Autumn Budget 2024: Investment on the Horizon Needs to be Protected

The tail end of October saw the first Autumn Budget under the new government, marking the first under Labour in 14 years, and the first ever to be delivered by a female Chancellor of the Exchequer.

A bumper package revealed over 90 minutes was packed to the gills with policies all aimed at “putting pounds in people’s pockets” and driving economic growth with an approach to “invest, invest, invest”. Despite many items such as tax changes being trailed in the run up to the Chancellor’s statement, as the dust settled there has been a lot of detail to unpick behind the headlines.

The key question is always how the Budget will affect things into the future, so we have broken down the key things you need to know across five core areas in line with future development.

Energy

The government had already announced the founding of Great British Energy – a new publicly-owned energy company – following the general election in July, but energy continues to take a front seat in Labour policy. The drive towards net zero continues, with the Department for Energy Security and Net Zero (DESNZ) seeing a major budget increase, and several announcements that will support the transition to a renewables grid.

More specifically, the government has also pledged £3.9bn in funding between 2025-26 for carbon capture projects, support towards the first round of 11 green hydrogen production projects, and a further £2.7bn to funnel through funding channels into the completion of Sizewell C. Further to this, £3.4bn investment focuses on decarbonising and increasing energy efficiency of the UK’s existing homes through the Warm Homes Plan.

Education

The maintenance, repair, and capacity issues faced by schools, and prisons are well-known, all being exacerbated by increasing demand and tightening budgets for the public bodies running the services. Schools around the country are continuing to deal with the fall out of the RAAC crisis as well as normal maintenance – all while demand for school places continues to rise.

An additional £1.4bn has been allocated to continue the School Rebuilding Programme, meaning 100 projects can start next year and work towards the rebuilding on 518 schools in total. A separate allocation for maintenance and improvement is £2.1bn, which is a rise of £300m from last year – and colleges will receive a further £300m for investing in further education estates to provide certainty for facility improvements. This adds to the pre-Budget announcement that £15m has been allocated to begin the delivery of 3,000 school-based nurseries, with schools able to bid for up to £150k to expand existing nurseries or open a new one.

Healthcare

Those with NHS investment on their Budget bingo cards were able to cross that box off as several announcements were made for healthcare. The government has pledged an additional £22.6bn of resource spending for the day-to-day health budget for this year and next in order to support an additional 40,000 elective appointments every week.

Meanwhile, a separate £3.1bn increase to the capital investment budget for this year and next has been announced, which includes allocation to address backlog repairs and upgrades, with particular focus on hospitals impacted by the presence of RAAC.

The question remains on whether this goes far enough to cut waiting lists and improve NHS building stock, or if it only scrapes the surface.

Planning reforms

The government has already been making moves in reforming the planning system to “Get Britain Building”, including already holding a consultation period on a new National Planning Policy Framework that aligns with the government’s strategic aims.

The Budget announced additional funding to feed a pipeline of “planners of the future”, helping to recruit an additional 300 planning officers, while also boosting and upskilling local planning authority capacity. These additional planning officers were announced earlier in the year in line with other planning reform announcements – but even with this funding announcement there is no indication just how quickly these extra planners can be in post and how much impact they will have on the system as it stands.

Transport & infrastructure

While consumers and companies with larger fleets will have zoned in on the extension to the fuel duty freeze and the rise to single bus fares in England, there were enough transport announcements in the Budget to shake a stick at when it comes to infrastructure.

After reports that ministers were looking to cut costs, the Budget included a commitment to “secure the delivery” of Transpennine rail upgrades between York and Manchester, electrifying the line all the way via Leeds and Huddersfield. Meanwhile, the new East West Rail line between Oxford and Cambridge has been promised, and a commitment made to fund the tunnelling work that will take the HS2 rail line to Euston station in London.

Elsewhere, £1.3bn has been put towards urban transport schemes through City Region Sustainable Transport Settlements, which will go towards projects such as renewing the Sheffield Supertram and constructing the new Liverpool Baltic railway station.
For roads, an extra £500m is going towards repairing England’s potholes next year – but it is important to note that where the Budget gives, it also takes away. For roads, this includes a number of planned schemes no longer making the cut, including A5036 Princess Way, A358 Taunton to Southfields, M27 J8 Southampton, the A47 Great Yarmouth, Vauxhall Roundabout, and A1 Morpeth to Ellingham.

What does this all mean?

The overall message from the Chancellor was that the policies covered by the Autumn Budget are being introduced to plug the shortfall in public finances, and in time return the country to a more positive economic position.

Whether it’s a nursery extension, new hydrogen production plant, rail electrification, repairing hospital buildings, or filling in potholes – every single penny of public investment needs to be spent responsibly and go as far as possible. Even more importantly, those investments need to be protected from undue risk, and so effective contract management needs to be central to every single project undertaken.

Size of project does not directly correlate to the level of risk associated, or how likely it is to see a dispute raised. Particularly when considering the projects born from these announcements will be complex or include multiple parties, it’s vital to invest in tools that protect from unnecessary risks – such as miscommunication, misunderstanding or ineffective collaboration.

Our contract management software gives clients across energy, construction, healthcare, infrastructure and government the ability to manage any contract and size, giving them the ability and inbuilt compliance needed to protect the investment into their projects.