Pigs do fly

25 January 2016 7:30 am | By Bill Randall

The pigs are lining up for flypast after hearing David Cameron’s extravagant pre-London elections promise to build two new ‘affordable homes’ for every council home sold in the capital. Their flight plans are justified. Previous housing pledges by politicians of all stripes have mysteriously evaporated after the ballot boxes have been sealed.

Equally justified is the general scepticism about the government’s plans to sell public land with planning permission in place to small developers. Mr Cameron claims it will give housebuilding a new boost. In principle, it’s a good idea. However, Labour says he is simply repackaging numbers already announced. Shelter predicts the new homes will be beyond the pocket of households earning less than £77,000 a year in London and £50,000 outside the capital.

As they stand, the government’s proposals would do little for Generation Rent and would simply add to the growing number of Londoners moving out to less expensive areas. So many are moving to Kent from Islington, by the way, that Deal has been rechristened Dealston. Forty per cent of all new homes in Brighton and Hove go to newcomers, a growing number of them Russian and Chinese investors drawn to London and the South East by marketing events in Hong Kong and other cities. None of this helps local communities whose key workers and sons and daughters are priced out of the market.

But wait. Using the public land mechanism, the government has an opportunity to make the housing on five pilot sites and any that follow truly affordable. It should give the land free to community land trusts (CLTs) to hold in perpetuity and work with community housing providers – housing co-ops, local housing associations and self-build groups to build homes for rent, shared equity and low-cost homeownership alongside community facilities and work spaces.

At one stroke it would remove the land cost and the developers’ mark up (the target is generally somewhere between 15 and 20%) from the final price of the homes built. It would be a bold and uncharacteristic step for a Tory government, but in the long-term it could save the chancellor a fortune in the staggering amount of housing benefit currently filling the deepening pockets of private landlords.

“Using the public land mechanism, the government has an opportunity to make [housing] truly affordable. It should give the land free to community land trusts.”

And why not? Mr Osborne has given generous tax cuts to the bankers whose recklessness shattered the economy. Here is an opportunity to show a similar generosity to those struggling on low incomes by providing free land for Living Wage housing.

A transfer of land to CLTs would also guarantee that any homes built on the five sites go to local people on modest incomes through local nomination schemes. This certainly helps overcome resident opposition to new housing, as Tory-controlled East Cambridgeshire District Council has found with its village CLT programme, which is driven by surveys of local need and involves communities in the design and location of new affordable homes. This approach could usefully be applied in Northstowe in neighbouring South Cambridgeshire, one of the five pilot sites.

At the same time, the government should relax public borrowing rules to allow local authorities to raise funding for CLT developments and their own building programmes. There is also a strong case for the reintroduction of council building companies.

The advantages

Destroyed in the 1980s by Margaret Thatcher’s governments on ideological grounds, they shared the general imperfections of the construction industry. However, most of them were successful, building houses, schools and community facilities across the country.

Their health and safety record was better than the rest of the industry, they provided job security and offered large numbers of apprenticeships. They had the added value of operating outside of price-fixing rings that were commonplace in the 1970s and 1980s and drove up costs.

Operating as community building companies, they would be ideally placed to work with community housing providers and could train homeless men and women to build their own homes.

If you think that’s far-fetched, take a look at the work of Tyneside Cyrenians (now Changing Lives).

Using the Walter Segal timber frame self-build system, a dozen of its formerly homeless clients built new homes and a detox unit in Newcastle, with the help of three tradespeople. Most of them then found jobs in construction. Another group converted a derelict Victorian mansion into housing and community facilities. Off the back of this work an apprenticeship training school was set up.

Is there any better way to help men and women out of homelessness and unemployment and tick so many government boxes?

Bill Randall, board member, Brighton Housing Trust