The Budget does absolutely nothing to tackle the housing crisis

This government's few plans for housing are couched in the rhetoric of cost-cutting, rather than tackling the social determinants of poor health and growing inequality

 

When chancellor George Osborne sat down yesterday after delivering his last budget before the general election, the UK’s growing housing crisis remained largely unacknowledged and certainly un-tackled. This was underscored in Ed Miliband’s spirited response and it may have dawned, finally, on Labour, that commitments to invest in affordable housing, as advocated by the save social housing group SHOUT, by lifting council borrowing caps, could be a vote winner.

The majority of those who took part in the Homes for Britain rally in Westminster the day before the Budget were dismayed at the total lack of any attempt by the government to boost affordable housing supply.

The Homes for Britain campaign, which is calling on all political parties to commit to end the housing crisis within a generation and to publish a detailed plan for doing so within a year of taking office, has achieved remarkable agreement across much of the political spectrum that significantly higher investment in bricks and mortar is needed from the public purse.

Speaking at the rally were Ken Loach, director of the 1960s ‘Cathy Come Home’ documentary, which ushered in housing campaigning organisations such as Shelter, and the Guardian’s Owen Jones, who found common ground with right-leaning commentators like the Telegraph’s Tim Montgomerie. Even Nigel Farage, who was controversially asked to speak at the rally, paid lip service to the need for more housing building rather than current policies that drive up house prices and private sector rents.

Instead, the chancellor made very few new housing spending commitments(£) with the exception of an announcement to introduce a ‘Help to Buy ISA’ to enable first-time buyers to top up their savings for a housing deposit by a £3,000 maximum.

The National Housing Federation calculates that for the £2.1bn cost of this vanity policy, housing associations could build 69,000 affordable homes to meet escalating need expressed by the 210,000 new households being formed each and every year.

The short-termism of housing policy-making was underscored by NHF chief executive David Orr:

“Our politicians talk about the housing crisis. However, for decades they have only offered short-term measures. For example, over the last five years, the government has made more than 500 announcements which include housing, with more than 200 different housing initiatives. We don’t need any more initiatives. We need a long-term strategy and a political commitment to make it happen.”

The government’s only major housing supply announcement was made by the prime minister ahead of the budget with a vague pledge to provide 200,000 new homes for first-time buyers at 20 per cent below market values. This subsidy will be paid for by removing the obligation on house builders to provide a proportion social housing in new developments through so-called section 106 agreements.

Osborne announced that new housing zones outside London would be confirmed and a ‘feasibility study’ for expanding direct commission of homes on a large-scale. Further devolution of planning powers to the mayor of London are also being considered. Bizarrely, the government will consider ways to increase long-term investment in private rented housing for homeless families but not in social housing provided by local councils and housing, while thousands are stranded in expensive but low quality B&B accommodation.

The government will examine whether improving housing quality, which has a direct impact on health, can reduce costs to the National Health Service. However, again this announcement was couched in the rhetoric of cost-cutting rather than improving the health of the nation and tackling the social determinants of poor health and growing health inequalities

Some £30bn of further cuts in public services were trailed in the Budget, with around £10bn marked for welfare. This will adversely affect many living in social housing who have already shouldered more than their fair share of welfare cuts since 2010, including the discredited bedroom tax.

Most worryingly, these massive cuts seem to be pencilled-in for the first two years of a future Conservative-led government. Let’s hope that after 7 May people on low incomes and benefits do not have to absorb yet another blow to already stretched household budgets and declining living standards.

Kevin Gulliver is director of Birmingham-based research charity the Human City Institute and chair of the Centre for Community Research. He writes in a personal capacity on social and economic policy

One Response to “The Budget does absolutely nothing to tackle the housing crisis”

  1. Leon Wolfeson

    Well of course not.

    And I fully expect the Tories to slash housing benefit for their savings. Labour too since they’re following the same “logic”. UC makes it even easier, of course.

    (And hey, at least those in social housing have to deal with far lower rents in the first place!)

    “This subsidy will be paid for by removing the obligation on house
    builders to provide a proportion social housing in new developments”

    Sigh.

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