Written evidence submitted by the Heritage Alliance

About Us

The Heritage Alliance is England’s largest coalition of independent heritage interests, bringing together over 200 organisations, which contain over 7 million members, volunteers, trustees, and staff. We sit on the Government’s Heritage Council, and on the heritage sector’s Historic Environment Forum. The vast majority of England’s historic environment is owned, managed and cared for by Heritage Alliance members. Our Heritage Manifesto sets out our vision for a resilient future for our sector, which unlocks the full potential of heritage to deliver a range public goods. It also proposes a number of practical solutions to many of the questions raised in this enquiry.

Heritage is one of our greatest national assets, breathing life into our towns, cities, coasts, and countryside and creating places that people want to live and invest in. The heritage sector contributes an estimated £45 billion in gross value added to the UK economy and supports over 523,000 jobs. It is estimated to make a larger direct contribution to UK GDP than the sport, security, defence, or aerospace industries.[1] Heritage is a living and breathing part of our everyday economy – from high streets and parks to canals, theatres and churches. Heritage is not a constraint, but an enabler for responsible and characterful growth in the right places which makes use of our existing buildings – and a vehicle to deliver much-needed housing and green energy infrastructure to support our national development and growth. We welcome the Culture, Media and Sport Committee’s interest in this important topic and will be happy to provide any further detail on this briefing if useful in the future.

1. What are the most significant challenges facing owners and operators of built heritage assets, and how are they affecting what those sites can offer?

Our 2024 ‘On the Brink’ report provided a snapshot of the greatest challenges facing heritage organisations. We identified five core themes, which we have found continue to affect our members in 2025 in our live data gathering.

Energy Bills

94% of heritage organisations identified energy bills as an ongoing concern in our 2024 survey, with our members already having reported up to 900% quoted increases in their energy bills in 2022/23. Unique vulnerabilities for historic buildings include the challenge of heating control in larger spaces, supply gaps in traditional skills and materials to carry out necessary energy upgrades, and inaccurate EPC assessments which can recommend harmful and ineffective measures. This has impacted the ability of many sites, particularly historic religious buildings, to be warm spaces and offer community support. Lack of temperature regulation not only affects the comfort of occupants, staff, and visitors, but can damage a building’s fabric and contents. An uncomfortable space can reduce visitor numbers and has even necessitated the closure of some heritage sites during the winter months. Costs are also likely to have an impact on climate adaptation efforts, as investing in clean energy sources and retrofit schemes are often put out of reach by the upfront costs involved. 

Staff and Volunteer Gaps

A third of our 2024 survey respondents said this was their biggest overall concern – more so than energy costs. Heritage employers are struggling to meet expectations of wages rising with inflation, with skills and training gaps leading to recruitment challenges. The sector is currently heavily reliant on older volunteers (41% are estimated to be aged 65 and over), but the pandemic and cost of living pressures severely impacted participation from this key demographic. ​There has been a trend of heritage volunteers stepping back during covid and not returning – some needing to take on more paid work due to financial pressures; some because of health concerns, and others taking early retirement from volunteering. In subsectors with specialist skills, such as the heritage rail sector, or for certain craft skills like millwrighting, the workforce is rapidly ageing, and expert knowledge is being lost through retirement and a lack of accessible training and apprenticeship schemes for small businesses and freelancers. The most recent edition of the Heritage Crafts Association’s Red List of Endangered Crafts features 84 endangered crafts, 62 critically endangered crafts, and five crafts which are now extinct in the UK.

Changes in Consumer Behaviour

Not all heritage sites are public facing, but we found notable impacts on consumer confidence and visitor behaviours which have affected those sites which rely on public engagement. There are signs of recovery in recent tourism forecasts, though total visitor numbers and spend are still down on pre-pandemic figures. According to a 2023 Audience Agency survey, 59% of people are actively ‘put off’ attending arts and culture venues (including heritage) due to the cost-of-living crisis, and 38% are engaging less than they were before the pandemic. Drops in participation are more notable among underrepresented groups, which is reflected in the pattern of declining school visits to heritage sites. The Sutton Trust found that 68% of the most deprived state schools have cut school trips, compared to 44% in the least deprived schools. English Heritage has launched a fundraising campaign to support the future of their school trips programme, which has seen a 73% increase in costs since 2019. Lack of educational and public access to heritage sites reduces cultural enrichment opportunities across the board, and also has a knock on effect on the representation of marginalised communities in the composition of our sector workforce. This is despite a clear desire from young people to engage with heritage – DCMS found it is the third most popular sector activity with over 70% of young people taking part last year.[2]

