Plans to support small and medium-sized enterprises (SMEs) through the launch of a ‘Help to Build’ scheme should be implemented according to construction industry experts.
The Labour Party has discussed proposals to launch such an initiative with members of the Federation of Master Builders (FMB), who have welcomed the plans.
Under the Help to Build proposals, government guarantees would be introduced to underpin certain loans which are handed to small and medium-sized house-builders.
According to the FMB, the plans might increase the number of small-scale construction companies operating in the UK property sector.
Brian Berry, the trade body’s chief executive, said that in light of its potential benefits, the policy should not be restricted to the Labour Party.
He said: “This is an idea which could reinvigorate the SME house-building sector and we hope the policy is implemented by whichever party forms the next government after the general election.”
Mr Berry added that the proposals are the most “far-reaching” to be put forward by the country’s politicians to date.
Earlier this week, representatives from FMB member firm Building Associates Ltd discussed the attributes of Help to Build with Shadow Chief Secretary to the Treasury Chris Leslie and Shadow Housing Minister Emma Reynolds.
Mr Berry said the Help to Build plans are welcome in light of the difficulties which small house-building companies have encountered in the past.
Along with their larger-scale counterparts, SMEs operating in the construction industry are important contributors to the wider UK employment market, delivering apprenticeships and entry-level positions.
However, Mr Berry believes these firms have “suffered” over the past few years.
He added: “They used to build two thirds of all new homes, but they are now building just over a quarter and much of this reduction has happened in the past six years.”
SMEs will not begin to return to the house-building market until ministers get to grips with the barriers they face when attempting to access finance, the expert suggested.
Because of their inability to secure viable loan agreements, Mr Berry concluded that many small building groups have diversified their operations and moved away from housing projects.