To Keir Starmer
From the Labour Campaign for Council Housing
April 8th 2020
On behalf of the Labour Campaign for Council Housing congratulations on winning the Labour Party leadership/deputy leadership election and Thangam’s appointment to Shadow Housing Minister.
We are asking for a commitment from the new leadership to stick to the Manifesto policy of 100,000 council homes a year funded by £10 billion annual grant and to press the government to provide such a level of grant for building social rent council homes.
You come into office at an extraordinary time. The coronavirus crisis will undoubtedly make the housing crisis much worse. Even with the moratorium on evictions (be it for 3 months only or extended) there will be a big increase in rent arrears as a result of tenants losing their jobs or being stood down for a period. Many small businesses will not reopen. It is likely that at the end of this period there will be a spike in evictions and councils simply do not have the resources to cope with a big increase in the numbers in temporary accommodation.
The low level of council homes (now less than 1.6 million in England) is a key problem when dealing with homelessness. Placing people in the private rented sector is much more expensive than placing them in council housing. The question of a large scale council house building programme therefore becomes even more urgent when we emerge from the lock-down. Obviously we are not in power to implement the commitment to building 100,000 council homes a year but the government is more susceptible to pressure than might have been the case before this unprecedented crisis erupted. Even the Tory dominated LGA recognises that a return to large scale council house building is necessary to resolve the housing crisis. Putting building workers back to work building homes for social need will be a key means of dealing with the impact of the current crisis. So long as house building is dominated by commodity production then the building industry swings between feast and famine. Large scale council house building creates more job security.
Our Manifesto included a commitment to a review of Council housing ‘debt’. Our campaign supports the cancellation of the bogus £26 billion debt held by the Public Works Loans Board. This is an historic injustice. Council tenants have paid more rent than the costs of borrowing for past building programmes. The current figure is the result of Treasury manipulation which has fleeced tenants for many years. HRAs are grossly under-funded. The current crisis will exacerbate their financial problems. With most housing departments now only doing emergency work there will be a big backlog of maintenance and renewal work. HRA income streams will be hard hit by increasing rent arrears and loss of rent from ‘voids’ being empty for longer.
We are therefore asking the Labour leadership team and Shadow Cabinet to press the government to cancel the HRA debt.
A few weeks ago this might have been considered ‘extreme’. However, the government has created a precedent by cancelling the £13.4 billion NHS debt. £26 billion is not much higher given the scale of government action. Because they wouldn’t have to service the debt council HRAs would have at least £1.25 billion (last year’s debt charges paid to the PWLB) a year extra income, probably more.
Safe, secure and genuinely affordable Housing should be a human right rather than a commodity. So long as house building is dominated by the big builders/developers then most housing will be speculative, designed not to address a human need but to create a profit for companies that have made a fortune from Help to Buy.
Secretary, Labour Campaign for Council Housing