MIPIM | Dennett urges councils to step up in affordable homes drive
Speaking on the opening panel session of the expo, Salford City Mayor Paul Dennett said local authorities need to have more “skin in the game” to address the UK’s chronic shortage of discounted accommodation.
Speaking in front of hundreds of delegates on the main stage at Housing Matters!, Dennett said the UK has been too reliant on the private sector to develop affordable homes since Margaret Thatcher was in power.
“That has brought us to this crossroads of a growing housing and homelessness crisis,” he said.
“The market, fundamentally, is not meeting need, which is a problem.”
Dennett bemoaned the current system, which classifies affordable housing as 80% of market rate, which he says is divorced from the reality many people live through.
“It has no relationship to the labour market, household income, or what is going on in terms of people’s wages,” he told attendees.
“There is a disconnect between the realities of the economy and what is happening with the housing market.”
It is incumbent on local authorities, Dennett believes, to step in and deliver homes in line with local need in a way that the private sector cannot or will not.
Data from the Local Government Association estimates that, in the 1950s, councils were delivering 147,000 homes a year. These days, output is below 2,000 units annually.
“The future is one of the state and the market really trying to figure out its relationship with one another,” Dennett said.
“And that for me is about the state having skin in the game again in terms of being an active participant in the market.”
In Salford, Derive, the council’s own housing company, is buying up land to develop homes that it can offer to residents at social rent or capped at local housing allowance levels.
Last year, Derive delivered 113 homes while construction is continuing on another 393.
“We have got to deliver affordable rents otherwise all we will do is store up problems for the state,” Dennett said.
Well if the Government goes ahead with its proposed viability reforms in the NPPF that are currently out for consultation it will only be the public sector in whatever guise that be (Councils and Registered Social Landlords) who will be delivering affordable homes. The “Viablity Challenge for the House Building Industry” should be the big discussion point at MIPIM this year.
By Anonymous
Totally agree that the current system doesn’t build affordable social homes in areas that they are badly needed. This government has placed far too much reliance on the private sector to build homes in often unsustainable locations on greenbelt and farmland. These are unaffordable and out of reach for most young families.
The current system of private sector reliance isn’t working and local authorities need to step up and purchase brownfield sites for social homes.
By Geoff McNaough
I’m all for more Council housebuilding but it involves many Councils running on now or low financial reserves taking massive risks.
By Anonymous
The councils don’t have the skills to deliver housing any more – just filled with people who write “policy” with limited background in development and then wonder why that then results in unviable developments!
By Anonymous