There are a number of inevitabilities around next week’s Autumn Statement from the chancellor. But there is an opportunity, should George Osborne be in the mood, to excite, to innovate and simply to deliver.
Knockabout politics, rehashed spending commitments and reined-back forecasts are the inevitabilities. The delivery of further uncertainty is the fear. For Osborne, like his predecessors, the goal remains to serve up a package of announcements that secure growth. It’s easier said than done.
Specifically, five matters of relevance to property will get an airing: Osborne will deal with the impact of flooding, of course; planning and housebuilding will be mentioned; stamp duty will resurface; there will be at least a nod to the disposal of government land; and empty rates will be namechecked to a greater or lesser degree.
With floods, and perfectly understandably, given the severity of their impact, he will focus on households. But he shouldn’t neglect the impact on corporate premises. As we saw in New York in the aftermath of Superstorm Sandy, it is as important to help small businesses to rebuild as it is domestic property owners.
The chancellor also needs to be mindful that large areas of the country will be simply off limits from an investment perspective unless there is security around protection – both in terms of flood defences and insurance. The fact that talks between the Association of British Insurers and government have reached an impasse is unhelpful to say the least. A breakthrough is needed or households, businesses, landlords, regeneration areas and entire regional economies will be hurt. Without progress, a lack of flood insurance after June 2013 could be the catalyst for economic chaos in many parts of the UK.
Planning and housebuilding will be mentioned, of course. There will be fine words around the notion that freeing up the planning system will foster economic growth, particularly in the housebuilding sector. Osborne won’t, however, take the more helpful step of substantially increasing planning charges on sizeable developments and, in return, investing the money in hiring more local authority planners and speeding up the process as a result.
Meanwhile, advisers have been telling wealthy clients for several months to sit tight pending clarification of stamp duty increases on £2m-plus homes. Osborne is unlikely to rein back on the clampdown he announced as recently as the March Budget. But the chancellor knows better than anyone whether the 33% fall in homes in this bracket is actually costing the Treasury money. If so, will he be brave enough to acknowledge an error and reverse the policy?
It has been a year since Berkeley Group chairman Tony Pidgeley began his review of the disposal of Whitehall-owned land. He is thought to have recommended the handing of responsibility for this to the Homes & Communities Agency, a change welcomed by our Big Question panel this week.
And then there is empty rates. Here hope is perhaps running ahead of expectation. Political and fiscal considerations stand in the way of a complete u-turn. But there may be concessions; after all, unlike with stamp duty reform, this was a policy dreamed up by the previous Labour government.
Estates Gazette has presented its findings to parliament, showing how much the tax actually costs arms of government – and our revelation last week that the empty rates bill for the Olympic Park could be £18m is merely the latest example. We hope that will prove compelling.
All of this potential change flies in the face of another demand from this industry: a call for a period of stability. But as ever – and to state the bleeding obvious – any welcome changes will be embraced, anything with the potential to cause damage will be decried. It was ever thus.
