FMB backs Help to Build proposal
The Federation of Master Builders (FMB) has welcomed Labour's proposal for a 'Help to Build' scheme to complement the Help to Buy initiative.FMB chief executive Brian Berry said builders and buyers need access to finance in order to ensure the right number of houses are built in the UK. Help to Build would remove some of the severe restrictions still faced by small and medium-sized enterprises (SMEs) in the building trade, he claimed.He added that while the government's Help to Buy initiative has been a success, and the extension of its equity loan scheme is welcome news, more needs to be done to improve access to finance."The SME house building sector used to deliver around two-thirds of all new homes. It now delivers less than one-third and the number of firms in the market has plummeted over the past five years, further reducing the industry's capacity," Mr Berry commented. "Without access to finance on reasonable terms, SME house builders will remain hamstrung in their ability to increase the supply of new homes."Shadow chancellor Ed Balls recently proposed an emergency Help to Build scheme in an interview with the Guardian. Underpinned by new government guarantees, it would support the building of a further 10,000 houses this year.The idea relies on providing guarantees that help SME builders secure access to finance - through the banks - to help them begin building. Current guarantee schemes favour big infrastructure projects which benefit larger housebuilders. Mr Balls said his proposal would lead to an extra 10,000 homes a year being built and help combat increasing concentration in the housebuilding market. He added that SMEs had a much greater involvement in the big construction projects of the 50s and 60s.Mortgage rates could go up sooner if the chancellor does not support the housing market and the wider recovery, Mr Balls commented.He also suggested that the low interest rates needed to strengthen growth and business investment could be under threat if a balanced housing market recovery does not take place.
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