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Last edited 25 Nov 2023

2023 Autumn Statement in brief with reactions

1 Five priorities outlined
2 Governments and Industry related bodies react
3 Related articles on Designing Buildings

[edit] Five priorities outlined

The Autumn Statement reiterated three economic priorities set out in January; to halve inflation, grow the economy and reduce debt. The indication is that inflation has fallen and the Office for Budget Responsibility (OBR) forecasts policies will help it reduce further next year. The statement talks of a responsible approach to public spending to keep debt falling, cuts taxes for working people and businesses, reform welfare to help people into work and remove barriers to business investment.

The statement says; "The government is focusing on five areas: reducing debt; cutting tax and rewarding hard work; backing British business; building domestic and sustainable energy; and delivering world-class education. The Autumn Statement takes a responsible approach to public spending to keep debt falling, cuts taxes for working people and businesses, reforms welfare to help people into work and removes barriers to business investment to boost growth."

These 5 focus areas are described here in brief in the order they appear in the four main focus area chapters in the statement.

[edit] Reducing debt

Growth forecast improved to 0.6%, now 1.8% higher than pre-covid.
Inflation is expected to fall. OBR expects key interest rates to stick at about 4% until 2028.
Headline debt is to be 94% of GDP.
The gap between spending and income is 4.5% of GDP.
The statement talks of tackling waste and inefficiency but ensuring public services continue to operate effectively in the face of financial and operational pressures.

[edit] Delivering world-class education

Reaffirms the commitments made in 2022 to make available up to £14.1 billion for the NHS and adult social care and provide an additional £2 billion for schools in both 2023-24 and 2024-25.
Total departmental spending will be £85 billion higher in real terms by 2028-29 than at the start of this Parliament (2019-20).

[edit] Cutting tax and rewarding hard work

NI contributions from employees will be cut from 12% to 10%. Reduction for self-employed by the main rate of Class 4 self-employed NICs from 9% to 8%, with Class 2 self-employed NICs abolished.
The national living wage will increase to £11.44 and will be extended to 21 year-olds, and state pension was also increased by 8.5%.
The Back to Work Plan will increase benefits by 6.7%, but require mandatory work experience after 18 months.
Local housing allowance to increase by £800 for some households.

[edit] Backing British business

The full expensing scheme, allowing businesses to offset investment on new IT equipment and factory machinery against tax over 3 years will become permanent.
Removing barriers to investment in critical infrastructure, by reforming the planning system to speed up approvals, setting out a plan to reduce time for new projects to connect to the grid, to drive new commercial developments that will enhance energy security and help drive the transition to net zero.
Business rates support package worth £4.3 billion over five years to support small businesses and the high street.
Small business multiplier to be frozen and Retail, Hospitality and Leisure (RHL) relief extended.

[edit] Building domestic and sustainable energy

Measures to help increase business investment by about 1% of GDP, targeting support for digital technology, green industries, life sciences, advanced manufacturing and creative industries, including £4.5 billion to unlock investment in strategic manufacturing sectors – auto, aerospace, life sciences and clean energy.
New “investment zones” in Wrexham, Greater Manchester, and the West and east Midlands.
Explore options for sale of government’s stake in NatWest, through a “retail share offer”.

To read the 2023 Autumn Statement in full visit HM Gov here

[edit] Governments and Industry related bodies react

[edit] Scottish Government

Deputy First Minister Shona Robison said.

“Today’s Autumn Statement from the UK Government has delivered what is the worst case scenario for Scotland’s finances. Scotland needed a fair deal on investment for infrastructure, public services and pay deals – the UK Government has let Scotland down on every count.

“We needed investment in the services that people rely on and in infrastructure vital to the economy, but the Chancellor’s actions failed to live up to the challenges we are facing as a nation, while not doing enough to help those on the lowest incomes. The cut to National Insurance shows the UK Government has the wrong priorities at the wrong time, depriving public services of vital funding. Shockingly, the health funding announced today represents an increase of less than 0.06% to Scotland’s health budget in 2023-24 of £19.138 billion.

