Half a policy is better than the Coalition’s none

Ed Balls’ speech to the House Building Council yesterday was pushed down the news agenda by his own robust rebuttal of Cameron’s slurs on him and Ed Miliband over the Co-op Paul Flowers affair. But that shouldn’t detract from the importance of the speech.

First, let us look at what he said. He reminded us of Labour’s commitment to build up to 200,000 homes a year by 2020 and the various previous promises about the funding of affordable homes. As everyone acknowledges, this is not enough but it would be a significant step forward from where we are now – getting on for a doubling of performance so far under the Tories. He noted that successful previous recoveries from recession have involved substantial investment in new homes, and that housing would be central to his economic policy. He put the case for a higher share of affordable homes.  He set out a pathway to a new generation of New Towns, using the post-War Development Corporation model, backed by Government guarantees and forward funding of infrastructure.

Balls was nuanced in two important areas. First he defended the ‘brownfield first’ policy, arguing that weakening it would run the risk of undermining sustainable development in areas ‘where viable brownfield sites are widely available’. Many commentators take the view that greater use of greenfield land, and indeed green belt land, is essential. In my view, this is all about the terms on which greenfield land is released – and in particular avoiding endless new estates of executive houses like we have had in the past. One way forward would be look at how the rural exemptions policy has worked in the past and seek to apply it to new circumstances.

Second, despite the lazy reporting that Labour now supports ‘Help to Buy’, Balls distinguished heavily between the scheme’s first phase which supported first time buyers and the second phase which gives Government-backed loans to any buyer of property up to £600,000, including those re-mortgaging, which could have a serious impact on prices whilst supply is so heavily constrained.

Balls made much of the two independent reviews Labour has launched: Sir Michael Lyons looking at land supply and land banking, the planning system and the local authority role; and Sir John Armitt looking at infrastructure including drafting new legislation. We need these studies to proceed rapidly.

Overall, the speech represented further steady progress from the position staked out by Jack Dromey during his excellent stint as shadow housing minister. But more needs to be added if the policy is to be sufficiently comprehensive to be capable of meeting the challenge. To get housebuilding moving all the levers have to be pulled not just some of them. That’s why I call it half a policy.

Balls may return to other issues in future, but some of the questions still to be addressed include the following:

  • What should be done about property and land taxation?
  • How will greater affordability be achieved other than waiting hopefully for extra supply to temper prices?
  • Is shared ownership an answer lower down the income scale?
  • How can we ensure all sites, or perhaps virtually all sites, have a genuine mix of market and affordable homes to own and rent?
  • What should we do with the disastrous ‘affordable rent’ programme which is stretching housing association finances while delivering hopelessly unaffordable homes in many cases?
  • How can a genuine ‘benefits to bricks’ policy be developed to prioritise investment and reduce reliance on housing benefit?
  • How can we develop policies that fit all of the different regions with their hugely different circumstances?
  • The promise of Government guarantees indicates some willingness to lift ‘the dead hand’ of the Treasury, but will Labour commit to ending the cap on councils borrowing for new homes? And will the Party finally grasp the nettle of changing public borrowing definitions so councils can operate more like housing associations – to everyone’s benefit?
  • And finally on my little list, how much grant will be available to support new social housing, and at what levels? – without grant to oil the wheels, none of the other policies will deliver fast enough.
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3 Responses to Half a policy is better than the Coalition’s none


  2. Gary Martin says:

    Why not have a really bold policy. 800,000 empty homes approximately, the figures are there. How about for the vast majority, complulsory purchase with no compensation to the owners. sold to landlords for nominal fee with stipulations that interest free grants are paid, repayable upon certain conditions being met, and must be let to low income households at affordable rents, much less than affordable housing thus far completed. That may stir things up a bit!

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