Radicalising Labour’s housing policy

This is an article published in Labour Briefing

The contradiction between Labour’s official housing policies and the more radical aspirations of members and supporters was highlighted at the recent Liverpool conference. The composite resolution on housing which was passed, included two things which contradict existing policy. Firstly, it supported ending Right to Buy, rather than just suspending it. Secondly, it proposed building 100,000 ‘social rent’ homes a year as opposed to Labour’s policy of 100,000 ‘affordable homes’ for rent and sale.

How much grant?

Although the composite talked of “the biggest council housing programme for 30 years”, Labour has no commitment to a specific number of council homes. John Healey’s office has told us that they don’t know how many council homes will be built because it’s up to councils to decide. Yet Labour can determine how many council homes it aspires to have built by deciding on the amount of grant available to councils.

New Labour’s National Affordable Homes Programme offered around £60,000 grant per property for new building but that was ten years ago. Taking account of inflation £80,000 would be needed today. With that it would be possible to support the building of 100,000 council homes a year for £8 billion. Yet Labour’s commitment is just £4 billion a year and that is for shared ownership as well as ‘social housing’. Since its definition of “affordable homes” includes shared ownership, councils could fulfil the proposed “duty to promote affordable homes” without building a single council home. They could simply bid for grant for shared ownership properties.

Challenging the government’s housing policy

Whilst the debate on a housing programme for a Labour government is critical, we cannot passively wait for one. What Labour does in response to current government policies gives an indication of what the Party will do in office. Two issues underline the passivity of the Shadow Housing Minister’s office.

The Tory government is proposing to increase council rents from 2020 by CPI + 1%; at least five years of above inflation rent increases. Although council tenants have had 1% rent cuts for 4 years, under New Labour and the coalition they had many years of above inflation rent increases. Rents have increased by 32% since 2010. Reintroducing above inflation increases will stretch the finances of poor working tenants and drive up the housing benefit bill at the same time.

Thus far Labour has failed to oppose these increases. John Healey’s office told us that this issue will be considered as part of their consultation on Labour’s Green Paper. Its failure to oppose them in the consultation suggests that it supports them.

Stock transfers

Tucked away in their consultation on their Housing Green Paper, the Tories have floated the possibility of a new round of stock transfers of council housing. John Healey’s office told us “we’re very sceptical of the benefits of more large scale stock transfers”. However, they said they would “wait to see further detail”. This is another mistake in our view. Labour should be publicly opposing a new round of transfers to try and stop a proposal being brought forward in a White Paper. Of course, the Tories may well throw New Labour’s past support for stock transfers in Labour’s face. The obvious reply to that is that New Labour’s policy was wrong.

Will the conference be ignored?

How will the Shadow Housing Minister respond to the passing of this composite? The indications are that he will ignore them. Pressure needs to be brought to bear on Labour for it to commit to ending RTB and to building 100,000 council homes a year. We have been told that he does not envisage building 100,000 ‘social rents’ homes until the second term.

It’s true that councils will not be able to go from the current minimal building to 100,000 homes a year, overnight. However, the key question remains will they get the grant needed for a large scale building programme? Instead of proposing to introduce a duty to promote “affordable homes” councils should be given a duty to build council housing. Instead of competing against housing associations there should be specific grant for council housing. Without it then councils will not be able to put together annual plans and build up the teams and resources necessary for a large scale building programme.

CLPs and affiliates need to pick up on the passing of the housing composite motion and demand that Labour changes its policy accordingly. It needs to commit to a large scale council house building programme as its “first (housing) priority”.

Martin Wicks

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