London Assembly Liberal Democrats have launched plans to build an extra 270,000 homes in the capital over the next five years
The party’s plans to turn ‘around 35 years of housing failure’ set out how more affordable homes could be built in London through changes in existing housing policy.
Describing the shortage of affordable housing as the ‘the biggest brake on the region’s economy’, the report suggests that the Mayor should double investment in affordable homes through borrowing against the Greater London Authority’s (GLA) annual budget.
It also recommends that all GLA owned land should be used to build affordable homes, predicting that this would provide an additional 50,000 houses.
It has suggested that if government were to invest just 11 per cent of the money it currently spends on subsidising London rents through housing benefit each year for four years, London could have 111,000 extra affordable homes.
- The Mayor should double investment in affordable homes by borrowing against the GLA’s £11.2 billion annual revenue budget under prudential borrowing rules to provide an additional 55,000 homes per year
- The Mayor should use all GLA-owned land for affordable homes
- Government should scrap the Housing Revenue Account borrowing cap, enabling the London boroughs to invest in affordable housing under prudential borrowing rules
- Government should increase its investment in affordable homes, shifting the balance of spending from housing benefit to construction
- Devolution of responsibility for Skills Funding Agency money for London to the Mayor, so that it can be better focused on addressing local needs
Assembly member Stephen Knight said: ‘This report is about addressing the abject failure over the last 35 years to build anything like enough affordable homes.’
‘There is now an overwhelming economic case for investment in new affordable homes in London.
He added: ‘Capital investment funded by public borrowing is economically sound. At a time when finance is cheap and spare capacity exists in the construction sector it makes absolute sense to borrow to build. It would be criminal to not take advantage of these favourable circumstances.’
According to think tank and lobby group London Councils, more than 525,000 new homes need to built in the capital each year for the next eight years to keep up with current demand. But at present levels just 25,000 will be constructed by 2021.