How Labour’s plan to tackle the housing crisis will work


12:18 pm - September 28th 2013

by Don Paskini    


      Share on Tumblr

In the past six years, both Labour and the Conservatives/Lib Dems have set out policies to tackle the housing crisis. In 2007, Gordon Brown set a target to build 3 million homes by 2020, a goal which was almost immediately killed off by the financial crash. Meanwhile, the Coalition’s policy has been to ask the vested interests for their policy wishlist and then implement it – spending billions on state-backed mortgage guarantees, allowing developers to reduce standards and build fewer affordable homes, allowing anti-development councils to block new homes. Unsurprisingly, this hasn’t worked either.

So why might Ed Miliband succeed where Gordon Brown and David Cameron have failed? The answer is in his revolutionary new approach to the policy development process. In place of grandiose target setting or government-by-vested-interest, Labour’s housing policy has been developed by two groups who are usually shut out of the policy development process – ‘people on low and middle incomes’ and ‘experts who know what they are talking about and don’t have a financial interest in making the problem worse’.

The main features of Labour’s housing policy are as follows. Firstly, a recognition that we need to build more homes at a time when there is a lack of capacity – far fewer firms, fewer workers with skills and so on. Secondly, targeted policies which will make this increase in supply possible – a ‘right to grow’ to stop Tory-run councils from vetoing new homes, new garden cities, and the ‘use or lose it’ policy to prevent landowners gaming the system. For all the hysteria, this particular policy is one backed by filthy communists such as the International Monetary Fund and Boris Johnson. Thirdly, greater housing security for people – from axeing the bedroom tax to reforms to regulate bad landlords and help people who rent privately.

The reason we have a housing crisis in Britain is because housing policy has been dictated by a wealthy, well organised minority, who benefit from house price bubbles and a lack of homes. Meanwhile, the majority who suffer from these policies are less organised and haven’t had a political party for many years prepared to put them first and see off the scare-mongering.

There is further for Labour to go, and in particular it is hard to see how these goals can be achieved unless local councils are given the freedom to borrow to build homes. But in more than a decade of working together with people from ‘Middle England’ and those living in poverty who have been suffering from our dysfunctional housing market, this is the first time that I’ve seen a national political party which really seems to get the problems which they’ve been experiencing and has a credible plan to sort these problems out.

    Share on Tumblr   submit to reddit  


About the author
Don Paskini is deputy-editor of LC. He also blogs at donpaskini. He is on twitter as @donpaskini
· Other posts by


Story Filed Under: Housing

Sorry, the comment form is closed at this time.


Reader comments


The excessive cost of housing seems to be a blind spot all round. It would be hard to turn the clock back and make housing more affordable but something needs to be done to control house price inflation if the economy recovers. The rental sector needs better controls too. Both second home-owners inflating rural house prices or foreign investors pushing up prices and rents in London need to be stopped.

@1. Cherub: “It would be hard to turn the clock back and make housing more affordable but something needs to be done to control house price inflation if the economy recovers.”

If house purchase for a contemporary 30 year old is to be as affordable as 20 or 40 years ago, the conundrum is more than just ‘hard’. Perhaps UK should endure huge general price and wage inflation, or house prices should be hugely deflated. Both propositions are electorally unappealing and create massive collateral damage.

Somehow, some way, more homes have to be created — houses which ordinary people can afford to buy or rent — without creating a community of losers (people who have a home, for which they have not fully paid or which they perceive as an asset). Somehow, some way, some people have to acquire a home without others feeling that they have lost out.

Space for the creation of 200,000 homes per annum can be found. Even on our small islands, we can find the space; but not always in the compressed bit of the south east of England. There is a relationship between where people live and work that needs to be considered. Does UK undersell — often to itself — job creation outside SE England? Does centralisation exacerbate problems? Do we have a clue (eg mistakes learned from BBC move to Salford Quays) about how to decentralise?

@OP, Don Paskini: “Firstly, a recognition that we need to build more homes at a time when there is a lack of capacity – far fewer firms, fewer workers with skills and so on.”

I’m not sure about all of that. If there are fewer firms, look at trade contract rules in local and national government which deny opportunities to newer or small companies. Regarding fewer workers with skills, you know the answer to that, Don: employ ‘retired’ workers to improve the skills of younger ones. Enhancing the ability of workers may increase cost of a first employee contract, but on future ones the employer is winning.

I acknowledge that there are limitations in skill training; local authorities that relinquished employment of skilled workers and managers should not build council houses because council management does not know how to do it. But it bloody well should do.

targeted policies which will make this increase in supply possible – a ‘right to grow’ to stop Tory-run councils from vetoing new homes

How does this square with Labour’s intention to scrap the Coalition’s planning reforms?

“Local communities should decide where they want new homes and developments to go and then give their consent in the form of planning permission,” Mr Benn said. “It’s the difference between having a say and having it done to you.”

http://www.telegraph.co.uk/earth/greenpolitics/planning/10104786/Labour-would-scrap-the-Coalitions-planning-reforms-minister-indicates.html

Which is it? It’s basically a fact of life that all local communities oppose new development. If you’re putting local communities in charge, then you’re blocking new development. If you’re stopping local authorities from vetoing new development, then you’re not putting local communities in charge.

This is the thing that irks me about Labour at the moment. They cheerfully face both directions at once. Energy bills are too high! We need to de-carbon our energy! We’re not building enough houses! The Govt are riding rough-shod over local communities’ wishes!

4. Barry, Ipswich

Don, I think you miss the point of the Coalition’s policy “- spending billions on state-backed mortgage guarantees”

The policy is an unprincipled attempt to generate a feel-good factor ahead of the next general election.

By encouraging new entrants (generally, those that can’t raise a decent deposit, or afford the mortgage payments at historic interest rates) to the housing market will generate higher volumes of house sales, higher house prices, and for those 60% of us that are owner-occupiers a feeling that we’re a little better off. It also takes a large number of owner occupiers out of negative equity, again another, temporary, feel-good factor.

A more practical thing to do would have been to stop mortgage lenders lending to new buyers who don’t have a 30% deposit. The chances of that happening under any administration is nil.


Reactions: Twitter, blogs
  1. Liberal Conspiracy: How Labour’s plan to tackle the housing crisis will work | moonblogsfromsyb

    […] via Don Paskini Liberal Conspiracy http://liberalconspiracy.org/2013/09/28/how-labours-plan-to-tackle-the-housing-crisis-will-work/ […]





Sorry, the comment form is closed at this time.