The Budget – Time for a fundamental rethink on housing policy

Winston Churchill once said: “You can always rely on the Americans to do the right thing, once they have exhausted all other possibilities”. The same can also be said of government housing policy.

Over the years, we have seen so many policy initiatives fail miserably that one would hope that all the wrong policies have now been exhausted and that the Chancellor, Philip Hammond, will, in his Budget on Wednesday, do the right thing.

The millions of Pounds committed in pursuit of its obsession with home ownership has done nothing to increase supply and has achieved little other than fuelling house price inflation. Home ownership levels continues to slide.

Rent to Buy, too, has failed. Just one in ten Rent to Buy tenants purchase their home (based on a snapshot survey of nine housing associations where just 180/ of the 1,594 homes have been bought over past decade). Yet again, this policy has done nothing for affordability or supply.

The Right to Buy of former council homes has seen the privatisation of public assets, at a huge cost to the public purse, with 40% of the homes sold reappearing in the private rented sector charging rents four times higher than the previous social rents, rents often subsidised through housing benefit.

The extension of the Right to Buy to housing associations as the ill-named ‘Voluntary Right to Buy’, has become, according to Inside Housing magazine, a “Zombie policy”.  It was not thought through and is heading nowhere very slowly. (Here is what I wrote about it recently).

As a result of the government’s lack of capital investment and the restriction on the powers of local authorities to borrow, house building is at its lowest level in decades.

Welfare Reform is forcing people to use food banks and rent arrears are spiraling out of control. In spite of all the warnings about Universal Credit from the ‘usual suspects’ as well as Conservative Members of Parliament and even the former Prime Minister, John Major, the government plows on and on and on, unmoved by the obvious hardship caused by the disastrous policy.

Eight out of ten private landlords are saying that they won’t house people on Universal Credit.

I have said that the Minister, David Gauke, must be arrogant, deluded or ill-informed to persevere with this policy.

Because of the ongoing freeze of Local Housing Allowance (the amount you can claim in Housing Benefit to help with your housing costs), almost all privately rented homes are now unaffordable for those on benefit and the low paid.

The number of rough sleepers continues to climb, the most visible and shocking indictment of the failure of government policy. 4,218 people in Brighton have nowhere to call home.

Chancellor Philip Hammond

This is not a comprehensive list, but illustrative of the government doing all the wrong things.  I hope that all the wrong things have now been exhausted and Philip Hammond will do the right thing – a massive investment in council house building, the relaxation of restrictions on borrowing by local authorities, public land to be earmarked for public housing, and the abolition of all the failed policies, such as the Right to Buy.

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