THE BMF's REsPONSE TO SPRING STATEMENT

24 March 2022

Responding to the Chancellor’s Spring Statement, John Newcomb, CEO of the BMF said: “The Chancellor offered two rays of hope in his Spring Statement, with a temporary reduction in fuel duty and the removal of VAT on energy saving materials for the next 5 years. We have long supported zero-rated VAT on these materials, both to promote energy efficient upgrades to our existing housing stock and support the drive to net zero, and welcome the Chancellor’s announcement.

“However, the potential impact of these positive measures must be considered within the broader context of building materials supply, where the outlook is much less certain.

“Even before the war in Ukraine, rising energy, freight and labour costs were reflected in price increases for many essential building products, with many manufacturers already announcing increases of 4-10% this year and energy intensive products increasing by as much as 20%.

“With continuing disruptions to global supply chains, particularly in oil and gas, the Office for Budget Responsibility (OBR) already expects inflation to rise to 7.4% this year, with further increases to come. I am sure a lot of building materials manufacturers, and their customers, would have been looking for more support."