Fresh Blow for Rachel Reeves as Builders Warn Labour May Miss

Published: 29 October 2025. The English Chronicle Desk / Reporter Name. The English Chronicle Online.

Rachel Reeves is facing renewed pressure over Labour’s housing ambitions after Britain’s top house builders warned that the government is on course to miss its pledge of delivering 1.5 million new homes by the end of the decade.

In a private letter to the Office for Budget Responsibility (OBR), the Home Builders Federation (HBF) said forecasts for economic growth from housing construction were overly optimistic. The federation, representing home builders across England and Wales, argued that current policies and planned taxes are making development increasingly difficult.

Neil Jefferson, the HBF’s chief executive, said the OBR’s targets would only be achievable if ministers offered more support to first-time buyers and scrapped new levies on housing. “The OBR’s forecasts for housing supply were ambitious,” he said. “The numbers are only achievable in the right policy environment.”

The warning, first reported by The Times, threatens to undermine hopes that the OBR might upgrade its growth outlook for the construction sector ahead of next month’s budget. Instead, some analysts now fear a possible downgrade, raising fresh doubts about the government’s economic strategy.

Labour’s manifesto promise to deliver 1.5 million new homes during the current Parliament has already faced criticism from within the industry, with developers calling it overly ambitious amid tightening regulations and rising costs.

MP Chris Curtis, chair of the Labour Growth Group, said his party risked missing its targets due to slow reforms and political gridlock. “The House of Lords has been holding up legislation, and the government hasn’t been strong enough in standing up to opposition,” he told The Times. “That’s why we now need to go further—by reforming the building safety regulator, fixing the broken approach to nature regulation, and swiftly advancing the New Towns programme.”

However, Housing Minister Alex Norris rejected claims that Labour’s plans are faltering. “We made that commitment and we’re going to deliver on it,” he told LBC. “The reality is we inherited a broken housebuilding system. The lack of targets meant the market ground to a halt, and of course it’s taking time to ramp up. But whether it’s changes to the planning framework or the Planning and Infrastructure Bill moving through Parliament, we are taking action to make it easier to build across the country.”

He added that the government had been upfront with voters that progress would not be immediate. “We were clear with the British people from the start—it wouldn’t be an even distribution from year one because the baseline from which we were building was so weak.”

The row over housing comes as Reeves prepares to deliver her first major budget in November, amid reports that she faces difficult fiscal choices and grim forecasts from the OBR. Writing in The Guardian, the chancellor said she was determined to “defy” pessimistic projections and rebuild the economy’s long-term health.

Reeves acknowledged that austerity, Brexit, and the pandemic had left “deep scars” on the UK economy but insisted she would not “relitigate the past or let past mistakes determine our future.”

A government spokesperson said ministers remained committed to the 1.5 million homes target. “We will leave no stone unturned to build the homes this country desperately needs and restore the dream of homeownership,” the spokesperson said. “On top of major planning reforms and a £39 billion investment in social and affordable housing, we are going further and faster to bring about the biggest era of housebuilding in Britain’s history.”