It took the preventable tragedy of Grenfell Tower to get the government to own up to the reality that the housing market is broken.
Grenfell rightly forced us all to recognise the enormous injustice in what we have come to regard as acceptable in terms of quality and even safety for the ‘have-nots’ as opposed to the ‘haves’ in modern Britain. That must change.
But we need wide-reaching changes if we are to make a real difference because national housing is leaving too many people behind and will worsen without a radical rethink.
Over the years of this government, housebuilding has dropped to an average of 127,000 new homes per annum; the lowest for any government since the 1930s. Ministers boast it reached 141,000 in 2016, whilst accepting we need some 250,000 new homes each year. Even these figures disguise what is happening; new homes for so-called affordable rent (80% of market rents) fell from 56,000 to 28,000 a year and new starts for social rent (up to 50% cheaper than the market rent) from 36,000 to a staggering low of 1,000 a year.
The results have been dramatic. There has been a collapse in young people owning their own homes (60% of 25-34 year olds in 2001 to just over 40% in 2015) and this is worse in rural areas. More and more young people now live with their parents (one in four of 20-34 year olds). There has been a massive growth in multi-family homes to 289,000 households. Overcrowding is endemic.
Each of these statistics tells countless individual and family stories of people let down by our national housing failure.
The overwhelming majority (85%) of housing spending has shifted from building new homes to providing housing benefit. The bulk of that goes to working families in private rented accommodation; money which is lost. Housing associations recycle surplus monies into new housebuilding but private landlords rarely do.
But this weak government knows it is vulnerable on housing and has recently announced three changes that we should welcome as a prelude to more fundamental change. Theresa May announced a further £2bn a year for new housing. That’s clearly welcome but not enough; government spending on new build has collapsed from over £11bn to a little over £5bn today.
The government announced it has u-turned on its destructive plan to slash support for supported housing, but with no clear announcement about its long-term funding.
Ministers also announced that housing association rents can return to an inflation-plus level from 2020 (CPI+1%) which will allow them to put money back into new building. The rent freeze probably took over £6bn from housing associations and cost some 27,000 new homes.
But we need the chancellor and the Prime Minister to agree the Budget this year will be a break from the past. Housing has got to be centre-stage.
We can argue about the exact numbers but we need the chancellor to embrace a 20-year vision for house building at levels of at least 250,000 new home each year. Within that figure, if we are to house those who do not choose or are priced out of owner occupation, we must be building an average of 100,000 homes for affordable purchase and rent. The chancellor must make it clear that both housing associations and councils will be part of the partnership necessary to solve our housing crisis.
With an ageing construction labour force and Brexit, we face the possibility of losing a significant proportion of our skilled people. The chancellor must recognise the need for significant investment in the construction skills training, as well as in the professional skills needed in councils’ planning and building control departments if we are to avoid the lax quality standards that led to Grenfell.
We need certainty over land supply for housing and the chancellor can announce measures to help councils to set up land banks, including an investment package to allow brown field sites to be ready for housing
We need the chancellor to underwrite the long-term sustainability of rents for council and housing assocations so they can plan with certainty as to their role in bringing forward new homes and the same for supported housing.
The housing crisis has shot up the list of political priorities and we look to the chancellor to be a part of building a long-term plan that offers hope to this generation, which has been let down, and the coming generation which simply must see better.
Tony Lloyd (Lab), shadow housing minister