“The increases to the state pension and Local Housing Allowance are welcome, but the increase to the minimum wage falls well short of the Real Living Wage. Some of the measures for businesses are also positive, but they come in the face of UK growth having been projected downwards as a result of Brexit and the UK Government’s mismanagement of the economy.

“As global temperatures push ever higher, the Autumn Statement was a chance to fund efforts to cut the UK’s carbon emissions – but it did not. It’s not enough to say they support measures to encourage more renewable energy developments and expand the UK’s electricity grid need. It needs to be matched with funding to actually deliver and help us meet our net zero targets.

“We will now assess the full implications of today’s statement as we develop a Budget that meets the needs of the people of Scotland, in line with our missions of equality, community and opportunity.”

For full statement visit https://www.gov.scot/news/autumn-statement-offers-worst-case-scenario-for-scotland/

[edit] Welsh Government

Rebecca Evans MS, Minister for Finance and Local Government writes:

The Chancellor claims that action taken by the UK Government has helped the economy to turn a corner. But the reality is that forecasts show the UK is on course to be one of the worst-performing advanced economies this year and next – both in terms of high inflation and weak growth. The OBR’s forecast shows the economy growing by just 0.2% on average each quarter through to the end of next year compared with an average quarterly growth rate of 0.5% achieved between 1997 and 2010.

While the Prime Minister’s target to halve inflation has been met, this is almost entirely down to a combination of global factors driving down energy and food prices and the Bank of England’s programme of increasing interest rates. The Institute for Fiscal Studies notes that the public finances have not meaningfully improved, the growth outlook has weakened, and inflation is expected to stay higher for longer. The OBR forecasts that living standards will be 3.5% lower next year than before the pandemic – the largest fall in living standards since records began in the 1950s.

The Welsh Government will receive an additional £305m across 2023-24 and 2024-25. This includes an additional £133m in resource budget in 2023-24, and an additional £167m in resource and £5.8m in capital in 2024-25.Following today’s Autumn Statement, the Welsh Government’s resource settlement will reduce by 0.1% in 2024-25 in real terms and our capital budget is down by 6% in real terms. Overall, that is a 1% year-on-year real terms reduction in our settlement...

Public services in Wales are already having to make incredibly difficult decisions – the NHS and local authorities are reporting acute challenges, with significant service pressures in health, social care, education, and homelessness. The Chancellor’s failure to recognise these pressures means schools, hospitals and vital public services are facing real terms cuts, impacting severely on the future sustainability of those services...

We will carefully consider the detail of today’s statement as we continue our preparations for the publication of the draft Budget 2024-25 next month. The choices made by the Chancellor in this Autumn Statement do not make our choices any easier. Our funding position remains incredibly difficult, and the decisions Welsh Ministers face are stark. But, unlike the UK Government, we will do all we can to put our public services, people, businesses and communities first.

For full statement visit https://www.gov.wales/written-statement-welsh-government-response-uk-autumn-statement-2023

[edit] The Chartered Institute of Building CIOB

Eddie Tuttle, Director of Policy, External Affairs and Research at CIOB, said:

“We are pleased to hear the Office for Budget Responsibility (OBR) forecast shows strong economic growth across the UK.However, to truly capitalise on this success, issues within key sectors such as the construction industry must be addressed. One of the biggest issues facing the construction industry is the skills shortage. In fact, Construction Industry Training Board (CITB) research recently revealed nearly 45,000 extra workers are required each year just to meet construction demand by 2027."

“While CIOB welcomes the Government’s commitment to invest £50 million in apprenticeships for key sectors like engineering, it is unclear whether the construction sector more generally, which has traditionally been reliant on apprentices as one way of generating new employment, is included in this investment, particularly when shortages are prevalent and have been highlighted across the industry.

