As the Chancellor prepares for the Autumn Budget, one reality is unavoidable: Britain needs jobs and growth, writes Mike Leonard, visiting professor of manufacturing and the built environment and co-lead of Birmingham City University’s Centre for Future Homes
The alternatives of higher borrowing and further tax rises are no longer sustainable. Elevated interest rates make borrowing prohibitively expensive, while increased taxation and National Insurance dampen employer confidence, consumer spending, job creation and economic momentum.
History shows the solution is always the same. After the Second World War, following the 2008 financial crisis, and even during the Covid pandemic, it was the construction industry, powered by UK manufacturers, that drove recovery. Unlike many sectors, construction delivers 360‑degree economic growth: we make the materials here, we build the homes here, and every £1 invested generates a £2.84 return across the wider economy.
A government reset – but still no urgency
The Starmer Government failed to shift the dial, despite repeated promises to build 1.5 million homes by the end of this Parliament. With a new Prime Minister and Angela Rayner returning as Housing Secretary, that target now looks set to be quietly abandoned, replaced by a renewed focus on council and social housing. The “Your First Home Scheme” announced by the PM at the Party Conference is, of course, very welcome, but fine words must soon become tangible outcomes.
Measures must be bold and brought forward immediately to tackle England’s worsening housing crisis, support struggling British manufacturers, and sustain the SME and major builders who deliver the homes and infrastructure the country needs.
I welcome the clarity on how the previously announced £39 billion will be allocated. But I feel that a programme stretching to 2039 will do little to address the immediate pressures facing the housing market unless investment is urgently front‑loaded.
Instead, the government must invest now to Get Britain Building, supporting UK manufacturers, home builders, and local economies at a time when weak demand is driving factory closures and job losses across the construction supply chain.
Build better places, not just more units
It’s important to stress that success cannot be judged solely by the number of homes built.
It is not all about numbers. We must also focus on creating better places – well connected to transport and public services and designed to meet the needs of a wide demographic.
That means delivering a balanced mix of homes – two-, three- and four‑bedroom houses, bungalows, apartments, rather than relying on a single development model. Genuinely affordable, safe, well‑connected homes built to last would also relieve pressure on the thousands of households currently trapped in temporary accommodation.
Crucially, the UK housing market cannot survive on the relatively small number of social homes built each year. Private development for sale and rent is vital, yet demand is now lower than during the 2008 crash. Pent‑up demand and an industry ready to build present the chancellor with a golden opportunity to act at speed to unlock the market, support first‑time buyers, close the affordability gap, and reduce the cost of moving for existing homeowners. This government should use its majority to legislate a requirement to build a minimum of 200,000 homes per year, every year. Flexing between private and social delivery to smooth out economic cycles. This would provide the certainty to support investment in plant and skills.
Homes fit for a changing climate
All new housing must be designed for a warming climate. That means non‑combustible materials, resilience to overheating, flooding and wildfires, and design that prioritises orientation, thermal mass, ventilation, shading and shutters, as seen across Europe.
Lightweight imported timber systems, often mandated by agencies such as Homes England, risk unintended consequences, not least because of mass deforestation. Timber homes are proven to overheat, rot when flooded, and combust when exposed to fire. Despite the lessons of Grenfell, the UK has avoided major loss of life in low‑rise timber frame housing more by luck than judgement. Policymakers and industry leaders owe a duty of care: where there is a sleep risk, fire safety must come first.
The Future Homes Standard will reshape new‑build housing from 2028. Homes will not be connected to gas, and many will rely on heat pumps to offset electricity costs, currently three times higher than gas. Operated correctly, these homes can be warm and affordable, but climate resilience must be embedded from the outset.
Re‑industrialisation and energy resilience
The UK must significantly reduce its dependency on imports. Recent events and economic fragility show that resilience requires domestic capability in nuclear, hydrogen, renewables and water infrastructure. That includes:
- A major programme of reservoir construction
- Undergrounding cables to distribute renewable energy, reducing years of planning delays
- Continued investment in the world‑class gas network to support a gradual transition to hydrogen
Over‑dependency on any single energy source presents risk, so we need a blended approach. Mandatory PV on new homes, combined with batteries and smart cylinders, will reduce bills, but PV must be used wisely, with careful attention to orientation.
Yet 95% of PV panels are imported from China, which is also set to dominate the heat pump market. We must learn from the virtual collapse of domestic car manufacturing because of Chinese imports. If Britain is serious about re‑industrialisation, incentives must align to encourage the manufacture of essential products, including PV and Heat Pumps, here.
Skills, training and a new national mission
A Churchillian approach to skills is needed. With many white‑collar jobs threatened by AI, now is a better time than ever to enter construction. Society and the education system have failed to recognise the value of skilled construction workers; this must change.
The stars are aligned. The industry is ready. The bell is ringing. It is time to Get Britain Building.
Evidence, measurement and better outcomes
Overall, robust measurement must sit at the heart of the programme. Sensors, performance data and interviews with residents should be used to understand how homes perform in real‑world conditions and how people experience them.
This approach builds on research by Birmingham City University’s Centre for Future Homes, which places the needs of the occupier at the centre of policy, regulation and design.
