During the Autumn Budget Statement yesterday, Philip Hammond, the Chancellor announced a cut in Apprenticeship levy contributions for SMEs; a £675 million Future High Streets Fund to allow councils to rejuvenate town centres; and a two-year extension for Help to Buy.
The Chancellor resisted a spending boom ahead of the outcome to Brexit negotiations, which he said were at a “pivotal stage”. Mr Hammond said forecasts by the Office for Budget Responsibility (OBR) that showed debt continuing to fall in each of the next five years.
Further changes to the apprenticeship levy to support employers were announced. From April, large businesses will be able to invest up to 25% of their apprenticeship levy to support apprentices in their supply chain. Some employers will pay half of what they currently pay for apprenticeship training – from 10% to 5%. The government will pay the remaining 95%.
The statement also revealed the end of PFI by scrapping future schemes under the initiative – although honouring current projects. While Help to Buy received a two-year extension, it will be axed from 2023 and will only be applicable to first time buyers.
Iain McIlwee, chief executive at FIS, said: “It was encouraging to see a focus on apprenticeships with SME contributions reducing. There does seem to be a rebalancing to focus on supply rather than demand side issues in housing with a reasonable period allowed for weening the market off of Help to Buy. There is an encouraging focus on redeveloping town centres and funds supporting a more strategic approach to addressing the balance of retail and homes.”
Sarah White, residential sector manager for British Gypsum, said: “Government efforts to support SME housebuilders with up to £1bn of British bank guarantees means we are optimistic that we should see an increase in affordable new homes in communities across the country. While these efforts to accelerate housebuilding are most welcome, it was disappointing that the Government was not ready to respond to Letwin’s recommendations on reform to the planning process – another crucial step towards delivering the homes the country so badly needs.’
Brian Berry, chief executive of the FMB, said: “The Chancellor has recognised the importance of investing in our high streets. There is a pressing need to re-invent many of our town centres in light of changing patterns of retail and leisure. The Government should be applauded for its ambition to safeguard the life of our high streets.
“We are also pleased that the Chancellor has today announced £1bn to guarantee capacity to support lending to the SME housebuilding sector. This will be implemented by the British Business Bank, working with Homes England. Many small-scale house builders continue to experience real difficulty in accessing the finance they need to build homes, and it is often the smallest scale builders that experience the greatest problems. This new funding will help to speed up the delivery of homes and lead to a more diverse and resilient housing supply.”
Duncan Green, managing partner at Pick Everard said: “I am pleased to hear that Mr Hammond has announced a £695m initiative to help small firms hire apprentices. I believe that apprenticeships for both males and females in construction are crucial to the future of the industry, especially because of the skills gap, and training needs to remain a top priority if we’re to see real change in the UK’s infrastructure. Essentially, skills and training are how we will see the high wage, high skill economy of the future.”