Spring Statement Key Points for Construction with Industry Response

TODAY, Chancellor Rachel Reeves delivered her Spring Statement to Parliament.

The Chancellor said she was “not satisfied with short-term growth figures” from the Office for Budget Responsibility (OBR) which halved the 2025 UK growth forecast from 2% to 1%.

Despite this initial bleak outlook, OBR forecasts for the next four years were more positive with output expected to grow by 1.9% in 2026, 1.8% in 2027, 1.7% in 2028 and 1.8% in 2029.

Spring Statement Key Points for Construction

As part of her plan to kickstart economic growth, the chancellor announced £13 billion of capital investment to “go further and faster to get Britain building”. This is on top of the £100 billion uplift announced in the Autumn Budget.

The Chancellor also said the government will fund a £625 million package to boost skills in the construction sector and provide up to 60,000 more skilled construction workers to support the government’s target to deliver 1.5 million homes in England.

The government will additionally scale up the existing construction skills pathway by providing £100 million for 35,000 additional training places in construction-focused ‘Skills Bootcamps’, supporting trainees, ‘returners’, and existing employees to succeed in the sector.

A further £40 million will also be used to support up to 10,000 more young people to access new construction Foundation Apprenticeships, which the Chancellor says will provide “a key entry route” into the industry.

The government also confirmed this week that there will be a £2 billion injection of new grant funding to deliver up to 18,000 new social and affordable homes.

INDUSTRY RESPONSE

Support for Construction Skills is Extremely Welcome

Tim Balcon, CITB CEO

Tim Balcon, CITB CEO, said: “Despite navigating an uncertain world, the Chancellor’s Spring Statement this week has been accompanied by two significant announcements for the construction industry. Firstly, the £600 million package for construction skills to catalyse the Government’s homebuilding target. Second, the £2 billion investment into affordable homes to accelerate delivery.

“As part of the construction skills package, CITB is providing £32 million to support the Government’s aim to fund over 40,000 industry placements each year. Additionally, we’ll be doubling the size of our New Entrant Support Team that helps make finding, recruiting and retaining an apprentice or new entrant easier for employers.

“The Government’s continued support for the construction industry through increased investment in construction skills is extremely welcome. As an industry, we need to collectively grasp this opportunity and be better at shouting about what a fantastic industry this is, the prospects it can offer people, and attracting people into pursuing a career in construction. 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.

“The Government aims to build 1.5 million new homes and approve 150 major infrastructure projects by the end of the decade – indeed, plans for Lower Thames Crossing were approved earlier this week. The opportunities aren’t just on the horizon, they’re in the here and now.”

Builders Tasked with Delivering Economic Growth

Brian Berry, FMB Chief Executive

Brian Berry, Chief Executive of the FMB, commented: “Rachel Reeves has tasked builders with delivering economic growth according to today’s Spring Statement. This week’s injection of funding to train 60,000 new construction workers is welcome, but CITB estimate we will need 250,000 more construction workers by 2028 to even get close to the Government’s targets. The numbers of workers don’t go far enough and the announcement of 1.3 million new homes by the end of this Parliament, seems to be a clear indication the original target was a step too far.

“The Chancellor pointed to OBR figures showing that house building stands to add 0.2% to the UK economy by 2029-30, worth an additional £6.8 billion, with that rising 0.4% by 2035 worth £15.1 billion to the UK economy. Builders have an essential role to play in kickstarting the UK economy, and today’s figures demonstrate the immense potential of the industry. Now, more than ever, we need to see the Government support the nation’s SME house builders, so that homes can be delivered by a healthy market, and not just a few companies at the top of the tree.”

Pivotal Moment

Roger Morton, NHBC Director of Business Change

Roger Morton, Director of Business Change, NHBC, responded: “We welcome the Government’s bold commitment to ‘Get Britain Building Again’ through a £625 million investment in construction and house building skills. Crucially however, this is not just about creating opportunities for young people. The construction and house building industry offers excellent, long-term career opportunities for everyone, regardless of age or background.

“It is vital this investment recognises the diverse talent the industry will need to thrive. From school leavers to career changers and those returning to work. House building is not a one-size-fits-all sector. It is a dynamic industry that depends on a strong, skilled and inclusive workforce.

“The Government’s investment is a pivotal moment. With Government, industry and training providers aligned, we have a unique opportunity to deliver a more productive and sustainable sector that genuinely offers opportunity for all.

“This is why NHBC is committing £100 million to our own national training programme. This will include 12 new multi-skill training hubs across the UK. These hubs will provide immersive, on-site learning from day one and deliver high quality apprenticeships in key trades such as bricklaying, groundwork and site carpentry. We are equipping the next generation and those re-entering the workforce with the confidence and skills to raise standards, build a stronger industry and quality homes for the future.

“In addition, we support the announcement of a further £2 billion investment in social and affordable housing. The demand for affordable homes is significant and it is encouraging to see targeted funding being allocated to meet this need. It will help to provide much needed security and stability for thousands of families across the country.”

Construction is Key Economic Driver

Eddie Tuttle, CIOB Director of Policy, External Affairs & Research

Eddie Tuttle, Director of Policy, External Affairs and Research at CIOB, commented: “We’re pleased construction is finally being recognised as a key economic driver and welcome this substantial investment.

“Having continuously called for government to develop a long-term plan to improve the pipeline of people entering the construction sector, we are encouraged by the latest plans to address the ongoing skills shortage by increasing funding for educational and workplace training through an injection of £600m over the next four years.

“However, it will take several years for the thousands of workers the Government is planning to recruit to be trained to a competent standard and ready to work, so the plans are unlikely to have an immediate impact on the industry’s capacity to build the 1.5 million homes the Government is committed to. The impact of the increased funding will not come to fruition until this parliamentary period is coming to an end, so while we very much welcome the plans, we question if this will enable the Government to meet its ambitious housing targets.

“Vital consideration should be given to how construction career opportunities are promoted to young people if we are to get more of them taking up the training places the Government is planning to create. Construction is a career that has something for everyone. Without proper communication of the varied opportunities within the industry, additional funding towards construction careers will go to waste.”

Enormous Boost for the Sector

Justin Young, RICS CEO

Justin Young, RICS CEO, said: “The announcement by the government of an additional £2 billion investment to build 18,000 new social homes is an enormous boost for the sector. Alongside ongoing reforms to planning, this should provide increased confidence for housebuilders across the country. According to RICS data, the gap between housing demand and supply continues to widen, so these new social homes will prove vital for supporting new supply and crucially housing the most vulnerable.

“The £600 million of additional funding for construction sector skills is a decisive investment in the UK’s built environment. This should help secure the next generation of construction sector workers and professionals as we look to tackle the challenge of an aging workforce alongside acute labour and skills shortages. If this can be combined with a new GCSE for the Built Environment in England, we can drive fresh talent to take up the new opportunities afforded by this investment.”

Positive Step

James Farr, Think Director

James Farr, Director of North West-based post-16 skills and training consultancy, Think, said: “There is a pressing need to tackle the construction sector skills shortages and so we warmly welcome Chancellor Rachel Reeves’ formally pledge to address this vitally important issue. The commitment to improving availability of teachers with industry knowledge and skills is also a positive step, as this remains a key challenge for the further education sector.

“It is critical that CITB efforts to provide work placements translate into a tangible increase in college learners progressing into apprenticeships which are the primary entry route into the sector. Ensuring this pipeline functions effectively will be key to addressing long-term skills gaps and supporting economic growth.

“We look forward to further details on the proposed technical education colleges. It will be essential to ensure that their sectoral and occupational focus aligns with local skills priorities, to meet workforce demands.”

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