With left-winger Jeremy Corbyn now appointed as leader of the opposition, what impact is he likely to have on the government agenda on issues such as house building, infrastructure projects, nationalisation, and energy policy?
Labour’s position on the opposition benches makes it unlikely that its rediscovered left wing agenda will make a direct impact on the construction industry in the next five years, but the possibility of renewed debate on key issues has been cautiously welcomed.
Jeremy Blackburn, head of UK policy at RICS, told Construction Manager: “Corbyn has raised some challenging but principled issues around the expansion of Right to Buy to private landlords; as well as providing a voice for the widely-felt dissatisfaction of privatisation in our rail sector.
“There is opportunity in his agenda around infrastructure and public spending to get Britain building, and we look forward to sitting round the table and discussing this further. With property, planning and development more central to Britain’s economic future than at any time before, stability and a clear vision for this sector will be crucial to securing the growth, prosperity and equity of this country for the next generation.”
Brian Berry, chief executive of the Federation of Master Builders, added: “The FMB works with all parties in order to look at ways we can improve conditions for our members, whether that be in removing the barriers that prevent SMEs from winning public tenders or enabling smaller construction firms to deliver more housing, and we look forward to hearing Labour’s proposals in the future.
“The new shadow housing and planning minister John Healey brings with him extensive experience as an MP and a keen interest in housing policy, and we look forward to speaking with him.”
Below, we look at 10 areas relevant to the sector where we might hear more about “Corbynomics”:
1. Volume construction of council homes
Corbyn’s housing policy states that he intends to build 240,000 homes a year and that to do this councils need to greatly increase the number of houses they build. The policy says: “It is essential for councils to build if we’re going to build the number of homes we need. We need to make sure we’re building council homes and homes that first-time buyers can afford – not just high-value assets global investors. A free-market free-for-all has simply failed to deliver this.”
The new houses would be supported by a National Investment Bank with low interest rates available for both councils and developers as long as “tough new conditions” were met on the proportion of genuinely affordable housing built.
Corbyn would also lift the borrowing cap in the Housing Revenue Account so that local authorities could borrow up to the prudential limits and thereby build more homes.
2. Reduction of Right to Buy
Corbyn has said in interviews that he would vote against the government’s plan to extend Right to Buy for tenants in housing association properties, and that he would “favour ending RTB full stop”.
His official housing policy says: “Instead of extending the right to buy we should be reducing the harm it causes to our affordable housing stock. Local authorities in areas of high housing stress should be given the power to suspend Right to Buy to protect depleting social housing assets.”
But, confusingly, he also said that he would be in favour of extending the policy to anyone living in privately rented accommodation – a move apparently aimed at curbing the Buy to Let investment sector. He has argued that the money released would be reinvested in building more social housing.
3. Introduction of a Land Value Tax
To stop developers from hoarding land Corbyn proposes a Land Value Tax on undeveloped land that has planning permission along with measures to confiscate land that is not used. His housing policy states: “We should consider introducing a Land Value Tax on undeveloped land that has planning permission, and ‘use it or lose it’ measures on other brownfield sites, to act as a disincentive to landbanking and to raise public funds for house building. Councils should also be allowed to compulsorily purchase (CPO) sites at a fair value if their owners are not developing them.”
4. No building on the green belt
Development of green belt land is not the answer to the housing crisis according to Corbyn and he apposes widespread development of the green land surrounding towns and cities. In his housing policy he writes: “Developers will nearly always argue for the release of green belt land because it is easier for them compared to developing brownfield sites. But we don’t simply want our towns sprawling outwards with reliance on cars growing – and the green belt has prevented that to a certain extent. Any widespread relaxations would also risk inflating the land values of green belt sites, without careful planning requirements being set in place first.”
5. Reduction of permitted development rights for property owners
Another recently introduced Conservative policy that Corbyn opposes is the right to develop homes without needed planning permission. His policy states: “The government’s extended permitted development rights are also problematic and must be reversed. By not needing planning permission there cannot be an assessment and provision for the wider facilities and infrastructure that communities need.”
6. Reversing privatisation of the railways
Away from housing Corbyn also proposes the nationalisation of the railways. It is unclear what the impact of this would be on the major proposed infrastructure projects. In his plan for a publicly owned railway system he foresees “better terms and conditions for railway workers” and “cheaper and more easily understood fare tariffs”. But he also said that he wants to “stimulate the economy by increasing investment in new high speed rail, creating jobs and connecting more towns and cities”.
7. HS2
July and early August saw many headlines speculating that Corbyn, who voted against HS2 in parliament in 2013, and abstained in 2014, would steer the Labour party into rejecting the plan at the final vote on the legislation in this parliament – potentially scuppering the entire project if as few as a dozen Tory rebels also voted against it.
However, more recent reports – and the wording of his statement on rail privatisation above – seem to suggest he has changed him mind. He also told the FT that it was too late to stop the first leg to Leeds, and he wouldn’t oppose the second leg to Birmingham.
8. Airports
Apparently, Corbyn does not support expansion of either Heathrow or Gatwick, creating a fresh complication in the ongoing debate following publication of the pro-Heathrow expansion Davies Commission report.
9. Energy policy
A number of interviews given by Corbyn have suggested he would take public stakes in the big six energy companies, telling the FT that “I would want public ownership of the gas and the National Grid… [and] I would personally wish that the big six were under public control, or public ownership in some form.” However, Corbyn does not appear to have made any statements indicating his position on the UK’s privately-funded new nuclear build programme.
In an interview with Greenpeace, he argued that all new homes and commercial buildings should have solar panels as a mandatory measure.
10. Allotments
Corbyn has a plot near his constituency in north London and told the Commons in 2008 that councils and developers “should be doing thir best to ensure that every new development includes some allotment space”.
