Budget 2021: industry reaction

Budget 2021: industry reaction

Reaction to the Chancellor’s Budget has come in from all areas of the heating and plumbing sector. Below is a selection of the responses…

Kevin Wellman, CIPHE
“The Chancellor’s budget has business in mind and the continuation of the furlough scheme indicates that minimising unemployment remains critical. We are encouraged to see further support for the self-employed and SMEs, especially for the 600,000 newly self-employed who missed out on support over the last 12-months.

“As unemployment has risen, it is encouraging that incentives to employ older apprentices are now on a level playing field with their younger counterparts. The £3000 payment is a step in the right direction, but as ever we would urge government to push further to help SMEs in developing the next generation of the workforce. This is needed with urgency in the plumbing and heating industry as it focuses on its contribution to the government’s net-zero commitments. Detail on how green bonds can further support this will be welcomed.

“Overall, the budget looks good for the industry, with the announced super deduction on investment in plant and machinery assets particularly attractive for manufacturing and even more so in an industry undergoing significant change. The stamp duty holiday extension should release funds for homeowners to work on their property, giving a welcome boost of demand for the industry.

“We would have liked to have seen further, dedicated support for the fuel and water poor. The impact of isolation and its relationship with public services has rarely been brought into sharper focus than in 2020 so it is hoped that an announcement is still to come about their protection. Equally, the freeze on national insurance, income tax and VAT is tempered by the same on the personal allowance. While the rise in corporation tax is not unexpected, the overall picture is one of wider future tax rises. While the budget is aimed at economic recovery, it’s very clear we’ll be paying for the pandemic for years to come. Now must be about ensuring the country is best placed to respond and to support its citizens when the next crisis emerges.”

Tom Reynolds, Bathroom Manufacturers Association
“Reducing the energy and water demand of our 27 million homes is crucial to achieving our national environmental targets.

“It was disappointing to see no reference to the National Retrofit Strategy in the budget. It has the potential to unlock hundreds of thousands of jobs and generate an economic stimulus across the country, making a considerable contribution to the ‘levelling up’ agenda.

“The stamp duty relief and new mortgage guarantee is great news for the housing market, and BMA members. A large proportion of bathroom improvement works takes place after home moves, so these announcements will keep buoyancy in the sector.

“The focus must now be on ensuring the national retrofit strategy is fully and unequivocally adopted by the Government in the Comprehensive Spending Review in the Autumn, which coincides with COP26.

“The chancellor has made clear, borrowing will be cut from 2023 onwards. He has set the scene on public spending in the future so we need to press for a proper retrofitting plan now.”

Paul Rose, OFTEC
“The Chancellor didn’t hold back in outlining the financial toll the Covid-19 pandemic has taken on the UK economy, so it’s perhaps not surprising there were very few new green announcements, other than re-commitments to existing policies.

“We mustn’t let this pandemic halt progress on creating a greener economy but, with little cash in the government’s pot and consumers tightening their belts, it’s clear more than ever that the route to a low carbon future needs to be driven by affordable and cost-effective solutions and not unrealistic spending expectations.

“OFTEC wants to play our part in the off-grid sector which is why we are securing support to transition oil heated homes onto a renewable liquid fuel which provides an almost drop-in replacement for Kerosene. This can deliver substantial carbon savings of almost 90% compared kerosene and, more importantly, at a fraction of the cost of other low carbon options to both the government and consumers.

“With all the damage Covid-19 has done, let’s not let it put our decarbonisation goals at risk as well.”

Damian Walters, BiKBBI
“Many of the measures in [the] budget will give a real boost to the KBB tradespeople and independent retailers who have had to deal with so much over the past year. In particular, the restart grant and extension of business rate relief will help the showrooms that have had to close their doors through the lockdown get quickly back into business over the coming months. Alongside this, the expansion and extension of support for the self-employed offers a lifeline for the sole-traders that are the lifeblood of our industry.

“The doubling of incentive payments for employers taking on apprentices is also great news, particularly given the urgent need to train a new generation of skilled installers.

“Our members will be a little disappointed that the VAT relief being enjoyed by other industries is not being extended to the home improvement sector, particularly given the potential it has to stimulate local economic activity. And while mortgage guarantees will drive activity in the property market, they do little to incentivise people to invest in the quality of their homes. We hope that this is something the Government looks at over time to ensure that homes themselves are valued just as much as home ownership.”

Iain Bevan, Daikin UK
“It’s reassuring to hear the government affirm its commitment to the UK’s transition to net-zero. Investing in the green industry is not only crucial to long-term economic growth, it is also vital in enabling us to achieve this low carbon vision.

“Now, prioritising investment in training in particular is essential if we are to build the highly-skilled workforce required to realise a greener future. For the heat pump market alone, we estimate around 17,000 new installers will be required to meet anticipated demand within the next ten years.

“The boost for apprenticeships cannot come soon enough. However, training at all levels, from apprenticeships through to experienced tradespeople, is needed if people are to acquire the skills they desperately need to develop a career in the green sector.

“At Daikin we’re working with those already in the industry to ensure they get the training they need to upskill and protect their future through initiatives such as our Sustainable Home Network. We also have an established apprenticeship programme and are always looking for ambitious and talented individuals who are keen to kickstart a successful career in heating.”

Julie Hirigoyen, UKGBC
“The Chancellor insisted that this country needs a real commitment to green growth and to create jobs where people are. However, ‘build back business as usual’ would be a more fitting description for the Government’s plans to build back better.

“We are still none the wiser about the fate of the Green Homes Grant scheme, which just a few short months ago the Chancellor told us would support over 100,000 jobs in green construction up and down the country. UKGBC, together with many others in our industry, have strongly advocated that the £1.4bn of unspent funding be rolled over to 2021/22, but today’s Budget leaves both industry and householders still in the dark.

“Beyond the opportunities for green investment offered by the Infrastructure Bank and new green gilt and retail savings product, this Budget appears to ignore the huge part that greening our buildings can play in delivering our post-Covid economic recovery. Tackling carbon emissions from buildings – particularly the existing housing stock – is not easy, but we cannot afford to duck the challenge any longer.

“The chancellor’s emphasis on local growth is also welcome, as we recognise that local authorities have a vital role to play in seizing local green growth opportunities. However, local authorities alone cannot deliver the change we need without central government leading from the front. The Chancellor’s ‘investment-led’ green recovery should not ignore the voice of the industry calling for a national retrofit strategy to unlock vital green jobs across the whole country.”

George Webb, Liquid Gas UK
“We are delighted to see that the Government has doubled spending on energy innovation to find new solutions to cut carbon emissions and accelerate near-to-market low-carbon energy innovations.

“Next to the Covid emergency the climate crisis is one of the biggest challenges we face and so we need solutions ready for the market now, especially for the rural economy where decarbonising heating is proving challenging due to most homes and businesses not being connected to the gas grid.  With this in mind, we welcome the Government’s £4 million UK-wide competition for the first phase of a biomass feedstocks programme, to help support the rural economy to make improvements to the production of green energy crops and forestry crops. Development of UK feedstocks will be important to other low carbon, renewable heating options, such as bioLPG.

“Indeed, we urge the Government to take into consideration bioLPG and support for its production in the UK. BioLPG represents a cleaner energy future, with a reduction of up to 90% in carbon emissions. As a drop in fuel, switching over from LPG to bioLPG means there is almost no upfront cost to existing users. The LPG industry is committed to being part of Net Zero and providing a viable green energy solution having already invested £106 million into  bioLPG. We call for LPG and bioLPG to be supported by the UK Government in the off-grid regulations, expected this month.”

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