Architectural profession reacts to Autumn Budget 2024: Calls for greater ambition alongside boost for investment

In response to chancellor Rachel Reeves’s 2024 Autumn Budget, key voices in the architectural sector have highlighted both the positive steps taken towards investment and growth and the need for even greater ambition, particularly regarding housing and infrastructure investments.

While the chancellor’s £100bn capital investment commitment has been widely welcomed, several industry leaders argue that more ambitious investment is needed to truly address the UK’s critical housing shortage and infrastructure demands.

RIBA was quick to acknowledge the importance of increased funding for affordable housing but stressed that the £500m addition to the Affordable Homes Programme, while helpful, falls short of the scale required to meet current demands.

RIBA President Muyiwa Oki stated: “Given the huge demand for housing, the £500m top-up  to the Affordable Homes Programme – as part of today’s Budget – is desperately needed. But this pocket-sized sum isn’t going to deliver a home for everybody who needs one, including the hundreds of thousands of people waiting for social housing.”

Oki also called for a reconsideration of the government’s approach, suggesting alternative funding models to reduce costs and enhance impact, as outlined in RIBA’s recent report, Foundations for the Future. He emphasised that housing investment should extend beyond numbers alone to include well-planned infrastructure and community development, remarking, “we must create places where people want to live”.

Mark Braund, head of housing at BDP, found the increase in affordable and social housing funding “extremely encouraging for the future of the sector”. He expressed optimism that this investment could drive local authorities to “push their plans forward”, especially on “viable and underutilised land”. Braund also praised the “£56m investment in Liverpool Central Docks” as part of a broader vision that includes “infrastructure, offices and leisure facilities alongside new homes”. He highlighted BDP’s work on Liverpool’s Hind Street development, which recently received funding, as a model for sustainable, housing-led masterplans.

Ben Derbyshire, chair at HTA Design and former RIBA president, expressed tentative optimism about the chancellor’s approach, specifically regarding the changes to debt rules for infrastructure investment.

Reflecting HTA’s longstanding advocacy for housing as a core infrastructure need, Derbyshire remarked: “At HTA Design we have long argued that public investment in housing as infrastructure is the only effective means of tackling the crisis in affordability… Done right, this investment should also reduce spending on temporary housing, contribute to mitigating the climate and ecological emergencies and create a platform for green growth.”

He welcomed the allocation of £5bn for housing, of which £3.1bn targets social and affordable housing, but he noted that a greater commitment is required. “According to the Institute for Government, a broader assessment of public assets would yield headroom in excess of £60bn so by that measure she could, and we say should, have gone further,” he added.

Derbyshire also addressed the chancellor’s plan to bolster local planning authorities by recruiting planning officers, a move he views as crucial to ensuring quality in new housing. However, he urged the government to “utilise the plethora of experts around to support this effort” and emphasised the need to avoid the “downsides of poor investment,” which could offset the intended benefits.

Lucy Tilley, UK CEO of Adjaye Associates, welcomed the “stand-out” pledge to build 1.5 million homes over the next Parliament, calling it “brilliant” for both the housing crisis and as economic support for construction. However, she raised concerns about how Labour would achieve “the most ambitious target a British government has set in decades”. Tilley questioned whether private investment firms, likely players in the development process, would be able to balance “profit with quality design and long-term sustainability”.

While acknowledging the extra £500 million allocated to the Affordable Homes Programme, Tilley questioned the government’s approach to affordability, asking if their definition of “affordable” was realistic in light of the £36,000 average wage. She advocated for more social housing, as proposed by think tanks like the New Economics Foundation.

Tilley also expressed approval for the reduction in Right to Buy discounts and the decision to allow local authorities to retain full receipts from social housing sales. This change, she suggested, could help counteract the loss of quality social housing to private ownership under Right to Buy.

Finally, Tilley praised the £1 billion allocated to remove dangerous cladding, a long-awaited response post-Grenfell.

Michael Woodford, director of the London studio at White Arkitekter, highlighted the importance of healthcare investment, aligning it with Labour’s manifesto to “transform the NHS and improve the health of the nation”. While he welcomed funding for buildings and equipment, he noted the need for a climate-conscious approach: “This means upgrading and transforming our hospitals to create high-quality healthcare environments with a sustainable design that stimulates the circular economy.”

Linda Thiel, director at White Arkitekter, responded positively to the budget’s affordable homes commitment but urged a broader approach: “The government needs to use multiple levers to deliver not just any housing but homes that are affordable and sustainably designed.” She encouraged Labour to “tie housing and energy together” and to support “social and climate-centric homes”.

Andrew Leaver, director at tp bennett, expressed cautious support for the Budget’s housing investment, calling it “a welcomed start” but emphasising it may fall short without further funding. He questioned the distribution method, cautioning against councils “bidding against each other in order to support their communities”. He called for a “genuine” approach to deliver “attainable, community-focused schemes” that are “sustainably designed” to address both housing and climate needs.

Miranda MacLaren, director at Orms and member of NLA’s housing expert panel, appreciated the £500m affordable housing boost as “a small step towards addressing the housing crisis”. She called for more measures to improve the private rental sector, noting that “high rents within poor-quality accommodation are a key driver in the current housing crisis”. MacLaren supported the additional funding for planning teams, which she felt could help councils “secure safe and long-term accommodation”, but stressed that “more substantial support is needed” to effectively serve communities.

