Give London more planning and tax powers to ease housing crisis, experts say


Extra powers over planning, tax and spending should be given to London to help ease the capital's housing crisis, experts have recommended.

The London Housing Commission called for Whitehall to give greater control to the mayor of London and the city's boroughs in exchange for a commitment to dramatically increase the number of homes being built.

The commission found that current measures are delivering only 25,000 new homes a year - half what is needed to keep pace with London's growing population.

The panel, led by former civil service chief Lord Kerslake, called for measures to double the annual supply of homes in London by 2020. 

Working together, the boroughs and mayor must unlock enough land for 50,000 homes a year and make sure their planning departments can cope with the extra workload. 

The commission also called for a major programme of public sector-led new housing alongside developments from private firms.

Lord Kerslake said: "London is facing a housing crisis of unprecedented proportions brought about by a chronic under supply of new housing. It needs urgently to be building far more houses of all types and tenures.

"We are confident that the package of measures we have set out in our report would go a long way to solving London's problems.

"While the mayor and the boroughs can do more with the powers that they have now, the only route to building substantially more homes in London is to give the capital's leaders more direct responsibility over the key levers such as land use, planning rules, housing standards, property taxes and investment and holding them accountable for delivery.

"If nothing is done, both the scarcity and affordability of housing across London will continue to worsen. Levels of home ownership will continue to fall and rents will continue to rise.

"That will not only put extra strains on the lives of Londoners living in the capital, but will also have wider social and economic consequences.

"The next strategy for London housing requires two phases. First, there is a number of actions the mayor and the boroughs can take immediately to boost housing supply. Beyond that, there are a series of longer-term reforms, including devolving powers to the mayor and the boroughs, which would make further inroads into the housing crisis, and maintain the momentum behind the efforts of the mayor and boroughs."

The commission, established by the IPPR think-tank, recommended that the cap on the boroughs' housing borrowing limits should be lifted so that they can invest more in new supply, and that London should be able to retain a substantial portion of the money raised from stamp duty. 

London's mayor would be given power to "call in" boroughs that are failing to identify enough land for homes or refusing too many applications to build new homes.

Boroughs would be allowed to set their own licencing schemes for landlords, with the prospect of a condition that they could be banned from renting out homes if properties are not brought up to a decent standard by 2025. 

A new tax could be levied on developers if housebuilding targets have been missed and boroughs would be able to set a higher council tax premium on empty and second homes.

A Government spokesman said: "Housing completions were up 35% in London in 2015 and the capital is receiving £1.45 billion through the affordable homes programme. We have also announced we will help deliver at least 90,000 affordable home starts in London by 2021.

"Alongside that many innovative approaches to boost housing delivery have been developed by the Government and Greater London Authority including housing zones and build-to-rent schemes.

"We are also reforming stamp duty, which will help people into home ownership."