Cutting Costs

Many heritage sites survived the pandemic with a combination of pausing operations where possible, using reserves and benefitting from emergency funding. Now their safety net is gone, some are ‘one rainy day’ away from collapse. Our research found that core activities are now being cut – making redundancies necessary, pausing urgent capital works, cancelling programmes​ or drastically reducing opening hours. Amongst Heritage Pulse survey respondents, 56% have delayed, cancelled, or scaled back major projects, particularly in the areas of capital maintenance and public outreach and education programmes. Heritage sites are particularly vulnerable to inflationary pressures because the fixed costs of maintenance are already high, ​failure to carry out maintenance can pose an existential threat , and there is a backlog of urgent works in many cases. The latest Heritage at Risk register demonstrated the ongoing deterioration at play: whilst 124 buildings and monuments were removed from the register, 155 were added. The true scale of repair backlogs is unclear (pending the publication of a report commissioned by the previous government in early 2024), but our members Historic Houses and the Church of England place the outstanding repair backlogs in their networks alone at the cost of £2bn and £1bn respectively. The concerning reality is that many previously ‘essential’ costs for heritage organisations are now susceptible to cutbacks, including insurance. Premiums for historic buildings have increased dramatically post-Covid, and our research indicates that growing numbers of heritage organisations have no choice but to scale back their policies. Some heritage sites have reported to us that they can no longer afford any insurance coverage for historic buildings under their care.

In addition to this, the Autumn Budget announcements for employers will have a further impact on the overheads of heritage organisations, particularly medium and larger organisations that will not benefit from the higher National Insurance cap. The NCVO estimates this will cost the charity sector £1.4bn and are calling for the rebate applied to public sector NI contributions to be extended to charities, which we strongly support. An academic body we represent estimates it will cost them £1.3m in NI rises alone, and a youth charity in our membership estimates the NI hike and minimum wage increases together will cost them £1.7m next year. The 6.7% hike in minimum wage will be more significant than the NI hike for many organisations, especially rural visitor-facing organisations which rely on casual or seasonal staff. Many organisations will be unable to offset higher staffing costs without support or relief on other operational costs, and it is likely that staffing will be cut in the long term. 

Funding Gaps

Our research found that the greatest reported threat facing the sector is overwhelmingly the lack of funding, with 81% of organisations saying it is a significant concern. In 2025, more than half our members say they are more concerned about funding than they were this time last year. Grant-in-aid funding from DCMS has fallen by 18% in real terms from 2010, and per-capita local authority spend on heritage and culture is down 43% in the same period.[3] A third of organisations ended their last financial year in deficit and more than half have reserves below their planned levels.[4] Many of these places are employers or host small businesses, whilst others provide vital support to local schools and charities – reduced funding will mean cuts to jobs, public access and educational opportunities.  

1. a) What interventions are needed to prevent the managed decline of heritage assets on publicly owned land?

Through their budgets for cultural services, local authorities provide funding for heritage, museums, galleries, and archives in their area, and sometimes directly operate these sites. It is estimated that 31% of all accredited museums in England (413 in total) are ‘local authority reliant’ (i.e. they are either owned and maintained by their local authority, or dependent upon their funding), whilst a significant number of town halls, civic centres and other council-owned public amenities are housed in historic buildings. In recent months, a growing number of councils have announced that they intend to significantly or totally cut their cultural budgets, while others are seeking to offload liabilities by selling off their heritage assets – for example, the Grade II* Red House Museum in Kirklees, which is being sold to pay the council’s debts. Such sales are likely to result in the loss of community amenities if buildings pass into private ownership and are permanently closed to the public. Even in areas where councils are not yet making cuts or divesting themselves of assets, cultural organisations report that the uncertainty is having a paralysing effect, and hindering them from implementing new strategies.

