No surprises from Labour

If you’re looking for anything new on housing in the Labour manifesto you’re going to have to search very hard for it.

The party’s priorities were clearly elsewhere in the document launched this morning and the housing sections are largely rehashes of Labour’s response to the Lyons Review and of previous statements on social security.

Housing gets a mention in the introduction but only in relation to housebuilding and home ownership:

‘We are not building the homes we need. Our sons and daughters have been shut out of the housing market and too often they are forced to leave the communities where they were brought up.’

The chapter on families and communities includes a section on ‘building new homes’ that sets a broader context:

‘Britain is in the midst of the biggest housing crisis in a generation, with the lowest levels of house building in peacetime since the 1920s. Young people have been priced out of home ownership. Fewer affordable homes are being built, homelessness is rising, and millions face insecurity and poor standards in the private rented sector.’

The most intriguing specific pledge is that: ‘We will build more affordable homes by prioritising capital investment for housing and by reforming the council house financing system.’

The first bit repeats previous assurances that housing will be ‘a priority’ for extra investment without repeating previous statements that this means ‘social and affordable’ housing. In addition, it does not sound as strong as Miliband’s statement in his 2014 conference speech that: ‘We will also make housing the top priority for additional capital investment in the next parliament.’

The second is more interesting: Labour ruled out changing the public borrowing rules or increasing the borrowing caps ahead of the Lyons Review but Lyons did talk about ‘active management of the overall council housing borrowing headroom by the Treasury’. Does ‘reforming the council house finance system’ hint at something more?

There is also a reference to ‘getting the public sector building again’ but nothing as specific as the 2010 manifesto pledge of 10,000 new council homes a year.

The other manifesto pledges are familiar ones:

  • ‘We will make sure that at least 200,000 homes a year get built by 2020 – almost double the current level – by implementing the recommendations of the Lyons Review.‘
  • New powers for local communities to provide the homes they need in places they want to live and for local authorities to give first-time buyers first call on new homes in areas of local growth
  • A Future Homes Fund to reinvest billions invested in Help to Buy ISAs in increasing housing supply
  • Greater transparency in the land market with ‘use it or lose it’ powers for local authorities to encourage developers to build
  • We will increase competition in the housebuilding industry by backing small builders, including through our Help to Build scheme, and by getting the public sector building again.
  • New powers for local authorities to reduce the number of empty homes, including higher council tax on long term empties
  • Starting to build a new generation of garden cities
  • Legislation to make three-year tenancies the norm in the private rented sector with a ceiling on excessive rent rises, plus a ban on letting agent fees and a national register of private landlords
  • A commitment to reversing increases in homelessness and rough sleeping.

At the manifesto launch, Miliband was asked whether he would match the Tory commitment to protect the green belt and said there would be a return to the previous policy of ‘brownfield first’.

The section that follows on social security includes the new pledge not to cut tax credits and also includes previous commitments on housing benefit and starting a shift back from benefits to bricks:

‘To get the benefits bill under control, we need to tackle the root causes of rising spending, by making work pay and building more homes. We will allow local authorities that negotiate rent reductions on behalf of tenants who are claiming housing benefit, to retain some of the savings, on the condition that the money is invested in building homes.’

Labour has said this before – but note that ‘retain some of the savings’.

Labour will ‘keep the household benefit cap’ but does not specify at what level. It will ‘ask the Social Security Advisory Committee if it should be lower in some areas’ (something the SSAC seems unlikely to recommend) but does not mention any consideration of whether it should be higher in others.

The manifesto ‘supports the principle behind universal credit – that there should be a smooth transition into work – but it must be affordable and fit for purpose, so we will pause and review the programme’.

Labour will also ‘replace out of work benefits for 18 to 21-year-olds with a new Youth Allowance dependent on recipients being in training and targeted at those who need it most’. That could raise big questions about the party’s commitment to reverse increases in homelessness and rough sleeping (something I’ve not seen it stress so strongly before). Crisis has already warned that this ‘could condemn more young people to life on the streets’.

On the bedroom tax, Labour simply promises: ‘It is cruel, and we will abolish it.’

For England, Labour pledges ‘the biggest devolution of power to our English city and county regions in a hundred years with an English Devolution Act. It will transfer £30 billion of funding to city and county regions, along with new powers over economic development, skills, employment, housing, and business support.’

Overall, this is a manifesto that tells us little new about housing under a Labour government. That’s not so surprising since the Lyons Review set out a comprehensive plan of how to get to 200,000 homes last year and the party had already made its main policy announcements. It’s also worth noting that housing is not alone: there were few new policies of any kind in the manifesto as the emphasis was on how Labour will pay for the ones it has already announced.

The big unanswered question still concerns what Labour’s fiscal rules will mean in practice. Eliminating the current Budget surplus by 2020 might or might not mean more austerity. However, that formula leaves the door open for borrowing for investment, which would include ‘prioritising’ capital investment in housing. Investment in new social rented homes would also help to reduce the current surplus target by cutting spending on housing benefit.

For the moment though Labour seems to prefer the more complicated (and expensive) policy of spending £2.2 billion on Help to Buy ISAs and then directing the banks to lend out the proceeds.

And it has left the door open for other parties to trump Labour on housing with some new ideas of their own.

Originally posted on Inside Edge 2, my blog for Inside Housing


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