defend_council_housingThere is a house building crisis and this presents, say Britain's communists, an ideal opportunity to build a way out of the recession.

As the recession bites deeper and the parliamentary parties vie with each other to present public-sector cuts as an inevitable consequence, there is an increasingly gloomy outlook for the type of expansion in social housing heralded by the government only a few months ago.

The pre-budget report outlined a £340 million cut in regeneration funding which will have a direct impact on the number of new social homes.  It is anticipated that the number of new housing association homes will plummet by 70%, from over 38,000 homes in 2011/12 to 10,500 in 2019.

Darling also announced reversal of long-standing policy that saw the private sector as the principal delivery agent of new social housing.  Prior to the recession the private sector delivered the majority of new social housing through the planning gain system.  Now, the government is in danger of throwing the baby out with the bathwater in asking housing authorities to ensure that any targets set for planning gain delivery are subject to rigorous ‘viability’ assessments.  This means calculating what proportion of social housing a developer can provide and still achieve a minimum 20% profit on their development.  This is likely to result in massive reductions on the targets of 35-40% affordable housing that were typically being set by local authorities as the S106 contributions by private developers.  While this is likely to stimulate private developer activity and may give a leg up to the ailing construction industry, it is clear that there has been insufficient investment for social housing development to plug the gap in new affordable housing that will result.

One welcome piece of news is that the Treasury intends to produce plans to increase the supply of council and other public sector land for affordable housing development.  However it remains to be seen whether this will result in local authorities and other public bodies with land holdings, such as the NHS and MOD will be compelled to release land for social housing.  In reality the majority of land available for social housing development in the country is owned by the public sector, much of it derelict or otherwise not in use.  Many Labour authorities already make land available either free or discounted for the development of social housing.  The same can not be said of many Tory authorities who prefer to sell land at market value and to use the capital receipts to help peg council tax increases, at the expense of the poor who need the housing, while ensuring they continue to keep sweet their wealthiest constituents.

We should be demanding legislation that ensures enough public land is made available to enable the development of social housing, along with a massive, long-term injection of public subsidy for new social housing.  That campaign should include the demand that Councils once again become developers and providers of housing.  This must mean a relaxation of the fiscal rules that prevent local authorities borrowing and implementation of the long-overdue review of the housing revenue account subsidy system.

Just as in 1945 we have an opportunity to build our way out of recession, create jobs and apprenticeships in the construction industry, and meet housing need for the first time in two generations.