Wednesday, 24 October 2012

Home Truths (With A Small PS)

The party conference season saw the economic arguments in favour of building more homes gain significant traction, and Trafford - in common with most of the NW of England - is a part of the world where unemployment is still rising despite the national figures indicating an overall fall. So this economic argument is a powerful one. Building homes boosts jobs on site and through the supply chain and, keeping as it does most of the spend within the domestic economy, creates further jobs up and down the supply chain, profits for distribution and tax revenues for the Government. But housing is also about meeting the inexorably rising demand for homes in this country. It shouldn't need the NHFs annual "Home Truths" publication to remind us, and politicians, of this. 

So what do this year's figures tell us? Rates of new house building are way below the rates of new household formation. Put another way, overall, demand for housing is rising. This shows in increased waiting lists, more homelessness acceptances, lower mortgage take up and higher rent levels in the private rented sector which in turn lead to more working families being eligible for housing benefit. With rent taking a higher proportion of disposable income comes, for me, the most telling phrase in the NHFs report: "Aspiration is stopped in its tracks".

I've been cautiously welcoming of the recent approach from government - what's not to like about a further £300m mini-round of the Affordable Homes programme and the prospect of a £10bn loan guarantee fund? But Minister - there is more that can be done; and it doesn't need to cost the government anything, there are three steps the Government could take that would ease the housing situation without needing funds throwing at them.

Firstly, please start to get tough with other departments that won't release their unused public land to provide sites for the new homes we so desperately need. Secondly, please give us certainty about our income stream in the medium term - we are doing our budgets now for 2013/14 and the current rent formula runs out the following year in 2015. Either tell us what the new arrangements beyond that date will be, or, even better, give us the freedom to set (within some form of local cap) our own rents in the light of local markets. Thirdly, echoing Jake Berry's call in The Spectator can we have some kind of land tax that encourages reluctant developers with land to build it out rather than just to sit on it.

And my PS? To be covered another time - but is anyone else intrigued by what's going on in local government at the moment? Civic leaders have woken up to the fact that outsourcing services is not the answer, that big is not always beautiful. When the leader of Britain's second city comes out and says as much, others really should start to listen. Who knows where this will lead - could merger mania within our own sector be the next conventional wisdom to bite the dust? Cosmopolitan anyone?

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