Traditional terraced properties in Greenwich on June 4, 2014. Photograph: Getty Images.
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Labour’s Help to Build scheme will succeed where the coalition has failed

By providing government guarantees to small construction firms we will kickstart housing supply. 

Today on a visit to a small builder in Kent, we outlined Labour’s proposal to boost small house-builders and help the next generation on to the property ladder. Our Help to Build scheme would underwrite bank loans to smaller housebuilders and unlock much-needed finance to get them building.

We’re in the midst of the biggest housing crisis in a generation. Families and young people are struggling to get on the property ladder. More and more people are living in the private rented sector which often doesn’t provide them the stability and peace of mind that they need. And if you’re on the waiting list for social housing then there are another 1.6 million households in the queue with you. The key driver of the crisis is that we’re simply not building enough homes. We're currently building less than half the number of homes we need to keep up with demand.

It’s true these housing pressures didn’t begin under this government - after all no government has built enough homes for 30 years. But things have certainly got much worse on this government’s watch. Under David Cameron, house building has fallen to its lowest levels in peacetime since the 1920s. Only today, we have learned that the government’s flagship housing policy, the New Homes Bonus, is redistributing money from some of the poorest Labour councils to the richest Tory and Lib Dem authorities, and is not delivering the homes communities need.

Labour can do better. We want more people to realise their dream of home ownership. But, unless we build more homes, property prices will rise further out of reach because supply cannot keep pace with demand. So today we are setting out our proposal to tackle the housing shortage by boosting small-builders by improving their access to finance.

Emerging findings from the Lyons Housing Commission, set up by Ed Miliband to deliver a roadmap to getting 200,000 homes a year built by 2020, show there is a need to increase diversity and competitiveness in the housing sector. Figures show that 25 years ago small builders were building two thirds of new homes. Now they're not even building a third of new homes. Over the same period, the number of firms building between one and 100 units has fallen from over 12,000 to fewer than 3,000.

What has caused this decline? The Federation of Master Builders (FMB) surveys of small house building firms have consistently shown that for these firms access to finance and land are the most significant barriers to growing their businesses and increasing the supply of new homes. In the FMB’s 2013 House Builder Survey, 60 per cent of house builder members cited access to finance as a major barrier to their ability to increase their output of new homes, more than any other factor.

That’s why earlier this year, Labour set out plans to increase access to land for SME builders. The next Labour government will require local authorities to include a higher proportion of small sites in their five year land supply. We will give guaranteed access to public land to smaller firms and custom builders. And we will guarantee that a proportion of the homes built in the next generation of new towns and garden cities will be built by smaller firms.

But we must do more. As Ed Balls said earlier this year, we need a Help to Build scheme that tackles the root cause of the credit crisis for SMEs. Our proposals would kickstart the supply of homes by providing government guarantees for bank lending to SME construction firms in a similar way to how the current Help to Buy scheme underwrites mortgages.

The Help to Buy scheme may increase access to mortgages but, when even Mark Carney, the Governor of the Bank of England, has warned about the risks to our economy of a lopsided housing market where housing demand hugely outstrips supply, it is clear the time is now right for a Help to Build scheme, using the strength of government guarantees to help increase the supply of affordable properties.

Labour’s Help to Build scheme will encourage small house-builders to deliver more homes, as well as stimulating the local economy and helping to prevent prices from spiralling ever further out of reach for young homebuyers. And we would lock in a series of stringent safeguards, such as a cap on the value of loans available for each development, to ensure the scheme is focussed on smaller builders, and the normal bank checks on construction firms' ability to repay.

This proposal alone will not solve the housing crisis. There is no one single proposal that can. That’s why our Housing Commission will report later this year, producing a roadmap of how we can reach our ambition of getting 200,000 homes a year built by 2020. But in the meantime, acting on this crucial issue will help get our small builders building again and it will begin to tackle the housing crisis which is leaving so many people without a decent home at a price they can afford.

Chris Leslie is shadow chief secretary to the Treasury; Emma Reynolds is shadow housing minister.

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The 11 things we know after the Brexit plan debate

Labour may just have fallen into a trap. 

On Wednesday, both Labour and Tory MPs filed out of the Commons together to back a motion calling on the Prime Minister to commit to publish the government’s Brexit plan before Article 50 is triggered in March 2017. 

The motion was proposed by Labour, but the government agreed to back it after inserting its own amendment calling on MPs to “respect the wishes of the United Kingdom” and adhere to the original timetable. 

With questions on everything from the customs union to the Northern Irish border, it is clear that the Brexit minister David Davis will have a busy Christmas. Meanwhile, his declared intention to stay schtum about the meat of Brexit negotiations for now means the nation has been hanging off every titbit of news, including a snapped memo reading “have cake and eat it”. 