The Heritage Alliance is calling for a stable, long-term funding settlement for local authorities, which includes ringfenced funding for cultural services, to ensure that all councils can invest in cultural infrastructure and the social benefits it provides. Bringing forward the implementation of statutory Historic Environment Records (following their inclusion in the Levelling Up and Regeneration Act) and ringfencing funds for historic environment services in planning departments would further ensure that the historic environment is protected in every locality across the country. Lastly, publicly owned heritage assets of significant community value could be protected by the creation of a Safe Harbour scheme. Councils that need to dispose of assets quickly in insolvency situations are often unable to consider the long-term impacts or opportunities for other community uses – the asset will typically be sold into private use. A Safe Harbour scheme would hold assets for a defined period to enable new sustainable management models to be developed, and to create the opportunity for communities to use the asset for public benefit. 

1. b) What can the Government do to make it easier for communities or local businesses to take ownership of historic buildings?

At a time when local authorities are struggling to maintain support for heritage organisations, it is important to secure a future for pre-existing schemes such as the Community Ownership Fund which have empowered communities to save the assets they value the most. The new Community Right to Buy will help people take on buildings in their local area, but new funding and support needs to sit alongside. Power to Change estimate that a £300m public investment over a decade will leverage £700m in private investment.[5] A presumption towards community purchase and extension of the time community organisations have to gather resources would also make a difference. As above, a Safe Harbour scheme could also save assets at risk of divestment at a lower cost upfront to community groups. Other affordability factors include business rates, which are onerous for social enterprise schemes and local businesses operating in historic buildings. Ratings based on property values currently place a ‘Heritage premium’ on such businesses, discouraging people from taking them on and in addition to the costs they face heating, repairing and maintaining historic buildings. A system based on profit rather than rateable value would more fairly leverage business rates on the businesses with the broadest shoulders. Linked to this is the VAT costs associated with maintaining a historic property for any community groups or businesses that take ownership of them – see our answer to question 4.

2. How effective are the current funding and finance models for built heritage?

Historic England, the Arts Council, the National Lottery Heritage Fund and Local Authorities form the bedrock of the sector. The National Lottery Heritage Fund has awarded over £8.8 billion to over 51,000 projects since 1994.  It has saved thousands of locally and nationally treasured heritage assets from damage or loss, generated jobs and growth, and inspired communities. The 20% share of National Lottery funding for the Heritage Fund must be protected to safeguard heritage assets for future generations – once they are gone, they are gone forever.  Historic England has suffered standstill settlements or cuts over many years. Its assured future, continuing stability and adequate funding is crucial, particularly given the challenges with reductions in finances and capacity at local authority level and increased demands on their services as we move to a new planning system. Focused and effective joint working between arms-length bodies has been a real positive throughout recent challenges, and financial support for continued collaboration would be welcome.

Heritage has always relied on a complex mixture of public, private, and self-generated income streams, and the current economic climate has exposed the vulnerability of many of these funding models. At present, most available funding within the heritage sector is project-based. To apply, heritage organisations typically need to propose a project with a clear beginning, middle, and end – setting out a delivery timetable, measurable outcomes, and a fully-costed budget, which will be monitored through regular progress reports and final evaluations. However, project-based funding is often competitive and labour intensive, and requires specialist fundraising and reporting experience during both the bidding process and the delivery stages. When project funding is the only type of support that organisations can access, they are forced to chase new funding opportunities to sustain themselves from year to year, impacting their long-term resilience. When the individual project concludes, heritage organisations often lose skilled staff, hindering their ability to preserve institutional knowledge and apply it to the next funding cycle. Many heritage organisations, particularly those led by volunteers, face significant skill gaps in areas such as fundraising and commercial operations. This lack of expertise leaves them ill-equipped to navigate the complex funding landscape and secure support.

The ‘projectification’ of arts and culture funding within the UK has been widely noted, and criticised for its short-termism, inflexibility, and precarity. Heritage Alliance members have shared their experiences of project based initiatives where short-term funding models led to the loss of any gains after the project concluded: from costly multi-year restoration projects that are now rapidly deteriorating with nobody on-site with the skills or capacity to maintain the asset; to community focused initiatives where the site may still be open, but the café has closed, the community space is rented out privately, and the site interpreters are now working as event managers to bring in profit for a corporate entity. Our members have also reported that grants are not keeping pace with rising costs and inflation, meaning that their original project budget has become unsustainable. In our recent sector-wide survey, 51% of respondents cited underfunding as an issue. As a result, these organisations are increasingly forced to subsidise underfunded projects with their own reserves or income, placing an additional strain on already-stretched resources and diverting money away from core operations.

