Rishi Sunak on Thursday “stepped in” to try to sort out London’s housing crisis blaming Sadiq Khan for sky-high property prices destroying the dreams of many Londoners to own their own home.
The Prime Minister announced a review of the London Plan to identify new sites to build tens of thousands new homes in the capital.
He also gave the Mayor of London an autumn deadline - three to four months - to agree progress towards changes to the city’s long-term masterplan or Housing Secretary Michael Gove may use powers to intervene.
“The Mayor has failed to deliver the homes that London needs. This has driven up house prices and made it harder for families to get on the housing ladder in the first place,” said Mr Sunak.
“That is why we are stepping in today to boost house building and make home ownership a reality again for people across this great city.”
The Government immediately highlighted that more flats and houses could be built on sites, close to Tube stations, instead of single-storey warehouses.
Labour’s Sadiq Khan has failed to deliver the homes London needs, driving up prices and making it harder for families to get on the housing ladder.
— Rishi Sunak (@RishiSunak) July 27, 2023
So I’m stepping in to boost house building and make home ownership a reality again for Londoners.https://t.co/G9YLR3R4LN
Mr Sunak also announced:
- £150 million of funding will go directly to boroughs, by-passing City Hall, to prepare brownfield sites for housing, including by putting in better infrastructure such as roads and green spaces
- £53 million for the Old Oak West project in west London to deliver more than 9,000 new homes, and aim to support 12,000 jobs
- Confirmed rules on the use of £1 billion for affordable housing will be relaxed so it can be used for regeneration of old social housing estates
- Promised that “beautiful, well connected homes” will be built with “landscaped parkland” as part of the Docklands 2.0 development which could create up to 65,000 homes across several boroughs including in Thamesmead, Becton and Silvertown
However, City Hall responded strongly to Mr Sunak’s attack on the Mayor’s housing record.
Are you the same guy who dropped his house building targets? Because I’m the guy who started building more council homes than the rest of England combined, exceeded your affordable homes targets & built more homes of any kind than since the 1930s. This is desperate nonsense. https://t.co/ChSVSCSp3n
— Sadiq Khan (@SadiqKhan) July 27, 2023
Mr Khan said: “This is pathetic gesture politics by the Tories in an attempt to distract from their out-of-touch government’s inaction on the mortgage crisis. Londoners won’t be fooled in the slightest.
“The Tories have a miserable record of continually blocking badly needed new housing in London across the board while Labour in London has exceeded the Government’s own affordable housing targets, delivered higher council home building than the rest of England combined and built more homes of any kind than since the 1930s.”
The London Plan puts a target of 52,000 new homes a year for the city, which is not being met.
Analysis by London Councils shows that 143,000 new homes could be brought forward in the capital if “viability challenges”, such as additional grant funding or the need for enabling infrastructure such as a larger Tube stations, could be overcome.
Darren Rodwell, Executive member for Regeneration, Housing and Planning at London Councils, said: “Emergency action is needed to ensure that affordable housing is available to all those who need it.
“London boroughs are playing our part – over the last year we started the highest number of new council-built homes since the 1970s.
“But we can’t do it alone. Raising Local Housing Allowance, enabling a broader range of housing to be acquired by councils and improving co-ordination across Government would be game-changing.”
Apart from a dip during the pandemic year of 2019/20, the number of affordable homes started in London has increased each year since Mr Khan became mayor.
A total of 25,658 affordable homes were started in the most recent year, 2022/23.
A spokesman for the mayor said: “The Government have relied almost entirely on London’s housing success to meet their national targets.
“Under Sadiq London has delivered 10,000 more total homes a year on average than under Boris Johnson.
“We’ve exceeded the affordable home building targets the Government set - building more homes of any kind than 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 green London for everyone.”
Since Mr Khan became mayor in 2016, the annual affordable housing starts have been: 7,416 (2016/17), 12,555 (17/18), 14,544 (18/19), 17,256 (19/20), 13,324 (20/21) and 18,840 (21/22).
The best achieved by Boris Johnson in his eight years as mayor was 16,351 affordable starts in 2010/11.
It is important to note that Mr Khan changed the definition of an affordable home, effectively making them more affordable to low-income Londoners – but harder for him to hit the target.
However, it is on the issue of completions that Mr Khan may be seen as vulnerable. It normally takes an average of two years for a “start” to be converted into a “completion”, and Mr Khan has yet to match the 17,875 affordable homes completed by Mr Johnson in 2014/15.
Mr Khan has blamed Brexit and Covid for causing delays, supply shortages and workforce problems in the housebuilding industry.
However, the number of affordable completions has increased every year under Mr Khan, from 4,934 in 2016/17 (beating the 4,881 in Mr Johnson’s final year as mayor), 5,355 in 2017/18, 7,544 in 2018/19, 7,775 in 2019/20, 9,051 on 2020/21, 10,323 in 2021/22 and 13,954 in the most recent financial year.
Between 2015/16 and March this year, 116,782 affordable homes were started in London – hitting the Government’s revised target of 116,000. This included 7,189 started in 2015/16 when Mr Johnson was still mayor, which was allowed under the Government’s counting rules.
Under Mr Khan, Transport for London has been ordered to build homes on land it owns. It has set up a property division – due to be rebranded this autumn – and it has quickly become one of London’s biggest housebuilders, with an investment portfolio worth in excess of £1.5bn.
In 2022/23, a total of 2,121 starts were made on TfL sites. Examples of projects that have been completed include hundreds of new flats beside Blackhorse Road Tube station in Waltham Forest. TfL has a long-term target of building 20,000 homes.
In 2020, the Government’s then housing secretary Robert Jenrick ordered Mr Khan to redraft his London Plan, saying it was over-bureaucratic and would prevent thousands of homes, especially family homes, from getting built.
Mr Khan has repeatedly come under pressure from Tories on the London Assembly to build more family homes rather than flats in high-rise towers. Tory mayoral candidate Susan Hall has pledged to focus on “high density, low rise” family homes, promising residents their “own front door and patch of garden, even if it is just a postage stamp”.
Mr Sunak’s bid to offer cash directly to boroughs may not deliver the results he hopes. Five London boroughs each completed fewer than 100 affordable homes in 2022/23. These were Redbridge (23), Richmond (38), Kingston (40), Merton (46) and Sutton (92).
