Political leaders have this week been warned that any incoming government must appoint a dedicated secretary of state to solve the housing crisis, following the 2015 general election
The next government must create a new housing role in cabinet on its first day in power and should declare housing a national priority, according to KPMG, which has published a new report in partnership with the housing charity Shelter.
The report, Building the homes we need - a programme for investment for the 2015 government, sets out a housing roadmap for the next government from 2015 covering its first two years in power.
It was published in the same week that main contractors told the AJ’s sister title Construction News the construction industry needed to be taken more seriously within Whitehall.
Bouygues UK chairman Madani Sow said he did ‘not believe that the government’s message on infrastructure was working’.
He said: ‘Take housing as an example. For many years we have heard that there is a big demand for housing in the UK, yet we are not seeing the level of building to meet this demand.’
London’s Evening Standard has reported that London mayor Boris Johnson was ‘itching’ to take up an infrastructure role in cabinet that would combine responsibilities for transport, housing and business.
When contacted by Construction News, sources from both political parties poured cold water on the claims and said neither had immediate plans to create the role if they were to win the next general election.
KPMG and Shelter said there was a need for joined-up thinking on infrastructure projects and housing in the UK.
It cited the absence of housing projects in the government’s long-term infrastructure plan, which commits more than £100bn of capital investment to energy, transport and other critical infrastructure over the next parliament.
KPMG and Shelter recommendations
- Incentivise building on stalled sites by levying council tax for land with planning permission.
- Open up the land market by releasing more data and launch a competition for the best use of newly released land.
Affordable housing investment
- Boost public and private investment in affordable homes, including increased institutional investment for private rented sector.
- Create a National Housing Investment Bank as a public corporation to lend to affordable housing providers.
- Help local builders access finance by providing government guarantees for bank lending.
- Level the playing field for builders of all sizes with national space standards for new homes.
Strategic local leadership
- Make housing central to the new City Deals, under which central government hands power and budgets to local authorities in return for them taking on greater responsibility to stimulate economic growth.
- Integrate major new infrastructure with housing.
Government and industry joint bodies the High Speed 2 Growth Taskforce and the National Infrastructure Plan Strategic Engagement Forum have also recently urged the government to consider housing when planning the construction of large-scale infrastructure, including the £42.6bn HS2 rail line.
The Building the homes we need report recommended the new government extend planning of its nationally significant infrastructure projects (NSIPs) to include housing schemes.
The NSIP list includes major projects in England and Wales such as power plants, airport extensions and major road and rail schemes, under which developers must apply for a Development Consent Order before construction can begin.
KPMG head of housing Jan Crosby, who co-wrote the report, said that there was a need for change as the “status quo isn’t delivering the number of homes [the UK needs]”.
Mr Crosby said the UK has a fixed level of housing demand through incentives such as Help to Buy but the supply side was lagging as the market readjusted.
On the report’s recommendation that a housing secretary be appointed, Mr Crosby stressed this role would be complementary to a potential infrastructure position at cabinet level.
He added that “intertwining” housing with wider infrastructure projects under the responsibility of a new cabinet secretary would be beneficial to both sectors.
Shelter chief executive Campbell Robb said: “The reality is that government-backed mortgages like Help to Buy or tweaks to planning rules will only ever be sticking-plaster solutions that risk making the problem worse, not better.
“We will only build the homes we need by creating a healthier housebuilding market through boosting small builders, giving towns and cities more power, finding new investment, and getting land into the hands of those who can get building high- quality, affordable homes.”
KPMG and Shelter said that integrating new infrastructure and housing development would increase the supply of new-build homes alongside the construction of major projects.
It highlighted that there are currently 100 NSIPs in progress since the process was introduced in 2008/09, and estimated there would be five opportunities to link medium housing sites to major new infrastructure identified per year in England, with a build-out rate of 250 housing units per project per year.
Last week the prime minister defended the government’s work on infrastructure planning when asked by Construction News if he supported the creation of an independent infrastructure commission, as proposed by Olympic Delivery Authority chairman Sir John Armitt in his Labour-backed review.
Mr Cameron said: “[The commission] would be more important were it not for the fact that we now have a National Infrastructure Plan that sets out a multi-year programme of all the infrastructure we want to see built, so anyone in Construction News or indeed the construction industry can ask the different political parties, ‘Well do you support what is in the plan?’”
In response, Sir John said he had received “widespread support” for his approach, which “gives the best chance of creating a cross-party consensus through parliament” over the needs and timings for UK infrastructure, as well as the priority of their delivery.
Shelter chief executive Campbell Robb “We will only build the homes we need by creating a healthier housebuilding market… getting land into the hands of those who can get building high- quality, affordable homes.”
KPMG head of housing Jan Crosby “The status quo isn’t delivering an extra 120,000 units a year, which is what we need, and I don’t think it will, so therefore you’ve got to do something if you want to cure the housing crisis… it’s time for action.”
Bouygues UK chairman Madani Sow “I do not believe today we are seeing the government’s message on infrastructure working.
“Take housing for example. For many years we have heard that there is a big demand for housing in the UK, yet we are not seeing the level of building to meet this demand.”