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Osborne Budget 'inadequate' in context of London's housing crisis

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Osborne Budget 'inadequate' in context of London's housing crisis

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Published by Jon Land for 24dash.com in Housing and also in Central Government, Local Government

Osborne Budget 'inadequate' in context of London's housing crisis Osborne Budget 'inadequate' in context of London's housing crisis

Mayor of Hackney and Chair of London Councils Jules Pipe (pictured) provides his reaction to George Osborne's Budget.

The Chancellor’s statement is inadequate in the context of London’s housing crisis. However, finally there is recognition of the acute challenges London is facing. The capital’s population is set to increase to over nine million by 2021, meaning 800,000 homes are needed to meet both existing and future demand.

Polls show that affordable housing is consistently the top concern for Londoners. Housing is not only an issue for London’s rising numbers of homeless, or the young families and professionals struggling to rent, but is vital to the UK-wide economy. Business in London is increasingly looking for reassurance that government is tackling its concerns about affordability for their employees.

Local government is a key partner in delivering the homes London needs. The failure to devolve real power is hampering local government’s ability to build homes and create jobs and growth.

Today’s announcements will only scratch the surface of dealing with the long term and daunting scale of London’s housing shortage. The government needs to do much more.

It is disappointing that the Chancellor did not take this opportunity to scrap the Treasury’s block on councils investing in building new homes, when backed up by a stable funding stream. Lifting this Housing Borrowing Cap would create 60,000 new homes and 19,000 new jobs, adding 0.6 per cent to GDP, and further stimulate competition in the construction market.

But the Chancellor’s announcement of half a billion pounds of finance to small house builders is a welcome move. We know that just 27 companies are responsible for around 70 per cent of the housing starts in London. Yet 20 years ago, around two-thirds of housing was built by companies employing fewer than 500 people.

Encouraging small businesses into the market would provide more competition and foster the right environment to deliver badly-needed homes. Early and constructive engagement with local government is absolutely essential to ensure support is finding its way to where it will make the biggest impact.

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