Sweeping reforms to the planning system could make housebuilding quicker and simpler for tradespeople. As a part of the government’s Plan for Change, they’re investing in small businesses to help them achieve their goal of building 1.5 million homes by 2029.
And with millions of pounds set to be invested into the growth of smaller firms, plus more funding for construction apprenticeships, the industry could receive a major boost.
How is the planning system for housebuilding changing?
The government says the current planning system and regulations for housebuilding are overcomplicated and time-consuming. And with a focus on unlocking the potential of small builders, it plans to reduce red tape and make it easier to get jobs off the ground.
The government is proposing five key initiatives as part of its Plan for Change.
1. Faster decisions for small building projects
Whether you’re building 10 houses or 100 houses, the planning system is the same complex process. To change this, the government is proposing a simpler planning process for house building projects under 10 homes.
Biodiversity Net Gain (BNG) is an initiative that makes sure building projects have a positive effect on the biodiversity in the area they’re developing. The government plans to ease the BNG requirements for smaller projects.
Under the new plans, smaller building jobs would be approved by expert planning offers instead of a planning committee. It’s hoped this will streamline what can be a drawn-out process.
2. A new ‘medium site’ category
A ‘medium site’ category for the planning system would see a new set of rules for projects building between 10 and 49 homes. With the aim of making the process simpler and less expensive.
The Building Safety Levy is a tax on new residential property projects that funds safer building practices on new and existing homes. The government is proposing a potential exemption from the Building Safety Levy for ‘medium site’ developments.
Plus, the proposals include a simplified approach to Biodiversity Net Gain for ‘medium sites’ to help make environmental targets more achievable.
3. More land and financing options for SMEs
Making government contracts more accessible to smaller businesses is an aim of the government. The Procurement Act 2023 laid the groundwork for making public sector contracts easier to win for small businesses. And Homes England (the government’s housing and regeneration agency) is looking to go a step further by releasing more land exclusively for SMEs.
There’s also a new National Housing Delivery Fund to ‘support long-term finance options, such as revolving credit facilities and lending alliances’, according to the government. The details of the fund will be confirmed during the next spending review.
4. A plan to free up small sites for SMEs
Brownfield sites, patches of land that had previously been developed but are now abandoned, will be freed up for small builders. The government is calling this the Small Sites Aggregator and it will be trialled this year in Bristol, Sheffield, and the London Borough of Lewisham.
The aim is for these brownfield sites to be turned into social housing to try and tackle the housing crisis in these areas.
5. Increased funding for small builders
To support smaller firms in managing these projects, the government is proposing new funding options for housebuilding projects:
- SME Accelerator Loans worth £100 million to help smaller firms grow
- £10 million to fund more specialists to speed up environmental assessments
- £1.2 million PropTech Innovation Fund to support innovation on small sites with new technology
When talking about these reforms, Deputy Prime Minister and Housing Secretary, Angela Rayner said:
“For decades the status quo has failed them [builders] and it’s time to level the playing field. Today we’re taking urgent action to make the system simpler, fairer and more cost effective, so smaller housebuilders can play a crucial role in our journey to get Britain building.”
Investment in apprenticeships to boost workforce
With an ongoing skills shortage one of the biggest challenges facing the construction industry, the government is investing in apprenticeships to grow the workforce.
Through the government’s reforms, 120,000 new training opportunities are set to be introduced in construction and health care positions. And a £3 billion budget has been set aside to support both the employers and apprentices through their development in a trade.
Some of that budget will be split into:
- £14 million in skills funding in construction for the next academic year, expected to support up to 5,000 additional adult learners
- £136 million for skills bootcamps across a range of priority sectors (including construction) in 2025 and 2026
- £100 million over four years to expand on the current Construction Skills Bootcamps
- 10 technical excellence colleges specialising in construction skills, opening in September 2025
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