Industry reacts to Autumn Budget

Chancellor Rachel Reeves delivered the 2025 Autumn Statement today (November 26), and voices from across the construction industry have been weighing in with their initial impressions of her plans.

Bradfords Building Supplies CEO, David Young, says: “Today’s Budget offers some positive signals for construction, particularly around housing ambition, skills and the transition to a lower‑carbon economy. But it falls short of the reset the sector was hoping for. The real test will be how quickly planning is unblocked and investment flows into projects on the ground. For Bradfords, the fundamentals haven’t changed: demand for warm, efficient, well-built homes across the South West is strong. Our customers want clarity and stability so they can plan, price and deliver work with confidence.”

At the Builders Merchants Federation, CEO John Newcomb says that the organisation is concerned that the Budget is only about ” the delivery of small incremental measures”, and that it has not done enough to bridge the gulf between the Government’s ambition to build 1.5 million new homes by July 2029, and the state of today’s market.

“We have stated that without Government intervention it was going to be difficult to move out of a stagnant market, so it’s disappointing to see no incentives to help first time buyers and stimulate the housing market.”

He adds: “The Government is adding headwinds, with issues such as the increases to the National Living Wage and National Minimum Wage, as well as the impact of the Extended Producer Responsibility for Packaging Waste, having a knock-on effect on investment and growth. And of major concern to our members and the wider economy is the Chancellor’s commitment to Inheritance Tax.

 “A minor alteration has been made for spouses so that any unused £1 million allowance for the 100% rate of Business Property Relief will be transferable between spouses and civil partners, including if the first death was before 6 April 2026.

“That will not change the position we hear across the industry that the changes in inheritance taxation could limit the future of the sector, with many private and family businesses across our membership reporting back that the impact of Business Property Relief will damage enterprise.

“The end result could be a scaling back of the operations at SME merchants, suppliers and even builders in light of the changes, and that will have a significant impact on the whole economy.”

While the BMF feels the Budget lacks the ambition to boost economic growth and regional prosperity, it does welcome some moves made by the Chancellor.

Newcomb added: “There were positive outcomes in some areas of the Budget. That includes moves to create developments around train stations and other transport hotspots, which will support the earlier announcement of at least three New Towns in Bedfordshire, Leeds and Enfield this Parliament.

“The Chancellor’s announcement on Landfill Tax is also welcomed, as this is something the BMF, alongside other associations, petitioned for, with the Government now not proceeding with transitioning to a single rate of tax by 2030, and retaining the exemption for quarries with disposal permits.

“The move to make training for under 25 apprenticeships completely free for SMEs is also a positive step. Co-investment payments that SMEs have had to pay now for apprentices under the age of 25 will be scrapped, and we support an extension of the temporary five pence Road Fuel Duty being cut for an extra five months, which offers a further fuel duty freeze.

“However, looking at the situation overall, the difference between what the Government says it will do and the implementation and delivery is a major concern. We are looking more at the detail, but the feeling is that more could have been done to get Britain building.”

Forza Doors managing director Will Hunnam says: “As a UK manufacturer, we welcome the certainty delivered by today’s long-awaited Budget, however, some of the detail will mean new pressures for businesses like ours. A 4.1% minimum wage rise – above current inflation – adds further cost pressure at a time when many inputs are still increasing. This impacts margins and forces difficult decisions around what we absorb and what must be passed on.”

“The changes to salary-sacrifice pension contributions are a particular concern. Employer National Insurance being applied above £2,000 per employee introduces a new, hidden cost – around 15p for every £1 contributed – which could amount to more than £100,000 a year for us. That’s investment that could otherwise support new roles, product development or further growth in West Sussex. On the flip side, the expansion of apprenticeships is a genuine positive and supports our long-term skills plan.”

“Ultimately, all businesses are navigating the same landscape. We’ll focus on what we can control: growing our market share, innovating and delivering outstanding service for our customers.”

In terms of energy and sustainability, manufacturer Daikin welcomed the government’s plan to reduce energy bills by an average of £150. Residential product manager, Hamid Salimi, says: “Bringing down the cost of electricity will undoubtedly ease the cost-of-living crisis. This will make low-carbon heating and cooling more affordable and encourage households and businesses to make the switch.”

However, the Budget also brought with it the news that the ECO (Energy Company Obligation) scheme will be scrapped to save consumers £150 annually, which could impact manufacturers’ ability to avoid fines under the Clean Heat Market Mechanism.

Martyn Bridges, director of external affairs at Worcester Bosch explains; “ECO 4 started on April 1 2022 and continues until March 31 2026. In that time, it has fully funded just under 39,000 Heatpumps up until the end of September 2025, an average of around 1,000 appliances a month. In today’s budget, the chancellor announced that ECO will not continue after April 1 2026. As these appliances were all eligible to be counted towards the target quota that manufacturers have to meet to avoid fines under the Clean Heat Market Mechanism (CHMM), then the CHMM targets need re-appraising. Removing on average 12,000 funded heat pumps from the market would potentially result in fines in excess of £6m for manufacturers if they cannot meet their quotas.”