Lib Dems propose 'large-scale' building programme
A Liberal Democrat government would undertake a large-scale house building programme as part of a series of radical new housing policies to be tabled at the party conference next month.
In a policy paper that puts clear water between the other political parties on housing, the party proposes a catalogue of reforms which would see it commit to building 300,000 homes a year and funding social housing again.
Assuming members vote in favour of the paper at the conference, it will be formally adopted as party policy by October.
The Conservative and Liberal Democrat coalition government has ended funding for social housing instead offering grant to a new tenure called ‘affordable rent’ charging up to 80 per cent of the market rate. The Lib Dems will negotiate for some of the new policies to be adopted by the coalition if they become party policy.
The policy paper states there is a strong argument for substantial government investment in a large-scale programme of social housing ‘immediately’ and that this would lead to long-term savings on the housing benefit bill.
In order to reduce the impact on public borrowing the paper also proposes adopting public borrowing accountancy rules used in Europe so that the councils can borrow against the Housing Revenue Account – releasing £50 billion affordable housing investment over time.
It also calls for the Bank of England to extend the scope of quantitative easing to include underwriting or buying up housing association bonds that would reduce the cost of debt – a move that the coalition is expected to back next month.
Housing associations would be given the power to offer long-term low cost mortgages on properties they sell in order to help first time buyers and to guarantee income for landlords looking to expand their stock.
The paper also states that the party would abolish caps on local authority borrowing against future revenues.
In a bold move likely to anger developers with big land banks, the party is mulling introducing a ‘use it or lose it’ policy whereby a proportion of the land has to be developed in a certain portion of time rather than just started. Councils could be given powers to levy residential land that goes undeveloped after a certain period.
It also proposes asking the Competition Commission to investigate the landbanks of the major developers to see if their holdings restrict or distort the market.
In a section entitled ‘Holding social landlords to account’, the party proposes ramping up the remit of the social housing regulator by removing the obligation on the Homes and Communities Agency to ‘minimise interference’ in the sector.
Also, to increase the protection of tenants, it would include the proactive regulation of consumer standards, which it rarely intervenes in at present, and bring local authorities fully in under the framework to provide sector-wide consistency.
Public funding would only go to landlords that could demonstrate accountability to their tenants through tenant representation on boards,and social landlords would be brought under the scope of the Freedom of Information Act.
The party said it would look at introducing powers to vary rent levels based on tenants’ability to pay on a scale sliding up to market rent levels.
In a crackdown on the private sector, the Lib Dems would also introduce licensing of private landlords – potentially using a fit and proper persons test.
Richard Kemp, who co-chaired the working group that wrote the paper, said that it was important that there was government funding for social as well as affordable rent properties.
A Lib Dem source said the policies had been well received and were expected to be passed without problems.