Originally written as a column for Inside Housing.
‘Everything starts with a good home and this country finally has to put that at the top of its priority list.’
Housing has rarely been as central to the vision of a prospective prime minister as it was in the speech by Andy Burnham on Monday.
The speech was billed in advance as being all about devolution and how the success of the model inherited and further developed by Mr Burnham as mayor of Greater Manchester can be spread across the country.
And there was plenty of that as he promised ‘the biggest rebalancing of power our country has seen’ driven by a new No10 North based in Manchester.
But what really struck me was how fundamental housing is to that wider vision: ‘If you don’t give people a good home then what chance of having a good life?’ was his rhetorical question.
The new MP for Makerfield has often taken positions on things like public control of essential services, council housing, high private rents and Local Housing Allowance that are to the left of the current government.
The question is whether those policies would really be priorities for Mr Burnham as a prime minister with a million and one other things to think about: not just devolution but the NHS, defence, education, immigration that usually dominate the political agenda.
For all his emphasis on devolution and building things from below, powerful backing from the top will be required to deliver change in housing against entrenched interests elsewhere in government.
Mr Burnham’s ‘10-year mission to raise people’s living standards’ sounds similar to Keir Starmer’s Plan for Change and ‘decade of national renewal’ at first glance.
But where the current prime minister’s missions had little to say about housing, his successor puts homes front and centre in what he’s saying about ‘greater public control of essential services like water, housing, energy and transport’.
In this story the loss of 1.5 million council homes since the 1980s has led directly to a ‘housing trap’ in which the benefits system chases higher private rents, governments try to control costs via freezes in Local Housing Allowance and the costs fall on local councils paying for temporary accommodation with a ‘ruinous’ impact on the public finances.
There can be no solutions to child poverty that do not address the high cost of housing.
Take even a cursory glance at the government’s child poverty strategy published on Friday and you cannot avoid the direct links between deprivation in childhood and homelessness, a severe shortage of social housing and unaffordable private rents.
The strategy builds on the abolition of the two-child limit in the Budget, which accounts for 450,000 of the 550,000 reduction in the number of children in poverty forecast by the end of this parliament.
Even taken on its own, this is a major change, perhaps the single most progressive thing that the Labour government has done since it took power.
But as in the Budget you will search in vain for two other policies that will blunt its impact.
Originally written as a column for Inside Housing.
Even if it had not been leaked in advance, this Budget could have been defined as much by what was not in it as what was.
The astonishing mistake made by the Office for Budget Responsibility (OBR) in uploading a report containing all the key measures before chancellor Rachel Reeves had started speaking came after weeks of well-sourced stories about them.
We already knew the headline measures: the abolition of the two-child limit; a council tax surcharge on high-value homes; and freezing income tax thresholds.
They were joined on the day by a private landlord tax (higher rates of income tax on income from property), confirmation of more money for the Warm Homes Plan and a welcome move to tackle the ‘benefit trap’ facing tenants in supported and temporary accommodation.
But the Budget delayed one of the decisions most eagerly awaited by social landlords: they will now have to wait until January for the government’s final decision on rent convergence, in effect how quickly they can increase their lowest rents above the CPI plus 1 per cent limit.
Three months on from the consultation closing, the Budget background document explains that: ‘While the government remains committed to implementing social rent convergence, it is important to take the time to get the precise details right, taking account of the benefits to the supply and quality of social and affordable housing, the impact on rent payers and affordability.’
And there was no mention at all of the Local Housing Allowance (LHA) freeze, perhaps the housing issue raised by more organisations than anything else in the run-up to the Budget.
Originally written as a column for Inside Housing.
With a week to go until the most consequential spending review for ten years, the Treasury is facing desperate last-ditch lobbying from departments that have yet to agree their settlement.
Last week’s public intervention by chief constables warning that the government will fail to meet its pledges on crime unless they get more cash is sign enough of that.
So too the leaked memo from deputy prime minister Angela Rayner setting out options for higher taxes that was inevitably followed by more leaks about her spending priorities.
As of this week, the Ministry for Housing, Communities and Local Government (MHCLG) was said to be one of the departments yet to agree a settlement, alongside the Home Office, with the Department for Energy Security and Net Zero just finalising one..
By contrast with previous spending reviews, housing starts with the advantage of having a politically powerful secretary of state in charge – and Angela Rayner has repeatedly promised ‘the biggest boost to social and affordable housing in a generation’.
Originally written as a column for Inside Housing.
A final verdict will have to wait for the spending review in the Spring but how should we assess the first Labour Budget for 14 years?
The answer of course depends on what you take as your starting point. Compared with the disastrous first Conservative Budget in 2010 or even the first Labour one in 1997, this one takes some definite steps in the right direction.
But does this Budget live up to Labour rhetoric about greater investment and long-term solutions. To what extent will it really ‘fix the foundations’ and deliver ‘the biggest boost to affordable and social housing for a generation’?
Here are 10 key areas that I was looking out for:
1) New social homes: The £500 million top-up to the Affordable Homes Programme (AHP) briefed in advanceis welcome news but it must only be a down-payment on a far bigger increase for the next AHP after 2026.
It is at the lower end of expectations of up to £1 billion extra and it will not be enough to make up for a shortfall in delivery caused by construction cost inflation and other pressures on social landlords. The current AHP is on course to deliver between 110,000 and 130,000 affordable homes over five years rather than the 180,000 originally expected while need is estimated at 90,000 social homes a year.
All of which puts the 5,000 the government says will be generated by the top-up into perspective.
