The Federation of Master Builders (FMB) has welcomed plans by Chancellor Philip Hammond to commit £2.3 billion for a Housing Infrastructure Fund.

In his Autumn Statement, the Chancellor outlined plans to spend £1.4bn on building 40,000 affordable homes as well as investing £1.3bn to upgrade roads.

Sarah McMonagle, Director of External Affairs at the FMB, said the Housing Infrastructure Fund "could go some way" to solving the housing crisis.

"The Chancellor's commitment to double annual capital spending on housing by 2020 demonstrates that he understands that house building and economic growth are intrinsically linked," she said.

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"For every £1 invested in construction, £2.84 is generated in the wider economy and therefore the best way to protect ourselves from an economic wobble as we leave the EU is to invest in our built environment. For that reason, the £1.4 billion announced for 40,000 affordable homes is welcome, as is the £1.3 billion for roads – the latter will help improve the UK's infrastructure and make our economy more competitive."

However, Ms McMonagle added the funding of local infrastructure for new homes "should not fall entirely on private house builders".

"As council budgets have been stripped back, local authorities have increasingly looked to developers, including even the very smallest developers, to plug these funding gaps," she said.

"Heavy demands for Section 106 and Community Infrastructure Levy can make many small developments unviable. Key to the Fund's success will be to ensure that it focuses on unlocking large numbers of small sites and not just small numbers of large sites. The Chancellor wants a 'housing market that works for everyone' and central to this is empowering small local house builders."

(LM)