UK Government Set to Miss Housing Targets by 33,000, Says Committee of MPs

Recently constructed show homes are illuminated for potential buyers on a new housing estate in Knutsford, United Kingdom, on Feb. 3, 2022. Christopher Furlong/Getty Images

Prime Minister Rishi Sunak’s government is set to miss its national housebuilding target by 33,000 homes, according to a committee of MPs that said the national housing crisis showed no signs of easing.

The Department for Levelling Up, Housing, and Communities (DLUHC) will deliver 157,000 new homes this year against its forecast of up to 180,000, says the MPs’ report.

The committee said the DLUHC did not appear to “grasp” the fact that construction costs, inflation, and labour shortages could mean even the 157,000 figure might not be reached.

The Public Accounts Committee said insufficient numbers of homes for subsidised, or social rent, were being constructed.

The report comes only days after the government backed down on housing targets after facing a backbench rebellion by Conservative MPs.

Labour accused the prime minister of being “weak” after he pulled the vote, but housing secretary Michael Gove said this week the government was determined to deliver reforms to the planning system before it could meet the housing targets.

Amendments made to the Levelling-up and Regeneration Bill mean the building of 300,000 homes a year in England becomes an advisory target rather than a mandatory one, and councils will be able to turn down planning applications if they feel they “significantly change the character” of the area.

In a letter to MPs on Monday, Gove said he recognised “there is no truly objective way of calculating how many new homes are needed in an area.”

He said councils could put forward lower targets if they face “genuine constraints.”

300,000 Target Dates From 2019 Election Manifesto

The target of 300,000 new homes a year was set out in the 2019 Conservative general election manifesto, but the Public Affairs Committee said there was no target for how many of those homes must be affordable.

The committee’s chair, Dame Meg Hillier, said: “The government knows affordable rented homes offer the best value for money. Many people in high-cost areas simply can’t afford to rent privately or buy their own home and there’s a desperate need for affordable, secure rented homes. But amid all the building targets there isn’t one for affordable or socially rented homes.”

She added: “Local authorities know where and what homes must be built to address the national housing crisis but don’t have the power to act. The human cost of inaction is already affecting thousands of households and now the building programme is hitting the challenges of increased building costs.”

The backbench revolt about the higher housing targets represents a victory for former Cabinet minister Theresa Villiers and Isle of Wight MP Bob Seely.

Around 60 MPs had signed an amendment that would have scrapped mandatory housing targets.

The co-author of the 2019 manifesto, Robert Colville, said the amendment would “enshrine ‘nimbyism’ as the governing principle of British society.”

NIMBY is an acronym for Not In My Back Yard and nimbyism is a term for residents, or their political representatives, who fight against changes to the status quo which would affect their area.

Villiers welcomed Gove’s decision to back down and said the reforms would “rebalance the planning system and give local communities a greater say over what is built in their neighbourhood.”

“The compromise we have secured shows that positive change can be achieved through backbench scrutiny of legislation,” she added.

Seely said “well over 100 Tory MPs” had opposed the government’s original plans.

He said: “The new language we’ve agreed will work with communities, speaking to the character of areas and celebrating the beauty of good design. It understands the need for farmland, will significantly emphasise brownfield over greenfield development and will help deliver homes for young people.”

Labour’s shadow secretary of state for communities and local government, Lisa Nandy, said the government’s decision to give in to the backbenchers was “unconscionable in the middle of a housing crisis.”

She said: “We offered Labour votes to defeat the rebels, but Rishi Sunak and Michael Gove seem to have chosen party before country. This is so weak. In office but not in power.”

Other changes agreed to by Gove include charging a higher infrastructure levy on greenfield development, taking action to prevent land banking, and ending the “duty to cooperate,” which sees rural and suburban areas required to help meet the housing need of neighbouring cities.

There are differing views about what has caused Britain’s housing crisis, but all political parties accept that more homes are needed, especially in London and in other thriving towns and cities in the south and east of England, like Brighton, Oxford, Cambridge, and Norwich.

Former Prime Minister David Cameron’s government sought to create a “northern powerhouse” policy in a bid to encourage jobs and investment away from London and the south east, but it has lost impetus since Boris Johnson took over and was replaced by Liz Truss and Rishi Sunak.

A Downing Street spokesman said a promise to build 300,000 homes every year by the mid-2020s remained their “goal.”

PA Media contributed to this content.