There’s much to welcome in the Lyons report – but councils could do so much more

The home is absolutely central to people’s lives. The affordability and condition of one’s home has perhaps the biggest impact on quality of life. Poor quality housing causes and sustains health problems such as asthma. Overcrowding means little room for children to concentrate on their homework. High rents eat up the income of low and increasingly middle income families, dragging more and more families below the bread line.

This is why I’m obsessed with housing. Everyone deserves a decent, affordable place to live. Once we start to get housing right, a lot of other problems begin to correct themselves.

Labour recognises this. Emma Reynolds, who deserves much praise for her work as shadow housing minister, has already set out proposals for the biggest shakeup of the private rented sector since Margaret Thatcher abolished rent controls in 1989. This will particularly benefit Londoners, a quarter of whom now rent privately.

Last year Ed Miliband tasked Sir Michael Lyons with coming up with proposals to deliver 200,000 new homes a year by 2020. Today, Sir Michael published his report.

At 180 pages long, the Lyons report sets out a comprehensive strategy for meeting Ed Miliband’s target. There is much in it to be welcomed. Our dysfunctional land market is one of the key barriers to house building, so I’m delighted to see proposals to tackle land banking such as charging council tax on undeveloped land and shortening the time before a planning permission expires. Proposals to make the land market more transparent must also be warmly welcomed because they will make it easier for SMEs and others to enter a market currently dominated by a relatively small number of volume house builders.

Lyons recommends the creation of Housing Corporations led by local authorities working in partnership with housing associations and the private sector. Earlier this year I made similar proposals for a London Housing Corporation run by the Mayor to allow City Hall to deliver homes directly.

I am also pleased that the report recognises we won’t reach our target unless there is a revitalisation of council house building. This is refreshing after decades of councils being maligned. In the late 1970s, councils were responsible for around a third of all the new homes being built in Britain every year. This declined throughout the 1980s and 1990s as the Tories choked off council house building. Thanks to reforms made by John Healey at the very end of the last Labour government the trend has started to reverse and local authorities are once again delivering new homes.

But councils could do so much more. Arcane Treasury rules are currently stymieing those councils which are keen to build the housing their residents need. Lyons recommends that local authorities that want to build should be able to take borrowing capacity from those that don’t. However, it is disappointing that Lyons does not call for lifting the cap on council borrowing for investment in housing altogether.

Investment in housing pays for itself through rents. No other EU country counts public borrowing for building homes towards national debt, treating it instead as commercial borrowing. Labour should be making the case that borrowing for housing differs from almost any other kind of borrowing.

Last month I wrote an open letter with seventeen London housing leads and Parliamentary candidates calling for the cap to be lifted. Unfortunately, at Labour Party conference Ed Balls made it clear that there would be no new borrowing for housing. This is not just a mistake; it is short sighted.

Without a step change in the supply of council and other affordable housing, we are locking in a system of high welfare spending where lower-income households are forced to rely indefinitely on expensive private rented sector housing.

I believe that the measures set out in Lyons will enable us to reach the target of 200,000 homes a year by 2020. But, as Lyons recognises, we need to go further than that. London alone needs 63,000 homes a year to be built over the next ten years according to the Mayor’s own assessment of housing need. A Labour Government should aim to go far beyond 200,000 a year and this cannot be done without the uninhibited involvement of local authorities.

That Labour will go into the next election with the most serious, far reaching proposals on housing of all the main parties is beyond doubt. The question is whether we can afford to be more bold. I believe we can be and should be. The Lyons report is an excellent start, but we must go further.

Tom Copley is a member of the London Assembly where he is Labour’s housing spokesperson