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Home truths can spoil a manifesto launch. A simple one? That since 2006, when a UK government first set its 300,000-a-year target for building new houses, Britain has never hit it once.
Governments of both stripes have routinely missed, often by 100,000-plus units a year. So plenty has to be taken on trust with Sir Keir Starmer’s pledge of building a fresh 1.5 million abodes to “restore the dream of home ownership” over the next parliament.
At least he’s started with a bit of ambition, even if you wonder if self-promotion, not getting stuff done, is his key skill: did he really have to put 32 pictures of himself in Labour’s 136-page election missive?
Whatever, after the Tories’ bleak house regime, Starmer doesn’t have a lot to beat. This year Britain will be lucky to get to half the target for new-builds. And Starmer has spotted the key problem: the mix of Nimbyism and planning gloop exemplified by Rishi Sunak caving in to a backbench Tory revolt just after becoming PM and junking mandatory housebuilding targets for local authorities. The result? More than 60 withdrew their plans for new homes, instead spending £50 million on planning appeals — a move that consultancy Lichfields reckoned would lead to 75,000 fewer homes being built each year.
The damage is clear. The latest housing pipeline report from the Home Builders Federation shows that in the first quarter of this year only 2,472 sites were given planning permission, the lowest figure since 2006. On top is a staff shortage. The Royal Town Planning Institute found net spend on local authority planning wings fell by a real-terms 55 per cent to £480 million between 2009-10 and 2020-21.
Starmer says he’ll “immediately” work to put all that right, “restoring mandatory housing targets”, ensuring authorities have up-to-date “local plans”, using government “intervention powers” where necessary and hiring 300 planning officers — funded by some of the £40 million earmarked from a 1 per cent hike in stamp duty for non-UK buyers of residential properties. Yet none of this is a quick fix. New planning officers have to be trained. And, as RBC analysts noted, the industry reckons “£500 million will be required over four years” to tackle planning delays and the drop in departmental funding.
Some of Starmer’s stuff is wishy-washy, too. About 160,000 homes remain unbuilt due to “nutrient neutrality” rules — the need to mitigate any extra nutrient load from developments. Starmer glibly says he’ll “unlock the building” of such homes “without weakening environmental protections”. But how, exactly? He also plans to deliver the biggest rise in affordable homes “in a generation”. But aren’t they the least profitable to build?
• We need to axe red tape to get Britain building
Dean Finch, the Persimmon boss, is not alone, either, in calling for more than a “mortgage guarantee scheme” to get first-time buyers struggling to raise a deposit on the ladder — not least with interest rates on the rise again. “Without a stimulant, I don’t see how Labour is going to hit its numbers,” he says.
And even if demand picks up, Britain has an ageing construction workforce and skills shortage — not helped by post-Brexit resistance to importing foreign labour. There’s also a lack of smaller builders for the sites of ten homes or fewer that the big guns, such as Barratt, Persimmon and Taylor Wimpey, won’t touch. In short, Starmer’s target is no easy hit. Still, at least he’d be trying to bring it home.
Return to sender?
Maybe Daniel Kretinsky will hand over to the posties one of his polluting coal-fired power plants. Or a few metres of the Eustream gas pipeline. Or perhaps a stake in West Ham United.
How else, you wonder, can the Czech billionaire fulfil the demands of Dave Ward, the Communications and Workers Union chief, to give his 110,000 Royal Mail members a “significant and meaningful” stake in the business? Or, for that matter, meet the ambitions of Starmer, who says vaguely that he’ll “explore new business and governance models for Royal Mail”.
• Royal Mail: Football fans’ model will be union’s pitch to Kretinsky
If Kretinsky succeeds with his £3.6 billion takeover of the Royal Mail’s owner, International Distribution Services, it’ll be subsumed into his EP Group. He’s said it will become a “core subsidiary” — part of maintaining EP’s investment-grade credit rating. This is a private company owned by him. So what mechanism is he supposed to use to give the posties a stake in EP’s Royal Mail subsidiary? Some weird illiquid share scheme that no one can value?
True, maybe he could offer some sort of Royal Mail profit share. But if Ward wants his workers to have a stake in the business, it would be far easier if it wasn’t sold to the Czech Sphinx. Share options in a listed business would do the trick nicely.
Frozen assets
Wannabe Tory MP one minute, warm-up act for Starmer the next. The human chameleon Richard Walker — the executive chairman of Iceland — has thawed from blue to red in no time. But even he can’t totally reinvent his past.
Who can forget the puzzler he posed in February 2021? “Why has Iceland not followed some of the other grocers in returning our pandemic business rates relief to the government?” The answer? Because he and his dad, Sir Malcolm Walker, spent some of the £40 million freebie buying the frozen foods company for themselves.
Thanks to the largesse of the Tories, who Walker Jr is now so “sick and tired” of, the family — plus a few mates — had some extra readies to buy out the 63 per cent stake in the business held by South Africa’s Brait. How lucky was that! Who knew freeloaders cut so much ice in the Labour Party?
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