Analysis

Analysis

10 key findings from the Tory conference

We provide a roundup of the key issues

Political uncertainty has major ramifications for the industry. Here’s what you need to know from the Conservative Party conference:

1. Shout louder to get a positive result from Brexit

Skills minister Anne Milton told a private property dinner that the industry needs to get Daily Mail front pages for ministers to listen. The message from government is that sectors need to lobby hard for what they need if they want to get heard. Ministers and civil servants, who have been sidetracked by dealing with the divorce bill, citizens’ rights and the Ireland border, say they are now ready to engage more with business. Chancellor Philip Hammond said he wants to hear about specific deferred investments that will help “galvanise” his cabinet colleagues in recognising the urgency of making a transition agreement.

2. It’s getting urgent

The future of the 200,000 construction workers nationally and the 12% of the City of London’s workforce that come from the EU remains uncertain. Catherine McGuiness, policy chair of the City of London Corporation, which lobbies on behalf of the financial services sector around the UK said: “Unless we have clarity in the next couple of months over a transition to give us time to work towards the longer term future, institutions are going to move jobs elsewhere.”

3. Sharma is the “implementation housing minister”

New housing minister Alok Sharma sees his main role as following the agenda set out by his predecessor Gavin Barwell, who lost his seat at the June General Election. “My job is to deliver this,” Sharma said, waving a hard copy of the housing white paper published in February. Giving councils powers to boost planning fees, supporting build to rent and promoting SME housebuilders are among the policies that Sharma plans to implement.

4. Social housing is back on the agenda

Theresa May announced an extra £2bn for affordable and social housing. The money will go towards just 5,000 homes a year over a five-year period but it does represent a significant policy shift. Before the election May pledged to deliver a “new generation of social rented homes” but it later emerged “social rented homes” really meant affordable rent levels at up to 80% of market rent. This time, social housing really means social housing.

5. But home-ownership is not off the agenda….

A £10bn Help to Buy extension will benefit 135,000 households, which works out at £74,000 for each first-time buyer to get a mortgage with a deposit as low as 5%.

6. Political leadership is lacking in Westminster, but shining in the regions

The rumour mill at the Midland Hotel in Manchester was abuzz with talk about which ministers were preparing leadership bids in the hope that Theresa May steps down before the next election (foreign secretary Boris Johnson, international development secretary Priti Patel, Brexit secretary David Davis and chief whip Gavin Williamson are all tipped to run if they get the chance). In more positive news, both Labour and Conservative metro mayors were out in force pledging to get on with business while Westminster is blocked by political disputes. Tees Valley mayor Ben Houchen said he hoped to be the link between investors and development opportunities. West Midlands mayor Andy Street says he wants to share the “growing success story” of the region with other areas.

7. The door to wider devolution is open

Business, energy and industrial strategy secretary Greg Clark said the first devolution deals were just the start of a process to devolve “more and more power”. His tip to regions was to “make government an offer they can’t refuse”. He said: “What is being proposed needs to be so clearly in the national interest as well as in the local interest, demonstrated convincingly with the analysis that is available, that actually it would be crazy for the government to stand in your way.”

8. Anger about infrastructure investment in the North of England isn’t going away

The chancellor pledged an additional £400m for infrastructure investment in the North of England – £300m for the rail network, ensuring HS2 infrastructure “can link up with future Northern Powerhouse and Midlands Rail projects” and £100m for road improvements. However, he did not commit to a timeframe or cash for HS3, the proposed East-West rail link. Thinktank IPPR North called the £300m rail investment “a drop in the ocean compared to what was needed and nowhere near the £59bn catch-up cash necessary to narrow the spending gap with London”.

9. The November Budget could offer some breakthroughs

The conference was light on policy announcements, leading to speculation we could have a bumper Budget on 22 November. Adam Marshall, director general of the British Chamber of Commerce, called on the chancellor to reduce some of the “upfront costs” businesses are dealing with such as business rates. He said: “If we are worried that the tap is being turned off because of uncertainty, then the government should do everything it can to turn the tap back on.” However, Hammond has not offered many hints, only saying he thought “removing uncertainty” was the best way government could support business.

