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Christine Whitehead

Ian Gordon

June 7th, 2020

Mayoral Election Workshop 1: Housing Delivery

1 comment

Estimated reading time: 10 minutes

Christine Whitehead

Ian Gordon

June 7th, 2020

Mayoral Election Workshop 1: Housing Delivery

1 comment

Estimated reading time: 10 minutes

Roundtable 1: Housing Delivery

The background to this discussion was the long running story of the draft London Plan – specifically on the target numbers of homes to be delivered over the next 10 years. The Panel had accepted the identified capacity on large sites – which had not really changed from the previous Plan, but said that the assessment of what could be achieved on small sites lacked any evidential basis.  In response the Mayor had reduced the proposed number by almost 20% and we were waiting, although it was unclear how the Secretary of State might respond to the reduction.  The story is still running in early June with the Secretary of State refusing to allow publication in its current form and the Mayor putting forward as yet unpublished additional analysis of the policy changes required.  So the fundamental dispute remains unchanged.

Delivery v capacity

The starting point for discussion was a version of ‘delivery is the core problem; not the Plan’ or is the Plan itself faulty in that the capacity really is not there. The general agreement was that it was both. Many of the boroughs state that they cannot provide the numbers of sites required. Just as importantly many have to identify sites which are not ready for development until large scale infrastructure; such as Crossrail, is in place. Equally, it is the market, rather than the boroughs, which has the powers to ensure timely development occurs, even when everything is in place.  So the SoS blames the Mayor for not identifying the sites; the Mayor and the SoS blame the boroughs for not getting the homes built; and even among boroughs there is tension between inner and outer London because of the emphasis on small sites. The question for candidates is therefore: how can the Mayor be more proactive to support the boroughs? Are there better ways than making up numbers?

Accountability

A big issue from the point of view of the Mayoral election is who might be hurt by the blame game which already appeared to be raging. National government blames the Mayor for incompetence because actual numbers, while they have been rising, are nowhere near what was promised; while because of the slow development process, the Mayor can always blame the last Mayor for low levels of activity in his first term and can promise more for the second – without any real suggestion that he will stay around to take the blame in 5 years’ time.  Meanwhile the Mayor also blames the local authorities that have the legal responsibility ensure housing needs are met – even if that is practically impossible.  This process is a very unsatisfactory way of holding anyone to account for poor performance.

Inner/outer London – the politics

At the Assembly discussion on the Plan it was argued that the suggested spatial distribution of housing was a ‘war on the suburbs’ with obvious electoral implications.  Certainly the location for the large scale additions to planned output levels is mainly in the outer suburbs – but this is inherent in putting most of the emphasis on small sites. But there also must be significant concerns about the dwelling types to be provided and the capacity of services – especially public transport – to cope with such an expansion, given so many are dependent on the car to carry out day-to-day activities. So what would a new Mayor do about the spatial distribution of new housing?

Planning densities  

Issues were also raised about the benefits of increasing planning densities as well as the growing emphasis on tall buildings in many ‘town centres’ within London. These also linked with concerns about what is the most suitable mix of dwelling sizes:  with some participants asking for a lower proportion of small units (although the projected growth in household numbers is concentrated among small households) and larger proportions of larger family homes, notably in the social/affordable housing sector. Even so, there was considerable support for building smaller, accessible units close to local town centres – both planned and through permitted development – not only because such development would be close to transport nodes but also to help support retail and leisure activities in these areas.

Financing social and affordable housing

A ‘hard-core’ of participants continue to call for all or at least most of affordable rented housing to be built to be let at social (targets) rents.  At first sight this is apparently a poor way of maximising provision, as higher rents are almost entirely paid for by larger welfare payments for non-working households. Affordable rents allow more units to be provided for the same amount of grant or developer contributions.   Against this, higher rents mean it takes longer for employed households to get off benefits all together and get to a point where their marginal ‘tax’ rate is 20% like other lower income households not in receipt of benefits.   But again the trade-offs are difficult and the politics are important.

Another funding issue was around the new First Home policy – 30% discounts on some market homes for local first-time buyers.  These are to be paid for from developer contributions – so are in direct competition with affordable rented new homes – an initiative not welcomed by those who spoke out. So what does the new Mayor think?

Private Renting 

This is almost certainly meant to be seen as Mayor Khan’s  most important political gesture. Sixty-eight percent of respondents think support a policy of rent control in London. Khan is suggesting a system by which rents could not just be frozen but actually forced down. He has no powers to introduce such a policy BUT it can still bring in the votes.   Other candidates need to engage.

A final issue: improving the existing stock

If one had to bet about what housing issue will have risen up the agenda by March 2021 it would be around energy efficiency and improving the existing stock – which can generate employment opportunities and make a major contribution to climate change. Yet it was hardly mentioned at this roundtable – which was perhaps too tightly framed by the draft Plan rather than the real housing issues faced by Londoners.

 

About the author

Christine Whitehead

Professor Christine Whitehead is one of the programme officers for LSE London. Christine is an applied economist whose research is well-known in both academic and policy circles and is Emeritus Professor of Housing Economics at the London School of Economics and Political Science.

Ian Gordon

Ian Gordon is an Emeritus Professor of Human Geography at LSE. His main research interests have been in urban development and policies, spatial labour markets, migration and spatial interaction, particularly in the context of major metropolitan regions.

Posted In: Mayoral elections

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