The Government’s surprise decision to lift the borrowing cap on local authorities so they can expand the building of new council homes was one of the most welcome pieces of news of recent times.
As ever the devil will be in the detail, but for the moment it is accepted that this could be a real game-changer that marks a long overdue and much demanded freedom for councils to provide the affordable homes their communities so badly need. It is right up there with the Decent Homes programme, which saw millions of existing homes modernised and tenants’ lives made more comfortable.
In a series of announcements Prime Minister Theresa May suddenly appears to be delivering on her often made statement that finding a solution to our broken housing market is her number one domestic policy priority.
There were warm and encouraging words for the contribution that housing associations can make in the first ever Prime Ministerial speech to the National Housing Federation, coupled with a commitment to invest another £2bn in the affordable housebuilding programme. Taken alongside the announcement at the Conservative Party Conference to lift the cap on council borrowing, this provides the most positive environment for social housing in living memory.
Prudence
We know the money will not magically appear overnight – the Government simply has too many demands on its resources right now – but taken together there appears to be an under- standing that housing has probably become a key issue at the next general election. It could make the difference in what promises to be a tight contest. And that could come sooner, rather than later given the parlous state of the Brexit negotiations in Brussels and Westminster. It is hoped that within a couple of years councils could be building at least 10,000 new homes a year (maybe more), to contribute towards the ambitious target of 300,000 homes a year that has been set.
But seeing is believing and the Budget should provide more details of how the lifting of the cap will work. Of course there will be some constraints. The borrowing will need to be done within the prudential limits but this is to be expected and amounts to no more than living within your means and not taking out loans that cannot be repaid. Local Government probably has a better record than Westminster on that particular score!
Indeed some councils have managed to run decent sized development programmes in recent years and it’s likely that officers at authorities like Sheffield and Bournemouth will be in strong demand to share their experiences and know how. But the failure of Local Housing Companies to build houses in any meaningful numbers provides a cautionary note. We need to ensure that Whitehall red-tape does not stymie this initiative.
Stimulus
The new council housebuilding programme can provide a much needed stimulus to local economies and help the private housing market and commercial developments to kickstart themselves into life. Ten years of austerity and the growth of on-line shopping have taken their toll and this can be seen in deserted high streets and empty town centres across the country.
Of course one major hurdle to overcome will be do we have the labour and skills to deliver all of this new building activity? The construction sector has been warning us for the last few years that it is facing a crisis with retirements and natural wastage outstripping the rate of new recruitments. Brexit is making this problem worse as lots of foreign nationals leave these shores for pastures new and as yet we are not exploiting the modular housing model sufficiently for this to fill the gap.
The general public apparently does not welcome the prospect of living in a factory built house, but this is probably our best opportunity to showcase just what this part of the housing industry can contribute. Building houses more quickly, to a higher and more consistent standard at a lower cost should surely convince even the most strident doubters that this is a practical solution to one of the toughest problems of today.
Another skill shortage we need to overcome is in local authority planning departments. For the last ten years we have been losing experienced town planners as part of the general belt-tightening affecting the public sector. The pressure will be on to get housing schemes approved quickly so that starts can be made on site as soon as possible. A presumption that planning consent will be given (whatever) is not necessarily the right message to give.
CAPACITY
But here is the rub – the Grenfell Tower tragedy and the Hackitt Review have shown us that we cannot play fast and loose with building regulations or safety standards. The design and planning of housing is one of the most fundamental elements in ensuring that our homes are fit for purpose and will continue to provide for our needs in decades to come. The houses and flats built in the next five years or so will need to last for a century or more and we do not want to be providing our children and grandchildren with a sub-standard product. They will never forgive us!
In her speech to the NHF conference, the Prime Minister called on housing associations to use their skills and know-how to ensure we build the right kind of homes, in the right places at the right prices. It is vital that councils draw on this experience and encourage associations to contribute fully to local community building and regeneration efforts.
The Local Government Association has recently published on its website the results of an interesting and timely study “Innovation in council housebuilding” which provides a wealth of information and practical examples of how obstacles can be overcome. This is essential reading in council housing and planning departments, but also in developers’ offices, so they can understand the issues and think how they can contribute ideas and solutions.
Council leaders have been asking for this financial freedom for years and this is not the time to blow it. The problem and the importance of finding workable solutions means that a much greater emphasis will have to be placed on collaborative working – irrespective of whether this is with neighbouring councils, housing associations or indeed the private sector. There is an opportunity here for all to benefit and petty jealousies or past mistakes cannot be allowed to get in the way.
I have heard some politicians and senior council officers likening the current environment to the one that existed when Attlee and Macmillan lead the great council housebuilding eras of the last century. I am obviously far too young to make similar comparisons myself, but it does appear that the necessary bricks are being put in place to deliver a long overdue fillip to affordable housebuilding. The signs are better now than they have been for the last 30 years or so that national and local government are finally prepared to work together on delivering a workable solution, which we should all benefit from.
The close links between good housing and good health means that an important outcome from this could be that some pressure is removed from the NHS. That is the surely the sort of dividend that all of us can get behind and support.