Rishi Sunak is intervening in Sadiq Khan’s housing plan as he says not enough dwellings are built.
But the mayor of London has criticised the prime minister’s “disappointing and disingenuous claims” about the capital.
On Thursday, the government said Mr Khan has until the autumn to “look at opportunities to accelerate residential development on inner city brownfield industrial sites” or Housing Secretary Michael Gove will intervene directly.
Downing Street criticised the mayor’s London Plan and wanted “to address issues such as single-story warehouses being prioritised over new homes on central London sites within a few minutes of tube stations”.
Mr Khan was quick to highlight his record on housebuilding, claiming that more homes had been completed under his leadership than at any time since the 1930s.
He pointed out progress had been to beat a target of starting 116,000 affordable homes in the capital between 2015 and 2023.
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The government, meanwhile, claimed that “London’s own local housing plan says that 52,000 new homes are required – after the Mayor’s London Plan was not deemed credible to deliver the original 66,000 homes a year that he estimated to be needed”.
“Despite this, only around 30,000 have been built in recent years, and the latest indicator suggests only 21,000 new homes started development last year”.
Image: Sadiq Khan says the PM ‘doesn’t understand building in the capital’
Mr Khan’s spokesperson said: “These disappointing and disingenuous claims appear to show a fundamental lack of understanding of housebuilding in London.
“The mayor delivered record numbers of affordable homes over the last six years, consistently exceeding government targets despite the impact of the pandemic and Brexit. This has included starting more council homes than at any time since the 1970s.
“The mayor’s London Plan was approved by the government in 2021 and the ministers should know that the housing figures included within it are reliant on sufficient government investment being made in infrastructure, particularly transport.”
In the aftermath of the Conservatives’ narrow win at the recent Uxbridge by-election, it was clear they had taken two key lessons from the result.
Tory MPs interviewed in the early hours said it was about showing what Labour in power was really like and that single issues, like ULEZ (the Ultra-Low Emission Zone) could be weaponised to win votes.
Less than a week later, it appears that the prime minister has wasted no time in applying what many in his party think could be the strategy that enables them to cling on to power at the next election.
Which is presumably why Rishi Sunak popped up on a London building site today to trash Sadiq Khan’s housebuilding record in the capital.
Focusing on the Labour mayor enables the prime minister to avoid his own party’s record which, assessed against almost any metric, is a disappointing one.
Their 300,000 homes a year pledge, established in 2017, has been oft ignored and at times watered down, with Housing Secretary Michael Gove last year downgrading it to “advisory”.
The party’s one serious attempt at meeting it with ambitious planning reforms and country-wide targets was met with a furious wave of opposition from its own MPs and council leaders, many determined to protect the picturesque Tory shires.
It was clear that approach had been abandoned this week when Mr Gove set out a new vision focused instead on cities, including a significant expansion of Cambridge – a scheme immediately condemned by the area’s Conservative MP.
Meanwhile, the most recent homelessness figures show record number of families living in temporary accommodation, including 131,000 children without a home.
Add to that the recent economic turmoil that has pushed up rents and mortgages to eye-watering levels and you get a toxic combination that underpins a dysfunctional and deteriorating housing market.
Rishi Sunak’s response? To point the finger at the London mayor and to say he will now step in to sort it out.
Given his government’s record across the rest of the country, Londoners may be forgiven for thinking this is anything more than electioneering.
Mr Sunak said: “We are on track to build 1 million new homes over this parliament, having already delivered over 2.2 million across the country since 2010.
“But the reality is that too few of these homes are being built in London, and for too many Londoners the dream of owning their own home is beyond reach.
“The mayor has failed to deliver the homes that London needs. This has driven up house prices and made it harder for families to get on the housing ladder in the first place.
“That is why we are stepping in today to boost house building and make homeownership a reality again for people across this great city.”
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In its plans, the government said it wanted to support a “Docklands 2.0”, which would see increased building in parts of east London like Thamesmead, Beckton and Silvertown.
It also said £150m for housebuilding will be passed onto London boroughs, bypassing the mayor’s Greater London Authority.
And another £200m will be spent on developing unused brownfield sites.
The chancellor has confirmed she is considering “changes” to ISAs – and said there has been too much focus on “risk” in members of the public investing.
In her second annual Mansion House speech to the financial sector, Rachel Reeves said she recognised “differing views” over the popular tax-free savings accounts, in which savers can currently put up to £20,000 a year.
She was reportedly considering reducing the threshold to as low as £4,000 a year, in a bid to encourage people to put money into stocks and shares instead and boost the economy.
However the chancellor has shelved any immediate planned changes after fierce backlash from building societies and consumer groups.
In her speech to key industry figures on Tuesday evening, Ms Reeves said: “I will continue to consider further changes to ISAs, engaging widely over the coming months and recognising that despite the differing views on the right approach, we are united in wanting better outcomes for both savers and for the UK economy.”
She added: “For too long, we have presented investment in too negative a light, quick to warn people of the risks, without giving proper weight to the benefits.”
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6:36
Rachel Reeves’s fiscal dilemma
Ms Reeves’s speech, the first major one since the welfare bill climbdown two weeks ago, appeared to encourage regulators to focus less on risks and more on the benefits of investing in things like the stock market and government bonds (loans issued by states to raise funds with an interest rate paid in return).
She welcomed action by the financial regulator to review risk warning rules and the campaign to promote retail investment, which the Financial Conduct Authority (FCA) is launching next year.
“Our tangled system of financial advice and guidance has meant that people cannot get the right support to make decisions for themselves”, Ms Reeves told the event in London.
Last year, Ms Reeves said post-financial crash regulation had “gone too far” and set a course for cutting red tape.
On Tuesday, she said she would announce a package of City changes, including a new competitive framework for a part of the insurance industry and a regulatory regime for asset management.
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4:21
Reeves is ‘totally’ up for the job
In response to Ms Reeves’s address, shadow chancellor Sir Mel Stride said: “Rachel Reeves should have used her speech this evening to rule out massive tax rises on businesses and working people. The fact that she didn’t should send a shiver down the spine of taxpayers across the country.”
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The governor of the Bank of England, Andrew Bailey, also spoke at the Mansion House event and said Donald Trump’s taxes on US imports would slow the economy and trade imbalances should be addressed.
“Increasing tariffs creates the risk of fragmenting the world economy, and thereby reducing activity”, he said.
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