Heritage organisations have a pressing need for core funding to cover essential day-to-day repairs and maintenance, and to retain skilled staff who possess the expertise to conserve historic buildings and collections. These activities have high fixed costs, particularly repairs. However, they are also the most difficult area to secure funding for, with the majority of heritage grants being designed for self-contained projects. This means that, for many heritage organisations, their core purpose – safeguarding historic assets – is at risk. In a 2024 UK Heritage Pulse survey, only 42% of respondents agreed with the statement ‘my organisation is currently able to adequately care for its area of heritage/collection’.[6]

There are also some systemic problems with the way that UK heritage funding operates. There is no ongoing funding for sector support organisations in the way that there is for other parts of the culture sector, for instance, as mentioned below, there is no equivalent to the Art Council’s funding for sector support organisations through a ‘portfolio’. This leads to a lack of sector stability and challenges in ongoing support to the breadth of the sector.

The breadth and complexity of heritage in all its forms means that it cuts across numerous government departments and policy areas. DCMS is viewed as the ‘home’ of heritage policy, given its remit over arts, culture, the creative industries, and tourism. However, much of the historic environment falls under DEFRA’s purview, planning is within the remit of MHCLG, and broader heritage considerations span a wide range of departmental portfolios (from transport to education). In some cases, heritage is at risk of losing out on significant pots of money due to these siloes. Environmental Land Management Schemes (ELMs) present a significant opportunity to harness the potential of historic landscapes and features to deliver public goods and protect historic assets not covered by any other funding scheme. However, heritage outcomes are routinely at risk of being deprioritised within ELMs, and their benefits are not well communicated to land managers. Whilst the breadth of heritage means that it plays a role in advancing many different areas of public policy, it can also mean that the sector is sidelined as a peripheral concern within individual departments, creating gaps, inconsistencies, and inefficiencies in funding provision.

On a local level, our local authorities play an important role in providing historic environment services to protect and maintain heritage assets in their area, as well as being custodians for publicly owned heritage assets such as museums, town halls, libraries, guildhalls, and other civic buildings. However, they are undergoing a funding crisis of their own. Since 2021, six local authorities have issued a Section 114 notice. As of February 2024, half of all English local authorities (51%) have warned that they are likely to issue one within the next five years, and 14 councils (9%) have reported that they are likely to do so within the 2024/25 financial year.[7] The Local Government Association has predicted that English local councils will face a funding gap of over £6 billion in the next 2 years.[8] Local authorities have statutory obligations to provide services in certain areas, particularly health and education. This means that non statutory areas (such as cultural services) are often perceived as an easy target for cuts, rather than vehicles for public good and important drivers of wellbeing in their own right. Historic England has found that between 2009/10 and 2021/22, council spending on heritage declined in all areas (archives -38%, heritage -35%, museums -34%, development control -57%, and conservation and listed buildings planning policy -39%).[9] Over the last decade, specialist conservation provision within English local authorities has declined by at least 50%, and at least 6% of local authorities no longer have access to conservation advice in any form.[10]

2.a) What should long-term public funding for the sector look like?

If the heritage sector is to survive and thrive in the long term, it will need more than just short-term fixes and emergency support packages. It will require a fundamental reappraisal of how we value, fund, and sustain our cultural heritage, and a new settlement between the sector, the government, and the public. This settlement must be based on a clear understanding of the challenges (and opportunities) facing the sector, and a shared commitment to investing in its future. It must also recognise the diversity and complexity of the sector, and ensure that heritage sites which have seen little benefit from new funding streams thus far (such as public attractions held in private ownership, or mobile heritage assets) are included in any support measures. Part of the solution to long term financial resilience must be through a more supportive fiscal framework (as set out in our answer to question 5) alongside a reassessment of funding structures.

