How high are Labour Chancellor Rachel Reeves sights really. (Picture: Kirsty O’Connor)
Millions of people face crippling rents and are at the mercy of private landlords. Others live in damp, mouldy homes or languish in temporary accommodation.
They are all crying out for solutions to Britain’s housing crisis. But Labour’s new housing plans will do little or nothing for them.
“Get Britain building again” is one of Keir Starmer’s flagship policies. It promises 1.5 million new homes over the next five years, and changes to planning regulations to make it happen.
The plans mean more power to housing developers, increased costs for ordinary people and a focus on meeting targets rather than on people’s housing needs.
Building new homes may seem like a solution. But this will only exacerbate the existing crisis.
The construction of the houses will be handed over to multi-billion pound corporations whose only priority is to make as much profit as possible.
That always means slashing the number of council or affordable homes.
There is a severe lack of social housing— including council homes and affordable homes often run by housing associations. But “affordable” can be just 20 percent less than the market rate. Labour’s plans include restoring mandatory housing targets.
Under the Tories, housing targets were advisory. It also says it will deliver “the biggest increase in social and affordable house building in a generation” by prioritising building social rented homes and reviewing increased right to buy discounts.
An early insight shows how Labour intends to fund its scheme. Chancellor Rachel Reeves is introducing a ten-year formula to calculate social rent on homes that will increase every year by the CPI inflation rate, plus one percent.
This removes an existing cap on rises. So 3.8 million homes, previously shielded from inflationary increases, will no longer be protected.
Housing campaign groups, including Homes For All, said in a joint statement, “Already almost 30 percent of social tenants can’t afford bills or debt repayments, and 63 percent struggle to meet housings costs.
“The new government should be investing in vital social housebuilding not making social homes less affordable.” It says Labour should tax the rich instead, “including private developers and landlords with massive portfolios”.
Meanwhile in London the mayor’s Affordable Homes Programme 2021‑26 built just 71 new affordable homes between April and June this year.
The scheme was supposed to begin construction on 35,000 homes by March 2026. By September 2023 no work had started on any. So, how realistic are Labour’s plans?
Housing historian John Boughton told Socialist Worker, “Details are thin, we don’t have clear and exact policies. But my concern is that any plans are predicated on the existing public-private partnership.
“There’s a tension in the Labour Party. Deputy leader Angela Rayner talks about providing social housing, but Reeves says the state cannot build houses.
“I think Reeves will hold the cards, and Labour will be over reliant on the private sector. Social housing could become more squeezed than it currently is.” John said when it comes to housebuilding, developers hold the power.
“We currently rely on Section 106 of the Town and Country Planning Act 1990 to build. It lets private developers squeeze money from local authorities for housing and infrastructure.
“Corporations who have good lawyers and accountants gain heavily from the system. They pay and provide far less than they initially promise.”
Housing and planning activist Paul Burnham is also sceptical of Labour’s plans.
“It’s continuity from the previous government. The Tories promised 300,000 homes a year that they never achieved. Labour says 1.5 million over five years. This type of target has been road-tested with predictable results.
“The 1.5 million homes will be delivered without additional money in the affordable homes programme. The logic of a target means relying on house building, creating a disproportionate number of unaffordable homes.
“It’s counterproductive. These homes are not aimed at people on waiting lists.” John said it’s right to be “sceptical” of Labour’s plans. “We have a very centralised system of government finance.
“Devolved powers allow councils to have their own local source of income. But councils have been incredibly constrained.
“Central government has cut through local government budgets with impunity. It’s reached a point of being unsustainable and statutory needs cannot be met.
“Local councils can be empowered through state support. Central government targets are important for councils to be ambitious, but they’re hamstrung when trying to be so.”
Labour also talks about building “quality” homes. “We’ll see too many homes on sites, which is already a problem,” Paul said. “Starmer is putting forward the idea that planning reform will grow the economy.
“This is neoliberalism to the next level. It doesn’t account for when the market goes wrong.
“Starmer met with developers to ask whether they wanted more money. But what they want is change to the planning system to make it easier to do what they like.
“Developers don’t want to build affordable homes. In London 65 percent of new homes were supposed to be affordable over the last five years but only around 20 percent are.
“Labour needs to draw up local plans based on need and use that to solve the problem.”
Private development and right to buy schemes have slashed council housing stock.
