David Cameron’s speech to the Conservative party conference has been hailed as ‘good politics but bad policy’. The risk is that Labour’s response will be good policy but bad politics.
In his speech Cameron promised to make it easier for people to buy their home. He said that he would do this by replacing the obligation for home builders to build social housing with an obligation to build ‘starter homes’.
This is a terrible idea. Combined with the extension of the right to buy, the end of the affordable homes grant and the reduction in social housing rents, this will means that no one will build social housing for the next five years. This at a time when the number of people who are homeless is rising at an alarming rate.
Despite being a terrible idea, the promise of making it easier to own a home is a seductive one. If Labour’s response to this proposal is to stress the need for more council housing it risks enlarging the gap that exists between them and large swaths of the electorate.
Polling commissioned by Jon Cruddas illustrates how large this gap already is. He found that 42 per cent of voters in the south said they would never vote Labour, a similar percentage to the number of northerners who said they would never vote Tory. The party is actually more toxic than the Tories among so called ‘settlers’ (socially conservative voters).
This group thinks that the Labour party does not represent their views on the economy, on benefits or on immigration. They think Labour will be profligate with the public finances and this will benefit immigrants and people who receive benefits, neither of whom are groups they feel positively towards.
When the Fabians asked the public what words they associate with social housing, 53 per cent said ‘benefits’ and 24 per cent said ‘immigrants’. You can see the problem. If Labour is primarily associated with social housing not home ownership, the gulf that exists between the party and the public that it seeks to represent will continue to expand.
John Healey understands this risk. He was one of the earliest voices warning of the threat that the United Kingdom Independence party poses to Labour and he was the best housing minister during Labour’s last spell in government. As he develops Labour’s housing policy he will need to achieve at least two things: designing a policy that can end the housing crisis and one that represents the views and aspirations of an electorate who are increasingly sceptical of the Labour party.
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Thomas Neumark is a former Labour councillor and blogs at Dream Housing. He tweets @TomNeumark
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So how do you propose to deal with this, then? Perhaps a huge rise in Inheritance Tax hypothecated to housing supply so that the fruits of asset bubbles are evenly shared rather than being passed to those lucky enough to have parents (or grandparents, more likely) who made huge capital gains simply by living where they did. Inherited gains have no virtue and are fundamentally anti-capitalist as they require no enterprise or risk to acquire them.
I think Labour’s response should be a programme of councils building homes for people to buy
My concern is, and has been for a while, that tranches of the Labour Party are looking at politics in three dimensions, ignoring the fourth one, that of time. As Harold Wilson said, a week is a long time in politics. Five years is a lot longer, and bad policy today can easily turn into bad politics down the line. ‘Benefits’ now could be 2020’s essential support for Britain’s infrastructure, sorely missed once they’re gone. ‘Immigrants’ could become a missing army of health workers, builders, agricultural labourers, entrepreneurs, whose absence will be felt. And genuinely affordable rented accommodation could be seen as the holy grail of British government – and the voting public will know who legislated to get rid of it. They’ll know because we will tell them.