The Builders Merchants Federation has met with two Liberal Democrat Cabinet Ministers to get them to explain the thinking behind the Budget Statement, and the associated Plan for Growth.
Secretary of State for Business, Innovation & Skills, Vince Cable MP, and Chief Secretary to the Treasury, Danny Alexander MP, talked to BMF managing director, Chris Pateman and BMF policy manager, Brett Amphlett, to give insight into what lay behind some of the Budget decisions.
Cable talked about the availability of credit for projects and operations, un-conventional sources of finance, business investment and re-aligning skills to meet the low-carbon challenge. while Alexander spoke about the planned reductions in Corporation Tax and changes to planning permission.
Questions were asked about the forthcoming Green Deal and why VAT has not been reduced to 5% for housing repair, maintenance and improvement work.
After hearing from the Ministers, Pateman said: “We were encouraged by Budget measures like the new help for First-Time Buyers, the cut in Road Fuel Duty, and the release of publicly-owned land for development. We also welcome the reforms to the planning system, which we believe will prove more fundamental and more far-reaching than most commentators have yet realised”.
“But that said, we feel a crucial tactical opportunity was lost to really kick-start the private enterprise-led recovery we all long to see. A selective VAT reduction on home improvement projects, a new flexibility for local authorities to reflect householders’ investments in carbon reduction with a lower rate of Council Tax, or even a revision of the Stamp Duty regime, could all have made a qualitative difference to the economy at only nominal medium-term cost to the Exchequer”.
“Instead, the construction industry starts a new financial year in which we will really start to feel the effects of the £81bn package of public spending cuts, with no clear sign that government yet recognises the unique ability of the building trade to create jobs, improve the nation’s infrastructure and deliver the homes the nation so sorely needs”.
Alexander said the Government is unlikely to use the Green Investment Bank as the main route to attract corporate investors. John Thurso MP – who, like Alexander, represents a Scottish Highland constituency – discussed the scope for different mortgages to pay for home improvements.