Bringing a solution to the housing shortage under the remit of the NIC would show the Conservatives mean business
Chancellor George Osborne’s slightly unexpected choice of refrain in his Conservative Party conference speech this week - “We are the builders” - might not yet quite ring true to an industry that has seen public sector construction decimated under the party’s austerity drive. But the unusually heavy focus on the built environment at the party’s annual meet in Manchester was nonetheless positive news for the sector, which has long believed policies affecting it are determined largely on the fringes of government. And this focus yielded its first major win for the industry this week: the policy shift which will see the Conservatives introduce an independent National Infrastructure Commission, under the auspices of former Labour peer Lord Adonis.
The launch of an infrastructure commission, which shifts responsibility for the UK’s long-term infrastructure priorities from the government to an independent body, was championed by Building’s 18-month Agenda 15 campaign, launched in January 2014. The idea, which through Agenda 15 received backing from all sections of the industry, originated from Sir John Armitt’s Labour-commissioned review of infrastructure and was a central part of Labour’s election manifesto. Osborne’s acknowledgement of Labour’s role in creating the policy was a sign that the need for a long-term programme of infrastructure development outweighs party politics (although, ironically, the credit will have been partly motivated by the Tories’ political desire to capture the attention of those who feel abandoned by Labour’s shift to the left).
Osborne’s explanation for his party’s shift in stance - that the idea’s “time has come” - is disingenuous at best, given that the UK’s infrastructure gap is a result of poor planning and underinvestment, which has long been known about. But with the country facing a looming crisis over energy generation, in particular, the fact that a party of government has committed to these challenges being overseen by a politically independent body cannot be underestimated. And the Conservatives are to be applauded for - even belatedly - being that party. However, if the National Infrastructure Commission is to fulfil its potential they must think more creatively about how to secure financing for the projects recommended by the commission. Jeremy Corbyn’s so-called “people’s quantitative easing” is highly controversial but does at least recognise that existing funding methods are struggling to keep up with the infrastructure pipeline needed (pages 22-25). The delay to a new generation of nuclear power stations, and especially Hinkley Point C, should serve as a warning of the risks of leaving funding in the hands of market forces.
But, even before securing project finance, there is a further way in which the Conservatives could show they are serious about meeting the UK’s built environment needs. And that is by bringing a solution to the housing shortage under the remit of the commission. This week, the Treasury told Building that it would not be making housing part of the commission’s role. But if this remains the party’s policy, it would be a huge wasted opportunity.
Having accepted that the UK’s long-term infrastructure needs are best identified and planned by a body removed from the short-termism of a five-year political cycle, it makes sense that the same logic is applied to the shortage of homes. Given an estimated 337,500 new household groupings of people could be created each year until 2021, housing is undoubtedly one of the biggest, if not the biggest, challenge faced by the UK in its drive to support its future population.
Of course, there are party political reasons not to do this - not least because a government’s record on consistently delivering housing, unlike a 20-year rail project, will be an easy target in future elections.
But if, in Osborne’s words, the commission will exist to “hold any government’s feet to the fire if it fails to deliver”, surely it could hold the key to ensuring the legacy of housing undersupply is dealt with as fast as is needed to avert crisis for thousands of individuals and families.
Sarah Richardson, editor