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29.10.18

Investment in ‘new generation’ of social housing could generate £320bn for economy

Councils could generate £320bn for the UK economy over 50 years if they were given funding in today’s Budget to build a “new generation” of social housing.

Major investment in new, high-quality council housing would see returned income generated through rents and also create savings in the annual housing benefit bill, delivering huge gains to tax payers, according to the LGA.

The LGA has called on the chancellor to “deliver a once-in-a-lifetime change” in the Autumn Budget later today, which would create significant wider economic gains such as increased productivity, jobs and increased tax returns.

The analysis looked at four different possible future economic scenarios, and found that even the worst-case scenario would deliver a £102bn return.

The LGA now says it wants to see 100,000 high-quality social homes every year as part of a national effort to kick-start a new generation of social housing.

Lord Porter, chairman of the LGA, said: “The last time we built enough homes, councils built 40% of them.

“We need to get back to those levels if we’re to tackle our housing crisis, which is why we need to look towards delivering a new generation of 100,000 high quality social homes a year.

“The gains are enormous. Investments in social housing could generate returns up to £320bn over 50 years, helping countless families along the way by creating local jobs and building homes people need and can afford.”

Following calls from the LGA, the cap on how much councils can borrow against their housing revenue account was scrapped by Theresa May earlier this month at the Conservative Party conference.

The LGA are now urging the chancellor to fulfil that pledge and set out plans for the borrowing cap to be removed entirely as part of the budget, as well as launching a report which will showcase how councils are building new homes.

Lord Porter continued: “Councils have been quietly getting on with building some outstanding new homes, they now need to be free to deliver them at scale.

“This is because the future of council housing will deliver high quality and innovative design, support local builders, create local jobs and training, and build where the market will not.

“On Monday, the Chancellor has a real opportunity to deliver a once-in-a-lifetime change that could benefit thousands of people across the country. We encourage him to take it.”

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Image credit - lamontak590623

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