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Any other business

The best answer to the Brexit vote: more jobs and more houses

Also in Any Other Business: who wins and who loses as rates change; Theresa May and Matthew Taylor; a new royal yacht

8 October 2016

9:00 AM

8 October 2016

9:00 AM

‘I rang and said can I have a council house, I’ve nowhere to go, an’ the bloke said no you can’t, we need them all for t’Romanians,’ was a remark offered by a fellow patient, known to me as Fat Lad, when I was hospitalised three years ago. ‘I’m telling you, I’m the biggest Ukip supporter there is…’ he went on, illuminating how — unnoticed by the comfortable classes — a shortage of social and affordable housing was helping to fuel the national mood that eventually led to the Leave vote.

Belatedly, Communities Secretary Sajid Javid has had a Damascene moment: ‘Tackling the housing shortage is not about political expediency,’ he declares. ‘It is a moral duty.’ He and Philip Hammond have pledged £2 billion to fund accelerated housebuilding on public land, plus a £3 billion Home Builders’ Fund to encourage smaller builders and developers.

This will act as a Keynesian stimulus through the Brexit turbulence the Chancellor warned of in his conference speech — but I doubt it will come close to filling the gap between the 170,000 homes currently built each year and the 250,000 that experts say we need, both to house a growing population and to hold the price of housing down. That will require bolder interventions, including radical relaxation of planning rules, if social unease is to be averted, particularly among the disadvantaged young. Brexit moves markets, shares rise as the pound falls, but ministers should remember that domestic issues such as housing actually drive voter behaviour: trifle with them at your peril.

Meanwhile, in my Yorkshire town of Helmsley the cheapest new-build house on offer is a two-bedroom cottage in a cramped courtyard at £395,000. Fat Lad will never be able to buy it, or anything like it, and by now I’ll bet he’s a Corbyn voter.

Rebalancing at last

My long-running campaign for fairer business rates may not have been the most laugh-out-loud of this column’s themes but it has resonated with many readers who are business owners, residents of provincial towns with moribund high streets, or both. Following George Osborne’s reforms last October, inter alia allowing local authorities to keep the £28 billion raised and spend it on infrastructure that might actually help the businesses which pay the rates, the new government has launched a valuation review that recognises the imbalance of prosperity between London and the provinces.

The Great Recession played havoc with the commercial property values on which rates are based: for bombed-out town–centre retail spaces, rates became a bigger cost than diminished rents. But the previous government shamefully deferred an overdue revaluation beyond the 2015 general election for fear of losing small-business votes to Ukip. The review finally announced last week adds 11 per cent to the capital’s rates bill while cutting a similar percentage for the rest of the country and maintaining the overall take at its present level.

That’s a shift in the right direction, but transitional arrangements mean that savings for non-metropolitan businesses will be maddeningly slow to arrive. Those on the painful side of the new equation have nevertheless been quick to protest — led by BT, where the rates bill will go up by more than half a billion, provoking threats of higher broadband charges to make customers pay. Worst hit are West End retailers such as Polo Ralph Lauren in Bond Street, facing an 80 per cent rise to £3.9 million a year, and Selfridges in Oxford Street, up 51 per cent to £15.1 million. But foreign shoppers armed with cheap sterling surely won’t notice any consequent price rises.

By contrast, City banks in their shiny new towers get off more lightly than they probably deserve, with a rates rise of 34 per cent. But not so the Bank of England, which will have to pay 61 per cent more for being where it is — though of course it can print money to pay the bill. The governor might even claim that will boost the economy, but any struggling small-business owner up north will tell him that a simple cut in the cost of workspace and sales space through lower rates would be a lot more stimulating, if times are going to get tough again, than any of his monetary gimmicks.

Man for the job?

Following my plea (17 September) for a national debate on the ‘atomistic jungle’ which is the new world of work, I naturally sat by the phone awaiting a call from Downing Street inviting me to lead an inquiry into the buyers’ market of low-paid flexible working and insecure self-employment I had described, and whether new rights and protections are needed in response. Imagine my surprise (and indeed that of former Tory ministers and right-leaning think-tankers who might have fancied it) to find Mrs May has given that job to my old sparring partner Matthew Taylor, former head of Tony Blair’s policy unit, co-author of Labour’s 1997 manifesto and, when I first met him, an early exponent of dark Mandelsonian spin.

The appointment has been called a ‘centre–ground land grab’ that shows off the prime minister’s One Nation credentials. But she might find the real Matthew Taylor nowhere near the centre — to the left even of his combative persona on Radio 4’s The Moral Maze, and a bit subversive to boot.

All in good taste

My great predecessor Christopher Fildes rings in to support another of my recent calls, in concert with the Daily Telegraph: for a new royal yacht and export sales flagship funded by donations from repentant bankers and FTSE executives. He has an even neater suggestion, that Sir Philip Green should offer the Queen the one of his own floating palaces, Lionheart or Lionchase, on condition that he be allowed to keep his knighthood. But would Her Majesty be happy with those marbled bathrooms and crocodile-skin cocktail stools? A tasteful refit might cost more than a new yacht.


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