Further and further out of reach. Photo: Getty Images
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The root cause of London's housing crisis: we don't build enough houses

Far from fixing the underlying problem, the Conservatives' mucking around with demand-side issues will only make things worse.

Elizabeth is in her early thirties. In January, after more than a decade living in London, she decided it was time to leave. 

The staggering rise in the cost of renting – up by around £3,000 a year for the average London property since 2010 – has left many of those, like Elizabeth, without a foot on the property ladder considering whether it makes sense to stay here. Meanwhile, increasing house prices have essentially guaranteed that very few of those who do stay will get the opportunity to buy.

Rising costs are perhaps the defining issue, but they are far from the only problem facing London’s housing stock, with inexcusably high levels of overcrowding, homelessness, dire property standards and rogue landlords on the rise.

Yet, these seemingly disparate problems have a common thread; we simply haven’t built enough homes in London. For Elizabeth, this has meant unpalatably high rents. For Emma – who contacted me because her landlord consistently failed to fix a chronic damp problem that led to her son developing asthma – this means increasingly few options to escape the type of negligent landlord to whom she and her husband pay large sums of rent every month.

This raises a fundamental question: Does the proposal to extend Right to Buy to housing associations do anything to solve the extensive problems we have with London’s housing stock?

The National Housing Federation estimates the policy could cost UK taxpayers as much as £12billion if all eligible and able housing association tenants took up their new right. £2billion of this would be required in Greater London. Alternatively, this would be enough to fund the construction of more than 66,000 much needed affordable homes, many of which would be for first-time buyers.

But the implications for housing supply run much deeper than government spending. This is a policy which facilitates state-sanctioned asset stripping of housing associations (many of which are charities), undermining their ability to borrow for new house building. The result could be fewer homes, higher prices and a deepening housing crisis – it is the antithesis of what London should be aspiring to.

There is a double injustice in the proposals though, with plans to fund it by forcing councils to sell their most expensive homes when they become available for re-let. Analysis of the proposals show that this could result in the forced sale of every council home that becomes available in the City of Westminster. The parallels with Shirley Porter are stark, and the implications for London’s mixed and balanced communities dire.

Even then, it is difficult to see how the funding will stack up. The £4.5billion that the Conservative manifesto estimated would be raised through local authority housing sales has been pledged to three different items – the cost of the extra Right to Buy discounts, building replacement homes for those that are sold, and funding a new £1billion ‘Brownfield Regeneration Fund’. Compare this with the NHF estimate that discounts alone could cost up to £12billion and the figures just don’t add up.

Many Londoners will understandably have trouble believing the government will fulfil their pledge to replace all sold homes. The previous Government promised the same in April 2012 when announcing the reinvigoration of Right to Buy. But since then 4,017 council homes have been sold in Greater London and only 1,530 started, and this without the additional pressures of compensating housing associations and funding an additional £1billion programme.

The fact is that we can only fundamentally tackle London’s housing crisis by building more homes, and we need to do so urgently. We can see that the personal dilemma faced by Elizabeth is shared by thousands of other Londoners and that the city’s public services and economic competitiveness are increasingly undermined by this crisis.

Yet, it would be difficult to devise a housing policy that is as carefree with the public finances but as socially damaging as the proposal to extend Right to Buy to housing associations.

Ask yourself this question: If you suddenly found £12billion that you were willing to spend on a housing policy, would you use it in a way that delivers fewer homes, makes it harder for most to get on the property ladder and increases the difficulty of tackling homelessness? I wouldn’t. I don’t think the Government should either.

 

Tom Copley AM is the Labour London Assembly Housing Spokesperson and a Londonwide Assembly Member

 

Tom Copley is a Labour member of the London Assembly

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An unmatched font of knowledge

Edinburgh’s global reputation as a knowledge economy is rooted in the performance and international outlook of its four universities.

As sociologist-turned US Senator Daniel Patrick Moynihan recognised when asked how to create a world-class city, a strong academic offering is pivotal to any forward-looking, ambitious city. “Build a university,” he said, “and wait 200 years.” He recognised the long-term return such an investment can deliver; how a renowned academic institution can help attract the world. However, in today’s increasingly globalised higher education sector, world-class universities no longer rely on the world coming to come to them – their outlook is increasingly international.

Boasting four world-class universities, Edinburgh not only attracts and retains students from around the world, but also increasingly exports its own distinctively Scottish brand of academic excellence. In fact, 53.9% of the city’s working age population is educated to degree level.

In the most recent QS World University Rankings, the University of Edinburgh was named as the 21st best university in the world, reflecting its reputation for research and teaching. It’s a fact reflected in the latest UK Research Exercise Framework (REF), conducted in 2014, which judged 96% of its academic departments to be producing world-leading research.

