CPA Bulletin

www.cpa.uk.net CPA Bulletin > November 2024 15 Firstly, the 100-day mark for a new government means very little in practical terms, but politically, it is a loaded term that that goes back to the days of the 1950s and 1960s. There is some debate about whether it was President Eisenhower or Harold Wilson and his first Labour government in 1964 who first came up with the idea. Wilson wanted a 100-day action plan for his new government, and while numerically it sounded good, as Keir Starmer is finding out, it can be both a benefit or an unwantedmarker that highlights the limits of power and the differences between opposition and government. In the first weeks of the new government, Angela Raynor announced plans for house building in England to reach 300,000 new homes a year. While welcome in principle, each of the previous governments has had plans to reform the planning system and build more homes. The government has to learn that construction is not a tap that can be turned on or off. Plans quite literally need to be in place to allow for supply chain capacity and capability, materials and available land, alongside market conditions that encourage house builders and people willing to buy them. Planning reform is one element, but the government must learn there are a myriad of factors that have to align if this figure is going to be reached. The 30th October Budget was the first real test for Rachel Reeves on how she intended to address the apparent £40bn black hole in the public finances that the new teamat the Treasury uncovered in the weeks after they took office. Ahead of a big fiscal event, any new government will inevitably blame the previous government for everything that went wrong and why you are the only teamable to fix it. Nonetheless, it was disappointing to see the rise in Employers NI confirmed – this is essentially a tax on jobs and will do little to bolster economic growth but will impact on recruitment and wage rises in the existing workforce. Although not a surprise, the Chancellor and the subsequent Corporate Tax Roadmap which was published alongside the Budget, confirmed that the Full Expensing Allowance for the rental and leasing industries, will only be introduced when fiscal conditions allow. In a subsequent meeting with the Treasury, the CPA expressed concern that with higher borrowing, higher taxes and limited economic growth forecast, it is doubtful in this Parliament at least, that these conditions will ever be met in the foreseeable future. In the first weeks of the new government, several high-profile schemes such as the tunnel under Stonehenge were cancelled, with proponents of the Lower Thames Crossing scheme now having to wait until May next year for a decision on its future. This comes after two previous deferments on a plan that was initially conceived back in the days of the Thatcher government in 1989. Despite these delays and cancellations, at the time of writing, it does look like HS2 will now finish at Euston, after the original plan was changed by Rishi Sunak’s government and plans for Old Oak Common as the London terminus were introduced last year. How it will be funded is unclear, however, for anyone having to use Euston, this is a welcome development given the now well documented issues of capacity and overcrowding, as well as the amount of development work in the wider area that has been put on hold in the last two years. Chief Secretary to the Treasury, Darren Jones announced the creation of the National Infrastructure and Service Transformation Authority, which will ‘look to fix the foundations of UK infrastructure system by bringing infrastructure strategy and delivery together addressing the systemic delivery challenges’. Billed as part of the government’s yet to be published ten-year infrastructure strategy, Chair of the National Infrastructure Commission John Armitt will delay his retirement in the interests of continuity. The new authority, in the words of the Chief Secretary: ‘will get a grip on the delays to infrastructure delivery that have plagued our global reputation with investors. It will restore the confidence of businesses to invest and help break the cycle of low growth’. Sounds great in principle but in the words of Ronald Reagan, the nine most terrifying words in the English language are ‘I’m from the government and I’m here to help’. Put simply, if government is serious about long termand sustainable economic growth, then it must exercise its power and messaging, responsibly, with the needs of the construction industry inmind. Each new government comes into power with the aim of changing the status quo and leaving a legacy that future generations will benefit from. While those aims are not in dispute, this means thinking beyond the political cycle and accepting that the benefitsmight not be felt for a period – possibly beyond their time in office. The October Budget suggests government has more to do in terms of understanding how it secures economic growth. With high profile examples in how not to go about infrastructure projects all too recent, the new government would be wise to learn the lessons of failure and how not to repeat them. Learning the Lessons for the Future A Guide for Government POLICY POLICY The new government’s Budget has raised business taxes and caused concern in the construction industry about how it intends to secure lasting and sustainable economic growth. What does the first 100 days of office mean for mean for construction and the new(ish) government as it develops its industrial strategy and plans for construction?