Assuming that polls are right, this will likely set the tone for policy over the next five years.
Last week we welcomed Gaurav Ganguly, Chief European Economist and Head of the Climate Change Group for the Moody’s Analytics, Kelly Edwards, Head of UK Public Policy at Instinctif Partners, and David Gauke, former cabinet Minister and Chief Secretary to the Treasury to speak to a selection of our clients around the implications for the built environment.
As we enter the next five years, here are some considerations as to what we can expect from the new government, and some of the opportunities and challenges they present:
Clarity and certainty is needed
The UK has been in a period of uncertainty, some of which has been as a result of external forces. This can’t be avoided. The UK does not have much fiscal space for manouevre, without incurring impacting the trust of market participants, as was evidence in the mini-budget of 2022. Declarations around one fiscal event a year, and adherence to fiscal rules helps create that clarity, while the economic conditions of inflation and interest rates decreasing will create much-needed tailwinds.
Government working with business is paramount
Much of Labour’s rhetoric is good for business, including commitment to net zero and strategic investment in innovation. Judging by recent comments, a new government will look to ‘shape’ markets and create a basis for partnership with the private sector. With ambitious industrial and climate targets, this will likely require significant investment from the private sector.
Economic growth first
While a new Government will have many conflicting interests, the suggestion is that economic growth will be prioritized. Against a backdrop of a deglobalizing world, a new Industrial Strategy, will likely need to see a trade-off between investment in protection of industries, and investment in new and emerging growth sectors. The UK is well placed to benefit from its position in life sciences and climate tech, the latter of which will benefit both economic and climate targets.
Planning reform is front and centre
Labour put planning reform at the front and centre of its manifesto, has pledged to reintroduce ambitious housing targets and increase social housing provision. The implication is that some elements of planning reform will be introduced quickly – amends to the NPPF, greater powers in the hands of Local authorities, the designation of a ‘grey belt’ - in order to spur housebuilding and in turn, economic growth.While change is long-awaited, there is likely to be scepticism until there is genuine movement. Notwithstanding those issues, firing housing supply will rely on ensuring the UK has the right skills in order to deliver the homes being promised.
