Daniel Austin, CEO and co-founder at ASK Partners, comments on reports of new government delays to infrastructure projects falling short of its homes target.
Housing remains a pivotal issue for Labour, closely tied to economic stability. Despite recent upticks in house prices and mortgage approvals, the UK faces a severe housing shortage that threatens to prolong the economic downturn. This shortage, driven by insufficient homes for rent and sale, has led to an affordability crisis, contributing to GDP strain and decades of unresolved social pressure. It’s particularly concerning that new analysis reveals government delays in 40% of major infrastructure project decisions.
Several nationally significant infrastructure projects (NSIPs), intended to follow a ‘fast-track’ approval process, have been delayed since Labour came to power, according to the Britain Remade campaign. Under the Conservatives, the rate was slightly lower, with 38% of projects delayed. Additionally, recent research indicates that Labour risks falling short of its 1.5m homes target by 500,000 unless it intervenes with additional funding for the housing market.
The UK urgently needs a comprehensive, long-term housing strategy, and the Autumn Statement presents a critical opportunity to offer much-needed clarity on the UK’s economic direction. While the target of building 300,000 homes annually has been a missed government goal since 2004, experts, including Capital Economics, argue that a more ambitious goal of 385,000 homes per year is essential. Meanwhile, France has significantly outpaced the UK in housing construction.
The UK’s housing crisis stems from four key challenges: an over-reliance on major housebuilders, a politicised planning system that stifles development, a net loss of social housing, and post-Brexit labour shortages. To overcome these obstacles, revitalising SME housebuilders is crucial. This can be achieved through a mix of incentives, access to small land plots, streamlined planning for brownfield sites, and increased availability of skilled domestic labour.
Independent planning decisions, combined with private-sector collaboration, would help reduce delays and costs, while lenders offering flexible financing options could further support smaller developers. Although a pro-growth agenda may be politically contentious in the short term, it is essential for addressing the housing crisis. A strong housing policy is vital not only for economic recovery but also for securing long-term prosperity across the UK.