Darren Price, director at ADAM Architecture, focused on the Budget’s impact on the housing and infrastructure sectors. Commenting on the extra £500 million added to the Affordable Homes Programme, which now brings the annual budget to £3.1 billion, Price emphasised the need to “deliver the right homes in the right places”. He added that this investment should ensure the creation of “vibrant and lasting communities” rather than “soulless estates and dormitory suburbs”.

Price also welcomed the £100 million allocated for cycling and pedestrian infrastructure, stating that “walkability and enhanced cycling routes” are key elements in helping to reduce car dependency.

However, Price noted his disappointment at the Budget’s lack of VAT adjustments for historic and listed building restorations, which he said remain “penalised under the VAT rules”. He highlighted the importance of these projects in “protecting the integrity and lifespan of our built heritage” and acknowledged the continued efforts by organisations like Historic Houses to advocate for this change.

Jack Taylor, associate director at A is For Architecture, commended the government’s renewed commitment to affordable housing but raised concerns about the need for thoughtful development: “It is great to hear that the government has finally taken notice of the housing crisis that is troubling the UK and is making provisions for more housing investment – particularly affordable housing.”

Taylor underscored the importance of building strategically: “It would be a catastrophe if most of the new housing stock ends up as endless suburban sprawl with little to no connection to urban life, the high-street, infrastructure or public transport.” He advocated for more compact, town-centre developments, which he believed would foster a stronger connection to community life and urban amenities.

Welcoming the business rate cut, Taylor said he hoped it would extend to all high street units to maximise occupancy and support creative industries’ access to street-level commercial spaces. He also saw the budget’s emphasis on sustainable connectivity as a positive step, commenting that “infrastructure is everything.” He reflected on its potential impact, stating, “Physical mobility is essential to social mobility… Hopefully the real-world benefit to the average person will be felt, and it might go some way to reminding the public of the role of government in delivering a better, more connected and greener future.”

Reactions from the wider sector

David Rudlin, urban design director at BDP and a BD columnist, welcomed the new housing funding as a positive start but noted that “5,000 affordable homes is a drop in the ocean of what is required”. He expressed hope that this would signal further investment as part of the government’s spring housing strategy. Rudlin emphasised the need to “secure definitions of brownfield, grey belt and greenbelt land” to ensure affordable housing is placed “in the right locations across the UK”.

Pooja Agrawal, CEO at Public Practice, highlighted the scale of the homelessness crisis as a critical financial risk to councils: “Just last week, London Councils shared stark findings that the ‘skyrocketing’ increase in homelessness is the fastest-growing risk to councils’ financial stability. On average, councils across the capital are spending around £4m a day on temporary accommodation. But this is not just a London problem – the Local Government Association has warned that one in four councils in England are likely to have to apply for emergency bailout agreements, to prevent bankruptcy in the next two financial years.”

Agrawal said that the budget’s £500 million top-up to the Affordable Homes Programme, revisions to the Right to Buy Scheme allowing councils to retain full receipts, and the £233 million to combat homelessness offered some positive news: “These steps signal more stability for Local Government, helping tackle the homelessness crisis and build more social homes.” However, she noted that a multi-year settlement would have provided better support for long-term planning.

Peter Hogg, UK cities director at Arcadis, acknowledged the increased commitments to housing, healthcare, and education, while also recognising that the transportation and energy sectors received some attention. He remarked: “This was a budget that raised an historic amount of tax in one budget at an eyewatering £40bn. So the question has to be what does the nation get in return?… There is continuing support for transport projects, particularly in the North… The commitment to beginning tunnelling the Old Oak Common to Euston tunnels is a cautious first step.”

Hogg further noted that while capital expenditure is projected to be 20% higher at the end of the parliamentary term, inflation may offset much of this, leaving modest gains in productivity. “Overall this is a budget that sees a lot more taxing for relatively little additional capex spending,” he concluded.

Robert Sloss, chief executive of developer HUB, noted that the Budget arrives amid rising costs, a vulnerable construction industry, and delays tied to planning and Building Safety Act backlogs. He welcomed the government’s renewed housing targets and additional funding for affordable housing and planning, seeing it as a positive move to ease sector pressures.

Sloss highlighted the importance of brownfield regeneration, noting its potential to revive UK town and city centres. He pointed to HUB’s experience with their 8,800-home pipeline, saying that “multifamily build-to-rent has catalysed regeneration and transformative investment in urban areas” while also “unlocking affordable housing delivery”. While he acknowledged the role of the private sector, Sloss identified viability issues as a significant barrier and urged the government to provide “additional resourcing for the planning system” and to promote local authority approaches that “prioritise delivery”.

Amid the Budget’s substantial tax hikes, concerns were raised regarding the impact on small and medium-sized enterprises (SMEs), which make up a significant portion of the architecture and construction sectors. With the tax burden shifting primarily to businesses, there are fears that these increases could put considerable strain on the sector’s smaller firms. Eddie Tuttle, director of policy at the Chartered Institute of Building (CIOB), warned: “Higher taxes are likely to increase financial strains on the SMEs that are so vital to the industry and its supply chain… Increased tax rises without consistent monitoring of the impact they have on the health of crucial sectors, such as construction, run the risk of damaging the pivotal role SMEs play.”

Tuttle further emphasised the necessity of ongoing government consultation to assess the impact of these tax measures on SMEs and to ensure they remain resilient contributors to housing and infrastructure delivery.