Following the first multi-year Spending Review since 2021, the UK construction is still examining the finer details of Chancellor Rachel Reeves’ plan, but here are some of the instant hot takes from the industry, with the overall mood being relatively positive.
Emma Joy Smith, social housing partner at law firm, Shakespeare Martineau:
“The social housing sector has been overlooked for too long, but an injection of £39bn into the Affordable Homes Program over the next ten years could be the starting point for real, long-lasting change. With waiting lists recently revealed to be over 100 years in some areas of the UK, there is still a long road ahead and a lot of work to be done. The government needs to ensure that this investment doesn’t also come with more cumbersome bureaucracy so that housing associations can hit the ground running.
“The announcements today should be celebrated and give certainty and direction to a sector that has been left to stagnate for too long. The need to build affordable homes goes beyond just meeting a target, it changes lives. The ability to put down roots, become part of a community and live in safe, high quality affordable housing helps individuals, cities and the country flourish. The UK will reap the benefits of today’s announcement for years to come.”
Simon Toplass, Chief Executive Officer at Pagabo Group:
“The headline announcement of the £39bn, ten-year Affordable Homes Programme is a seismic shift in the way affordable housing will be funded and delivered over the coming decade, and represents the biggest cash injection into social and affordable housing in half a century.
“Programmes such as this are a catalyst for greater stability, innovation and capacity in the housing sector – all of which are critical to meeting the UK’s chronic need for affordable homes.
“Setting a decade-long funding horizon also provides much-needed certainty for housing associations, local authorities, and developers – stability which in turn empowers the sector to invest in skills development, modern methods of construction and long-term partnerships.
“By redesignating Homes England as a public finance institution, new financing models will also be brought to the table. This evolution will require the housing and construction sector to adapt quickly to these new funding models and delivery mechanisms, especially when it comes to making sure that procurement can integrate seamlessly with funding and delivery.
“Our recent experience has shown that public-private partnerships involving local authorities, private developers and local consultants offer a model that gets homes and wider development on site much more effectively. It’s a model that does not currently receive the appreciation it deserves, but we are seeing increased engagement with available procurement routes which help facilitate growth.
“As ever with such large-scale housing programmes, it will be imperative that positive social outcomes remain at the forefront of the minds of those charged with delivering it – and embedding this into procurement processes and contracts can be effective in assuring that delivery. For the revamped Affordable Homes Programme to be a success, it needs to ensure that the promise of increased, sustained investment translates into more affordable homes being built, rather than just spreading the existing commitments more thinly.
“Elsewhere, the other clear winners from Wednesday’s review were the health and defence sectors. While the NHS is set to receive an additional £29bn for service delivery, working out at an increase of 2.8% of GDP per year over the next three years, financial support for the Ministry of Defence is to grow to 2.6%.
“Overall, with total departmental budgets set to grow by 2.3% a year in real terms, it’s important that money is used effectively and efficiently. Not only to reach desired outcomes sooner and derive value from procurement, but to help justify spending £190bn more than the Conservatives had planned.
“Looking at the spending forecast, it’s expected that growth in real terms will reduce in the final three years of this parliament. While government headlines paint a positive picture, real judgement can only be made if and when the initial momentum expected is maintained.
“With £113bn allocated for capital spend, the hope is that a strong pipeline of projects across green and nuclear energy, housing and infrastructure come to fruition. From central government to local authorities, the prospect of competitive tendering should excite both our industry and the communities that will benefit.
“With any form of public sector, compliance is key – as scrutiny will remain. Now the Procurement Act is also in place and additional obligations must be met, organisations across the public sector will need to balance their ambitions to procure both quickly and compliantly.
“I expect this will be particularly true in relation to retrofit and decarbonisation projects, where targets are in place and the clock is ticking. The benefits of energy efficiency work can come about quickly for those living in unsatisfactory homes, which I am sure the government considered when deciding to expand its Warm Homes Plan.
“And finally, touching on the £15bn boost to support regional transport connections, this is welcome news for the towns and cities of the north. The time to talk about connectivity is over, and it’s time to deliver.
“As a Hull-based business, we would like to see the vision for proper coast-to-coast connectivity become reality, though we will settle for our surrounding towns and cities first. Not only will this benefit us from a recruitment perspective, but more importantly it will improve many people’s everyday lives and create new opportunities. We’ve seen more rapid evolution of transport infrastructure in the south, so it’s time for the same commitment to the north.”
Gareth Belsham, director of Bloom Building Consultancy:
“The Chancellor has made a subtle but important change to the rules relating to the way Homes England is funded. And while this shift has so far generated fewer headlines than her flagship announcement of £39bn for social and affordable housing, it matters.
“The Chancellor wants to unlock a further £10bn for Homes England, and her announcement revealed that much of this funding will need to come from the private sector.
“The idea of social housing as a private investment class – offering reliable, Government-supported returns – could be a compelling one for investors and developers looking for an investment shielded from the conventional property price cycle.
