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London needs more powers to double housing supply by 2020 – report

Words: Laura Edgar
London Housing / iStock: 000041231914

The London Housing Commission says the capital needs to double its housing supply to 50,000 homes by 2020 to try to meet the demand – and more powers are needed to achieve this.

In its report, Building A New Deal For London: Final Report Of The London Housing Commission, the commission also recommends exempting London from the National Planning Policy Framework (NPPF).

Last year, 25,000 homes were built in London, says the commission, but double that number are needed to “keep pace” with the capital’s growing population. The commission says the housing crisis in London has serious consequences, with businesses “struggling to recruit and retain staff”, and more people living in overcrowded social and rented homes.

The report recommends that the next Mayor of London and the 33 boroughs should together strike a devolution deal with central government.

This should involve a commitment to deliver 50,000 homes a year by 2020 and make sure that affordable housing is available for residents of all income levels. It warns that promoting home ownership – if it comes at the expense of affordable homes for rent – would add to the housing challenges in the capital.

Additionally, London should be given “significant new freedoms” to control its own planning, borrowing and taxes.

Lord Bob Kerslake, commission chair, said the body “does not claim to have all of the answers, but it is clear that the status quo will not do”.

“The housing crisis will not solve itself, and radical measures of the sort we outline in this report will go a long way to delivering the volume of quality, affordable homes that the capital desperately needs.”

The devolution deal should comprise a number of measures, which include:

  • Exempting London from the NPPF. The mayor’s London Plan should instead be given the same status as well as giving the mayor the power to “force boroughs to change their plans if they are not identifying enough land for housing”. This means, says the report, that local authorities outside London would have a duty to cooperate with the mayor to help solve London’s housing crisis.

  • Increasing the Greater London Authority’s borrowing powers and lift the cap on the borough housing borrowing units.

  • Allowing London to keep more of the stamp duty raised from homes in London, adjusting the rates over time.

  • Devolving responsibility for setting planning fees to allow boroughs to charge higher fees, “enabling them to speed up the planning process”.

  • Lifting the cap on council tax premiums for empty and second homes.

In the meantime, the reports also recommends measures the mayor and the London boroughs can take immediately to address the housing shortage and “prepare the ground” for a devolution deal. These include speeding up the release and development of public land identified by the London Land Commission and reviewing green belt land near public transport sites.

Lord Kerslake said: “While the mayor and the boroughs can do more with the powers that they have now, the only route to building substantially more homes in London is to give the capital’s leaders more direct responsibility over the key levers such as land use, planning rules, housing standards, property taxes and investment and holding them accountable for delivery.”

If nothing is done, he continued, the scarcity and affordability of housing in the capital will get worse.

Bill Davies, senior research fellow at think tank IPPR, which published the report, added: “The next mayor, boroughs and the government all have a stake in securing London’s economic success and maintaining its social fabric – it is in their interest to work together and to look at how homes are delivered in the capital, which will help each layer of government work towards the goal of seeing more good quality, affordable homes across all tenures.”

Richard Blyth, head of policy at the RTPI, said to The Planner: “It is important that London is planned in a way which is joined up with the planning of the counties round it. I am not sure that removing London from the NPPF would necessarily assist this. It should also be noted that the counties round London are also areas of severe housing pressure.”

The report can be found on the IPPR website.

Image credit | iStock