Labour’s toxic housing policy

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Fight Racism! Fight Imperialism! 257 May/June 2017 Election Special

On 9 May, Labour leader Jeremy Corbyn pledged to put housing at the forefront of his party’s general election campaign, guaranteeing to build a million homes, with half of them council houses. But in the Labour manifesto this radical promise has been watered down to ‘at least 100,000 council and housing association homes a year’ – by the end of the parliamentary term – ‘for genuinely affordable rent or sale’. Corbyn has embraced Labour’s new definition of ‘council’ housing, which can be any kind of tenure and where the idea of a regulated council rent is a thing of the past, with ‘affordable’ meaning anything up to 80% of market rent. There is no mention of social rent.

The last government’s Housing and Planning Act ushered in a massive fire-sale of public land and housing stock, fuelled by the City of London, giant construction companies, international developers and estate agents eager to profit from soaring land prices. But far from challenging this sustained attack on working class housing, Labour councils have leapt onto the gravy train.

Indeed, the framework for this new land grab was provided by a former Labour Cabinet member, Lord Adonis. In March 2015, he called for the demolition of 3,500 London council estates – which he lumped together with ‘brownfield land’ – to be replaced by ‘market-priced rent developments’, saying ‘there are particularly large concentrations of council-owned land in inner London, and this is some of the highest priced land in the world’.

Adonis was writing for a report produced by the estate agents Savills, whose major shareholders are City and international investment companies, and which has worked tirelessly with London councils to further the corporate takeover of their housing stock. The result has been the destruction of more than 150 working class estates by Labour councils in London alone. At no stage has Corbyn acted to rein them in, or expressed support for those fighting to save their homes. On the contrary, he praised Labour authorities for doing ‘a good job’ of delivering homes.

All across the country, Labour councils have entered into alliances with Savills, major developers and construction companies. Many, like Newham in east London, whose Red Door Ventures is a wholly commercial operation, have seized the option of setting up so-called ‘Special Purpose Vehicles’ (SPVs), or private housing companies, to deliver homes outside the reach of working class people. Developers have consistently applied to reduce their obligation to provide any kind of housing for submarket rent, arguing that it would limit the ‘viability’ – that is, profitability – of their projects; invariably, craven Labour councils have agreed. Now the private investors participating in these SPVs will ensure new developments contain no ‘affordable’ housing at all.

Examples of how far the interests of Labour councils and private capital now converge include:

• Lambeth, south London

Savills has advised the council, which plans to ‘regenerate’ – ie demolish - six estates, including Central Hill, on the creation of Homes for Lambeth. This SPV has signed a contract with construction company Airey Miller, which will require all new housing developments to be for-profit, to cover their fee of £6.5m. There has been not a word of support from Corbyn for the Central Hill campaigners, who face the destruction of 200 homes.

• Southwark, south London

Southwark is notorious for selling off the Heygate estate to Australian developers Lendlease at a knock-down price for ‘regeneration’, with a loss of 1,000 social rented homes. Newly-built two-bedroom apartments on the renamed ‘Elephant Park’ sell for more than £800,000. Labour council leader Peter John once described council estates as ‘symbols of inner city neglect, with crime, unemployment and anti-social behaviour the only things that flourish there’. With Savills’ help, Southwark Labour Council has sold off 7,639 council homes in the past ten years. Plans to destroy a further 2,000 are in the pipeline.

• Haringey, north London

Labour leader Claire Kober is leading the attempt by Haringey to carry out a mass privatisation of public assets, corralling homes, school buildings and its biggest library into a massive £2bn private fund. The property developer Lendlease will have a 50% share in this ‘Haringey Development Vehicle’. The promised 5,000 new homes will include none for social rent.

Any housing movement in this country will have to wage an uncompromising fight against these toxic Labour councils: they are the problem, not the solution. The RCG is part of building that movement. Corbyn has made it clear that he is not.