Heritage organisations have shown remarkable resilience and adaptability in the face of adversity – working hard to improve their financial planning, diversify revenue streams, and think of new ways to engage with visitors. In our 2024 Heritage Debate, the audience of over 300 heritage professionals and stakeholders voted for their ideal funding mix between public, commercial and philanthropic, with commercial income coming out with more than a third of the vote – recognising that our sector doesn’t want to be wholly reliant on grant funding and has done a lot to help its own sustainability. Between 2020 and 2023, Rebuilding Heritage helped 1,290 heritage professionals to learn new operational and business skills to enhance sector resilience. There is still a strong sector-wide appetite for training in core business areas such as digital, marketing, and fundraising – and as our Rebuilding Heritage programme demonstrated by improving confidence levels by 60% on average, targeted training and resources can be hugely impactful.[11] But training programmes like this are also typically project funded and time limited – they need sustained investment to reach the entire sector.

In some areas, recent years have seen unparalleled government investment through the Culture Recovery Fund (CRF), alongside Levelling Up Funds and the Cultural Investment Fund. The CRF in particular – a £1.57 billion funding package for organisations at risk of insolvency – was vital for the survival of many heritage organisations during the pandemic. Amongst our survey respondents, almost nine out of 10 of those who had received CRF funding described it as ‘a lifeline’. This unprecedented investment in our sector yielded impressive results: it prevented over 600 organisations from closing, safeguarded over 20,000 jobs, and every £1 spent led to up to £3.66 in benefits.[12] However, these investments have been undermined by a loss of revenue due to global inflationary pressures and rising costs. Moreover, not all organisations were able to benefit from the CRF, with one in every three applicants being unsuccessful. For many of those that were successful, the positive impacts now risk being undone. As the CRF’s evaluation highlighted, organisations remain concerned about shifts in audience demographics, reduced sales, fewer advance bookings, sector skills gaps, and an overall reduced margin for error.[13]

One potential means of tackling this fragmentation would be to establish a Heritage Investment Fund to give consistent and stable resource to heritage sector-support organisations, akin to that administered by Arts Council England. Their National Portfolio Organisation (NPO) system is delivered through a mix of grant-in-aid and Lottery funding, and currently supports 985 arts and culture organisations. This means that the Arts Council can distribute its funding widely across the diverse and expansive UK arts scene. Whilst Historic England does offer some multi-year funding agreements, it is currently not funded to operate a comprehensive capacity-support model. A similar heritage investment fund system could be one means of facilitating more long-term equitable support for the entire heritage sector in all its diversity – including providing much-needed ‘core’ operational and capacity-building funding in addition to time-limited and targeted project-based funding.

When core funding is secure, heritage organisations are able to better plan for the future: to invest in their staff and assets, respond more effectively to the needs of their communities and audiences, and deliver high-quality programmes and services. In a 2022 UK Heritage Pulse survey, 70% of respondents said that there was a need for greater flexibility within existing project/grant funding, and 62% cited a need for resilience funding to safeguard organisational infrastructure.[14] If a heritage site is unfunded for a period of time, it may not be possible for it to be ‘picked up again’. Even temporary funding gaps risk the permanent loss of historic assets: collections may be sold off; buildings and landscapes will deteriorate; and cultural memories, skills, and practices will be lost. Ultimately, the protracted ‘projectification’ of heritage funding in the UK has left the sector vulnerable to external threats like the current cost of living crisis.

At a local level, stable long-term investment in Local Planning Authorities and Council culture budgets would help to safeguard locally cherished heritage. Ringfenced funding for the maintenance of Historic Environment Records, and for the hiring of archaeology and conservation officers would help to ensure that the historic environment is equally protected in every locality across the country. Having already lost half of their historic environment capacity since 2010 and with spending down 40%, local planning authorities urgently need ringfenced investment and training in these teams to build resilience. Using any increase in planning fees or developer contributions to plug this gap would be a prudent measure at a time when applications for consents are on the rise, and to avoid discouraging development due to an inefficient planning process. Ensuring more stable, long-term funding settlements for local authorities by increasing budget periods to three years would also enable more ambitious, flexible and long-term financial planning. Lastly, only half of local authorities currently have culture strategies, and these are not always easily accessible. Clear strategies could play a greater role in ensuring that heritage and culture are embedded in local service provision and development planning, and that their social benefits are maximised for communities.

3. What role does built heritage play in the regeneration of local areas and in contributing to economic growth and community identity?