10. Property needs to improve at communicating its value

Major industry lobby groups have launched Brexit manifestos, but for government to react it is important to get the public onside. Phil Briscoe, managing director of Newington Communications, who spent the conference lobbying ministers in the Midland Hotel bar, said: “While Brexit secretary David Davis pushes on with the negotiations, there is an opportunity to engage with the Department for Exiting the European Union and put the property sector firmly at the heart of the UK position. But there is an opportunity to go beyond this and shape public opinion. This also means tapping into a public narrative that is often shaped around the future of financial services, defence or research, and adding real estate to that list.”

‘Atypical Tory policies for atypical times’

Damian Wild, EG editor

Mansion taxes, curbs on landlords and a package of measures to woo the student vote are not the sort of policies you would typically expect to hear floated by Conservative politicians. But these are not typical political times.

On and off stage at this week’s Conservative party conference in Manchester, you could see the unthinkable in pursuit of the unimaginable: a non-traditional agenda designed to counter rising support for a left-lurching Labour party.

“There’s a shift in public opinion,” London School of Economics professor Tony Travers told a Mishcon de Reya/London Communications Agency gathering of investors and politicians on Sunday night at the conference. “It’s a shift you need to adapt to.”

For some at Sunday night’s dinner, the party’s current policy priorities were misplaced. For most present, however, they were not nearly radical enough. Nothing less than full commitment to devolution, wholesale reform of the local government financing system and a fundamental rebalancing of power between London and other core cities would be enough.

Westminster city council leader Nickie Aiken’s bid to impose a doubling of council tax for wealthy residents was an eye-catching start to the week. The council is keen to present this as not-a-mansion-tax – “it’s a voluntary community contribution,” she corrected. It would see owners of properties valued at more than £10m elect to pay a £1,300 levy on top of their £1,300 top-band council tax.

It’s a pretty radical idea, though it’s more symbolic given the comparatively paltry sums it stands to raise. Voluntary today, it could yet become compulsory. And it is drafted in the full knowledge that the government cannot afford primary legislation time as it focuses on the great EU repeal bill. But if Aiken acknowledges that government support will be thin on the ground for the next 18 months at least, collaboration between cities and with the private sector remains perhaps the only viable way forward.

Urban Splash founder Tom Bloxham recognised as much. “Greater Manchester has to collaborate because the economy has been pretty tough,” he said. With ministers apparently wavering in their commitment for even the devolution they had promised, Greater Manchester Combined Authority chief executive Eamonn Boylan warned that his and other regions might have to continue to find their own solutions.

“The problem for us is that the default position of government is to see the political landscape defined by the political issues of London,” he said. Peter Rogers, chairman of the New West End Company, shared Boylan’s frustration. “What they have devolved are duties,” he said. “They have not devolved tax-raising powers. Devolution is merely a word in central government. The civil service is frightened of losing powers. What we need is a fundamental reform of local fiscal powers.”

For some, the fiscal reform being pursued is wrong. Former Conservative minister Steve Norris labelled Help to Buy, which drew a further £10bn in support this week, as “absolute economic madness”. Pocket Living Nick Cuff said the current system of local government finance – “an amalgamation of CIL and s106 that pays for everything” – needed to be overhauled and replaced with a simpler tax. For Wandsworth leader Ravi Govindia the current system was one that left everyone thinking, “it’s a stitch-up”.

So in the absence of fundamental reform, it is collaboration or nothing. And at least a note of optimism on that was sounded by James Cooksey, The Crown Estate’s director of central London. “From an industry perspective, collaboration has got a lot more honest over the past 12 to 24 months. And in the dark halls of the development world, most would say it’s a fair cop. We’ve got to make a better contribution.”