Yesterday, the prime minister made clear what the rhetoric of the next few months will be: Build, build, build; build back better; level up – and all delivered by the new Project Speed. Rhetoric without necessary investment, however, risks being nothing more than empty words – and on housing, the substance of the prime minister’s plan clearly fails to live up to the ambition he’s setting out.
After much confusion created by an errant line in the press release accompanying the speech, the housing minister confirmed yesterday evening that when it comes to investment in housing, the new plan is… the old plan. Given the changes we’ve seen in the past few months and the challenges we face now, it is impossible to believe that plans devised in March will be big enough, or fast enough, for the times we now live in.
At this moment we are heading for the worst recession in over 300 years. And as set out in new research commissioned by Shelter from Savills, as many as 244,000 jobs in construction are at risk, and as many as 318,000 homes that could have been built in the next five years will never appear.
With this in mind, what the economy needs is the government to truly go faster and further, and the answer should be simple: invest, invest, invest. That’s why we are arguing for the current Affordable Homes Programme to be accelerated to be spent over two years, to provide the kickstart the economy needs. Not spent over five years as originally planned
Investing in social housing can save housebuilding
In March, the chancellor confirmed that the next generation of the Affordable Homes Programme (AHP) would run from 2021/22 to 2025/26, and would distribute £12 billion in grant over that period. This announcement was welcome – but it wasn’t clear how much would be for the social housing we actually need, and the overall amount is far from enough if we truly want to end the national housing emergency. Now we have to face the stark reality that the world today is very different from the world the chancellor addressed from the dispatch box in March.
As one of my colleagues outlined to the Housing, Communities and Local Government Select Committee this week, 174,000 private renters in England currently face eviction due to rent arrears built up because of coronavirus (COVID-19). In addition, we have over one million people on council house waiting lists and more than 280,000 people who are already homeless. On top of this, the pandemic has shown the unquestionable importance of a safe, secure home, while at the same time laying bare the dire consequences of inadequate housing supply, with thousands isolating in cramped conditions and poor quality temporary accommodation.
The moral imperative to build a new generation of genuinely affordable social homes is clear.
But building social housing is not just the right thing to do to address our social challenges. It is also the right thing to do to address our economic challenges.
As we have outlined before, social housing delivery is counter cyclical. This means that during the inevitable bust element of the boom and bust housebuilding system, it can continue being built. The reason for that is simple enough: near-limitless demand for the product.
This is why it is so disappointing that the government has decided that no new investment in affordable and social housing is needed. Instead of taking advantage of social home building to help save jobs and homes, the government has decided business as usual will get the job done.
Reviewing planning right now is a recipe for disaster
There is also another risk to getting things built now – ill-timed planning reviews like the one the prime minister also announced yesterday.
At a time when the country is safely and affordably housed, there may be an argument that the inevitable uncertainty another review would cause can be managed for long-term gain. That time is clearly not now.
At a time when the country faces social and economic challenges that require homes to be built quickly, rushing headlong into a ‘first principles’ planning review will cause delays that cannot be afforded. No developer is going to increase output if in a year, two years, or three years, the system might suit them better. So instead of ‘build, build, build’ a review will only encourage ‘wait and see’.
The alternative
Building and investing in housing is the right way to tackle the economic and social challenges we face, and to build a better future for us all. However, the government’s plan to waste time on planning reviews and refuse to bring forward investment is the opposite of what we need.
Now is the time to invest in social housing as a catalyst for building back better. And a better deal for housebuilding is possible by:
1. Accelerating the £12.2 billion Affordable Homes Programme, to make it a two-year rescue and recovery package.
2. Spending the bulk of the rescue and recovery package on building new social rented homes with realistic grant rates, and being flexible and imaginative about allocating grant.
3. Using the recovery as a launchpad towards delivering the 90,000 social rented homes a year we need through a long-term programme.
Please sign our petition urging politicians to prioritise social housing and build the homes we so urgently need.