Details of ‘future grant investment’ in the next AHP will be set out in the spending review and will support a mix of tenures ‘with a focus on delivering homes for social rent’.
With the days counting down to the Budget and all eyes on the tax increases to come, you’d have to be quite an optimist to expect an immediate boost for housing.
There may be scope for redistribution of some existing budgets but the first fiscal event of the new government is taking place against a gloomy short-term backdrop, with cabinet ministers for unprotected departments reportedly protesting about the cuts they are being expected to take.
The real question for October 30 – and for the Spring spending review to come – is a more long-term one: a shift in thinking about the value of housing investment.
There have already been some hopeful signs on this, with chancellor Rachel Reeves said to be considering a shift in the measure of debt to take account of the value of the assets created by investment as well as the costs. This could create room for billions in extra public investment, but housing would have to join the queue alongside health, education, transport, prisons and all the other government priorities.
If you’re looking for reasons to invest in housing specifically, there is plenty of timely evidence in the new UK Housing Review Autumn briefing paper published this week.
Originally written as a column for Inside Housing.
Labour’s huge election victory is undoubtedly good news for housing but will it take this once-in-a-generation chance to prove that ‘change’ is more than just a slogan?
You’ll have to have worked in housing for more than 25 years to remember the last time Labour successfully regained power in 1997.
Then, as now, the party took over after a long period in which Conservative governments got to set the parameters of the housing system on everything from tax to investment and planning to benefits.
The Blair-Brown governments made solid progress on homelessness and decent homes and eventually boosted investment in new homes but they blew the chance to change things more fundamentally.
Keir Starmer takes over at a time when housing is significantly higher up the political agenda but the economic backdrop is far bleaker.
So how should we react to Labour’s stunning victory?
Originally written as a column for Inside Housing.
The good news in Jeremy Hunt’s speech is that the government has finally listened to all the arguments about soaring rents, evictions and homelessness and Local Housing Allowance (LHA) rates will be linked to private rents again from next April.
The bad news buried in the background documents to his Autumn Statement is that rates will be frozen again for the four years after that, recreating the shortfalls between housing benefit and rents for tenants and generating all the costs of homelessness that led to the lifting of the freeze in the first place.
It’s not much of a way to run a benefits system or a housing system but it is entirely in keeping with an Autumn Statement characterised by even more smoke and mirrors than a usual Budget.
That’s amply demonstrated by the most headline-grabbing measure: the cut in National Insurance will not actually mean a tax cut for households hit by a continued freeze in the thresholds for income tax, although it does at least benefit workers (who pay NI and income tax) rather than landlords and shareholders (who only pay income tax).
And the cuts in NI and business tax are made possible in the first place by more sleight of hand: as the accompanying report from the Office for Budget Responsibility reveals, they only add up thanks to unfeasibly large cuts in public services and a freeze (aka significant real terms cut) in capital spending after the next election.
Needless to say that leaves next to no room for investment in new social homes or the decarbonisation of the existing stock even though the real value of both continues to be squeezed by inflation.
Instead, beneath the surface of the statement, there are signs of a desperate search for policies that are not affected by the squeeze on public spending.
Originally written as a column for Inside Housing.
So where next? The publication of the UK Housing Review this week is a chance to take stock and ask where the housing system may be heading.
The sense is one of considerable flux, for home ownership as the housing market downturn continues, for private renting as the momentum behind increased regulation grows and for social housing as landlords face competing demands for scarce resources.
The paralysis of policy signalled by a Budget that mostly ignored housing could be just a temporary lull ahead of a UK general election.
As ever, the review puts all that into context. For starters, John Perry’s chapter on housing expenditure shows where total government support (in grants, loans and guarantees) for housing is going. The balance between the private market (59 per cent) and affordable housing (41 per cent) may not be quite as skewed as it was in the heyday of Help to Buy but it is still tilted in one direction.
The good news is that public spending on affordable homes has risen in real terms since the dark days of the coalition government. Investment under three Affordable Homes Programmes is set to peak this year – but the looming cliff edge is an indication of the big decisions that lie ahead:
Current spending plans (as in the Budget) rely on eye-watering (and unrealistic) austerity after the next election so that they comply with the chancellor’s fiscal rules. Key decisions lie ahead in the spending review after the next election regardless of who wins.
What is getting built is also skewed. There were 59,175 affordable housing completions in England in 2021/22, the highest for 11 years. However, more than 20,000 of those were for affordable home ownership and 28,000 for affordable rent, leaving just 7,528 for social rent (plus another 3,080 for similar London Affordable Rent).
Contrast that with Scotland, which managed 9,757 affordable completions in 2021/22 including almost as many social rent homes (7,306) despite having a population about a tenth of England’s.
Originally written as a column for Inside Housing.
In a Budget where everything had to begin with E there was little hope for housing.
Neither Rishi Sunak’s economic priorities nor Jeremy Hunt’s e-list (enterprise, employment, education and everywhere) left much room for an issue on which the Conservatives appear to have given up.
On energy, there was good news for tenants on pre-payment meters and for everyone with the extension of the price guarantee.
However, there was no more support for a policy that would do more than anything else to reduce dependence on unreliable overseas energy supplies and Vladimir Putin.
Investment in the decarbonisation of existing homes would cut energy demand at the same time as it cut carbon emissions and bills for tenants and home owners and delivered on the government’s new priority of energy security.
Energy efficiency even begins with the right letters but that either counts as a double negative or was quietly forgotten.