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Haringey vehicle has few solid guarantees for tenants
People want the public sector to be in full control of housing decisions, says Labour MP Catherine West
Councils across England and into the heart of London have suffered from draconian cuts to local budgets. Figures this week laid bare the harsh fact: by 2020 local councils will see central funding fall by 77 per cent. As a former council leader, I know well that vital services cannot be run on tuppence.
“People want the public sector to be in control of housing decisions.”
Maintaining parks and museums, libraries and leisure centres, street lighting and discretionary bus routes are all under pressure. But perhaps nowhere is this felt as much as in housing.
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In my own constituency, Haringey Council has been driven to form the Haringey Development Vehicle – colloquially known as an HDV. Our well-run and thoughtful council says owing to government grant and funding cuts, it simply cannot build the houses on its own. Since 2010, Haringey has lost about £160m and by 2020 it will be half the size it was 10 years beforehand.
The council writes: “We simply do not have the money, and cannot sustainably borrow it, to realise our ambitious plans for Haringey on our own.”
But for much of the community, the HDV is a scheme that privatises £2bn of public land with few solid guarantees they will be rehoused or that there will be 50 per cent affordable housing after. Even a “sixty-forty” partnership, whereby local people were assured their council had the majority ownership and control of assets would be preferable to the current proposal of “fifty-fifty”. The trust level in private developers is at an all time low owing to so many homes being built and then sold on for an astronomical cost, out of the reach of so many Londoners. People want the public sector to be in control of housing decisions.
“In the wake of Grenfell Tower, we must take extra care to include the community.”
And in the wake of the Grenfell Tower tragedy, we must take extra care to include the community in political decision-making.
That is why ek Tottenham MP David Lammy and I wrote to the leader of Haringey Council to urge it to pause the HDV until there had been further consultation with the community and an impartial audit of the plan. Namely, we are concerned about affordability of the homes, the bidding process, the financial risks to the council and the lack of oversight.
But in such dire times, what is the alternative? In the short term, I would like the council to consider setting up a 100 per cent owned development company to deliver the homes, which it would own entirely.
In the future, however, government policy must change. Labour would like to see the rules limiting the amount councils can borrow against their housing stock lifted. At present, the Localism Act 2011 has limited local authority housing debt. It is a controversial and backward policy that places an artificial cap on councils’ borrowing. It needs to be scrapped to deal with the problems we face now.
Allowing councils to borrow against their housing stock will make it affordable to borrow and allow councils to build up to 12,000 desperately needed homes each year.
In many councils, there are thousands of homes with planning permission that cannot be built, simply because there is not available finance.
"I believe Haringey Council needs to think again."
In difficult circumstances many are having to rashly think outside the box. I believe Haringey Council needs to think again.
But I also think the central government needs to think again – before it forces councils to sell off valuable land and put vulnerable, families and communities at risk, purely for financial gain.
Catherine West, MP, Hornsey and Wood Green
