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VAT rise will cost Green Deal jobs, warns FMB
30/11/10
Edited by Tom Bardsley.The government's decision to increase VAT from 17.5 per cent to 20 per cent from January threatens its plans to deliver energy-saving home improvements under the Green Deal, the Federation of Master Builders (FMB) has warned.
Richard Diment, the trade association's director-general, said independent research suggests the higher rate of tax will see the £45.5 billion renovation and maintenance market shrink by two per cent.
He added that this is projected to cost around 7,500 jobs at a time when the sector needs to "grow massively" if it is to deliver the government's Green Deal ambition of retrofitting 26 million homes over the next two decades.
Mr. Diment noted that in order to meet this target, tradesmen will have to improve around 1.3 million properties each year, which equates to approximately 25,000 houses every week.
"The government must drive job creation in the sector so that the skills are available when the Green Deal starts," he argued.
Energy and climate change secretary Chris Huhne has previously said the retrofitting initiative will generate around 100,000 jobs by 2015.
