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fru-gal

Treasury Considering Becoming A 'commissioner Of Housing'

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http://www.insidehousing.co.uk/finance/treasury-considering-becoming-a-commissioner-of-housing/7006100.article

The Treasury is considering a ‘radical’ proposal for the government to step in and directly order the building of private and affordable homes if the economy cannot deliver.

The idea, unveiled by chief secretary to the Treasury Danny Alexander today, was described as a ‘backstop’ if private house builders and housing associations could not build enough homes to meet demand.

It would see the government set a target for the number of homes to be delivered and commission them directly if it appeared targets were going to be missed.

Mr Alexander said the idea was at an ‘early stage’ but Treasury officials were considering its practicality.

Addressing a fringe session on housing at the Liberal Democrat conference in Glasgow, he said: ‘If we are to address the cyclical nature of the market and the structural undersupply of housing, then we need to look at whether the government should operate as a comissioner of housing.

‘I think a truly radical approach would be for the government to have a role in house building - not just affordable house building but in the private market also.

‘The government could form a view of the amount of housing needed at any point in the cycle and if this number was less than the amount expected… then you would have a capacity for the government to step in, to place orders, to pay contractors and to build houses.’

He stressed the idea would be an ‘unprecedented change’ and was not current government or Liberal Democrat policy.

But he added that Treasury officials were exploring the proposal in more detail and said it was ‘worth working up radical solutions’.

One housing chief executive, also at the fringe session, described the proposal as ‘the best thing I have heard at any of the three party conferences’.

It follows the Liberal Democrats adopting a motion to build 300,000 homes annually and give councils the power to suspend the right to buy.

Edited by fru-gal

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‘If we are to address the cyclical nature of the market and the structural undersupply of housing,

At least he said it even if it (obviously) won't come to anything and isn't Lib Dem or Tory policy.

Why didn't he say it 4 years ago?

In another 5 or 10 years some overpaid genius in Whitehall might take a look at my sig and say "You know what? Why don't we just QE £100bn and sort out this structural supply deficit?" but I shan't hold my breath

Edited by R K

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‘The government could form a view of the amount of housing needed at any point in the cycle and if this number was less than the amount expected… then you would have a capacity for the government to step in, to place orders, to pay contractors and to build houses.’

In other words, the government could form a view of the amount of housing required to keep prices at stratospheric levels, and decide not to build anything at all.

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‘The government could form a view of the amount of housing needed at any point in the cycle and if this number was less than the amount expected…

It sounds very much like what they do now to get the number of new homes built right down to about 100,000 per annum for several years.

Except that they would have yet another more direct lever on the control mechanism and instead of Local Authority built housing at the current UK rate of a total of about 2000 per year the government could step in whenever necessary to more directly reduce the number of new homes built.

Edited by billybong

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Come on - put your cynicism aside for a moment.

This is exactly what we need: government action to solve a problem (not enough homes being built), despite the broken market.

Expect this in the Lib Dem manifesto. It's better than anything put forward by the others (except, perhaps, Labour's policy 'Build as many homes as we need', which is a great aspiration but woefully blurry)

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