If the government wants to help the 'left behind' then housing is the place to start
The first stirrings of a new Tory housing policy can be felt ahead of the Conservative Party conference in Birmingham this week.
Housing minister Gavin Barwell has indicated that a greater balance between affordable renting and home ownership is on the cards within an overall push to boost the total number of homes built by 2020. Barwell reiterated his stance at yesterday’s conference fringe run by progressive Tory think-tank Bright Blue and save social housing campaign group SHOUT.
Chancellor Philip Hammond also signalled a departure from the Cameron-Osborne obsession with home ownership was also signalled when he consigned the former chancellor’s flagship housing policy of ‘Help to Buy’ – a costly experiment that failed to increase the rate of house-building – to the dustbin of history.
The emergence of a more balanced housing policy was also underscored by James Cartlidge, Conservative MP for South Suffolk and chair of the All Party Parliamentary Group (APPG) on housing and planning, in a Guardian article last Friday:
“What is a one nation housing policy? In my view, it must be one that includes not just those who own a home or aspire to do so, but those who currently rent and are likely to continue to do so for many years to come, including measures to give greater security to existing tenants and more flexibility to the mix of new housing tenures. A housing policy that ‘works for everyone’ cannot be one that excludes a vast tract of the country’s residents.”
This echoes themes sketched out in speeches by prime minister Theresa May since her ascension to the Tory throne in June. Emphasis on policies that seek to improve the lives and life chances of the ‘left behind’ and ‘the struggling to stay afloat’ – possibly with a view to recapturing the votes of former blue-collar Tories who moved into the UKIP camp because of Brexit – is increasing; at least rhetorically.
A further sign is some softening of so-called welfare reform, as evidenced by the decision to scrap retesting for chronically ill sickness benefit claimants by the Department of Work and Pensions. This follows apparent Tory abandonment of austerity as a singular economic plan. Securing a surplus on the national accounts by 2020 is no longer a priority it seems.
But the acid test of a changed and more pragmatic approach to Tory housing policy will be enabling significantly more social housing to be built. Housing history suggests that building the 250,000 homes needed every year for the foreseeable future cannot be achieved without local councils and housing associations building far more homes than they have been allowed to in recent years. Barwell accepts that the market on its own cannot solve the UK’s deep housing crisis.
And building more social homes represents greater value for money to taxpayers. It is a pragmatic way to save money on the housing benefit bill, because of lower rents in the social sector than for private renting, while stimulating the economy.
A report commissioned by SHOUT, reveals that government could generate savings of up to £319bn over a 50 year period if it helped pay towards 100,000 new social rented homes a year – a total of five million new affordable homes. This level of savings is equivalent to one sixth of national debt or three years funding for the NHS.
The authors of the report – think-tank Capital Economics – support the VFM case for building social homes, since, unlike other types of infrastructure investment, social house-building begins to pay for itself right away through rent payments from tenants.
Such state investment in social housing would not only counter a possible post-Brexit economic slowdown, while providing much-needed affordable rented housing, but burnish the ‘one nation’ bona fides of the government.
Kevin Gulliver is Director of Birmingham-based research charity the Human City Institute, writing in a personal capacity. Follow him on Twitter @kevingulliver
See also: Our prime ministers aren’t building houses – that’s why there’s a crisis
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3 Responses to “Are the Tories starting to see sense on housing?”
Craig Mackay
It is encouraging that the government are beginning to realise that more houses must be built. What they do not seem to understand is that the rate of new housebuilding that they are proposing is at least a factor of 10 smaller than we need. The nation needs to target something like 400,000 new houses total per annum. We are currently building about 125,000. Undoubtedly there are substantial challenges in achieving the numbers we need to start to catch up with so many years of missed targets. A detailed look at some interesting and more radical solutions can be found at: http://tinyurl.com/j5xwsov.
benjamin weenen
The UK has plenty of existing housing. We don’t need to build any more. Land has no cost of production, so if housing is unaffordable for some parts of our society, then it must be “more affordable” for another in an equal and opposite way.
This is why affordability issues and excessive inequality are two sides of the same coin.
A 100% Land Value Tax would drop the selling price of UK homes to their capital only value. Saving future purchasers over £35bn a year in mortgage repayments.
By leveling the playing field for all participants it would allow the market to allocate land at optimal efficiency, reducing vacancies and under occupation.
Most importantly, because land by value is more concentrated than income or capital, a 100% Land Tax would reduce individual and regional inequality, increasing the discretionary incomes for the majority of UK households, and shifting demand away from London/SE to where capacity and the potential for growth is highest.
Negating the need to wastefully build the extra new homes a functional market would deem unnecessary.
Its a shame the Left keeps on swallowing economic ideology used by the Right as a smokescreen to hide the real issues.
Martyn
If the Tories are really concerned to do anything of substance on poverty and/or social housing then they will junk the Housing Bill/Act. So far there is no sign that this is the case.