As part of its commitment to building a stronger Wales, priorities have been given to funding for health and social care and local authorities to ensure equal access to services, rebalance inequalities and develop a new three-year Finance Plan to enhance the link between infrastructure and tackling climate change.
Supporting the housing sector
The budget has set out several key areas for investment for the housing sector up until 2025, including:
- £1bn capital investment in building new social housing including Social Housing Grant
- £580m to support decarbonisation of existing social housing
- £375m capital investment in building safety
- £100m for the Warm Homes Programme (aimed at tackling fuel poverty)
- £60m to support an increase in market housing
- £8.5m investment in the Homebuy scheme
- £3.5m to expand the private rented leasing scheme
- £1m in revenue funding to establish Unnos (an independent construction company to help deliver social housing)
- An additional £27.5m for homelessness prevention service
Due to ongoing uncertainties around the COVID-19, further support to sectors directly affected through the Retail Leisure and Hospitality Rates Relief (RLHRR) scheme has been made. An additional £116m of non-domestic rates relief will be provided, meaning eligible businesses will benefit from 50 per cent non-domestic rates relief for the duration of 2022-23 up to a cap of £110,000 per business.
Additionally, the non-domestic rates multiplier will be frozen to ensure that no business or rate payer will be faced with higher rates next year.
Land Transaction Tax
Land Transaction Tax (LTT) rates remain unchanged, though published alongside the Budget is a consultation on potential changes to the LTT higher rate for second homes. The proposals as outlined could see the Welsh Government increase the higher rate in some locations where second home ownership is seen to be impacting affordability or having broader negative consequences on an area.
The Welsh Government has launched a consultation as part of its ‘three-pronged approach’ to address perceived affordability issues and the impact of second homes and holiday lets in some parts of Wales.
Housing and homelessness
Funding for housing and homelessness prevention continue to be priorities for Welsh Government, with over £1bn capital funding set out to 2024-25. This will support the delivery of 20,000 low-carbon social homes for rent, whilst £60m will be invested in market housing to address housing supply issues.
A further £8.5m is allocated for Homebuy to enable shared equity homeownership, while £3.5m will be available for local authorities to discharge their homelessness duties by leasing property in the private rented sector. In order to improve the supply of social and affordable housing, £1m is allocated for the establishment of a new national construction company.
In tackling building safety concerns, £375m capital investment is committed to 2024-25 for remediation projects through the second phase of the Welsh Building Safety Fund, supporting the Building Safety Passport Scheme and long-term reform of building safety.
Investment in commercial property
The Budget also sets out £30m of investment over three years in commercial property, including delivery of 150,000 sq ft of new commercial floor space in line with the Welsh Government’s Property Delivery Plan.