“While the announcement is in part a way to insulate the Government from criticism that it is ‘spending now to pay later’, it’s also an acknowledgement that all forms of funding will be to required if it is to have any hope of hitting its target of getting 1.5m new homes built in England during this Parliament.”
NFRC Director of Membership, Richard Miller:
“It’s encouraging to see the Government making a strong commitment to social and affordable housing at a time when difficult decisions are being made across the board.
“A safe, well-built home is the foundation for a stable life, and this investment will play a key role in making more of these homes available to those who need them.
“To ensure this funding delivers real value, it is essential that homes are constructed to a high standard, using quality products and contractors whose workforce is demonstrably skilled.
“This is particularly important for roofing, especially now that solar panels will be the default on all new homes under the Future Homes Standard. That policy will only work if solar systems are properly designed and installed by professionals with the right expertise in both PV technology and roofing.
“Many roofing businesses are already under pressure from rising employment costs. In our most recent Spring survey, cost of employment was the most cited challenge facing roofing businesses, with 76% of responding Members highlighting the issue. Construction insolvencies remain high, and any further financial strain could put the Government’s housing ambitions at risk, regardless of how much funding is committed.”
Adrian Plant, Director of SOWN, (part of LRG):
“Yet again, Shared Ownership left in the cold. Despite a bold spending pledge on affordable homes, the Chancellor continues to ignore Shared Ownership which is a vital route to homeownership
“The Chancellor’s £39bn commitment to affordable housing is a long-overdue recognition of the scale of the challenge. At nearly £4bn a year, it marks a significant increase on previous funding and rightly prioritises investment in homes for social rent. But the glaring omission of Shared Ownership from today’s Spending Review is both short-sighted and concerning.
“For all the political attention paid to housebuilding targets, tenure matters. While social housing provides a safety net for those in greatest need, Shared Ownership offers a springboard. It gives working households – particularly first-time buyers – a credible and affordable pathway onto the housing ladder. That it has been overlooked in today’s announcement is a missed opportunity to support aspiration, boost tenure diversity, and relieve pressure on both the private rented sector and social housing stock.
The government must reconsider its silence on Shared Ownership because the homeownership dream is slipping further out of reach for a generation. With rents at record highs, wages stagnating, and savings depleted, the traditional route to buying is no longer realistic for many. Shared ownership was developed to respond to precisely these conditions.
“The Spending Review, like the Labour manifesto before it and the Planning and Infrastructure Bill, makes no meaningful reference to Shared Ownership. In fact, the most recent NPPF mentions it just once – and only in a glossary. This lack of visibility is not just symbolic. It undermines awareness, reduces uptake, and weakens the role that Shared Ownership could play in tackling the housing crisis.
“Housing policy cannot afford to divide people into simplistic categories of need. The assumption that one group requires support through social rent while another should pursue full ownership on the open market leaves little for those in between. Shared ownership helps to fill that gap. It allows people to buy a share of a home, often with a much lower deposit and mortgage requirement, while paying a reduced rent on the remainder. Crucially, it gives them the opportunity to build equity over time and move towards full ownership.
“The current emphasis on delivering new social homes is important, but it should not come at the cost of helping working people buy. A more balanced approach – one that supports both renting and gradual homeownership – is essential to creating truly mixed, resilient communities.
“Crucially, promoting Shared Ownership is not a real term cost to the government. The homes are already being delivered by housing associations and developers. What’s needed is clarity, consistency and a concerted campaign to raise awareness. A renewed government-led communications strategy could help demystify the model and encourage a new wave of uptake – particularly among older first-time buyers and key workers.
“It would also send a message that the government values homeownership as a goal for everyone – not just those who can afford a deposit outright.
“Today’s Spending Review made headlines for its scale. But in its current form, it risks entrenching a two-tier housing policy – one that funds homes for rent while neglecting a proven route to ownership. Shared ownership is not a silver bullet, but it is an essential part of the solution. With political will, strategic investment in communications, and a stronger policy footing, it could help thousands more people take that first vital step onto the ladder.
“The government has a chance to restore hope and build a housing market that works for everyone. It should seize it – before yet another generation slips through the cracks.”
Nick Diment, Director, Boyer (an LRG company):
“We welcome investment in the North and Midlands from levelling up perspective, though the exclusion of London from the announcements today was notable and disappointing.
“That said – and this needs to be recognised in the draft London plan – the approach to delivering economic growth shouldn’t be reliant on the delivery of infrastructure alone. Any effective economic strategy needs to be robust enough to stand on its own two feet and not reliant on infrastructure. My expectation in that with the right economic circumstances London will remain the powerhouse of the UK as it always has.
“Plentiful, clean energy has never been more important and the funding for Sizewell C will, long term, go some way in addressing rising energy prices and energy security.
“But there’s much more to creating a new nuclear power station than funding. Successful delivery will require access to not only workers but materials, and these materials will need to be stored in accessible locations distribution warehouses which will inevitably further fuel the local resistance to the scheme. This is just one of the many practical issues that the implementation will face.