“We were also interested to hear the Chancellor’s plans to extend National Insurance relief for employers who take veterans on their payroll. While we support the importance of this scheme, we would also be keen to understand if it could be extended to include relief for organisations which take on ex-prisoners as employees for example. Ministry of Justice figures state just 17 per cent of people with criminal convictions get a job within a year of release from prison and CIOB believes relieving National Insurance for employers recruiting ex-offenders could go a long way in increasing this figure.

“The Chancellor also discussed further changes to Permitted Development Rights (PDR) to increase the number of new homes. We have long argued that delivering new homes should not be solely a numbers game and it is vital to ensure any new home delivered is of the highest standard including quality. CIOB is particularly keen to understand further details behind the Chancellor’s comments on PDR and we would like to know how this will impact the quality of new homes. We will follow all of these points up with relevant ministers in order to continually push for better outcomes for the construction sector as a whole given the importance and economic leverage of the sector to UK PLC.”

This section and the top image appears on the CIOB news and blog site as "CIOB comments on the Chancellor's Autumn Budget" dated November 22, 2023.

[edit] The Institute of Historic Building Conservation IHBC

David McDonald IHBC Chair commented:

'Greater efficiencies in the planning process should be better for all involved. However, these should not be allowed to lessen the protection of the historic environment, and must include proposals to enable local authorities to provide sufficient numbers of staff qualified in planning, conservation and urban design.'

This section was issued via direct comment from IHBC to Designing Buildings editorial tean on November 23, 2023.

[edit] Electrical Contractors Association ECA

Rob Driscoll, Chair of the Cabinet Office SME Advisory Payment Group and Director of Legal & Business for ECA, said:

“This is a huge achievement for ECA in levelling up the commercial environment in which our Members operate. It clearly demonstrates liquidity of supply chains and cash-flow are political priorities. Over the past 24 months, ECA has worked tirelessly with its Members, payment software providers, industry press, the Construction Leadership Council, the Department for Business and Trade, the Cabinet Office, and an alliance of a dozen trade bodies to underscore the urgent need for reform and elevate SME payment terms within the political agenda.”

ECA has also welcomed Kemi Badenoch’s commitment on behalf of Government to reform payment reporting. This is designed to eradicate loopholes and maintain the credibility of the government's open-source credit information reports on large firm payment performance.

ECA was also successful in influencing the new Procurement Act, which gained Royal Assent last month. Following several meetings with Ministers, peers and MPs, it introduces 30-day payment as a statutory implied term into public sector contracts at tiers 1, 2 and 3 of the supply chain. It ensures that the public sector reports on payment terms in the same way as the private sector. ECA, which represents nearly 3,000 electrical and engineering services businesses in England, Wales and Northern Ireland, has been a steadfast advocate for improving payment conditions for decades.

This section was issued via Press Release as "ECA applauds Chancellor’s payment reforms for SMEs " dated November 24, 2023.

[edit] Association for Project Management APM

In response to the Chancellor Jeremy Hunt’s Autumn Statement this week, Andrew Baldwin, Head of Policy and Public Affairs at APM said:

“There are reasons to be optimistic about some of the measures announced. We welcome the Chancellor’s nod to stability through plans to support investment, boost skills and improve efficiency in many of the key areas where projects take place, such as technology, house-building and advanced manufacturing.”

On the Chancellor’s announcement about planning reforms and infrastructure projects:

“Importantly, ensuring successful delivery needs to remain a focus in light of planning reforms announced by the Chancellor. We acknowledge that bureaucracy around infrastructure projects can be a source of frustration for those tasked with delivering these projects. Whilst measures announced in the Autumn Statement to speed up this process have the potential to quicken project delivery, it is important to remember that projects must be delivered with a sustainable and sustained approach in mind.

