In April's Budget, chancellor Gordon Brown commissioned Kate Barker, a member of the Bank of England monetary policy committee, to review issues affecting housing supply. Housebuilders are preparing their submissions to the review, which will report in the autumn. They will warn that even if planning constraints were lifted the government would still miss its targets by at least 10% because of the shortage of labour.
Many bricklayers, for example, earn more than £52,000 a year.
The chief executive of a major construction group said the government had failed to tackle the labour problem. 'Builders can now command far higher wages and dictate the terms to the construction companies. If they feel like taking a long weekend off to play golf in Spain even if they are supposed to be working on site, they do.'
The labour shortage is the latest challeng facing deputy prime minister John Prescott's plans to build an extra 200,000 homes on top of 900,000 homes already planned for the south east. In April, a commons select committee report said the funding available was 'clearly inadequate.' They calculated it would cost close to £20bn to build the new homes and the infrastructure [including schools, roads and drainage] to support them.
Housebuilders will also tell the Barker review that planning restrictions by local authorities are continuing to act as a block on new housing developments, particularly of affordable housing. Council planning departments are understaffed, obstructing planning applications - which they are under no obligation to approve.