Keith Cooper

Labour’s claim of being the party of council housing is in tatters

Labour's claim of being the party of council housing is in tatters
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As part of the Labour conference focus on the cost of living, the party will be going to great efforts this week to reclaim its presumed title as the party of 'council housing'.

Expect to hear private builders bashed for squirrelling away land plots rather than piling ‘em high with apartments as they should. And the pillorying of the right to buy policy, ritually chastised as it is each conference as the chief reason for the country’s interminable descent into social housing drought.

What you’re unlikely to hear is a serious admission by Labour of its appalling track record on council housing supply. That local authority housing passed into private hands far faster under Labour than Conservative prime ministers. Or that the true title of council housing champion sits more comfortably in Conservative hands.

This chart tells starkly the story of which party’s policies have best driven social house building:

Despite the huge building boom under Tony Blair and Gordon Brown, only 13 percent of the 2.5 million homes which rose up under their watch were built by ‘social’ landlords. This compares with almost a quarter of 3.8m homes under Margaret Thatcher and John Major’s reign. Even David Cameron appears on track to match his predecessors’ trend, in market share at least. If Labour had caught onto the coat tails of their building boom to the same degree as the Tories, almost 300,000 more social homes would be dotting this land. What a massive missed opportunity.

Whichever way you look at it Labour’s council housing halo has slipped.  Investment in housing plunged under Blair and Brown to its lowest level for decades. During their first 12 months in power they spent less than in any year of Thatcher and Major’s 18-year reign. Their poverty of social housing ambition persisted throughout most of their administration. A big increase only arrived in its dying days- as a prop for builders tripped up by the financial crisis.

One council housing crown does belong firmly in Labour’s territory, though not one its grassroots members ever wanted. As these charts show, council houses and flats passed into private ownership at a far greater rate in Brown and Blair’s 13 years than under two decades of Thatcher, Major and Cameron premierships.

Labour really pushed the boat out on public housing privatisation with ‘stock transfer’, a programme in which the sell off of councils’ property portfolios to housing associations. And all on the cheap: £4,200 per home on average. Three-quarters of all ‘transfers’ - almost 1 million property sales - were waved through by Blair and Brown in this fashion. Such homes are now lost to the public sector forever; their association owners under a limited obligation to help town halls whittle down their waiting lists.

And with this grand council housing sell off Labour has shot itself unceremoniously in the foot. By divesting hundreds of authorities of property portfolios, the party hobbled its current ambition to ‘increase investment in council housing’ as Messieurs Miliband and Balls have both pledged. For the only way this investment will be realised is by councils finding the money themselves. It’s a point even the party’s senior councillors concede. As the Labour’s chief councillor in Croydon Council, Tony Newman, has admitted to me:

'There is a recognition out there that even if the economy picks up in the years to come, the money we used to have isn’t going to be there. Labour shadow ministers are very much looking at the innovative ways Labour Councils are delivering housing and learning from it.'

But Labour grand plan of pinning their hopes on local authorities has one fundamental flaw. Councils’ capacity to pay for extra homes depends on land values and regular rental income from existing tenants’ rents. Fine for the likes of Labour-led Southwark with its prime London location and steadfast refusal to let go of its valuable homes.  But for Wakefield which sold off 32,000 homes in 2005 for less than £500 each? Not so much.

Labour’s great housing sell off puts it in a tricky position. While housing experts claim that Miliband must fulfil its pledge with taxpayers’ cash, political pundits warn this would spell election suicide for a party seen as reckless spenders.

But commitment is a commitment. And as David Orr, the chief executive of the National Housing Federation will say in the magazine Inside Housing this week:

'The benefits of investing in housing  is one of the most consistent things Ed Miliband has said.The party would destroy its credibility…if they didn’t do it.'

But if the party’s recent track record is anything to go by, the credibility of any claim as the party of council housing is in tatters already.