Where the Government has failed, Labour Councils can play a part in tackling the UK’s housing crisis
A report last month produced jointly by the National Housing Federation, Shelter and Chartered Institute of Housing outlined the Government’s failure to get to grips with the housing crisis. In two key areas of housing supply and affordability, the Government is making the problem worse: failing to build new affordable homes, pricing tenants out of existing ones. Tory Councils up and down the country are buying into the Hammersmith and Fulham model – that income, not need or community ties, should determine where you live. Labour Councils, especially in London where most residents’ real incomes are falling as the value of the land they live on is rising, are struggling to meet the demand for affordable housing.
In Southwark there are around 20,000 people on the housing waiting list and it is increasing all the time. Despite being the largest local authority landlord in London, with over 50,000 homes under council management, the reality for many is that they will never get a council home in Southwark.
A rough estimate suggests we would need around £1.9bn in additional capital to build a home for every person or family on our waiting list. An impossibility for councils even in the good times, let alone during a recession and facing disproportionate cuts from this Tory Lib Dem Government.
People on housing waiting lists can expect little relief from the Coalition’s own house building programme. The latest figures show the number of housing starts has fallen by 35% compared to the average achieved during Labour’s 13 years in office. Most people with a basic grasp of economics could have warned Grant Shapps that this would be the consequence of his decision to slash the budget for social housing by £4bn back in 2010.
But this is only half the story. It’s not just that we are not building enough new homes; the Government’s all-out assault on tenants is having a devastating impact on the affordability of housing across the country. Abolishing secure tenancies, slashing housing benefit and creating a new affordable rent at up to 80% of market rents for the local area will mean people in central London boroughs, like Southwark, could soon be priced out of the area.
So what is the solution? In Southwark we have announced that we will build 1000 new council homes by 2020. That will be more council homes in our borough than have been built in the whole of London in the last 10 years.
This is an ambitious goal but by using the returns from our successful regeneration projects we believe we have a secure and sustainable funding solution. There are challenges: for any new development in Southwark we require a proportion of affordable properties to be included as part of that agreement. However in some areas of particularly high land value we may be able to build a greater number of genuinely affordable homes elsewhere in the borough than could be delivered on-site.
New housing that is council-funded and managed, allows greater control over rent levels and management. It allows for local lettings – where new housing is let to local residents in priority need, enabling the council to re-let existing homes and create better mobility on estates. It also means we can provide specialist housing such as accessible or wheelchair adapted homes responding to the need for properties suitable for disabled people as well as larger properties for families.
This is not a panacea to the housing crisis across the country. We are fortunate to be in an attractive location for developers and there are still tough choices to be made in order to balance meeting housing need with our commitment to genuinely mixed communities. However when the Tories and Lib Dems lack the political will to build more homes and continue to adhere to the misguided belief that tenants in affordable and social housing contribute little, they will never see the true value of council housing. As a result they will never get to grips with the housing crisis. Despite the cuts, Labour Councils should still strive to deliver high quality, genuinely affordable council homes at a time when they are needed most.
Peter John is the leader of Southwark Council