HQN blog: Labour delivers the goods – for the most part

It was back in September that Jeremy Corbyn announced a review of Labour’s housing policy. After a slow start, the Party got its act together and spent the winter months developing its Green Paper – ‘Housing for the Many’, published on Wednesday 18 April 2018. Overseen by John Healey, Shadow Secretary of State for Housing, this was always going to be a thorough and thoughtful piece of work. It will be interesting to compare the government’s own Green Paper (which was announced last summer and has yet to be published) with the analysis and policy proposals produced by the main opposition party.

The evaluation of the housing crisis facing this country is spot-on. Just producing more housing – as promulgated by the current government – is not the answer. As Jeremy Corbyn pointed out at the press conference, developing more speculative private housing for the top end of the market does nothing to alleviate the housing problems faced by most people in the country. The Green Paper is also right when it emphasises that the critical housing problem centres on affordability – for people renting privately, owner occupiers with large mortgages and those tenants in the social housing sector paying so-called ‘affordable rents’.

So having got the analysis right, what is the Labour Party proposing?

There are a vast number of proposals set out by John Healey and his team – it amounts to a 50 point plan. There are some critical points which deserve particular emphasis. These are:

  1. Plans to build 100,000 genuinely affordable homes in the social housing sector each year over 10 years – one million new social homes in all
  2. The scrapping of affordable rents (linked to market values) with a proposal to establish ‘living rents’ which are set at a level equivalent to a third of household income in local communities
  3. The suspension of the Right to Buy
  4. A key role for all local authorities to support the development of new social housing in their areas backed up by access to loan funding based on prudential borrowing rules
  5. The repeal of some government policies that have eroded tenants’ rights (for instance the ‘bedroom tax’ and the abolition of full security of tenure for social housing tenants)
  6. The introduction of tenant ballots to approve (or otherwise) estate regeneration schemes
  7. The creation of a number of new agencies to help implement the Labour Party’s ambitions (such as a chief architect to oversee building standards and a body that would report on a Labour Government’s record on delivering against its housing plans).

So what are the downsides?

First and foremost, the Green Paper focuses exclusively on the social housing sector. This is a mistake. The country’s housing crisis affects all housing tenures. A holistic approach is required which addresses the problems in the private rented and owner occupied sectors as well as those in social housing.

Also the Green Paper fails to look at policies which are outside the remit of John Healey and his colleagues. Accordingly, for instance, there are no proposals to review property taxes which would have a fundamental effect on the country’s housing market. High rents and house prices in the UK are in part linked to the role of housing as an investment good in the economy. New property taxes would take the sting out of the housing market and help to improve affordability ratios. As the Labour Party develops its ideas on reforming the housing sector hopefully there will be more joined up thinking between the party’s Treasury team and those working with John Healey specifically on housing issues.

The document also tantalisingly makes reference to a number of initiatives which are not fully developed. For instance, the paper calls for the creation of a Sovereign Land Trust to purchase land for development at close to existing use value. This is a radical idea which could help promote the development of cheap housing in this country. However, details on the trust’s role and operational characteristics are limited.

The document puts a lot of store on local authorities to deliver on the party’s objectives. But as John Healey noted at the press launch around half of all councils do not have HRAs. And the capacity of local authorities to provide the services expected of them must be questioned after years of financial and associated staffing cuts.

But all in all, this is a Green Paper that is evidence-based and has a wide range of practical proposals that could help tackle the country’s housing crisis. The government’s own Green Paper will struggle to match this ‘tour de force’ from the Labour Party.

By Roger Jarman, HQN Associate

Members can download a copy of Labour's 'Housing for the Many' Green Paper from the HQN resources page here.