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Will Theresa May try to fix the broken housing market? Will Theresa May try to fix the broken housing market?
(about 1 month later)
To meet her objective of serving the many rather than the privileged few, Theresa May could immediately turn her welcome rhetoric into reality by addressing the social consequences of a chaotic housing market.To meet her objective of serving the many rather than the privileged few, Theresa May could immediately turn her welcome rhetoric into reality by addressing the social consequences of a chaotic housing market.
That’s not the view of a dysfunctional Labour opposition, currently incapable of framing any policy, but rather the considered judgment of some Tories. They are increasingly concerned that countless low-to-middle income families have been denied a decent home through the Cameron/Osborne government’s obsession with subsidising home ownership – at the expense of social and affordable housing.That’s not the view of a dysfunctional Labour opposition, currently incapable of framing any policy, but rather the considered judgment of some Tories. They are increasingly concerned that countless low-to-middle income families have been denied a decent home through the Cameron/Osborne government’s obsession with subsidising home ownership – at the expense of social and affordable housing.
The financial consequences of this ideological drive are slowly becoming clear. Loans and guarantees to the private sector have obliterated an affordable homes programme, which will get a paltry £2bn between now and 2020 – unless the prime minister changes course – from a total housing investment package of £44bn over that period. Much of this will go towards supporting home ownership. That’s last week’s startling assessment from the widely respected UK Housing Review, which has been tracking government spending on housing for the last 24 years. Experts warn that history will judge that huge sums have gone to propping up the private housing market with little to show for it, partly because many homes would have sold regardless of generous subsidies.The financial consequences of this ideological drive are slowly becoming clear. Loans and guarantees to the private sector have obliterated an affordable homes programme, which will get a paltry £2bn between now and 2020 – unless the prime minister changes course – from a total housing investment package of £44bn over that period. Much of this will go towards supporting home ownership. That’s last week’s startling assessment from the widely respected UK Housing Review, which has been tracking government spending on housing for the last 24 years. Experts warn that history will judge that huge sums have gone to propping up the private housing market with little to show for it, partly because many homes would have sold regardless of generous subsidies.
Whether May is prepared to listen – let alone change course through a new housing and planning act – is an open question.Whether May is prepared to listen – let alone change course through a new housing and planning act – is an open question.
Related: Britain’s obsession with ownership has turned housing into a pyramid scheme | Gaby Hinsliff
Pragmatic Conservative council leaders and MPs have long privately complained that George Osborne’s narrow focus ignored the plight of those unable to pay an average rent, let alone find a £5,000 deposit for a new home, even with generous government subsidies.Pragmatic Conservative council leaders and MPs have long privately complained that George Osborne’s narrow focus ignored the plight of those unable to pay an average rent, let alone find a £5,000 deposit for a new home, even with generous government subsidies.
“I meet people on low incomes who couldn’t afford to buy a house in a million years,” laments Robert Halfon, the Conservative MP for Harlow. At his constituency surgeries, he says, housing has become the number one issue. “I regularly see people who are living in overcrowded accommodation, six in a two-bedroom house – a huge problem – and we need to be on their side.” He is not alone on the backbenches. MPs in marginal seats cannot escape the reality of thousands frozen out of the housing market. Halfon wants a more equitable approach, balancing his party’s commitment to home ownership with a new emphasis on low-cost renting. “A priority of the government has to involve earmarking a proportion of funds for social housing,” he insists.“I meet people on low incomes who couldn’t afford to buy a house in a million years,” laments Robert Halfon, the Conservative MP for Harlow. At his constituency surgeries, he says, housing has become the number one issue. “I regularly see people who are living in overcrowded accommodation, six in a two-bedroom house – a huge problem – and we need to be on their side.” He is not alone on the backbenches. MPs in marginal seats cannot escape the reality of thousands frozen out of the housing market. Halfon wants a more equitable approach, balancing his party’s commitment to home ownership with a new emphasis on low-cost renting. “A priority of the government has to involve earmarking a proportion of funds for social housing,” he insists.
Wishful thinking? We shall see. May certainly has advice on hand. As a “Brummie”, May’s joint chief-of-staff, Nick Timothy, is a great admirer of Birmingham’s legendary late-19th century council leader Joseph Chamberlain, who helped create an active local state and improve the lives of an impoverished working class. And new housing and planning minister Gavin Barwell says that he will embrace mixed tenures to address the nation’s housing needs. Could this represent a policy shift, however slight?Wishful thinking? We shall see. May certainly has advice on hand. As a “Brummie”, May’s joint chief-of-staff, Nick Timothy, is a great admirer of Birmingham’s legendary late-19th century council leader Joseph Chamberlain, who helped create an active local state and improve the lives of an impoverished working class. And new housing and planning minister Gavin Barwell says that he will embrace mixed tenures to address the nation’s housing needs. Could this represent a policy shift, however slight?
But today municipal hands are tied. Last week’s report by the public sector accountants’ body, the Chartered Institute of Public Finance and Accountancy, noted that measures to devolve the financing of housing to councils, offering the initial prospect of 550,000 new social homes over 30 years, are failing. This is partly due to the government forcing rent reductions on town halls, thus curbing income from social housing, and then ordering them to sell high-value properties. Experts think this could lead to assets worth £1bn being hived off. Rob Whiteman, Cipfa’s chief executive and a former senior civil servant and council chief executive, laments that families will not get the homes they need because the government keeps changing housing policy without thinking through the consequences of actions. “The situation is desperate,” he says.But today municipal hands are tied. Last week’s report by the public sector accountants’ body, the Chartered Institute of Public Finance and Accountancy, noted that measures to devolve the financing of housing to councils, offering the initial prospect of 550,000 new social homes over 30 years, are failing. This is partly due to the government forcing rent reductions on town halls, thus curbing income from social housing, and then ordering them to sell high-value properties. Experts think this could lead to assets worth £1bn being hived off. Rob Whiteman, Cipfa’s chief executive and a former senior civil servant and council chief executive, laments that families will not get the homes they need because the government keeps changing housing policy without thinking through the consequences of actions. “The situation is desperate,” he says.
Like other senior Tories, May has apparently criticised Osborne’s regional agenda – devolving power to new combined authorities, such as Greater Manchester – as too narrowly focused and partial, creating winners and too many losers. She could well order a rethink. Whether she will also turn her attention to a broken housing market is another matter. That might depend on more restless backbenchers, from a governing party with a majority of only 12, breaking cover and speaking out.Like other senior Tories, May has apparently criticised Osborne’s regional agenda – devolving power to new combined authorities, such as Greater Manchester – as too narrowly focused and partial, creating winners and too many losers. She could well order a rethink. Whether she will also turn her attention to a broken housing market is another matter. That might depend on more restless backbenchers, from a governing party with a majority of only 12, breaking cover and speaking out.