Innovation engine

Measured across the UK, annual Gross Value Added (GVA) by University of Edinburgh start-ups contributes more than £164m to the UK economy. In fact, of 262 companies to emerge from the university since the 1960s, 81% remain active today, employing more than 2,700 staff globally. That performance places the University of Edinburgh ahead of institutions such as MIT in terms of the number of start-ups it generates; an innovation hothouse that underlines why one in four graduates remain in Edinburgh and why blue chip brands such as Amazon, IBM and Microsoft all have R&D facilities in the city.

One such spin out making its mark is PureLiFi, founded by Professor Harald Haas to commercialise his groundbreaking research on data transmission using the visible light spectrum. With data transfer speeds 10,000 times faster than radio waves, LiFi not only enables bandwidths of 1 Gigabit/sec but is also far more secure.

Edinburgh’s universities play a pivotal role in the local economy. Through its core operations, knowledge transfer activities and world-class research the University generated £4.9bn in GVA and 44,500 jobs globally, when accounting for international alumni.

With £1.4bn earmarked for estate development over the next 10 years, the University of Edinburgh remains the city’s largest property developer. Its extensive programme of investment includes the soon-to-open Higgs Centre for Innovation. A partnership with the UK Astronomy Technology Centre, the new centre will open next year and will supply business incubation support for potential big data and space technology applications, enabling start-ups to realise the commercial potential of applied research in subjects such as particle physics.

It’s a story of innovation that is mirrored across Edinburgh’s academic landscape. Each university has carved its own areas of academic excellence and research expertise, such as the University of Edinburgh’s renowned School of Informatics, ranked among the world’s elite institutions for Computer Science. 

The future of energy

Research conducted into the economic impact of Heriot-Watt University demonstrated that it generates £278m in annual GVA for the Scottish economy and directly supports more than 6,000 jobs.

Set in 380-acres of picturesque parkland, Heriot-Watt University incorporates the Edinburgh Research Park, the first science park of its kind in the UK and now home to more than 40 companies.

Consistently ranked in the top 25% of UK universities, Heriot-Watt University enjoys an increasingly international reputation underpinned by a strong track record in research. 82% of the institution’s research is considered world-class (REF) – a fact reflected in a record breaking year for the university, attracting £40.6m in research funding in 2015. With an expanding campus in Dubai and last year’s opening of a £35m campus in Malaysia, Heriot-Watt is now among the UK’s top five universities in terms of international presence and numbers of international students.

"In 2015, Heriot-Watt University was ranked 34th overall in the QS ‘Top 50 under 50’ world rankings." 

Its established strengths in industry-related research will be further boosted with the imminent opening of the £20m Lyell Centre. It will become the Scottish headquarters of the British Geological Survey, and research will focus on global issues such as energy supply, environmental impact and climate change. As well as providing laboratory facilities, the new centre will feature a 50,000 litre climate change research aquarium, the UK Natural Environment Research Council Centre for Doctoral Training (CDT) in Oil and Gas, and the Shell Centre for Exploration Geoscience.

International appeal

An increasingly global outlook, supported by a bold international strategy, is helping to drive Edinburgh Napier University’s growth. The university now has more than 4,500 students studying its overseas programmes, through partnerships with institutions in Hong Kong, Singapore, China, Sri Lanka and India.

Edinburgh Napier has been present in Hong Kong for more than 20 years and its impact grows year-on-year. Already the UK’s largest higher education provider in the territory, more than 1,500 students graduated in 2015 alone.

In terms of world-leading research, Edinburgh Napier continues to make its mark, with the REF judging 54% of its research to be either world-class or internationally excellent in 2014. The assessment singled out particular strengths in Earth Systems and Environmental Sciences, where it was rated the top UK modern university for research impact. Taking into account research, knowledge exchange, as well as student and staff spending, Edinburgh Napier University generates in excess of £201.9m GVA and supports 2,897 jobs in the city economy.

On the south-east side of Edinburgh, Queen Margaret University is Scotland’s first university to have an on-campus Business Gateway, highlighting the emphasis placed on business creation and innovation.

QMU moved up 49 places overall in the 2014 REF, taking it to 80th place in The Times’ rankings for research excellence in the UK. The Framework scored 58% of Queen Margaret’s research as either world-leading or internationally excellent, especially in relation to Speech and Language Sciences, where the University is ranked 2nd in the UK.

In terms of its international appeal, one in five of Queen Margaret’s students now comes from outside the EU, and it is also expanding its overseas programme offer, which already sees courses delivered in Greece, India, Nepal, Saudi Arabia and Singapore.

With 820 years of collective academic excellence to export to the world, Edinburgh enjoys a truly privileged position in the evolving story of academic globalisation and the commercialisation of world-class research and innovation. If he were still around today, Senator Moynihan would no doubt agree – a world-class city indeed.

For further information www.investinedinburgh.com