The housing crisis would not be resolved by Starmer s soundbites.

Keir Starmer via Labour party

To much fanfare Keir Starmer has unveiled Labour’s plans to tackle Britain’s housing crisis in a speech at the British Chambers of Commerce Global Annual Conference. Using the slogan ‘We choose the builders, not the blockers’ Starmer expressed an interest on building on the Greenbelt and prioritised reforming the planning system as a route to success. This is an intriguing approach for a Labour leader. Why? Because it’s basically the line taken by the right-wing think tanks of SW1 who, for many years, have blamed the housing crisis on the planning system and a limited supply of development land. Free the system up, they argue, and all will be well. This is magical thinking for a number of reasons – the prime two being limited house building capacity and the effects of mass immigration.

First, the planning system. UK planning authorities are under an obligation as part of the National Planning Policy Framework to provide a 5 year land supply of deliverable housing land. If they fail to do so they can expect developers to obtain planning permission via the appeals system. The government’s national ‘target’ of  building 300,000 homes per year is merely a political aspiration and no government has come anywhere near to achieving it. The last time total completions topped this figure was 1976  when 337,740 homes were built. The reason for this is simpler than many would appreciate – we lack the capacity to build at this scale. Why?

In the post-war decades the state regularly out-built the private sector and by the 1960s and 1970s the capacity of each sector was roughly equal. The heavy lifting was shared. The glaring – but largely ignored – fact about Britain’s inability to build sufficient houses is that state house building capacity has been deliberately destroyed.  In 1970 we built 357,070 homes (the state built 184,970 and the private sector built 171,470).  Since then state completions have dwindled to a few thousand per year and the 30,000 or so and homes built by Housing Associations don’t come close to compensating for this loss. Private developers have never come close to satisfying housing need. They lack the capacity to do so and tinkering with planning rules will not change this. A UK housebuilding industry that can barely top 200k units per year can not suddenly produce another 100,000 houses. Such a feat would require plant operators, bricklayers, carpenters and plumbers to appear out of thin air. The capacity does not presently exist – it must be built and until our politicians talk about skills training and have an idea of which entities will construct new homes we will get nowhere.

Furthermore, Starmer seems quite confused. He claimed in a tv interview on Good Morning Britain that ‘the decision about where housing is built is usually determined by those that own the land… and developers.’ This is plainly false. In fact, local planning Authorities and the Secretary of State determine the location of all new housing via the development control, plan-making and appeals system. If landowners and developers were really in change it would make little sense for Starmer to attempt to blame our housing woes on the planning system – but such logic escapes him. Starmer mentioned in passing the idea of development corporations – an SDP idea – as a vehicle but offered no detail. This is a pity because we need a viable entities to actually build the homes.

As important as what Starmer mentioned was what he ignored. Typically for a progressive, the question of mass immigration seems not to occur to the Labour leader as a contributor to our housing crisis – nor did it occur to the many journalists who interviewed him.  Some basic mathematics might assist. Net migration is running in the region of 600k per annum which (assuming average household size of 2.4 persons) implies a net new housing need of about 250,000 units just to house the migrants. True, many are living in sheds and bunking up 5 to a room but this is totally unacceptable. Future projections of well over 1 million migrants reaching our shores every year renders Labour’s slogans utterly meaningless. And to pretend that mass immigration has no bearing on housing need is politically dishonest.

Another area which Starmer passes over in silence is how to fund new housing. To be fair, if Labour expects the private sector to do all the work then the state will barely have to consider this. Starmer seems satisfied with a weak and inept state – unable to implement anything directly – which instead, taxes, regulates and out-sources its way into the future. A game-changing idea has been published  – again by the SDP – of levying a 50% tax on the uplift to land value attributable to the granting of planning permission on all greenfield sites and undeveloped land. However, I suspect this is far too radical for a ‘New Labour MkII Party’ wedded to ultra-liberal economics and advising that the UK ‘must be more open to global trade’.

At present, we’re stuck.

The aim of housing policy should be to make available a decent, affordable home for every citizen but no recent government has come close to securing this. Instead, the deliberate destruction of state housebuilding capacity together with mass immigration has created a perfect storm which denies millions a viable route to start a family and unfairly dashes young peoples’ dreams of a home of their own.  

The Conservatives’ hostility to the state housing sector combined with the need to protect its core ‘NIMBY’ constituency in the shires from new developments render it incapable of solving Britain’s housing crisis. Keir Starmer has failed to properly diagnose our housing predicament, ignores mass immigration as a driver of the problem and seems to lack the will to re-invigorate state capacity as a potential solution. 

We live in an era in which politics has been reduced to a series of superficial sound bites. Such things will solve nothing.