Charles Wright: What is Sadiq Khan’s record on housing?

Charles Wright: What is Sadiq Khan’s record on housing?

Building more council homes – 40,000 more by 2030 – is a central pledge in Sadiq Khan’s manifesto for the coming mayoral election. It’s an eye-catching promise at a time when 78 per cent of Londoners say the capital is facing a housing crisis, according to recent Redfield and Wilton polling for On London.

Almost nobody would deny the city needs more homes. But Khan’s performance to date, his manifesto says, shows that “with the right approach and the right priorities, it’s possible to make progress” in delivering “homes that Londoners can actually afford”. So how does the Mayor’s record stack up?

City Hall’s most direct power is its devolved control over the allocation of London’s share of the government’s affordable housing budget. This provides grants to providers to subsidise the cost of delivering affordable homes – albeit with Whitehall setting the actual amount available and an overall target for the number of homes to be started.

The 2016 to 2021 government programme, extended to 2023 after stalling during the pandemic, saw Khan given some £4.8 billion to get 116,000 affordable homes underway. He more than met that target, with the total including some 23,000 council homes, the highest total since the 1970s, and a “record-breaking” 25,658 affordable homes started last year alone. It’s treble the delivery rate he inherited, the manifesto claims.

Is Khan failing on family-size homes though, as his Conservative rival Susan Hall contends? London Assembly data show 22 per cent of the homes got underway during the 2016 to 2023 programme are three bed or more, against some 70 per cent one or two bed. While this is short of City Hall’s assessment that 29 per cent of new homes by 2041 should be three bedroom or more, it’s still four times as many as Johnson delivered, Khan says

Under the current government programme Khan has a further £4 billion to spend out of the £11.5 billion originally intended to help deliver some 180,000 affordable homes across the whole of England between 2021 and 2026. London’s initial target was 60,000 starts by March 2026.

It’s fair to say the new programme had a shaky start. Hall has pointed out that only four per cent of the homes pledged have actually been started. What’s going on?

It seems the 180,000 aspiration, set in 2021, ran up against reality, or “economic changes”, as recently-published Whitehall documents euphemistically put it. Inflation, interest rate hikes, delays in setting new safety rules for tall buildings and, not least, the necessary renegotiation of targets have all taken their toll.

By August 2022 Whitehall had reduced the London target to 35,000 homes and it has now been fixed even lower, to between 23,900 and 27,100. City Hall has promised that delivery will “ramp up” over the coming months, with more larger homes too following changes negotiated with Whitehall in the grant rate per home.

It remains to be seen how much impact those “economic changes” may yet have on affordable home delivery – and whether a Labour government will provide the extra investment Khan is hoping for. They have certainly affected overall house-building in the city, which the Mayor also has influence over through his London Plan, the development blueprint for the capital.

Supply of new homes of all types, at around 38,000 a year, is running well below the numbers needed. Hall and government argue that the policies in the Plan, which must be taken into account when councils make decisions on individual planning applications, are partly to blame for the shortfall.

The Khan Plan, like those of his predecessors, sought to respond to the continued increase in London’s population by encouraging “good growth” – defined as socially and economically inclusive and environmentally sustainable – and by “rebalancing” development towards “more genuinely affordable homes for working Londoners to buy and rent”.

The Mayor says the Plan has “raised the bar” on housing design quality while preserving the Green Belt and protecting vital industrial land. And his “35 per cent affordable” requirement for major schemes has seen the amount of affordable housing delivered go up to 41 per cent compared with 22 per cent when he took office.

But housing secretary Michael Gove said at the beginning of the year that the complexities of the Plan were actually “holding back” house-building in the capital. He announced a quick-fire review aimed at boosting delivery on “brownfield” sites in particular.

The review reported, albeit somewhat anecdotally, that in difficult economic circumstances there was “persuasive evidence” that the Plan’s plethora of requirements on design, safeguarding industrial land and, not least, on requiring 35 per cent of new homes to be affordable could indeed be frustrating development.

Echoing the concerns of some developers, it said that Khan’s policies were effectively loading too much cost on them, making potential scheme unviable. It nevertheless made general recommendations only, that there should be a “presumption” in favour of allowing building on brownfield sites (which many commentators suggested already exists).

Gove has now ordered further reviews, specifically on freeing up more industrial land for housing and accelerating progress on the 47 “opportunity areas” across London that the Plan identifies able in each case to deliver at least 2,500 new homes or 5,000 new jobs or a combination of the two.

Hall has taken the cue. “I have listened to concerns about excessive red tape in the London Plan, that holds back much-needed new homes on brownfield land, and I will overhaul it,” her manifesto states.

That would mean reviewing policies that “restrict housing development on surplus industrial land, especially in areas close to train stations and transport hubs”, while allowing more car parking spaces in new developments.

Her homes, she says, would be mostly “high-density, low-rise”, designed for “families to set down roots”. High-rises would be “limited to appropriate areas that do not disrupt existing communities” and the Green Belt would be “fully protected”. There’s a focus too on “Build to Rent” schemes and homes for ownership, and more estate regeneration.

Hall’s proposals, says Khan, would mean “12,000 fewer homes” in the city. But his manifesto nevertheless responds to criticism of his Plan from Gove and others, promising to “unblock” more new homes by creating “new Land Assembly Zones and setting up more Mayoral Development Corporations (MDCs) to boost overall housing supply and drive regeneration”.

Those proposals, as Khan says, would be a “decisive” step for a Mayor who to date has resisted the creation of MDCs, which effectively take planning powers from the boroughs. Perhaps that is a measure of the depth of the housing challenge facing whoever occupies City Hall after next week’s vote, as the development landscape in London looks set to change.

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