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Larry Whitty on how best to tackle the UK’s longstanding housing crisis

This year marks the Centenary of the Addison Act, which first gave general powers for local authorities to build and manage council housing. Until then, such provision came mainly via the great Victorian philanthropists and a few pioneering councils. With over 60% of the population living in insecure private rented dwellings – often squalid, frequently multiple occupation and generally exploitative – something had to give.

With the mass building of council housing from the late 1920s to the 1960s, secure accommodation at reasonable rents became the norm for households from all walks of life. Together, they formed settled communities in which millions of children grew up and millions of pensioners grew old. Generally, such housing was built to high standards – and by 2009, 86% of social homes were of a decent standard.

Despite all of this, Conservative governments since the 1980s have variously disparaged, curtailed and attacked social housing. The Thatcher Government’s ‘Right to Buy’ policy saw the loss of three million council houses – without the proceeds being used for replacement homes. Stock transfers and the allocation of management to arms-length management organisations removed councils from their housing management role. Building of social homes has fallen dramatically.

The combination meanwhile, of expensive land, a building sector made up mostly of mega developers, and government support for home ownership – admirable in itself but misguided in its effects – have led to escalating house prices and exorbitant private rents. Most of our country has no or little council housing available, or hopelessly lengthening waiting lists.

In recent years, the growth of home ownership has come to a juddering halt and then reversed dramatically. Renting privately often means unaffordable housing costs. Even within the social sector, there is insistence on ‘affordable rent’ up to 80% of the market rate. Both private and social tenants are increasingly dependent on housing benefit – now paid through Universal Credit – even when the household includes one or more adults earning a reasonable wage.

Alongside all of this, state support for housing has shifted dramatically over the past three decades. Instead of investing in building for the future, the government has an escalating benefit bill (much of which goes to private landlords) and there are housing shortages in town and countryside alike. At the end of this line is the tragically burgeoning numbers of homeless people on our streets, which has more than doubled since 2010.

Some in government have recognised the dysfunction in the housing market, and the need to provide hundreds of thousands of new homes each year. Yet Ministers still fail to accept that this, as ever, requires a very substantial contribution from council housing.

The Treasury for example, must drop its longstanding prejudices – most obviously, by ending the absurd restriction on councils ability to borrow for housebuilding. (Something the Chancellor finally recognised in the Autumn Budget). But also by reversing the squeeze on local authority funding in parallel with reduced housing stock.

The latter has left councils beret of expertise on architecture and planning. Something that has resulted in increased outsourcing, and often cosy relationships with developers who resist anything more than minimal targets for social housing in new developments and regeneration projects. A debilitating dependency that inhibits rather than enhances a return to council house building.

Labour is committed to a major council house-building programme, as well as giving local authorities and housing associations new funding, powers and flexibilities to build again at scale. Shelter has also called for a long term strategy to re-enable councils to build again; as have most social and housing commentators. More surprisingly, the Conservative-leaning Centre for Social Justice has come to very similar conclusions – something that I hope encourages the government to take real action with a lasting impact.

Lord Larry Whitty is a Labour Peer and a former Defra Minister

Published 29th January 2019

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