Housing Secretary Michael Gove took a dramatic step on Monday to intervene in Sadiq Khan’s London Plan to force through a new homes boom.
Mr Gove announced an “intention” to work with City Hall on a joint taskforce to boost the delivery of housing in the capital. But he told the Mayor that he was reserving the right to use powers at his disposal to instruct changes to the London Plan where it is seen to be “choking housing supply”.
The Government announced plans to boost house-building focused on three cities, London, Cambridge and Leeds, having watered down its targets in the face of opposition from Tory MPs.
In the capital, it was seeking to unleash a “housebuilding boom”.
The housing department said this included more support to deliver up to 65,000 homes in a new cross-borough East London Development Project, including Thamesmead Waterfront and Beckton Riverside, with up to 27,000 homes, two new town centres and better east to west transport connections.
It said £1 billion was being “released” to City Hall to boost affordable housing and estate regeneration.
Ministers emphasised that the London Plan envisaged building 52,000 new homes a year, after only 30,000 were delivered in 2021/22, a Covid-hit year.
They added that the average house price in London was £525,000, compared with £275,000 for England, and the “affordability ratio” for the capital 12.5, against a national figure of 8.3.
Mr Gove’s intervention sparked an angry response from City Hall.
A source close to the Mayor said the London Plan was “working,” adding: “Utter nonsense from Michael Gove and extraordinary hypocrisy from the Government who have relied almost entirely on London’s housing success in their national targets and are using Sadiq’s success as cover for their national failings.
“London exceeded the affordable home building targets the Government themselves set — building more homes of any kind than we’ve seen since the 1930s and starting a golden era of council homes building, with the most started since the 1970s. Sadiq is building a fairer, better and greener London for everyone.”
City Hall sources also said the £1 billion announced was not new money and that £6 million had yet to be confirmed for the extension of the DLR development work.
The Mayor did hit the target he agreed with the Government of starting 116,000 homes between 2016 and April this year, but only by including more than 7,000 started when Boris Johnson was mayor.
The key problem in London is not the number of affordable homes being started — but the number being completed. It typically takes two years from start to completion and although 25,658 were started in London in 2022/23, only 13,954 were finished.
Meanwhile, Tory MP for South Cambridgeshire Anthony Browne vowed to “do everything” to stop the Government’s “nonsense plans to impose mass housebuilding on Cambridge”.
Mr Gove announced plans to slash red tape to allow more conversions of shops and takeaways into homes. A review into the extension of permitted development rights is expected to make it simpler to extend homes and convert lofts. But the Local Government Association said loosening rules around permitted development rights could lead to substandard housing.
Lisa Nandy, Labour’s shadow housing secretary, said: “It takes some serious brass neck for the Tories to make yet more promises when the housing crisis has gone from bad to worse on their watch, and when housebuilding is on course to hit its lowest rate since the Second World War because Rishi Sunak rolled over to his own MPs.”