Heritage is a vital asset to every community, telling local stories, underpinning regional identities, supporting social cohesion and creating characterful places where people want to live and work. It drives positive social and economic change and is vital to creating distinctive places - the revitalisation of the Piece Hall in Halifax is an excellent example. People treasure their local environment, and the most sustainable building is one that already exists. Alongside building new homes, repairing and reusing existing buildings allows for communities to meet their needs while maintaining that sense of place and supporting net-zero commitments. Historic England estimates that 670,000 new homes could be created by repurposing vacant historic buildings.[15]  

In terms of economic impact, England’s heritage industry produces a total GVA impact of £45 billion and provides over 523,000 jobs.[16] Heritage-related construction activities generate £7.5 billion GVA in England, employing over 100,000 people up and down the country. Heritage is also a significant draw for domestic and international tourists, with major heritage attractions in every region of the UK supporting local visitor economies. Many of our most popular creative exports, from Peaky Blinders to Bridgerton, are grounded in and backed by British history and culture – it draws people to Britain and makes a big contribution to our international appeal. 7/10 of our most popular paid attractions and 100% of the UK’s top 20 free attractions are museums or heritage sites.[17] Heritage is also host to our vibrant creative industries - more creative and cultural activities are hosted in historic buildings than not, from theatres to galleries and design studios. And it makes them more productive – there’s a 5% GVA heritage premium’ for any business hosted in a listed building.[18]

Heritage is an important and popular part of people’s communities - 99% of people in England live within a mile of a listed place, 80% think local heritage makes living in their area better, and 81% say preserving heritage is personally important to them.[19] A national survey of 1,731 adults in England conducted by YouGov on behalf of Historic England shows that 87% agreed that ‘finding new uses for historic buildings is better than demolishing them’[20]. Heritage-led regeneration supports regional growth and strengthens communities by creating pride in place, encouraging pro-social behavior and increasing the safety of an area by 10%.[21]

Heritage engagement can play a key role in tackling ill health by providing more walkable environments, reducing anxiety and stress, and contributing to life satisfaction. Just inhabiting historic places can have a significant impact on our physical and mental health, with new research showing the overall wellbeing value (WELLBY) of everyday heritage encounters is worth £29 billion every year.[22] Additionally, the health benefits of heritage are equivalent to over £1600 NHS spend per citizen each year, or £193 million in total savings.[23]

Targeted place-based investments should continue to support heritage projects supporting culture-led regeneration and pride in place for communities. The Heritage Action Zones programme demonstrated how heritage-led regeneration can revitalise town centres and boost the local economy, and new research shows that historic buildings and districts are a catalyst for creative growth. The sector is already working to further develop the Culture and Heritage Capital approach akin to the natural capital approach to capture the full value of heritage to our society - the Government should champion this approach with HM Treasury and others as essential to future decision making. 

3.a) How can heritage buildings be supported to increase energy efficiency and contribute to the Government’s net zero targets?

Improving the energy and carbon efficiency of historic buildings and/or buildings of traditional construction and protecting their unique qualities are compatible goals. We support the development of improved regulations and standards for historic buildings and/or buildings of traditional construction, to ensure that appropriate energy efficiency improvements are made to all buildings, whilst ensuring that they are also resilient to climate change hazards such as flooding and overheating. We support the aim of historic buildings EPCs and ideally the eventual ability to remove associated exemptions. However, EPCs in their current form might recommend measures that are inappropriate for historic buildings and/or buildings of traditional construction, which risk causing detrimental impacts on significance and historic fabric and may negatively impact occupants’ health and building performance.

Part of the solution must also be investment in a National Retrofit Strategy to ensure the UK’s 6 million traditional homes, the oldest stock in Europe, make their contribution to decarbonising the built environment. A one-size-fits all approach will not work for our historic building stock, so this should include a pathway to double the number of specialist retrofit contractors, introduce whole-life carbon assessments of household energy emissions, targeted incentives to decarbonise historic buildings, and a one-stop-shop advisory service for the custodians of traditional buildings.