So, with confusion abounding, here is what we know from the Brexit plan debate: 

1. The government will set out a Brexit plan before triggering Article 50

The Brexit minister David Davis said that Parliament will get to hear the government’s “strategic plans” ahead of triggering Article 50, but that this will not include anything that will “jeopardise our negotiating position”. 

While this is something of a victory for the Remain MPs and the Opposition, the devil is in the detail. For example, this could still mean anything from a white paper to a brief description released days before the March deadline.

2. Parliament will get a say on converting EU law into UK law

Davis repeated that the Great Repeal Bill, which scraps the European Communities Act 1972, will be presented to the Commons during the two-year period following Article 50.

He said: “After that there will be a series of consequential legislative measures, some primary, some secondary, and on every measure the House will have a vote and say.”

In other words, MPs will get to debate how existing EU law is converted to UK law. But, crucially, that isn’t the same as getting to debate the trade negotiations. And the crucial trade-off between access to the single market versus freedom of movement is likely to be decided there. 

3. Parliament is almost sure to get a final vote on the Brexit deal

The European Parliament is expected to vote on the final Brexit deal, which means the government accepts it also needs parliamentary approval. Davis said: “It is inconceivable to me that if the European Parliament has a vote, this House does not.”

Davis also pledged to keep MPs as well-informed as MEPs will be.

However, as shadow Brexit secretary Keir Starmer pointed out to The New Statesman, this could still leave MPs facing the choice of passing a Brexit deal they disagree with or plunging into a post-EU abyss. 

4. The government still plans to trigger Article 50 in March

With German and French elections planned for 2017, Labour MP Geraint Davies asked if there was any point triggering Article 50 before the autumn. 

But Davis said there were 15 elections scheduled during the negotiation process, so such kind of delay was “simply not possible”. 

5. Themed debates are a clue to Brexit priorities

One way to get a measure of the government’s priorities is the themed debates it is holding on various areas covered by EU law, including two already held on workers’ rights and transport.  

Davis mentioned themed debates as a key way his department would be held to account. 

It's not exactly disclosure, but it is one step better than relying on a camera man papping advisers as they walk into No.10 with their notes on show. 

6. The immigration policy is likely to focus on unskilled migrants

At the Tory party conference, Theresa May hinted at a draconian immigration policy that had little time for “citizens of the world”, while Davis said the “clear message” from the Brexit vote was “control immigration”.

He struck a softer tone in the debate, saying: “Free movement of people cannot continue as it is now, but this will not mean pulling up the drawbridge.”

The government would try to win “the global battle for talent”, he added. If the government intends to stick to its migration target and, as this suggests, will keep the criteria for skilled immigrants flexible, the main target for a clampdown is clearly unskilled labour.  

7. The government is still trying to stay in the customs union

Pressed about the customs union by Anna Soubry, the outspoken Tory backbencher, Davis said the government is looking at “several options”. This includes Norway, which is in the single market but not the customs union, and Switzerland, which is in neither but has a customs agreement. 

(For what it's worth, the EU describes this as "a series of bilateral agreements where Switzerland has agreed to take on certain aspects of EU legislation in exchange for accessing the EU's single market". It also notes that Swiss exports to the EU are focused on a few sectors, like chemicals, machinery and, yes, watches.)

8. The government wants the status quo on security

Davis said that on security and law enforcement “our aim is to preserve the current relationship as best we can”. 

He said there is a “clear mutual interest in continued co-operation” and signalled a willingness for the UK to pitch in to ensure Europe is secure across borders. 

One of the big tests for this commitment will be if the government opts into Europol legislation which comes into force next year.

9. The Chancellor is wooing industries

Robin Walker, the under-secretary for Brexit, said Philip Hammond and Brexit ministers were meeting organisations in the City, and had also met representatives from the aerospace, energy, farming, chemicals, car manufacturing and tourism industries. 

However, Labour has already attacked the government for playing favourites with its secretive Nissan deal. Brexit ministers have a fine line to walk between diplomacy and what looks like a bribe. 

10. Devolved administrations are causing trouble

A meeting with leaders of Scotland, Wales and Northern Ireland ended badly, with the First Minister of Scotland Nicola Sturgeon publicly declaring it “deeply frustrating”. The Scottish government has since ramped up its attempts to block Brexit in the courts. 

Walker took a more conciliatory tone, saying that the PM was “committed to full engagement with the devolved administrations” and said he undertook the task of “listening to the concerns” of their representatives. 

11. Remain MPs may have just voted for a trap

Those MPs backing Remain were divided on whether to back the debate with the government’s amendment, with the Green co-leader Caroline Lucas calling it “the Tories’ trap”.

She argued that it meant signing up to invoking Article 50 by March, and imposing a “tight timetable” and “arbitrary deadline”, all for a vaguely-worded Brexit plan. In the end, Lucas was one of the Remainers who voted against the motion, along with the SNP. 

George agrees – you can read his analysis of the Brexit trap here

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.