“While speed of completion is always a consideration, this must not be at the expense of successful delivery. Infrastructure projects must not become ‘hurried’, as this could jeopardise its ability to deliver intended benefits over the long-term. Meanwhile, the focus on delivering so many new projects is a positive step although the proximity to an Election may impact on the ability to deliver all of them in such a short period. It must be remembered however that delivering project success means investing in people.

“It is concerning to hear the Government is focused on reducing the civil service at a time when its own centre for project expertise – the Infrastructure and Projects Authority (IPA) – is supporting more government projects than ever before. We believe the IPA should be given more resource, not less. We therefore call on the Government to ensure the IPA has the resources it requires to deliver projects successfully, so that projects succeed for the benefit of society.”

On the announcements about investing in the skills gap, particularly in the engineering sector:

“Investment in skills elsewhere must also be prioritised. Our research shows that the skills gap is a major concern for people delivering projects in the engineering sector – where 15% of project professionals say the skills gap is getting worse – and in the manufacturing sector, where that figure rises to 34%. Apprenticeship programmes will be vital to help boost the skills gap in these sectors. The announcement of £50million of funding over the next two years to pilot ways to increase the number of apprentices in engineering and other key growth sectors is welcome. We hope this will contribute to increased uptake of project management apprenticeships in particular."

On AI and future growth:

“The Chancellor is also correct to acknowledge the importance of AI in his autumn statement. The project profession has been an early adopter of AI and machine learning, and many of APM’s Corporate Partners are either applying AI already, or preparing to do so. Furthermore, our research has found that AI has the potential to increase project success and mitigate failure. Given the importance of projects in this Budget and the Government’s wider economic plan, we invite the Government to consult with APM and our Corporate Partners on how to make the best use of the announced £500 million of funding for innovation centres.”

This section appears on the APM news and blog site as "APM responds to Autumn Statement 2023" dated November 24, 2023.

[edit] The countryside charity CPRE

Commenting on the statement, Roger Mortlock, CEO at CPRE, said:

On the extension to the mortgage guarantee scheme: ‘People are crying out for genuinely affordable and social rented homes, both of which are in desperately short supply in all parts of the country. This morning, the government announced an extension to the mortgage guarantee scheme but nothing about investing in the kinds of housing that will help to fix our hidden rural housing crisis. The government must act now to ensure there is a supply of the homes people need. If it doesn’t, the future of our countryside communities will be at stake.’

On stamp duty rebates for people who make their homes more energy efficient ‘We agree with the government that people’s homes need to be more energy efficient, for the sake of both the planet and people’s pockets. But why is there still no requirement for new houses and other buildings to include solar panels? The proposed stamp duty rebates are a drop in the ocean when what we need is a rooftop solar revolution. Only by making huge changes to the way we generate our electricity will we meet our zero obligations and protect the countryside for generations to come. ‘New homes should set the standard for energy efficiency. To turn this into a reality, the government must be bold and make rooftop solar panels compulsory in all new developments, not fiddle around with things like stamp duty.’

On individual payments to people with new energy infrastructure built close to their property

‘Planning decisions should be in the wider public interest rather than just being about compensating people for loss of property values. Individual householder payments don’t make sense for rural communities. It would be far better for National Grid and others to invest in community energy schemes that make communities as a whole better able to adapt to climate change and move towards net zero.The National Grid already works to bury existing or new pylons in protected landscapes, but that is because improving these landscapes is a benefit for the whole nation rather than just those who live near to where the undergrounding takes place. When the will is there, we can protect our iconic landscapes and meet our nation’s energy needs.’

On plans to speed up planning decisions

‘This will not resolve the chronic under-funding of planning departments that is to blame for the inability of Local Planning Authorities and Planning Inspectorates to meet deadlines. Speeding up the decision-making process without additional resources will inevitably lead to councils approving lower-quality applications. Councils will be financially incentivised to push schemes through rather than consider them on their merits and adherence to relevant planning policies. Planning departments need more money in order to train and recruit the staff required to provide a high-quality service.’