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Tory cuts prevented 280,000 new homes being built, analysis reveals

Government investment in new homes has plummeted 81 per cent since 2010
Government investment in new homes has plummeted 81 per cent since 2010

Hundreds of thousands of extra homes could have been built since 2010 had the Conservatives not cut housing spending by £20bn, new analysis seen by The Independent has revealed.

If funding levels in the final year of the Labour government had been maintained over the last seven years, house-builders would have received sufficient money to build 280,000 new homes - enough to for every family that has been made homeless in England since 2012.

Instead, investment in new homes, in the form of grants to local councils and housing associations, has been cut from £4.1bn in 2010 to £764m last year – a fall of 81 per cent.

The finding is likely to place fresh pressure on ministers to use Wednesday’s Autumn Budget to announce significant new investment in housing.

While the number of new homes has risen since 2010, the rise is explained almost entirely by a surge in building by private developers. Councils and housing associations have barely increased their output.

Investment in affordable housing has been particularly affected, with the number of new social homes down 97 per cent since 2010.

Labour, which undertook the analysis, said it showed why any new housing measures announced in the Budget are unlikely to reverse the impact of Conservative cuts since 2010.

Ministers are under mounting pressure to boost house-building in the face of a burgeoning housing crisis that has seen homelessness and house prices soar but home ownership rates fall.

Philip Hammond said on Sunday that he wants Britain to be building 300,000 homes a year – close to double the 174,520 completed last year and a level not seen since the 1970s.

John Healey, the Shadow Housing Secretary, said: “There’s no hope of building the homes the country needs without at least 100,000 genuinely affordable homes to rent and buy a year, but the Conservatives have cut housing investment to the bone.

“Since 2010, crude cuts to housing investment mean the number of new affordable homes has fallen off a cliff, with the lowest number of social rented homes on record and the number of new homes for affordable ownership down by half.

“The Chancellor has a big job to do in the Budget tomorrow to make up the Conservatives’ affordable homes deficit. He should back Labour’s plan to invest to build the 100,000 genuinely affordable homes a year we need, including getting councils building at scale again.”

The number of homes being built has crept back up in recent years following a huge fall after the 2008 financial crisis, but is yet to return to pre-crash levels.

The Department for Communities and Local Government has been contacted for comment.