Watchdog says 33,000 homes have been built on unlocked land, just 5% of 713,000 target
The government “hasn’t much to show” for the £8.4bn of investment it has made into unlocking land for housing over the past decade, a report by the UK’s independent spending watchdog suggests.
The Ministry of Housing, Communities & Local Government (MHCLG) is currently preparing to launch a new National Housing Delivery Fund of £21bn from April this year to continue a previous government programme for unlocking land.
Prime minister Keir Starmer’s Labour government has pledged to deliver 1.5 million new homes by July 2029.
The National Audit Office’s (NAO) latest report, Unlocking land for housing, however, examines whether MHCLG’s programmes to increase the supply of suitable land for housing development support the government’s ambitions.
The NAO found 33,000 homes have been built on unlocked land, this is 5% of the target of 713,000 units.
But MHCLG and Homes England expect the contracts they and their devolved partners have signed to date to provide unlocked housing capacity to unlock land for 630,000 homes, 88% of the target.
Since 2016, MHCLG and Homes England have committed £8.4bn of the £10.5bn allocated funding to land unlocking projects.
The money includes grants, loans and equity investments, with £5.7bn having actually been spent. The majority of the works funded are incomplete and ongoing.
The NAO does point out that the final figure may be higher than 33,000, as the MHCLG and Homes England do not currently track all the homes built on all the land they open up.
Public accounts committee chair, Geoffrey Clifton-Brown, said it was “particularly worrying” that MHCLG “did not plan to monitor what happens to land after it has been unlocked through its funds”.
He added: “Unlocking land is an essential piece of the puzzle for government to deliver on its aim to build 1.5m new homes by the end of this Parliament. However, the most important outcome is the actual delivery of these homes.
“MHCLG has allocated £10.5bn over the last decade to create capacity for over 700,000 desperately needed homes. Despite the national importance, there is not much to show for this investment: so far MHCLG can only account for 33,000, or 5%, of the expected homes. It is particularly worrying that MHCLG did not plan to monitor what happens to land after it has been unlocked through all of its funds.”
Over the last decade, the MHCLG’s programmes have funded work on 768 sites. So far 141 of those projects have completed their unlocking works, with the remainder expected to continue through to 2034.
Some housebuilding on unlocked sites will continue until 2050. Currently, 128 (36%) projects launched between 2016-2021 have completed their unlocking work, compared with 13 (3%) of those funded since 2021.
In its report, the NAO calls on the government to clearly set out its purpose and ambitions, and track both the land unlocked, and the number of homes built.
Gareth Davies, head of the NAO, said: “The success of the new National Housing Delivery Fund will depend on government setting clear ambitions and priorities for investment alongside its approach to risk management, so that public spending genuinely helps unlock the homes the country needs.”
Clifton-Brown added: “Looking ahead to April, MHCLG has an opportunity with the upcoming National Housing Delivery Fund to set out its long term aims and build confidence in the market to ultimately deliver the necessary homes at pace.”
An MHCLG spokesperson said: “The NAO report rightly recognises that government support is essential to unlock land on which homes would otherwise not be built.
“While tens of thousands have already come forward, we know that on the most complex sites this can take time and there’s more for us to do.
“But we’re pulling every lever to tackle the housing crisis, including overhauling the planning system, committing billions in new funding and reinstating local housing targets to help build 1.5 million new homes.”
An MHCLG spokesperson said: “The NAO report rightly recognises that government support is essential to unlock land on which homes would otherwise not be built.
“While tens of thousands have already come forward, we know that on the most complex sites this can take time and there’s more for us to do.
“But we’re pulling every lever to tackle the housing crisis, including overhauling the planning system, committing billions in new funding and reinstating local housing targets to help build 1.5 million new homes.”
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