At a Glance
🏛️ Planning and Infrastructure Bill is now law, introducing wide-ranging reforms to speed up housing and infrastructure delivery.
🏗️ Planning applications and housing approvals remain at multi-year lows, keeping England well short of 300,000 homes a year.
💰 Financial distress in construction has surged, with critically distressed firms up 70% year-on-year in Q3 2025.
🌱 Renewables reached a record 54.7% share of UK electricity generation in Q3 2025 as policy shifts aim to accelerate deployment further.
🚆 A £725bn, 10-year public infrastructure strategy underpins the pipeline, but delivery risks are mounting across sectors.
Today’s update: the Planning and Infrastructure Bill has cleared Parliament, giving ministers and local authorities new tools to accelerate development, just as data shows planning volumes and housing output still moving in the wrong direction. At the same time, contractor balance sheets are under mounting strain and the energy transition is reshaping the next wave of infrastructure work. Here’s what you need to know to stay ahead today.
Ongoing Stories
Following earlier coverage of the Planning and Infrastructure Bill’s passage through Parliament, the legislation has now received Royal Assent, with key provisions on NSIPs, local planning fees and spatial development strategies taking legal effect.
Returning to the theme of the UK’s £725bn-plus infrastructure pipeline, today’s data ties that long-term commitment to weak planning and housing approval numbers, sharpening questions over how quickly the new regime can lift delivery.
Top 5 Headlines
🏛️ Planning and Infrastructure Bill becomes law, reshaping the planning landscape
The Planning and Infrastructure Bill received Royal Assent on 18 December 2025, with government aiming to cut delays and costs for housing and critical infrastructure. Reforms include allowing non-water companies to promote reservoirs as NSIPs, empowering councils to set full-cost recovery planning fees, and overhauling pre-application consultation to remove up to 12 months from major project timelines. The Act also introduces spatial development strategies across authorities to better align infrastructure with sustainable housing growth, supporting ambitions for 1.5m homes and 150 accelerated major infrastructure decisions this Parliament. This matters because it hardwires a faster, more centralised planning framework that developers, promoters and local authorities will need to adapt to rapidly. (Source: GOV.UK)
🏗️ Planning and housing approvals hit 12-year low against 300k homes ambition
Latest Q3 2025 statistics show England received 80,400 planning applications, down 5% year-on-year, with 80,800 decisions (1% down) and an 88% approval rate. Detailed approvals for new homes in the year to September 2025 fell to around 204,852, down from 243,351 the year before – a 15% decline and the lowest level in 12 years – while housing starts and completions in Scotland and Northern Ireland also dipped. With England building roughly 200,000 homes a year against a 300,000 target, and constraints driven by market weakness, affordability, viability and planning delays, the new legislation will be tested quickly on whether it can reverse the trend. For housebuilders, investors and local authorities, this gap signals sustained pressure on pipelines, land strategies and tenure mix over the medium term. (Source: MHCLG/GOV.UK; Planning Resource; BuiltPlace)
💰 Contractor distress escalates as profit warnings almost triple
Over 104,000 UK construction firms are now classed as financially distressed, including 7,361 in critical distress – a 70% year-on-year increase in Q3 2025. Profit warnings from UK-listed construction companies almost tripled versus 2024 levels in Q3, driven by policy uncertainty, geopolitical risks and regulatory pressures such as Building Safety Act implementation delays. Despite some easing in input costs and output price inflation of 2.7% year-on-year in September 2025, borrowing rates for new corporate loans remain elevated at 5.53%, squeezing working capital. This intensifying pressure raises counterparty and delivery risk across the supply chain, making due diligence, payment terms and risk-sharing mechanisms central to project planning. (Source: Tokio Marine HCC Construction Report; ONS; EY)
⚙️ Construction activity slows sharply as private building weakens
The November 2025 Construction PMI signalled the steepest downturn in output since the early pandemic period, with private sector building particularly subdued. Public and regulated sectors, by contrast, are reported to be holding up more steadily, limiting the overall decline in 2025 construction output, which is still projected to grow by around 1.9% this year with 2.8% growth expected in 2026. Combined with financial distress indicators, the data point to a two-speed market, with stronger prospects where public funding and regulated asset bases underpin demand. For contractors and consultants, this accelerates the pivot towards infrastructure, public sector and regulated workstreams as commercial and speculative private projects stall. (Source: Tokio Marine HCC Construction Report)
🌱 Record renewables share and new planning order set up next wave of energy projects
The December 2025 Energy Trends report shows UK total energy production at a record low in Q3 2025, while renewables reached 54.7% of electricity generation, driven by increased solar and wind output. Government plans under the Great British Energy banner target 56–62GW of solar, 39GW of onshore wind and a tripling of energy storage by 2035, with the Infrastructure Planning (Onshore Wind and Solar Generation) Order 2025 taking effect on 31 December to ease consenting. Alongside Budget 2025 support for nuclear (including Sizewell C), CCUS and green finance, this signals a sustained build-out of low-carbon infrastructure despite underlying energy security concerns. Developers, grid operators and contractors can expect a more favourable planning context but will still need to navigate land, grid capacity and supply chain constraints. (Source: GOV.UK Energy Trends; Carbon Brief; Great British Energy)
Also in the news
🏛️ Government has published a Single Construction Regulator prospectus, consulting on unifying construction product regulation ahead of a white paper expected in spring 2026. (Source: GOV.UK; Pinsent Masons)
🚆 The 10-Year Infrastructure Strategy confirmed earlier in 2025 commits £725bn of public investment across transport, energy and social infrastructure, framing the market context for today’s planning and contractor finance data. (Source: GOV.UK)
💰 Construction output price inflation of 2.7% year-on-year in September 2025 slightly outpaced input inflation, offering limited margin relief amid wider cost-of-capital pressures. (Source: ONS)
🏗️ Material prices were broadly stable through 2025, shifting the focus of cost risk from commodities towards labour, finance and regulatory compliance. (Source: ONS)
🌱 Energy security plans and progress on emissions reduction continue without major new announcements on 21–22 December, but underpin the acceleration of renewables, nuclear and CCUS infrastructure support seen across recent policy releases. (Source: GOV.UK)
The Daily Build is written for people shaping the UK’s construction and infrastructure pipeline, from boardrooms to site offices. If this briefing helps your planning for 2026 frameworks and bids, consider forwarding it to your wider team.