If we’re going to get the homes we need, Councils must be a part of the solution. But the cap on Council borrowing is proving a barrier.
That’s why I co-signed a letter, published today in the Guardian, calling for lifting the remaining cap on Council borrowing for housing.
London’s housing crisis is deepening by the day (Report, 17 September). Average house prices now stand at £500,000. Private rents are double the national average. Council housing is being depleted as a third of all right-to-buy sales are in London. Yet last year house building in the capital fell to its lowest level in a decade. Ed Miliband’s pledge that the next Labour government will build 200,000 homes a year by 2020 has been welcomed across the country, and especially in London. But in order to achieve it we need local authorities to be freed to deliver a new generation of council housing. Labour councils across London are building new council homes for the first time in decades. But they could do so much more if the arbitrary cap on borrowing to build was lifted. This would allow them to invest in housing – borrowing prudentially, as they can already do for other purposes. Borrowing to build homes pays for itself in the long term via rents. Indeed, no other EU country counts public borrowing for housing towards national debt.
In 1979 councils were building a third of all the new homes being built annually. When the Thatcher government choked off council house building, the private sector never filled the gap. History tells us that the private sector alone cannot deliver the homes we need to solve our housing crisis. Michael Lyons will shortly publish his independent review of housing policy as part of Labour’s policy review. We hope that he will recommend lifting the remaining cap on council borrowing for housing and that the Labour leadership includes a commitment to lift this cap in the next manifesto.
Tom Copley (London assembly member, Labour), Nicky Gavron AM(London assembly, Labour, Planning), Cllr James Murray (London borough of Islington), Cllr Jasbir Anand (LB Ealing), Cllr Damien Egan(LB Lewisham), Cllr Julian Fulbrook (LB Camden), Cllr Phil Glanville(LB Hackney), Cllr Ahmet Oykener (LB Enfield), Cllr Alan Strickland(LB Haringay), Ruth Cadbury (Brentford and Isleworth), Andrew Dismore AM (Hendon), Lee Godfrey (Kingston and Surbiton), Rupa Huq(Ealing Central and Acton), Sarah Jones (Croydon Central), Cllr Andrew Judge (Wimbledon), Chris Summers (Uxbridge and South Ruislip),Catherine West (Hornsey and Wood Green)