Reaching net zero is not just about improving energy efficiency, but about long-term sustainability and decarbonising our built environment. To achieve this we need to move to a circular approach which better acknowledges embodied carbon and does not treat buildings as disposable. As noted by the Environmental Audit Committee, the current tax regime incentivises demolition and rebuild over repair and reuse, contributing to the 126 million tonnes of waste produced by construction demolitions each year (RIBA). To encourage circular economy approaches and reduce waste, we support their recommendation to remove the Permitted Development Right (PDR) for demolition, and review the significant expansion of PDRs in general over the last 10 years which has facilitated poor quality and inefficient construction. We also encourage the government to explore how Listed Building Consent Orders (LBCOs) could be used to enable common and effective retrofit adaptations to historic buildings. There is an affirmative resolution order already drafted for the management of the assets of the Canal and River Trust. This has been awaiting parliamentary time for years. Implemented this first Order and then looking at how the principles could be applied elsewhere would be a positive step.

The measure that would have the greatest overall impact is VAT reform, also recommended by the EAC. At present 20% VAT applies to repair, maintenance and retrofit work to historic buildings, yet no VAT at all is charged on demolition and rebuild. This creates a perverse incentive for waste over reuse and contradicts the government’s aim to move to a low-waste circular economy. A VAT equalisation would also encourage homeowners to carry out repair and retrofit at a more affordable cost, stimulate local supply chains, create demand for green skills and jobs and help us reach our legally binding net zero targets.  A time-limited scheme could initially test and demonstrate the benefits of VAT equalisation and explore different mechanisms to deliver it, such as a tax credit or grant scheme. This could be delivered in targeted regeneration or growth areas or for historic buildings open to the public, and would be a natural extension of existing VAT relief schemes to incentivise energy saving measures.

The Listed Places of Worship grant scheme has shown how this model can work successfully, enabling thousands of historic religious buildings to carry out more affordable repairs each year by reclaiming VAT. The National Churches Trust has found that activities in church buildings, many of which are historic, have a yearly social value of £55 billion.  We now ask the Government to continue this effective scheme until 2030 to allow these special community buildings to plan for their future and to keep the refund cap per building, just brought in, under review to ensure that important larger projects are not jeopardised. 

4. What are the financial, regulatory and practical barriers to preserving built heritage?

4.a) What policy changes are needed to make restoring historic buildings easier and less expensive?

Financial

Financial barriers include the rising operational costs set out in answer to question one, which include the growing repair backlogs that extend into the billions. The true scale of need is not yet fully understood, though the previous government commissioned an independent research report to quantify the cost of cultural infrastructure backlogs. The findings of this report must be published as a matter of public interest. Beyond this, the costs of repairing, retrofitting and conserving built heritage are raised due to the VAT regime which incentivises demolition and new build over a less wasteful approach to our built environment. Equalising the disparity in VAT rates (currently 20% on repair and 0% on demolition/new build) would make repairs and reuse of historic buildings more affordable and align with the government’s circular economy goals. In the first instance, we call for with a time-limited pilot grant scheme for listed buildings open to the public – our member, Historic Houses, have recently published a report which sets out the economic modelling behind this proposal and explores how this could work in practice.

Regulatory

Heritage protection systems are not a constraint, but an enabler for responsible and characterful growth in the right places. Whilst there can be challenges, the listing and heritage protection system itself is not a barrier to good preservation, and it provides reasonable checks and balances to prevent damage. Listed Building Consent is free to obtain, and Historic England provides a wealth of professional advice to both Local Authorities and to owners and occupiers. However, due to long-term planning team capacity issues the process of obtaining consent can be slow and in some cases result in unsatisfactory outcomes. The planning system has experienced a period of instability and change since 2020, with successive consultations and amendments putting Local Planning Authorities in an insecure and uncertain position. Certain provisions of the Levelling Up Act, which were welcomed by the sector, are still unenacted. These include a government response to the consultation on removing demolition permitted development rights and the implementation of statutory Historic Environment Records. Planning authorities and statutory consultees have both seen their funding decline during this time, and they now need investment in resource and capacity to regain confidence, respond to these changes and be better equipped to deliver future infrastructure and development needs. We have outlined more on the under-resourcing issues in our answer to question 2. Other than by addressing capacity gaps in conservation teams, there are sector-supported mechanisms to improve the way the heritage protection system operates. These include the already mentioned removal of permitted development rights for demolition and bringing forward the Canal & River Trust’s Listed Building Consent Order as a model and test case for national Listed Building Consent Orders. These could be used to facilitate common and effective measures to reduce the carbon impact of the historic environment while reducing the caseload on local authorities and speeding up consents for such works. Lastly, the National Planning Policy Framework should support the exploration of renovating and retrofitting buildings first before considering their demolition, using appropriate data and assessment tools. This could be achieved through a prior approval mechanism.

