorkSol UK discusses how changes to be implemented by the Labour government will specifically affect building service professionals
A
t the end of October, the new Labour government announced their first budget since their election, which will have a significant impact on the construction industry,
its businesses and workers. The aim to “restore stability to our public finances, rebuild our public services and achieve economic stability” will directly impact the industry and its practices.
Ever since the pandemic, the UK has been in an economic crisis, with rising inflation and living costs, and the UK has amongst the least energy efficient homes in Western Europe, contributing significantly to stubbornly high energy bills and household emissions. Therefore, the Government has structured its budget around combatting this issue. The announcement of the Government’s Warm Homes Plan, to which the budget promised £3.4 billion, has so far focused almost entirely on the rollout of heat pumps and the electrification of UK housing stock. Heat pumps alone will not keep homes warm – without proper insulation Britain’s leaky roofs and walls will continue to cost families hundreds of pounds a year.
Despite this, the Office for Budget Responsibility has predicted that because of the budget, rates will continue to rise in 2025, with house prices taking a 3% increase. This is encouraging homeowners to invest in their homes, taking on renovation projects to add value to their current properties. One of the policies outlined in the budget to move the UK towards economic stability is the increase of the National Living Wage for workers and National Insurance Tax for employers. Even though this is a great benefit for workers, it comes with some hardship for small trade businesses trying to pay their workers a lucrative salary, while covering the increased rate of National Insurance. This in turn will also contribute to the already struggling labour shortage in the industry as they struggle to offer competitive packages to employees. As a result of this, project costs will increase.
In addition, materials have also risen in price as a consequence of inflation and as focus shifts to reaching Net Zero by 2025, projects must now source sustainable and energy efficient materials that will meet the green building standards. This will inevitably increase project costs further, posing a problem for businesses offering competitive prices to clients. The policies laid out by the Chancellor will hopefully boost the industry in the future and move the country towards a more financially solid economy, but with regulations in place and the 2025 Net Zero goal, solutions need to be implemented here and now. With homeowners turning their focus towards their current properties rather than moving, they are looking for solutions that will not only make it look nice, but also help to reduce their energy costs whilst adding value to their homes. To achieve this, many are addressing external work such as cracked render to improve the curb appeal of the structure, while others look to upgrade their insulation to improve the efficiency of the building. Taking action on both of these issues will benefit homeowners as it will lower energy bills and improve the structural integrity of the building, meaning they are able to keep costs low during this economic crisis. It is vital for many UK homeowners to enhance the insulation of their properties not only because of the money-saving aspect of it but also because of how susceptible they are to condensation due to poor ventilation of the building, which ultimately leads to the growth of mould. In the last century, the UK has seen several housing booms which has led to the construction of poorly made structures which are potential breeding grounds for damp and mould. Because of this, the industry has seen
6 BUILDING SERVICES & ENVIRONMENTAL ENGINEER JANUARY 2025
a rise in restoration projects, demolition and correct disposal fees which has negatively contributed to the £2 billion wasted annually in the industry. This significant loss of money has put the industry under especially high constraints and has therefore had a knock on effect on construction materials with steel, concrete and timber skyrocketing in price. In a time when governments are on a mission to combat climate change and have switched to focusing on green building practices, there has consequently been an increase in demand for sustainable materials, which has then contributed to a significant rise in costs. With this in mind, tradespeople must look for eco-friendly, cost-effective alternatives that will benefit homeowners, themselves and their businesses which might mean training in new areas or products. During a time of labour shortages and economic crisis, it could be easy to see this as an inefficient use of resources and time, and sticking to existing methods may seem a more attractive option, but it doesn’t help the industry move forward and evolve. On the subject of the skills gap, introducing quick-to-learn, accessible processes will help boost construction as we work towards providing more sustainable solutions. With the trades workforce at 88% capacity compared to pre-Covid numbers, many young adults are not choosing careers in building due to the heavy duty work involved that is constantly evolving. However, working alongside a company that offers intensive training, ongoing support and sales leads means not only will there be another service to add to repertoires, but the skills gap can slowly close with labourers learning the new, innovative solutions on the market. In addition, as these solutions continue to evolve in efficiency, they can offer unique services which can be completed quicker, causing little disruption to the owners, and is less physically demanding on the applicator.
The construction industry is constantly evolving and these budget changes will further contribute to the development of it. Even though these policies are expected to improve the UK situation in the long term, 2025 is still predicted to have rising prices and therefore, the industry needs that short term solution in place to combat the increasing costs. SprayCork, exclusively supplied by CorkSol UK, is just one of the possible solutions that will aid tradespeople to offer sustainable service to homeowners that will help everyone to persist through the economic struggles until the budget changes put in place begin to take effect.
Read the latest at:
www.bsee.co.uk
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38
