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Sector responds to chancellor: social housing should be considered an asset, not a drain on public finances
Chancellor Rachel Reeves promised to fast-track major housing and infrastructure projects in a speech on Wednesday. Stephen Delahunty rounds up key responses from the sector
In her address at the Siemens Healthineers factory near Oxford, Ms Reeves said the drive to speed up the planning process will not come at the expense of pledges made on building safety requirements in the wake of the Grenfell Tower fire.
“We’ve got to get the balance right on regulation, but we’ve made commitments to the families that have suffered because of what happened at Grenfell, and we will not renege on those commitments,” she said.
The forthcoming Planning and Infrastructure Bill will aim to “streamline the development of critical infrastructure” by removing red tape, particularly around environmental assessments.
Below are some key responses from the sector.
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G15
Fiona Fletcher-Smith, chair of the G15 and chief executive of L&Q, said: “The chancellor’s speech on growth correctly identified new infrastructure – and new homes to tackle a lack of affordable housing – as key to improving living standards across the country.
“New social housing is a long-term public good, and new social homes provide huge benefit to the economy and those who live in them. We know that new social tenancies for the more than 300,000 households on London’s social housing waiting list would inject at least an additional £7.7bn a year into London and the UK’s economy.”
She also praised the government for the strong progress it had made since it was elected last year.
Ms Fletcher-Smith added: “We now need to see low-cost measures such as a 10-year rent settlement, fair rent convergence and full access to the Building Safety Fund for not-for-profit housing associations.
"More broadly, housebuilding efforts are currently regarded as borrowing or grant and a drain on the economy, rather than the creation of an asset. The Treasury must now shift its outlook and think of building social housing as something which contributes to our national infrastructure and supports growth rather than adding to national debt.”
The call to reclassify social housing comes after the Labour’s first Budget in October introduced a change in how it measures government debt to allow more spending on infrastructure, while getting debt down as a share of the economy.
Peter Freeman, chair of Homes England, described this as “probably the most important thing in the Budget”.
Local Government Association
Responding to the chancellor’s latest speech on growth, Louise Gittins, chair of the Local Government Association, said: “National economic growth can only be achieved if every local economy is firing on all cylinders.
“Councils have a critical and unique role in delivering local growth across all sectors and communities, and are already driving growth – working with businesses, supporting jobseekers, planning regeneration and improving infrastructure.
“Government investment in our places and people is therefore key to supporting long-term sustainable, inclusive economic growth which brings increased prosperity to every part of the country.”
Aster Group
Amanda Williams, chief investment officer at Aster Group, believes the plans to unlock brownfield land around railway stations is a “positive example of the government thinking innovatively”.
She added: “It’s clear the chancellor recognises the challenges that have hampered homebuilding in the past, and any efforts to transform the planning system and land availability are welcome. But it’s important to make sure affordable homes are baked into these plans, particularly when we know demand is so acute.
“We know from experience that brownfield sites can prove to be more costly and complex to remediate, so viability challenges could make committing to delivering affordable homes even harder.
“Underpinning any of these changes is the commitment in terms of financial backing to the housing sector. Looking ahead to the Spending Review, it would be encouraging to see the Affordable Homes Programme, Housing Infrastructure Fund and brownfield funds strengthened to make sure affordable housing delivery is viable.
“Housing associations will be a critical enabler to help deliver affordable options for people and complex schemes that meet local needs. While there is no silver bullet to solving the housing crisis, this type of collaboration will be crucial to delivering the variety of homes needed, not just the volume.”
National House Building Council
Steve Wood, chief executive of the National House Building Council (NHBC), said he was encouraged by the government’s commitment to removing blockages in the planning system including in the Oxford-Cambridge Arc.
However, he was also concerned about tackling the chronic skills shortage in the construction sector. In November, the NHBC announced a £100m investment in the first tranche of 32 new skills hubs planned by the government that will deliver fast-track training across the UK.
Mr Wood said: “These hubs will produce tradespeople who will support the housebuilding sector’s productivity by delivering quality new homes when and where needed.
“Their expertise will be at the heart of delivering government’s ambitious 1.5 million new homes target. We are already seeing apprentices at the NHBC Training Hub in Cambridge qualifying in 14 to 18 months, many with distinctions.
“These tradespeople who have undertaken our industry-recognised and immersive training are now supporting the local workforce to build on the chancellor’s growth plans for the region.”
British Property Federation
Melanie Leech, chief executive of the British Property Federation (BPF), was focused on investor certainty.
She said: “Investors need certainty and a reason to put their money into the UK – the planning system has been an investment deterrent for too long. The government is absolutely right to remove barriers to the delivery of new homes and essential infrastructure by streamlining decision-making, encouraging development by transport hubs, simplifying the planning regime through a greater use of local development orders and refocusing the role of statutory consultees.
“The property sector strongly supports the introduction of more strategic planning. Such ‘larger than local’ planning will enable both housing and employment uses to be holistically planned across local boundaries, which will be hugely beneficial to local and national economies.
“However while these intentions are good, without adequate resourcing of planning departments, these ambitions will falter. The government needs to plan for more than 300 planners and allow planning departments to fully recover their costs while ring-fencing the income to protect the service.”
