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Social housing should be ‘top of government’s agenda’ for post-coronavirus recovery, say MPs
Social housing should be “top of the government’s agenda” as it seeks to rebuild the country from the impact of COVID-19, a cross-party group of MPs has said.
In a report published today, the Housing, Communities and Local Government (HCLG) Select Committee argued that 90,000 new social homes a year are needed in England and called on ministers to deliver them with a £10bn increase to annual grant funding.
The coronavirus pandemic “has exposed our broken housing system”, it added, with families in overcrowded homes facing “worse health outcomes” and private renters struggling to meet costs.
“A large social housebuilding programme will provide jobs, boost the economy and help the government meet its 300,000 homes a year target,” it said.
Ministers have so far made no indication that they intend to pump more money into the Affordable Homes Programme, worth £12.2bn between 2021 and 2026, in light of the crisis.
The HCLG committee pointed out that even if the government’s ambition of 180,000 affordable homes being built through the funding is met, it will average out at only 36,000 a year – fewer than what has been delivered in nine of the past 10 years.
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The HCLG report was a big moment for social housing – but don’t expect the cash to start flowing yetIt said it was “surprised” that the Ministry of Housing, Communities and Local Government (MHCLG) “seemed unwilling to challenge the Treasury on further funding”.
The committee also expressed doubt about ministers’ continuing faith in the cross-subsidy model of funding social housing, which sees providers build homes for market sale and use the proceeds to offset the cost of delivering social rented homes.
“The government believes housing associations can continue to financially innovate to build more homes, despite registered providers telling ministers they have reached the limit of their flexibility,” the report said.
The committee also raised concerns about why MHCLG does not collect authoritative data on the delivery of social housing, adding that its questions to housing minister Christopher Pincher revealed “the different definitions and figures can cause the real change in stock to be nebulous”.
Only 6,287 new homes for social rent were built in England last year.
As well as increasing funding for social housing, the government should reform land value capture, prioritise public land for social homes rather than raise revenue and allow councils to keep 100% of receipts raised through Right to Buy sales, the committee said.
These measures could help reduce the necessary grant costs to government and see the 90,000 annual social homes target met within five years, it claimed.
“The collapse of social housing building since the 1980s has had terrible consequences on our ability to provide adequate housing for those who need it,” said Clive Betts, chair of the HCLG committee and Labour MP for Sheffield South East.
“This must be a long-term commitment to creating a social housing system that meets long-term demand. It will be challenging but it is achievable.”
Clare Miller, chief executive of Clarion Housing Group, said: “We build every social home at a loss and in London the problem is especially acute.
“Extra grant finance would allow us to build more homes and spark growth into the construction sector at a time when it is desperately needed.
“If the government wants to ‘build, build, build’, it should adopt the findings of this report and make building social housing a national priority again.”
David Renard, housing spokesperson for the Local Government Association and leader of Swindon Council, said: “Housing must be a central part of the national recovery from coronavirus.
“Now is the time for a genuine renaissance in council housebuilding that reduces homelessness, gets rough sleepers off the streets for good, supports people’s wellbeing and is climate-friendly.”
A spokesperson for MHCLG said: “Building the homes this country needs is central to the mission of this government and is an important part of the action we are taking to recover from the impacts of coronavirus.
“That’s why we’re rethinking the planning system to kick start the construction industry and make it easier to build better homes where people want to live.
“We are ensuring more much-needed social housing is delivered by removing the borrowing cap for councils and spending more than £12 billion on affordable housing from 2021 – the biggest cash investment in a decade.”
Update: at 10.32am 27/07/20 a comment from MHCLG was added to the story.
