6 7
Why Government should act
Why housing matters
Whether or not the Government should take action in the recession, and the form that In March 2009 the Housing Minister, Margaret Beckett, stated the Government’s housing
action should take, is a key political difference between the parties. Unite believes the
targets were unlikely to be met and that "now we have to consider when this recession comes
Government has to take effective action to protect people from the harsh impact of the
to an end, which it will, some day, how can we get back on track”
17
. Unite believes action is
economic crisis and the human cost of the recession.
needed now - meeting the housing targets should not wait until after the recession, rather it is
There is a growing lobby, led by the Tories, CBI, and supported by the right-wing media, who
the meeting and exceeding of these targets that can help to take the economy out of recession.
are calling for a reigning in of public expenditure and to not invest in further packages to
Action on housing should not be the only action the Government takes to fight the recession,
stimulate the economy. This would be a catastrophic mistake. The country is in recession,
but the depth of that recession and the social scars it leaves are not yet decided – that will
but it is an important one, with the potential to positively impact on the overwhelming
depend on the actions taken by government. The Conservatives’ housing paper includes
majority of society. Poor standard housing - dwellings that are cold and damp, overcrowded,
proposals to abolish Regional Development Agencies, despite the important strategic role
or badly designed and built – has a detrimental impact on people’s physical health and their
they play in developing the wider infrastructure around new housing estates (for example,
mental well-being
18
. In addition, spatial design and planning, and access to necessary infrastructure
access to local amenities and public transport). RDAs contribute £53billion to the economy
15
. (such as transport and schools), also illustrate the important role that national and local
government play in contributing to the sustainability and quality of life in communities.
In its January 2009 Outlook the OECD demonstrated that the fiscal stimulus package introduced
by the British Government up to that point was relatively small as a percentage of GDP
According to a recent study published by the National Housing and Planning Advice Unit
(1.5%) compared against other countries; the US (4.8%), China (4.4%), Germany (3.4%),
(NHPAU), the body set up to provide advice to local and national government on housing
Canada (2.7%), France (1.3%), India (0.5%), Italy (0.3%). The average is 3.4%
16
. The stimulus
supply and affordability, a widening wealth gap, poorer health, recruitment problems and
package introduced has therefore not been ‘excessive’.
a housing market prone to boom and bust are all consequences of the country’s continuing
Through effective economic stimulus packages and using effective levers into the economy
housing affordability problem
19
.
the depth of the recession can be made shallower and recovery achieved faster. Not acting
will lead to a deeper and longer recession, with higher unemployment and increases in
As well as the growing housing need and the fear of repossession outlined above the
poverty. A longer recession will lead to worse public finances.
economic impact on the private house building sector of the construction industry has been
severe. In November 2008 redundancies in the sector hit a 10 year high
20
. There is a danger
that trained and skilled people in the construction industry may leave the industry altogether
leading to a damaging loss of skills.
In 2007, before the economic downturn began to bite there was a skills shortage in the
industry as a whole of 88,000
21
. The Construction Skills Network predict that there will
remain an annual recruitment requirement of 33,260 people into the industry between 2009-
2013 for planned projects and to build sufficient capacity within the industry for when the
economy begins to recover. If significant numbers of those in the house building sector of the
construction industry do leave it will be difficult, and take many years, to re-build the labour
capacity in the industry for when the economy begins to recover. The ‘2020 coalition’ has
argued that building up to 100,000 social rented homes over a two year period would save
30,000 jobs in the construction industry
22
.
17
28th March 2009, http://news.bbc.co.uk/1/hi/uk/7969526.stm
18
For example, see ‘Poor Housing and Mental Health in the United Kingdom: Changing the Focus for Intervention’, Journal Environmental Health Research,
Volume 1, Issue 1, 2002
19
Affordability – more than just a housing problem, http://www.communities.gov.uk/nhpau/keypublications/research/affordabilitymorethan/
20
http://www.contractjournal.com/Articles/2008/11/17/62070/construction-job-losses-and-redundancies-latest-news.html
21
Blueprint for UK Construction Skills 2009-2013, Construction Skills Network, http://www.constructionskills.net/pdf/research/outputs/2009/uk-2009-13.pdf
22
See the ‘2020 Coalition’ Launch document, 23rd February 2009. The 2020 Coalition: Kate Barker (Chair), Lord Richard Best, John Calcutt (Vice Chair), Homes and
Communities Agency, Home Builders Federation, Local Government Association, National Housing and Planning Unit, National Housing Federation, Royal Town
15
See Inside Housing, http://www.insidehousing.co.uk/story.aspx?storycode=6504040 Planning Institute, Shelter, TUC.
16
OECD figures are cited in the TUC Budget submission 2009 available on the TUC website
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