The appointment of new housing minister Grant Shapps has been warmly welcomed by the housing industry. Twas ever thus. Trade bodies always welcome the announcement of new ministers, because even if they disagree with everything they’ve ever said, written, thought, or even considered thinking, there’s no point making them your enemy.
And in this case the industry had extra cause to breathe a sigh of relief: the fear from the private sector was, once the Coalition had been announced, that Lib Dem housing spokesperson Sarah Teather might be given the job, who is known as a ferocious advocate for social housing, and no friend of the private housebuilder. Teather’s appointment at the Department for Education also means Lib Dem plans to raise VAT on new housebuilding have been kicked firmly into the long grass. Sources say Shapps has already made it known that he sees little future in that particular policy, and his appointment, alongside that of planning minister Bob Neill, seems to confirm that Tory ideas will drive the housing agenda.
In addition Shapps knows the sector well, having held the shadow brief for a long period, and has made it clear he is a friend of development, with a real desire to see a huge increase in housebuilding levels. He is also committed to reducing regulation and red tape. Rarely will the industry have seen such a knowledgeable minister this quickly after a change of government.
All this is true. However, in reality the appointment, stripped of its cabinet status, offers little for hope for a housebuilding sector propped up by two years of unprecedented public spending on new homes.
If Shapps lives up to his pre-election promises - and there’s no reason to think he won’t - the industry is actually likely to be in for a very difficult time. Housing targets will be abolished. Neighbours will be able to lodge appeals against nearby housing developments for the first time. Spending on planning departments will be slashed.
In addition the HCA, which has focused more on helping out private housebuilders (rather than regeneration schemes or social landlords) than anyone would have expected upon its inauguration, looks set to suffer huge institutional change and, most likely, swingeing budget cuts.
Furthermore, the Tories have pledged to get rid of the social housing regulator, the TSA, in their planned bonfire of quangos. Nevermind that the Council of Mortgage Lenders says the body, which costs just over £40m per year to run, saves the government somewhere in the region of half a billion pounds per year through the reassurance it gives to banks to lend to housing associations at preferable rates on development schemes.
Ultimately, the localism agenda is likely to see at the very least a hiatus in decision making. Spending will be transferred from the centre to councils, bodies which will not have the capacity to make decisions quickly at first, and will make the institutional landscape profoundly more complex for the private sector to negotiate.
Taylor Wimpey chief executive Pete Redfern has described the prospect as “scary” (whilst somehow managing to originally endorse the Tory planning policy upon its launch). He’s not alone. So while Shapps is pro-development and has a number of good ideas, there will this week be profound concern in housebuilder boardrooms about what the future holds. Despite the warm words.