Practical

Historic buildings require specialist skills, guidance, and materials to support appropriate retrofitting. However, the construction sector is currently facing a significant backlog of essential works, shortages in materials and labour (exacerbated by Brexit and the subsequent pandemic), and gaps in key conservation and green skills (see our response to question 5). All these challenges are likely to worsen as demand grows and the backlog worsens. As was stated in the recent Heritage and Carbon report, ‘the twin objectives of protecting the unique qualities of historic buildings and improving their energy and carbon performance are both compatible and achievable’ – but committed and coordinated action (such as a National Retrofit Strategy) is needed to address the practical barriers to decarbonisation. Additionally, although capital funding injections (like the Levelling Up Fund) have also provided much-needed investment, they contribute to inflated costs by driving up demand for labour and materials. By contrast, a steady, sustained stream of capital funding for heritage infrastructure over a longer period would help to balance demand and supply dynamics and reduce inflationary pressures. In addition to these challenges and linked to the under-resourcing outlined in question 2, most planning determinations for heritage properties are now made beyond the statutory deadline, heritage statements are a poorly understood and implemented part of the planning system, and there is considerable inconsistency between the performance of different planning authorities.[24] Longer-term, ringfenced settlements for local planning teams would go some way to addressing these time pressures and performance issues, as would new efficiency measures such as LBCOs outlined above.

5. What policies would ensure the UK workforce has the right skills to maintain our heritage assets?

Several issues currently face the existing heritage workforce, from lack of access to training and apprenticeships to a loss of specialist skills. The average age of the workforce within the heritage construction sector poses a threat to the long-term sustainability of these skills - a substantial minority of the current workforce, some 14%, are aged above 55 – many of whom will retire within the next ten years. By 2034, 42% of employees currently working on pre-1919 buildings will be aged over 55. By contrast, only 28% of the current workforce are in the earlier stages of their career – aged below 35 – and only 10% are aged between 16 and 24.[25] 

This is partially caused by a general lack of apprentice and trainee opportunities within the sector. Apprenticeships in specialised skills, for example those necessary for heritage retrofitting, are scarce – widening the disparity between the demographic of this sector and other areas of employment. For small and micro businesses, and for freelance craftspeople who represent many of the specialist heritage construction skills, apprenticeships remain inflexible and inaccessible. Without clear signs of demand, educational and training institutions will not tend to fund new courses for risk of the cost. Only a small portion of contractors take on apprentices, and almost all cases are found within mainstream construction trades such as brickwork and plastering. As the Historic Environment Forum’s Skills Needs Analysis articulates, ‘The result is a vicious cycle in which lack of provision and promotion leads to a decline in awareness of the potential for heritage-related construction careers, which in turn reduces direct demand for such courses.’.

A suitable solution to tackle the issue could be found in further reforms to apprenticeship programmes to make the process of apprentice recruitment easier for the sector – particularly for freelancers and smaller businesses. These include greater support for sharing apprenticeships between multiple organisations, as well as an introduction of a cross-subsidy mechanism to help fund apprenticeships within smaller organisations. We also recommend that the new Growth and Skills Levy allocates unspent funds   in a targeted manner to address skills gaps (e.g. in conservation and heritage crafts).

Current evidence also points towards an urgent need for an expansion to the workforce to properly address the retrofit backlog for historic buildings – it is estimated it would require at least 205,000 workers to achieve our net zero by 2050 targets (double the current number).[26] The government has identified heritage retrofit as a skills development priority in the recently published Skills England report of September 2024, but further action must be taken to deliver the training and upskilling needed to meet the challenge. As outlined in our answer to question 3, a targeted intervention could be delivered through a National Retrofit Strategy involving a skills delivery plan alongside specialist advice services.

With the advent of major planned heritage construction projects such as The Houses of Parliament Restoration and Renewal (R&R) Programme, a significant increase in demand for traditional building crafts is inevitable. While such projects will creating a substantial number of new jobs and apprenticeships, the necessary training to expand the relevant specialised skills must be set in place now, to avoid these larger projects effectively bringing other smaller projects to a halt. 

For further information please contact:

Lydia Gibson

Head of Policy and Communications