SME house builders demand action from “anti-building” Tories

Grant Prior 2 years ago
Share

SME housebuilders delivered a letter to the Prime Minister today calling for action to save their businesses.

The letter signed by 200 firms highlights the “existential threat to the survival of businesses posed by the increasingly anti-development policy environment.”

It warns that current blocks to development threaten to wipe out a growing number of firms in the coming months and years with 78% of firms considering scaling back their residential construction activities.

Smaller house builders are facing a raft of problems including:

  • The collapsing planning process where under-resourced local authority planning departments can take years to process applications
  • Planning reform. Michael Goves capitulation on the planning system to an anti-development faction of Conservative MPs – particularly the removal of mandatory housing targets and a softening of the Five-Year Land Supply Requirement, has now seen 58 local authorities withdraw or pause their Local Housing Plans.
  • Interventions by Government quango Natural England are delaying an estimated 180,000 homes over the disputed contributions of housing work to high levels of nutrients in waterways
  • The costs of the growing number of new taxes, regulations and policies are adding at least £20,000 to the cost of building a new home
  • Rampant inflation, supply chain issues and the challenging economic environment are further driving up costs.

Stewart Baseley, Executive Chairman of the Home Builders Federation said: “SMEs are the lifeblood of all industries, but in house building we are seeing them being driven out by an increasingly anti-development, antibusiness policy environment. The planning process is grinding to a halt and regulatory costs are rocketing, whilst the nutrient issue has put the brakes on sites across a quarter of the country.

“The impact of this policy approach is devastating for SMEs, and businesses unable to operate or generate an income are laying off staff, or increasingly closing their doors. We are urging Government to act now so that the businesses that remain have a chance of survival.”

Steve Morgan, Founder of Redrow plc added: “When Redrow commenced home building as a small SME in the 1980s there were very few barriers to entry. I, and many others, were able to set up building companies from scratch and grow them into large regional or national builders, with all the homes, jobs and economic benefit that came with it.

“From ‘red line’ outline planning permissions, it would take six to eight weeks to get the first spade in the ground.  Land was available, planning was pragmatic and finance was relatively easy to source.

“Sadly, the current operating environment and the Government’s anti-building stance makes it virtually impossible for today’s generation of SMEs to succeed. The country needs SME builders and the homes they are capable of supplying. However, the wall of bureaucracy in the system is completely stacked against them. I implore ministers not to turn their backs on the hard-working, aspiring business owners of this country, before it is too late!”

 

The struggles of SME house builders:

Steve Midgley, Managing Director of Fairgrove Homes: “I truly don’t know how anyone could start these days without substantial investor backing, so anyone without large company experience or a pot of money probably has no chance. We are seriously considering cutting back and reducing what we do if not leaving the industry all together.”

 

Mark Waite, Head of Planning at Kellen homes: Mark Waite, Head of Planning at Kellen Homes: “We’re a new entrant to the homebuilding industry, focused on brownfield sites.  Our direction of travel is entirely aligned with the direction of national policy. We are determined to succeed – and believe we will – but we are needing to tailor our own growth plans to account for the seemingly endless blockages in the system”

 

Kate Tait, Group Strategic Land and Planning Director at Cameron Homes: “As a family run regionally-based business, the uncertainty over land supply with planning permission is impacting on our ability to guarantee continuity of work and therefore retain our site based staff, subcontractors and supply chain. Without assurances of where they will be placed next, we risk losing long-serving staff to firms that can offer greater certainty of future work on larger sites. This leaves us in a perpetuating cycle of delays that is hampering our ability to progress and build homes local communities need.”

 

 

Latest news

Kier wins first phase of £700m Warwick Uni campus build

Firm to start work on science and engineering precinct last this year
9 hours ago

Torsion and Khalbros to build new Leeds £1bn neighbourhood

Eastgate Quarter site acquired from Hammerson
9 hours ago

JCB to double size of US factory in wake of Trump tariffs

$500m Texas factory under construction to expand to 1m sq ft
10 hours ago

Green light for £2.4bn Luton Airport expansion

Government go-ahead to transform airport
10 hours ago

Diversification pays off for concrete frame specialist Statom

Strong results as £180m turnover firm expands into infrastructure sector
12 hours ago

Cardo in talks to buy Breyer roofing arm

More than 100 jobs could be saved at Breyer Roofing
17 hours ago

Quartet win £750m Wales & Western railway deal

Network Rail confirms partners for Reactive and Minor Works framework
17 hours ago

Plans in for £350m London Bridge life sciences hub

Snowsfields Quarter will consist of three buildings containing labs
18 hours ago

Surging labour costs push tender price forecast up

Pick-up in tender prices despite weak growth
18 hours ago

Permasteelisa wins cladding deal on Multiplex city tower

Facade specialist wins work on Fenchurch Street ‘hanging gardens’ tower
17 hours ago

Wates wins fit-out for Manchester First Street Hub

Smartspace arm secures another Government hub deal
2 days ago

Peel Ports reveals winners for £750m framework

18 firms win places on deal: Full list
2 days ago

Big trade names dropped in M Group rebrand

Acquisitive group formed from Morrison Utility services in 2016
2 days ago

Breyer Group files administration notice

Staff hope rival firm could buy assets and save jobs
2 days ago

Former Severfield director takes helm at Embrace Steel

New CEO Martin Kelly aims to step up expansion of steelwork contractor
2 days ago

£302m upgrade funding awarded to FE colleges – list

Cash shared out between England’s 179 college groups
2 days ago

FK Facades thrives but construction arm hit by ISG row

Dispute with failed contractor costs specialist £5.5m
2 days ago

Galliford Try gets go-ahead for Milton Keynes PRS tower

33-storey tower needs gateway 2 approval before work can start
2 days ago

Small house builders get £150m funding for green homes

Developers will have to meet-up to ten new criteria to benefit from interest rate discounts
2 days ago

Lendlease Construction renamed Bovis

US private equity firm completes £35m purchase of UK contracting business and rebrands
3 days ago

Breyer Group battles for survival as rivals circle

Housing maintenance firm fights three winding up petitions in a month
3 days ago

Careys facing £2.4m claim by developer over demolition cartel

Giant Hong Kong developer claims it was overcharged on Lots Road Power Station job
3 days ago

Multiplex profit drops a third as revenue rises to £780m

Spate of new orders sets contractor up for three years of work
3 days ago

Galliford Try and Breheny land latest Sizewell C road deals

More infrastructure deals for new nuclear power station
3 days ago

Worker trapped in collapsed septic tank pit

Contractor and director fined after worker suffers multiple fractures
3 days ago

Homes England buys stalled Broad Marsh site

Demolition to finally be completed as developer hunt begins
3 days ago

Vistry go-ahead for 353 homes at Rochester Riverside

Work to start on next phase of Kent town regeneration at end of this year
4 days ago

M&E firm J S Wright collapsed owing £19m

Trade creditors hit for £11.4m by employee-owned Midlands firm
4 days ago

Right to work checks to be extended to self-employed

Government plans crackdown on illegal working and rogue employers
4 days ago

Midlands developer turns to London with £1bn resi schemes trio

SevenCapital plans 1,000 flats in Kensington, Islington and the Isle of Dogs projects
4 days ago

Contractor services