Land, regulation, and finance rules have been simplified in an effort to make work simpler for SME builders
Today, a series of proposals have been announced in construction SME support, benefiting smaller developments in time and money.
This comes as an effort to increase the market share of housebuilding, which SME’s have lost 40% of since the 1980’s.
Proposals for construction SME support streamline regulations
The proposed rule reforms include:
- Faster decisions for small sites (up to nine homes) through streamlined planning requirements and easing of Biodiversity Net Gain (BNG) requirements. Decisions will be made by a single planning officer rather than a committee.
- Introduction of a ‘medium site’ category, between 10-49 homes, which will have more simple rules and smaller costs than large sites. Potentially also being exempt from the Building Safety Levy and retaining simplified BNG rules.
- Increased options for land and financing, through Homes England releasing more land to SMEs exclusively, and a National Housing Delivery Fund (to be confirmed in the spending review) supporting long term finance options, such as revolving credit facilities and lending alliances
- Introducing a pilot for unlocking small sites for SMEs in the Small Sites Aggregator in Bristol, Sheffield, and Lewisham. The pilot uses a model from Lloyd’s Banking Group’s Social Housing Initiative.
Combined with the Home Building Fund, SMEs are set to potentially benefit greatly from these changes.
Deputy prime minister and housing secretary, Angela Rayner, said: “Smaller housebuilders must be the bedrock of our Plan for Change to build 1.5m homes and fix the housing crisis we’ve inherited – and get working people on the housing ladder.
“For decades the status quo has failed them and it’s time to level the playing field.
“Today we’re taking urgent action to make the system simpler, fairer and more cost effective, so smaller housebuilders can play a crucial role in our journey to get Britain building.”
Long overdue
Calls for construction SME support have long been a key issue, with the National Federation of Builders writing: “99% of the industry will want to know whether SMEs will be handed the annual, ‘here’s some funding you cannot draw down without full planning’ crumbs, or, if they will finally be appreciated as a key player to solving the housing crisis, reducing reliance on immigration and providing much needed competition to lift outcomes. Let us hope National Planning Policy Framework (NPPF) reforms which did nothing on small and medium sized sites indicate major reforms are coming for SMEs, particularly for developments of under fifty and one hundred homes.”
The Construction Alliance Northeast have also recently written for PBC Today, highlighting the importance of SME builders in the government’s plans to build 1.5m new homes.
Neil Jefferson, chief executive at the Home Builders Federation, said: “Measures to support SME builders are very welcome and crucial to the industry’s ability to deliver. Over recent decades, the increasingly complex and challenging operating environment has resulted in a dramatic fall in the number of SME house builders.
“Smaller builders play a crucial role and, if the policy environment allows, can make a major contribution towards the ambitious housing targets set by ministers. However, whilst these changes are welcome, unless the Government addresses the more significant barriers to delivery, housing supply will remain suppressed.
“The lack of government support for buyers amidst a dearth of affordable mortgage lending, and housing associations’ inability to take on the affordable housing developers provide, continues to prevent house builders of all sizes from accelerating output.”
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