“From the 1890s to 1970s we had a pretty simple model. To fund council housing would mean taking a loan from the Public Works Loan Board,” John explained.
“It’d give favourable rates to local authorities to repay over 30 years and that would be paid primarily from rental income.”
Around 126,000 council homes were built per year on average from 1945 to 1979. Now it’s around 6,000.
“Margaret Thatcher was hostile to council housing and took the view that the free market would deliver housing for all.
“And, more on the part of Labour, there was resistance to high public spending and a notion that private development was the vanguard to finance social housing.
“But developers provide small amounts of social housing. There’s now 1.4 million less socially rented homes than in the 1980s. The reduction in council housing stock with Thatcher’s right to buy also had enormous significance.”
This has created the housing crisis we now see. Council housing has stopped being seen as a public service that meets the needs of people.
“In 1977 we saw measures that meant people with priority need should have statutory access to social rent housing,” John explained.
“That became incredibly problematic with the reduction of housing stock in the 1980s and beyond.
“In London 62,000 households are in temporary accommodation, housed by local authorities in places like B&Bs. This is around 113,000 nationwide.
“That’s expensive. Local authorities are bankrupt but spend £1.7 billion on temporary accommodation.”
Paul says that Labour “needs to take over from the developers, build and invest.
“Relying on the markets means there’s been a severe crisis in housebuilding, resulting in a considerable downturn in council housing. Costs have gone up and hopes come down again.”
While councils overspend, developers rake it in. “That’s the essence of the housing crisis. The reduction in social rent housing has seen a rise in the cost of the private rental sector and insecurity,” John said.
And Paul slammed Labour’s plans to reform planning regulation as “harmful and weak”. “It’s not clear how it’s all going to work. Developers often claim their schemes are ‘sustainable’.
“Myself and others have started reading up on developments. We put forward arguments that mean they have to be pushed back or amended because they’re not good enough or don’t include enough council or affordable housing.
“It’s a continuous battle. Starmer’s plans are an economically charged pipe dream.”
Public spending on council homes has to be the way forward. “We’re told that’s not realistic,” John said.
“But we need direct public investment and treasury support to allow local authorities to build. Margaret Thatcher thought the consumer market would be more effective than state planning and provision.
“The irony is in the 1970s the state spent money on bricks and mortar. Since the 1980s its been paying for housing allowances and subsiding consumer demand.
“Some £12 billion of central government money goes directly to private landlords per year through housing benefits and allowances, especially because rents are higher.” Paul said that housing has to be based around need.
“People can’t afford to buy or rent. We need to build council or actually affordable sub-market rents that the public has invested in. That’s been completely lost. And we need to abolish the right to buy.
“There’s a consultation about the planning reforms that tenant-led bodies are putting responses to until the end of September. We need to get more trade unions to put forward objections.
“We can’t just have an excessive reliance on new builds. The government could give councils money, subsidising them when properties are available on the market.
“It means councils could buy back homes. Starmer has really been listening to developers too much, and we need to make him listen to ordinary people.”
A week after the general election 20 Labour councils said they needed more investment in council housing.
“That’s good. But rents don’t need to be higher—council rents are already too high. Quality and affordable housing makes a difference to people’s lives,” Paul added.
“And new council homes pay for themselves. It reduces housing benefits bills and means private rents go down. Plus, it reduces other costs like social exclusion and poverty.
“More trade unions need to sign up to Homes For All’s five-point plan.
“This calls for government investment in mass council house building, rent controls in the private rented sector, funding to repair council housing stock, adequate funding for fire safety and planning for people—not profit.”
Three of the top five landlords in parliament are now Labour MPs. The biggest landlord—measured by number of properties—in the Commons is MP Jas Athwal, who owns 18 rental properties.
Athwal rents out 15 residential properties and three commercial properties, all co-owned with a family member.
His collection of rental properties eclipses that of shadow chancellor Jeremy Hunt, a multi‑millionaire entrepreneur who owns nine rental properties.
MPs must declare if they have a rental property that generates more than £10,000 a year in annual income.
There are 85 MPs who declare themselves landlords under this definition. Labour has 44 such landlords, the Tories 28 and the Lib Dems eight.
Thousands of residents in London have been without water for months
The climate crisis is impossible to ignore
The human cost of the heatwaves are higher than the temperature
Divide and rule was used to undermine struggle
