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FMB: Community Infrastructure Levy is hindering house building

The Federation of Master Builders (FMB) has claimed the government's Community Infrastructure Levy on new developments could actually be hindering instead of helping home building in the UK.

Utilising sustainable measures including plasterboard, drylining and insulating laminates for new home projects may be the furthest thing from the mind of developers when taking on new schemes in the current financial climate, with the levy actually adding an extra level of bureaucracy that is far from needed right now.

Chief executive of the FMB Brian Berry argued that the 25 per cent of the levy that will be funnelled into council coffers under the proposal is a welcome boost to local communities, but it comes at a price of convoluting the planning system further.

He said: "While we appreciate the government's attempts to tackle the yawning housing deficit by incentivising new development, it is difficult to see how this latest announcement is going to kick-start the building of the quarter of a million new homes Britain needs every year just to keep up with demand."

Mr Berry added that a better method for giving beleaguered house builders a "shot in the arm" would be to reduce the level of red tape that builders are subject to at present, while at the same time speeding up delivery of the Business Bank.

This second measure would provide an equal - of not greater - boost to the sector than the Community Infrastructure Levy, while it would also help bring greater finance availability to cash-strapped small builders across the country.

Earlier this month, the FMB published the findings of its latest survey, highlighting the fact that many UK small builders would benefit greatly from a reduction in VAT for materials and services relating to home repairs and renovations.

Mr Berry noted at the time: "This is about creating a level playing field and reducing the number of individuals and businesses that rely on avoiding VAT." 

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