In the past week submissions closed for the housing review carried out for the government by Natalie Elphicke, due to report later this year. It's limited in scope because it focuses only on local authorities, both as housebuilders and as facilitators of housebuilding, and doesn't go much wider. Its remit specifically excludes any options that would involve more borrowing or changing the borrowing rules. So can it achieve anything?
One of the few bright spots in recent housebuilding statistics was the number of new starts by councils in the first quarter of this year (1,090). Described by communities secretary Eric Pickles as a resurgence in housebuilding, he claimed the overall level of new starts was due to Help to Buy and higher council starts were down to increased right-to-buy receipts.
While it would be encouraging if council output were now to start to increase significantly, there are a number of reasons for being cautious. The first is that this is only one quarter's figure. Second, we have the fact that the new affordable homes programme virtually excludes social rented schemes, while councils want to build about half their new output for letting at social rents). And while right-to-buy receipts are increasing they are nowhere near allowing full replacement of properties sold.
One test of the rigor of the Elphicke review will be whether it examines these claims about reinvestment of right-to-buy receipts and makes any proposals to change the current rules. It's highly likely that several submissions will mention this issue, as it is high on the list of local authority concerns.
Another test will be whether, though she can't recommend changes in the borrowing rules, Elphicke does at least review the evidence for what relaxed rules could achieve and the scope for minor changes. After all, the government itself offered minor concessions in the autumn statement, which might release an extra £300m of borrowing.
The review will only have credibility with local authorities if it avoids the blame game and the temptation to recommend further sales of the family silver. It's right for Elphicke to look at ways in which councils can raise their game in encouraging development, but if it criticises poor performers it should also be clear that councils only carry a small part of the responsibility for the failure to build enough houses.
It should look critically at the changes to the planning system Pickles has imposed, including the ending of regional housing targets, rather than endorsing his criticism of recalcitrant councils. Its remit doesn't extend to the role of developers themselves, but it can at least point to some of the endemic problems that see their share prices and profits going up while their output only increases with painful sluggishness.
Above all, Elphicke should point out that it is deeply cynical of the government to criticise local planning authorities for not planning for sufficient housing when it lacks an adequate housing strategy itself.
A step change in output can only be achieved with a clear plan, which sets targets and plausible means of achieving them, allocates responsibilities and finance, gets buy-in from the different parts of the industry and is properly monitored. This goes against the grain of how the coalition conducts housing policy, but until someone does it the "deep, deep structural problems" that Mark Carney says afflict the British housing market will remain unsolved.
"Monimbo" is a senior housing policy manager. A longer version of this post first appeared on the Red Brick Blog
Interested in housing? Join the housing network for more news, analysis and comment direct to you.
