Expectations were raised in the run up to the Spring Budget, as the Chancellor pledged more jobs, investment, services, lower taxes and greater growth. Clearly these are long term aspirations. However, the UK is faced with immediate problems and the Spring Budget offered no imminent solutions.

The UK housing crisis continues with a desperate need for more homes to buy or rent. The Government knows this. Reported housing completions were just 234,400 units last year; over 100,000 people are living in temporary accommodation, while net migration to mid-2023 was 670,000 (Office for Business Responsibility – ‘OBR’). Although general inflation is expected to fall to 2% by the end of the year, private rental inflation is still growing at 6.2% in the UK (6.9% in London) as demand outstrips supply.

Proposed measures in the Spring Budget cannot improve the market in the short term. For many, the cut of 2p to National Insurance Contributions (NIC) will not result in improved savings for a deposit but will be spent on increased living costs, higher rents and higher taxes. A Spring Budget proposal to free up homes for local residents, through reduced capital gains tax (28% to 24%) for landlords and individuals who sell second homes is no great incentive to sell when the personal capital gains allowance is falling in April (£6,000 down to £3,000). Changes to Permitted Development Rights, if introduced (the consultation closes in April) for larger home extensions, and the removal of the favourable tax regime for furnished lettings (which also applies to properties in the EEA) are unlikely to be game changers. While not a Spring Budget issue, the reduction in interest rates, linked to economic recovery, may do more to help those re-mortgaging or buying a home.

Turning to wider regeneration, there will be a further series of local initiatives in addition to those in the Autumn Statement. All are longer term projects, for example, targeted funding for Sheffield, Blackpool and Liverpool, is aimed at delivering a combination of housing, new enterprise and community assets. There is to be further investment in the Cambridge Biomedical Campus and the City (including new homes by 2050), while a further 20 towns across the UK can access up to £20m over the next 10 years. There is also an ‘ambitious vision’ for 20,000 homes in Leeds by the 2030s onwards; 10,000 homes in Euston (plus a privately financed HS2 Euston station) and a reallocation of £4.7bn of HS2 funding for investment in the North and Midlands through the local Transport Fund in the future. Investment zones and freeports will benefit from an extended sunset date in England (30 September 2031), Wales and Scotland (30 September 2034).

Looking at the overall picture, it is not clear is what criteria the Government will use to assess if these plans are successful. Is there a ‘Plan B’ for a specific area if a planned enterprise fails? Can further investment in social housing contribute to easing a local housing market?

Efforts are being made to improve the efficiency of planning decisions, to reduce delays in infrastructure and housing developments. Devolving decision making to certain local authorities for specific developments is helpful but a wider problem remains. Government provided an update on changes which are coming to the planning regime, but not immediately. First, consultations have started on an Accelerated Planning Service for major commercial applications (employment floorspace over 1,000 sqm) requiring a decision in 10 weeks; if not fees are to be refunded. The findings from the Nationally Significant Infrastructure Projects (NSIPS) consultation have been published; the Government response is to make changes, including ‘faster consenting’ and improved processes for environmental assessments by 2025. There will also be a pilot focused on speeding up other planning applications using AI, but no implementation date has been provided.

The Government has offered a vision of a future with more housing, improved local enterprise and levelling up for many regions. However, changes proposed in the Spring Budget to capital gains tax, the holiday let scheme and the cut to national insurance will make little immediate difference. An improved planning regime and targeted funding could deliver the Government’s vision – but not yet!