“Regarding the country-wide strategy for energy generation, for this approach to be effective requires a strategic and well-planned approach to delivering infrastructure. Such initiatives cannot be looked at in isolation and this is just the start.
“We all wait with interest to see what the Industrial Strategy says. But without wishing to sound like a broken record, this needs to be aligned with housing and other infrastructure strategies if the government is to create the right conditions to deliver home jobs and economic growth.”
Tim Balcon, CEO, Construction Industry Training Board (CITB):
“We support the Government’s commitment to getting Britain building again. Over £110bn announced for infrastructure projects like Sizewell C, a fresh £39bn affordable homes funding settlement, and £13bn for upgrading millions of homes with improved insultation all translates to a buoyant construction industry. In total, there’s positive news to the tune of about £165bn for the industry.
“Of course, we need the skills on the ground to deliver these ambitions. To improve understanding of retrofit work, we’re supporting the development of a Repair, Maintenance and Improvement (RMI) Sector Skills Plan, which aims to identify the specific skills needs and requirements across various occupations within the RMI sector. We’re investing £3.8m in the plan to develop tailored strategies, projects and interventions that address the unique needs of the sector.
“Similarly, at the beginning of this year, we launched the Sizewell C Skills Charter in partnership with Sizewell C, ECITB, Suffolk County Council, and East Suffolk Council. This was a commitment from all parties to working with training providers to support local recruitment and skills development that will have a lasting positive impact on employment and productivity in the area.
“Earlier this year, the Government announced a £600m construction skills package, £32m of which is investment from CITB to deliver increased industry placements. Back in November, we announced a £40m commitment to support the creation of Homebuilding Skills Hubs. I genuinely believe this is a once-in-a-generation chance to us to recruit and train our workforce – equipping more people with the skills they urgently need now and in the future.”
Conor Leyden, Managing Director of the LK Group said:
“It’s great to see the Government earmark funds for infrastructure investment outside of London and the South East, but it needs to deliver them now. Setting out plans for the ‘Northern Powerhouse Rail’ cannot come soon enough – it’s vital for regeneration across the North, which will unlock greater economic prosperity nationally.
“Regeneration is the single issue holding back regions outside of London, and transport is the main driver for success. It’s no secret the country is grappling with declining high streets, but strategic investment that increases footfall throughout towns will have a transformational impact on local economies.”
Jonathan Willcock, Managing Director of transportation at Costain:
“The Chancellor’s confirmation of additional, long-term investment into the UK’s public transport infrastructure has the potential to transform communities including in the North of England, Midlands and Wales. Improving transportation infrastructure is not just about connecting people and places, it’s about creating a sustainable future that drives economic prosperity, productivity, and economic growth, building much-needed resilience into the network and improving people’s lives.
“Recognising the continued importance of the nation’s capital, confirmation of a long-term funding agreement for Transport for London will be welcome news to the industry and wider supply chain. The settlement provides much needed clarity that will help it plan, invest, innovate and develop the skills that will be needed to deliver critical infrastructure improvements and modernise London’s transport network.
“We know from working on complex transportation projects that robust planning and early contractor involvement will be vital in ensuring these crucial projects are delivered on time, on budget and with minimal day-to-day disruption. We’re looking forward to bringing our skills, experience and expertise to support our customers in the delivery of this critical national infrastructure.”
David Harris, CEO, Premier Modular:
“As with all spending announcements, the real test lies in delivery – especially when it comes to infrastructure. The government’s opened the coffers, set the stage for growth, but it’s now down to the construction sector to ensure those plans come to life, and at pace.
“Behind the headlines there is a huge amount to be done and traditional construction methods aren’t going to be enough. Modern methods of construction must form a huge part of the solution. Projects like Sizewell C, given the green light this week, aren’t just builds, they’re like whole towns themselves, both in terms of the size and scale of the facilities and their supporting infrastructure.
“Modular construction can deliver faster and more cost-effective results that are future proofed to support changing needs. But to unlock that potential, the government must recognise this and make sure the MMC industry has a seat at the table when procurement starts and frameworks are put together.”
Nicola Gooch, Planning Partner at Irwin Mitchell:
“The spending review has treated planning and development with a slightly odd mix of generosity and restraint. On the one hand the Treasury has announced significant investments in social housing, transport and nuclear energy projects – which will be well received. On the other hand, day-to-day departmental spending remains tight. Which will be unwelcome news for local planning authorities who need to simultaneously grapple with ongoing planning reforms and local government reorganisation.
Investment in social and affordable housing is extremely welcome. The current lack of demand from registered providers for s.106 Affordable Housing is a real barrier to delivering consented housing sites. If the government is to have any hope of getting close to their target of 1.5 million homes by the end of the parliament, then a strong affordable housing sector is essential. However, LPA resourcing issues have not gone away and the further changes to planning fees proposed by the Planning and Infrastructure Bill are some way off being delivered.
Whilst the infrastructure spending promised in this review is welcome, it is a long-term bet. The spending review contains good news; but it is unlikely to make an immediate difference to beleaguered LPAs and developers currently trying to get applications through the system.”