Government to privatise £70bn of housing debt to boost house building
Ministers are preparing to take £70bn off the Government’s balance sheet in a bid to prompt housing associations to borrow money to invest in new homes.
The move would allow them to borrow without affecting overall debt figures, and comes as Theresa May and Sajid Javid pledge a house-building drive.
That will allow housing associations to be reclassified as private rather than public bodies, a change ministers hope will allow the not-for-profit organisations to borrow money more cheaply.
The announcement comes a week ahead of Philip Hammond's autumn Budget, in which he is expected to announce a number of measures on housing.
Yesterday the Chancellor warned that there is “no silver bullet” to solve the very “complex challenge” of affordability, pointing out that Britain is a “crowded island”.
But in a speech at the Treasury he added that the Government has been working on “making sure that the next generation has the same opportunities as their parents”.
MORE HOMES, MORE QUICKLY
Elsewhere, Theresa May will today commit the Government to building “more homes, more quickly” in a bid to “fix the broken housing market”.
The Prime Minister will say it is her “personal mission” to boost the number of homes at a faster rate, after decades of ministers failing to build enough.
The Government say that since April 2010 around 346,000 “affordable homes” have been built, including 240,000 for rent, but that the figure falls short.
“For decades we simply have not been building enough homes, nor have we been building them quickly enough, and we have seen prices rise,” she will say on a visit to a housing development in London.
She will add: “We must get back into the business of building the good quality new homes for people who need them most.
She will say that the Government will lay out how it plans to "go further" in the "coming weeks and months".
“This will be a long journey and it will take time for us to fix the broken housing market - but I am determined to build a Britain fit for the future," she will add.
In a separate visit Housing Secretary Sajid Javid will today call on the Government to “think big” in tackling the housing problems felt by younger generations.
“The generation crying out for help with housing is not over-entitled.They don’t want the world handed to them on a plate,” he will say on a visit to Bristol.
“They want simple fairness, moral justice, the opportunity to play by the same rules enjoyed by those who came before them.
“Without affordable, secure, safe housing we risk creating a rootless generation, drifting from one short-term tenancy to the next, never staying long enough to play a role in their community.
He will say while the Government's Housing paper in February set out a "broad vision", but there remain "many, many faults in our housing market, dating back many, many years."
"If you only fix one you’ll make some progress, but not enough. This is a big problem and we have to think big," he will say.
Shadow Secretary of State for Housing, John Healey MP, said: “After seven years of failure on housing, Ministers still have no plan to fix the housing crisis.
“Since 2010, housing problems have got worse on all fronts, from rising homelessness to falling home-ownership.
“The public must have confidence that new homes being built will be affordable to them and their families.”
The announcements come on the day the Government releases its ‘net additional dwelling’ statistics – the primary measure of housing supply.