We must remove regulations and requirements to encourage developers to build

The mayor must take some of the responsibility here – the performance of the Greater London Authority’s housebuilding programmes have been dire, despite being backed by £9bn of funding and another £11bn for future programmes. Sir Sadiq Khan’s policies in the London Plan, meanwhile, have helped to kill private development stone dead by rendering it unviable and introducing more regulation, all in the name of ‘good growth’. You cannot have good growth if there is no growth. 

The solutions outlined in my new report, Get London Building, are not easy, because solving this is not going to be easy. They are not simple either, and they require doing difficult things.

Politicians have called for more ‘affordable’ (subsidised) housing because it is easy. It sounds like it might be the solution. What it doesn’t do is get more affordable housing built or make housing more affordable to buy – it does the opposite.

Londoners may support more subsidised housing at first glance or in principle, until they realise they fund it through their taxes, but they would never be eligible for it. It actively makes trying to buy a home on the market more difficult. 

These targets should be abolished, enabling developers to build significantly more homes, make smaller developments viable and give Londoners a better chance of buying a home of their own. Both the previous 35% target and the new 20% target are unsustainable and are not being delivered because they are not economically viable. 35% of nothing is nothing, and 20% of nothing is also nothing. 

As the mayor has made plainly clear, local government cannot build homes at anywhere near the numbers London requires. So we need developers, and we need them to make money so they can keep building homes.

If we want houses, we need to create the economic conditions that make building them profitable. No developer builds houses to lose money, because no business exists to lose money.

In the upcoming Budget, the chancellor should introduce a tax relief system for developers proportionate to the number of homes they build, as well as abolishing stamp duty on primary residences. 

“Targets should be abolished, enabling developers to build significantly more homes, make smaller developments viable and give Londoners a better chance of buying a home of their own”

It is equally difficult to acknowledge that while the Building Safety Regulator was established by the last government with genuine intentions following the Grenfell Tower tragedy, the unforeseen consequences have been drastic for housebuilding.

The performance of the regulator so far, reported in depth by Inside Housing, has been unacceptable. Given that some of the projects held up are essential fire safety works in existing buildings, these delays are putting people in danger. 

The legislation should be updated to remove minor work from the regulator’s remit, and a pre-application process should be introduced to maximise the possibility of efficient approvals. You can staunchly believe that another tragedy like the Grenfell Tower disaster should never happen again, while recognising the system as it is implemented now is fundamentally flawed. 

Meanwhile, land that the mayor and the GLA already own could be used to fast-track 75,000 homes and identify sites for ‘New Villages’ across London. The government funding the DLR extension to Thamesmead in the upcoming Budget would immediately unlock 15,000 homes. Utilising the mayor’s Adult Skills Fund for the construction industry and reforming the mortgage market would also help to make a difference. 

As Get London Building argues, letting this housing crisis and housebuilding crisis deepen further is a choice. We do not have to make it. 

Lord Bailey of Paddington, London assembly member and member of the House of Lords