Jeremy Hunt must use the budget to boost economic growth

“Given the 12.3 per cent fall in the Energy Price Cap doesn’t kick in until April, it’s unlikely that the Monetary Policy Committee will take affirmative action at their next meeting on 21st March. At the May and/or June meetings, there needs to be a significant Base Rate cut to stimulate the economy. A quarter point drop to 5 per cent will do nothing to give the much-needed market visibility and confidence that is urgently required across all industries.

“Ahead of the date of the General Election being declared, Jeremy Hunt must use his platform on 6th March to find a way to improve GDP. Cutting Business Rates should be a top priority, to ensure the Government gives a clear signal that it is backing the dynamic firms possessing the potential to expand and drive the growth of the UK’s economy.

“The personal tax burden must also be addressed, but the diminished £13bn pot the Chancellor is likely to have to play with could be thinly stretched, given the freeze on fuel duty is highly likely to be extended, as it has a direct correlation with inflation. In my opinion, Hunt should go big and make a 2p cut to the basic rate of income tax and raise the child benefit withdrawal threshold.

“Meanwhile, with Michael Gove failing to make an impact on the overall number of attainable homes being delivered, the housing sector needs quick intervention. Affordability and fairer access to the housing market must be addressed. Unprecedented planning delays continue to negatively affect the supply of new homes, while the cost impact of delivering the Future Homes Standard and Biodiversity Net Gain legislation is being passed onto the consumer.

“The only real help first time buyers currently have to access the housing ladder is the Stamp Duty exemption for homes valued up to £425,000, with the temporary threshold increases due to end in March 2025. There is also the relatively unknown Mortgage Guarantee Scheme, but it bizarrely doesn’t apply to energy efficient new homes. If a 99 per cent mortgage initiative is introduced on 6th March, it could address the huge issue of widespread deposit erosion, caused by high rental costs.

“With less homes being built, there has been a marked impact on the rental market. For every home available to rent, there can be as many as seven people vying to occupy it. It is no surprise we have therefore seen rent hikes of 24 per cent at our Belgrave Village scheme in central Birmingham, and similar increases of 22 per cent at Nightingale Quarter in Derby city centre. The majority of the 500 houses and apartments we are handing over to customers this year have already been sold off-plan.

“Due to the difficulties vying first time buyers are encountering to obtain a mortgage, the sales rates of the PLC housebuilders – who have largely depended on them – have suffered. To counter this, there have been a number of sizeable deals into the Build To Rent sector. With the Renters Reform Bill seeing some private landlords sell up, I fear hardworking people could see pricy build to rent blocks as their only option. The current market conditions could result in three to four national landlords become an overly dominant oligopoly and able to collude to overinflate rents.”

Wavensmere Homes is constructing major urban regeneration schemes, located in Derby city centre and at Milford Mills in Milford, north Derbyshire.