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It’s time for the housing sector to flex its economic muscle and set out how it will contribute to the economic recovery

Housing associations have demonstrated the strength of our moral compass during the pandemic. Now it’s time to flex our economic muscle and to be framing the argument about how we can be contributing to economic recovery and making sure that lands across government, writes Mark Henderson

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It’s time for the housing sector to flex its economic muscle and set out how it will contribute to the economic recovery, writes @MarkGHenderson #ukhousing

“If we are to overcome the greatest economic challenge we’ve faced in three centuries, it’s going to take an almighty effort. The housing sector should be at the forefront of our economic bounce back,” writes @MarkGHenderson #ukhousing

Some of the UK’s leading companies have shown their true colours during this pandemic. That‘s certainly not gone unnoticed by politicians, the media and the general public. Their actions will, I’m sure, have longer-term ramifications.

Housing associations have gone above and beyond what was expected of them to support their customers, communities and colleagues, while working overtime to ensure their businesses remain in the best possible shape.

We should be proud of what we have done over these long, taxing months. We haven’t acted in the way we have for financial gain, political leverage or to score points. We’ve acted in this way because we care about our customers and colleagues – their well-being has been paramount.

While we continue to deal with the fall-out of the coronavirus pandemic by supporting those most in need, it’s time we start to think about how we deal with its wider impact, including the economic one.

Commentators have had to dig deep into the annals of history to find a comparison which illustrates how much of an economic challenge we are facing.

A report released by the Bank of England last month warned that the country’s economic output could fall 14% through 2020. That’s 1% higher than the devastating impact of the Great Frost of 1709, which decimated the UK economy as well as economies across Europe.


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If we are to overcome the greatest economic challenge we’ve faced in three centuries, it’s going to take an almighty effort. The housing sector should be at the forefront of our economic bounce back.

It was reassuring to hear the housing minister confirm last week that housing will be “central” to the UK’s economic recovery.

It was also reassuring to hear the prime minister’s commitment this week to housing as part of ‘Project Speed’. Speeding up is certainly the right approach, but the key thing is that we need to deliver.

While it will be good to see more detail on Project Speed next week from the chancellor, we also need to help shape the government’s plans.

Many of the issues pre-coronavirus, from the need for a refreshed Decent Home Standard to the unfairness of the five-week wait for those on Universal Credit, haven’t gone away.

“The housing sector should be at the forefront of our economic bounce back”

But we need to be realistic about what we would actually like and what it is we really need. As we’ve seen time and again over recent months, what was previously unthinkable no longer is. Context really can change everything.

The focus is now switching to how we can partner with the government to help rebuild our economy.

Every 100,000 homes built is the equivalent to 1% of GDP. Our sector delivered in the region of 40,000 homes last year, and we should deliver close to that number this year, even with the challenges COVID-19 brings.

From brickies to estate agents, the housing sector employs almost 2.5 million people.

Most important of all for a government looking to boost economic growth, we know we’re an extremely powerful economic multiplier.

Various independent studies show that size of the construction sector’s multiplier at close to £3 – one of the highest multiplier effects in any sector. This means that for every £1 spent on construction output, close to £3 of total economic activity is generated.

There are welcome signs that the government gets this. Hence its desire to see the sector among the first to reopen. Most, if not all sites, are now back up and running across the UK, which is providing a significant boost already.

We know there is a greater need for social and affordable homes. We also know there’s a need for homeownership. How many feet you have in which camp is not really the point. The point is that we must satisfy the needs of everyone.

If we are going to do that, then we can’t have a repeat of what happened following the 2008 recession when capital spending was slashed. This severely restricted economic growth – which this government has since acknowledged was a mistake. We will need significant capital investment, which was promised this week by the prime minister.

The government needs a response that is every bit as radical as the unprecedented measures it took to help the economy infected by coronavirus. Additional infrastructure and the ‘levelling-up agenda’ will be welcome in many of the communities in which we operate. But few opportunities will be as ‘shovel ready’ as those offered by housing.

In return we can and must play our part in finding some of that extra capital. This isn’t about internally robbing Peter to pay Paul – it’s about working smarter. I have talked for some time now on the need for housing associations to work in partnership more closely.

“The government needs a response that is every bit as radical as the unprecedented measures it took to help the economy infected by coronavirus”

I have highlighted the benefits of collaborative working in areas such as maintenance and repairs, especially if we embrace technology. I’ve also mentioned how working in partnership would give us much more procurement muscle, putting an end to the market playing us.

Other potential areas for collaboration could include land acquisition, multi-partner development and working towards net zero. Along with having such a positive impact on our customers, collaborations like these can provide us with significant efficiency savings – savings which could be put too much better use.

While we deal with the fall-out of coronavirus, we’re beginning to think hard about what the future looks like. It has thrown up so many questions about how we live and work as well as how we come together to solve problems – questions that may take some time to answer in full.

In the meantime we need to be part of the answer to our economic recovery, which will allow us to enjoy whatever that future looks like.

Any extra money will, I’m sure, come with strings attached. What we absolutely must not do is simply return to our old way of doing things. Reheating stale ideas will not pass muster when the demands on the public purse are greater than ever.

We need to be framing the argument now about how we can be contributing to economic recovery and making sure that lands across government.

Mark Henderson, chief executive, Home Group

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