Labour to unveil £75bn social housing plan to 'build for the many'

Heather Stewart and Robert Booth
Photograph: Joe Giddens/PA

Labour will promise to tackle Britain’s housing crisis by “building for the many”, setting aside £75bn over five years to fund the most dramatic increase council home construction since the second world war.

As he launches Labour’s manifesto, Jeremy Corbyn will pledge that by the end of its first term in office, a Labour government would build 100,000 council houses a year, and 50,000 social homes through housing associations – all of them to high environmental standards. Only 6,287 council homes were built in 2018-19.

Related: Labour targets renters with pledge of 100,000 council houses a year

The rapid increase would be paid for using half of the £150bn “social transformation fund” recently announced by the shadow chancellor, John McDonnell, which will be funded through government borrowing.

The shadow housing secretary, John Healey, told the Guardian: “We’re talking about a new era of council housing.

“And the significance of it is that building on this scale allows us not just to build for the poorest; but to be able to build homes again for those young people trapped in private renting; young families that want to get a start in life that can’t yet afford to buy; older people that may be in substandard homes that need somewhere more secure and reliably costed.”

He added: “We can do in a way that we did by kicking off that great council housebuilding programme after the second world war: we can build for the many.”

Healey conceded that to meet the target, Labour would have to rapidly increase the capacity of local authorities, whose planning departments have been hollowed out dramatically as building rates have declined.

Related: Labour must turbocharge its offer to young people. The fate of the country depends on it | Owen Jones

Corbyn hopes the focus on housing will help to broaden the general election debate beyond Brexit, where Boris Johnson has been hammering home his promise to leave the EU by the end of January in a bid to win over disgruntled leave voters.

Labour is defending a string of leave-voting seats across the Midlands and the north, which the Tories are targeting aggressively.

While Corbyn faced difficulties in Tuesday night’s debate over his refusal to say how he would campaign in the referendum he has promised to hold next year, his advisers believe painting Labour as a remain party would wreck their chances in Brexit-voting areas. They hope that by switching the conversation to bread-and-butter issues, they can hold on to longtime Labour voters.

Launching his manifesto, Corbyn will seek to reassure voters that he is “on your side”, and accept that “the hostility of the rich and powerful is inevitable”, because “they know we will deliver our plans, which is why they want to stop us being elected”.

His tax plans will be closely scrutinised, with a windfall-style tax on energy companies expected to feature. Labour’s ambitious housebuilding programme would come alongside a raft of reforms to the private rental sector, including the introduction of extended tenancies as the standard.

The Conservatives will also focus on housing on Thursday, announcing a “fairer deal for renters”, including a government-guaranteed scheme to allow tenants to transfer their deposit from one property to another.

They will also confirm plans first announced during May’s premiership to abolish “no-fault evictions”.

Labour’s slim red “For the Many” manifesto formed a central part of its campaign in the 2017 general election, when Corbyn unexpectedly deprived Theresa May of her majority.

Corbyn has already announced a series of radical policies, including providing free broadband by part-nationalising BT, overhauling business regulation, and opening 1,000 Sure Start centres.

The last time 100,000 council homes were built in a year was in 1977 and if achieved Labour’s plan would represent the biggest acceleration in public housebuilding since 1946, when Clement Attlee oversaw the reconstruction of swathes of postwar Britain.

Figures released by the Ministry of Housing, Communities and Local Government on Wednesday showed only 6,287 council homes were built in 2018-19, representing the second-lowest level since public house building began in earnest in 1921, except for during wartime.

With more than 1.1m households on waiting lists for affordable homes, the output was branded “outrageous” by Polly Neate, chief executive of the housing charity Shelter, who said it would be “a crushing blow” for families waiting, including many who are currently homeless.

“This includes mothers of severely ill children in need of a suitable home, people in their 70s and 80s desperate for some stability, and working families still struggling to pay their rent,” she said. “Only social housing will do, not expensive new-builds and luxury flats.”

The council houses were among 37,825 new homes built nationwide last year to be let at discounted rents. But the biggest increase in affordable housing came from shared ownership properties which require households to buy a part of the equity. Some 17,024 of these were completed as part of a total output of “affordable” homes of 57,485, a figure surpassed four times in the last decade.

Labour’s manifesto promise was welcomed by the National Housing Federation, which represents social landlords.

“The housing crisis is having a disastrous effect on millions of people in England, and we need to build 145,000 new social homes every year if we are to end it,” said Kate Henderson, NHF chief executive.

Ministers last month celebrated increases in overall housebuilding to a rate of more than 200,000 a year, although that remains short of the 250,000 a year target set in the Conservatives’ 2017 general election manifesto and the NHF’s estimate of housing need of 340,000 homes per year until 2031.

It said this many homes were needed to meet future demand and clear a backlog of demand from homeless people, private tenants spending too much on rent, children unable to leave the family home, and even couples stuck in unsuitable housing delaying having children.

The latest figures showed that homes for social rent made up an historic low of 2.5% of all houses built in England. The large majority of completions were homes for sale.