Of all the viciousness of the cuts to be unveiled tomorrow, arguably the most vicious of all is the callous decision to virtually stop social/affordable house-building altogether. These are public sector houses/flats priced above the cost of construction, but below local private market levels. They are the only way that the lowest-income 15-20% of the population (9-12 million people) can hope to get access to a place to live. The lack of availability of sufficient affordable homes is the biggest, most damaging, most scandalous focus of social misery in Britain today. Deliberately to magnify that yawning gap now is an act of politically treasonable neglect and irresponsibility.
Thatcher drastically cut the number of homes built by local authorities from over 100,000 in 1979 to less than 13,000 in 1990 when she was ejected from office. The number continued to dwindle under Major to 451 in 1996-7. Under New Labour the number never rose above 323 in any year, and the average over the New Labour period was just 161 a year! The Tories are now proposing to cut even that exiguous output to a mere 60 a year in London and the South-East where the pressure is greatest and to even less – to all intents and purposes nothing at all – in the rest of the country.
The cold savagery of this for low-income Britain is breathtaking, especially when all this deliberately created deprivation is being rationalised via a budget deficit created by the bankers, none of whom have been penalised for their recklessness and arrogance and most of whom are now back of pre-2008 fancy incomes and vast bonuses. But the lessons of this tragedy need to spelt out loud and clear by Labour.
First, the housing sector is a monumental failure of the private market. It has utterly failed to meet what I would regard as the single biggest unmet need in Britain over the last two decades. One of the consequences of the 2007-2010 breakdown of neo-liberal capitalism is the pressing need to rebalance the State and the markets. Housing is one area – along with several others like pensions, energy, transport and banking – where the State now needs to take a much larger, active, interventionist role. The State should not only be provider, monitor and champion of health and education, but of affordable housing as well.
But there are other lessons too. Housebuilding should be at the heart of a major public sector growth and job creation programme as the best single mechanism to tackle the deficit. It can generate hundreds of thousands of new jobs and re-galvanise the deeply depressed construction industry. All that is stopping this is Tory ideological dogma.
Then there is the disaster of Britain’s burgeoning under-class. The shutdown of housebuilding which they might just be able to afford (and even that is now doubtful with inner London rents of £350 a week and a £500 a week overall benefits cap) will cruelly exacerbate tensions among the most deprived. The only thing left is the streets.