King’s Speech 2023 | Key takeaways + reactions
In His Majesty’s first speech representing Rishi Sunak’s government, a range of measures were pledged including the future licensing of oil and gas fields, the roll-out of Network North, and the abolition of the “feudal” leasehold system.
Property professionals have welcomed some aspects of the bill, namely the promise of housing reform, however have highlighted disappointment in the lack of activity for the housebuilding sector.
King Charles III delivered the motions during the ceremonial speech, in which he described some of the decisions to be “difficult but necessary” to make the country better.
Industry leaders have shared their reaction on the housing reform bills, the Offshore Petroleum Licensing Bill, and Network North, as well as what was not included – namely the housing crisis.
Read on to see their analysis of the King’s Speech. Comments have been edited for clarity and brevity.
The Leasehold and Freehold Bill needs to be ‘fit for purpose’
Today, the government committed itself to ensuring that all new houses in England and Wales will be sold as freehold properties.
In essence, the bill will also reform the housing market by making it cheaper and easier for leaseholders to purchase their freehold. Ground rents will also be capped for new and existing properties and setting the default length of leases at 990 years, rather than 99 years.
Timothy Douglas, head of policy and campaigns at Propertymark, a professional body representing all aspects of the property industry, said: “Many agents and leaseholders will be relieved to hear plans for new legislation to further reform the leasehold system.
“However, the UK government must ensure any legislation to abolish leaseholds is fit for purpose.
“For example, there are no reports yet that have confirmed what impact capping ground rents will have on service charges, and it is important to consider that every development is individual, and some may still require aspects that justify specific service charges.
“As every development will likely have unique characteristics by design, there may well be a need for sensible provision and certain clauses/exemptions where an ongoing management fee might be appropriate.”
Katherine Whittle, senior associate at Brabners, is more optimistic and anticipates that the Leasehold and Freehold Bill is a “step in the right direction” for leaseholders.
However, Whittle recognises that some landlords will be “less enamoured” with the proposed reforms, which disincentives leasehold investments.
“They also face the increased risk of legal challenges from residents, with the bill expected to transfer more power to occupants for determining service charges, which could create fertile ground for conflict.”
Is this the Renters Reform Bill’s moment?
His Majesty confirmed today that the Renters Reform Bill has been carried over to this Parliament and remains on the agenda for discussion and implementation.
The bill aims to rebalance the rights and responsibilities of renters and landlords with the scrapping of ‘no fault’ evictions, the creation of a national landlord register, and providing certainty to landlords that they can regain their properties when needed.
Also carried over to the next Parliament but lacking any mention was the High Speed Rail Bill – or the better-known as the building of HS2 between Crewe and Manchester.
This is not surprising considering the government’s U-turn last month, confirming that the rail project will only go as far as Birmingham.
The North is set for a consolation prize however, with the motion of Network North passed. This £36bn project will see the government invest in road infrastructure and rail lines to deliver “faster and more reliable” journeys between, and within, cities and towns in the North and Midlands.
The Offshore Petroleum Licensing Bill is ‘lack-lustre’
The Offshore Petroleum Licensing Bill promises to support the future licensing of new oil and gas fields, helping the country to transition to net zero by 2050, while seeking to attract “record levels of investment” in renewable energy sources.
As a result, tax revenues from Britain’s oil and gas sector are expected to reach £50m by 2030.
Claire Petricca-Riding, head of planning and environment at Irwin Mitchell, highlighted that there is an undoubted focus on the economic, but a lack of detail on how this will progress.
“On balance it seemed rather lack-lustre on how the country’s long term future will be secured from these plans”, she said.
Petricca-Riding continued: “The Offshore Petroleum Licensing Bill will be introduced, but 75% of North Sea oil and gas is exported. So will a new bill deliver energy security for the country?”
“The government is framing this around making energy cheaper for households and removing the cost of the transition to net zero, but why is this always a choice for households instead of the government to make it easier for the renewable energy sector to gain traction?
“Setting up North Sea oil and gas as a ‘greener’ alternative to other oil and gas is also a strange dynamic; the bill will bring in a key test that carbon emissions must be lower than that imported.
“But how much lower does this need to be to classed as ‘green’?”, Petricca-Riding concluded.
Lack of housebuilding reform is a missed opportunity
Noticeably absent for property professionals was any mention of activity for the housebuilding sector.
Nicky Gordon, managing director of Genesis Homes, highlighted: “The annual opening of parliament presented the government with a real opportunity to take bold action towards alleviating the UK’s housing crisis, yet it is deeply concerning and disappointing that it has again shown a complete disregard for the nation’s desperate need for new housing by ignoring the many issues our sector is facing.”
Lack of Levelling Up shows ‘final roll of the dice’
There was also no mention of Levelling Up, which Tom Morrison, strategic director of economic development at Copper Consultancy, suggests that the Conservatives’ eyes are “on little else other than a general election next year”.
“Apart from some references to the Network North initiative, there was little in terms of major announcements for the region and Levelling Up seems to have taken a back seat”, Morrison continued.
“Pundits are calling this a final roll of the dice for the Conservatives as they try to hold onto power and it’s hard not to disagree with them on this showing.”