Preparing to weather a difficult winter

Preparing to weather a difficult winter

BLOG · BY TTF CEO, DAVID HOPKINS · 28 September

After Thursday’s Winter Economy Plan to replace the Coronavirus Job Retention Scheme (CJRS) with the new Job Support Scheme, attention now turns to the Comprehensive Spending Review, which will set out the Government’s spending plans for the next four years. The TTF and the Confederations of the Timber Industry are calling for a long-term spending commitment on building and retrofitting homes to meet the Government’s legislative goal to be Net Zero by 2050.

On Thursday the Chancellor announced a Winter Economy Plan with a focus on a new Job Support Scheme to replace the Coronavirus Job Retention Scheme (CJRS) which finishes at the end of October.  Employees will need to work at least 33% of their usual hours, with the Government to pay a further third of their wages capped at £697.92 per month.

Effectively this scheme would lead to an employer paying 55% of the normal wage costs of an employee working one third of the time. How many employers will be willing to carry this expense remains to be seen. The scheme will run for six months from 1 November, seemingly in-sync with the extension of winter restrictions by Boris Johnson last week.

The scheme is purposely far less generous than the CJRS, as the Government runs a difficult gambit between retaining jobs which are viable long term and shedding jobs without a future. Of course, while it might make sense on a macro-economic level, for the people affected and who lose their jobs over the coming months the scheme will not seem so kind.

However a positive note did come through our inboxes this week, with ‘Builders’ Merchant sales confirming a strong V-shaped recovery’ according to the Builders Merchant Building Index, with value sales bouncing back by 38.9% in the three months from May to July from the previous quarter. Landscaping was significantly ahead of all categories at +130.4% over the period. Timber & Joinery Products followed with +44.3%, while Heavy Building Materials was also ahead (+35.6%).

Of course we are not out of the woods yet, and eyes will be looking to both the climb in COVID-19 cases, potential for further lockdown measures which could trigger the ‘W-shaped recovery’, and signals from the Government about what support they may offer to businesses over this period.

While it is with some empathy we can view the Government’s delay of the Autumn Budget amidst COVID-19, and a potential no-deal Brexit, continual delay can only add to business uncertainty. We are hopeful that the Comprehensive Spending Review, which will set out the Government’s spending plan for the next four years, will arrive sooner rather than later. Together with the Confederation of Timber Industries (CTI) we sent in a submission calling for the Government to;

  • Make a long-term spending commitment which reflects the Government’s intention to support the building of 300,000 homes a year on average by the end of 2022.
  • Support a Net Zero carbon retrofit programme for existing homes.
  • Align public spending and procurement in housing and construction with the Government’s legislative goal to be Net Zero by 2050.

 

You are welcome to read our full response on the CTI website.

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