Almost two-thirds of senior council officials have said they are seeing delays to construction projects, despite local authorities’ key role in creating the wave of new housing and infrastructure promised by Labour.
Ahead of Rachel Reeves’ spring forecast on Tuesday, a survey of senior council officials showed that 40% do not believe the local authority they work for is well placed to press ahead with its building plans.
Local authority finances have been under sustained pressure for more than a decade. The Labor Party recently announced a restructuring of the funding formula for local councils in England, to redirect resources from wealthy areas of the country to more disadvantaged areas.
Among respondents, 64% reported project delays, and up to 94% called for more certainty about future financing, such as multi-year financing agreements. When asked to say in their own words what was causing the delay, many simply wrote “funding.”
More than a third (34%) said Labour’s radical reshuffle of local government could also create delays in the short term, while 40% pointed to skills shortages. Regeneration, housing and transport projects were identified as the most subject to potential disruption.
The survey was carried out by the Local Government Information Unit and public sector procurement body Scape.
Scape deputy chief executive Caroline Compton-James said: “Local authorities across the country really want to step up. They are galvanised. They want to deliver for local communities, and there is a real will and ambition to do that. But there are some constraints they are feeling.”
He added: “Requesting long-term funding arrangements, where local authorities and their partners can invest in work projects in those settlements, is really key.”
Labor came to power promising to be the party of “builders, not blockers” and has reformed planning legislation to allow more projects to go ahead. He has pledged to allow 1.5 million homes to be built in England during this parliament, although there is skepticism in the industry over whether the target can be achieved.
Reeves also changed the government’s fiscal rules in his first budget, to allow a significant increase in borrowing to fund investment projects, including transport infrastructure and social housing, and is expected to promise further planning changes in a speech later this month.
But council officials cited rising costs and political uncertainty as obstacles to getting projects built successfully, with problems often occurring at earlier stages of scoping, planning or contracting.
Councils are expected to play a key role in Labour’s flagship Pride in Place programme, which is allocating up to £5bn to local areas across the UK, and new neighborhood councils will decide how the money will be spent locally.
A Ministry of Housing, Communities and Local Government spokesperson said: “Our landmark Planning and Infrastructure Bill brings seismic reforms to a planning system that for too long has held back growth. It will break down barriers in the planning system, making it easier for councils to seize land and approve developments for much-needed housing and critical infrastructure.
“The recent deal on local government funding is our biggest move yet to make English local government more sustainable and secure. We have made more than £78 billion available for council finances next year, an increase of more than 6% compared to 2025-26.”
