IN FOCUS | Leaders bemoan Labour’s plan to increase housing targets

Council leaders across the North have reported feeling ‘blindsided’ and unfairly victimised by the proposed change to the standard methodology for calculating housing need.

In July, the new government said it was reinstating mandatory housing targets with a plan to build 1.5m new homes over the next five years.

As a means of reaching that goal, Labour has adopted a fresh algorithm for working out housing need. This has seen targets in the majority of local authority areas rising.

At the same time, Labour’s algorithm has resulted in a reduction of housing targets across some of the North’s largest cities.

Outlook for cities

Manchester, Sheffield, and Newcastle will all be expected to deliver fewer homes in future with less densely populated areas picking up the slack.

According to government data, Newcastle has fallen short of its 1,417 homes a year target for the last three years. The city’s target has now been revised downwards slightly to 1,345.

Neighbouring Northumberland Council on the other hand has overperformed. It has delivered, on average 1,461 homes a year since 2021 against a target of just 549.

Labour has increased Northumberland’s housing target significantly to 1,769 units a year. This 222% increase has not gone down well with the council’s Conservative Leader Cllr Glen Sanderson.

“There’s no sign these Labour-imposed targets come with any extra funding and so you can expect a challenging time as we work out how to deal with what is to come,” he said.

“Our existing targets are the right ones and our plans align with our actual housing need.”

Some of the homes Newcastle is no longer expected to deliver have been passed northwards to Northumberland and the same has happened elsewhere.

Birmingham City Council has failed to deliver even half of the 7,100 homes it is supposed to over recent years.

That target, under Labour’s new algorithm, has been revised downwards to just shy of 5,000, – making Newcastle’s 72 home decrease seem modest –and neighbouring areas such as Dudley and Herefordshire have seen their housing burden increase.

It is a similar story in Manchester and Liverpool. Both have had their targets reduced after consistent under delivery with the difference being divvied out to other boroughs within their respective city regions.

Easing cities’ housing delivery burden is, in the view of Andrew Carter chief executive of the think tank Centre for Cities, the wrong move.

“It is a strange strategic outcome,” he said.

“It might be that that’s what the methodology will produce if you just crank it through the system but you have got to apply a strategy and a vision to those numbers, [which should be] how do we get Greater Manchester, Greater Birmingham, Greater Leeds, and Greater Liverpool, playing a bigger role in the national economy?”

People power

Manchester and Liverpool are both experiencing population growth ahead of the UK average, making Labour’s decision to ease their housing targets seem counter-intuitive.

However, in some instances it makes sense to revise a city’s target downwards.

Sheffield, which Centre for Cities says is in the bottom 10 places for population growth in England, has failed to deliver even half of its 3,000-unit annual target over the last three years. Going forward, the city will be asked for 400 fewer homes a year.

However, slow population growth does not always equal softer housing targets.

York and Sunderland have both experienced population growth way below the national average since 2012 but have seen their housing targets increased. In Sunderland the rise is significant: 512 to 1,208.

Hull’s conundrum

Hull is also an interesting case. The city has delivered an average of 615 homes a year since 2021 against a target of 536 and is experiencing population growth 2% below the national average.

Despite this, Hull has seen its housing target hiked by just shy of 1,000 units a year.

“There needs to be a recognition that Hull has consistently hit its target over the last decade,” said the council’s Lib Dem Leader Cllr Mike Ross.

“It feels like we are a victim of our own success.”

Ross said he had been provided “no reason or rationale” for why Hull had seen its targets raised while others have seen theirs go the other way.

“I have concerns around the manner in which this has been done. There has been no meaningful consultation,” he said.

Labour, which was widely praised by the housebuilding industry for its plans to Get Britain Building, has said it will “intervene” if councils fail to deliver their allocated share of homes.

That could be bad news for places like Hull, whose government-imposed housing target jars with the reality on the ground.

“Hull is a built-up city. To double [housing] targets is incredibly challenging,” Ross said.

“It is becoming increasingly difficult to find new land to build homes.”

Dan Mitchell, planning director at Stantec, said the onus will be on councils to prove they cannot hit Whitehall's targets.

“Councils will have to go through an exhaustive process to demonstrate why they can’t deliver the government’s numbers,” he said.

Even those who can find sufficient land will struggle to hit their inflated targets, according to Mitchell.

“At the end of the day there is only so much capacity in the public sector and only so many developers. We are going to need some new entrants [to the market].”

Secretary of state Angela Rayner and housing minister Matthew Pennycook want to speed up housing delivery. Credit: House of Common, via CC BY-3.0, bit.ly/3g0ER6a

Green Belt grumbling

One place where councils are being encouraged to look for developable land is in the Green Belt. Labour is asking local authorities to identify poor quality Green Belt – which it is has termed grey belt – to top up land banks.

West Lancashire, which is 90% Green Belt, is likely to be one authority forced to relinquish some of its protected land.

Labour’s new algorithm has seen the borough’s annual delivery target go up from 166 to 605, which has angered the council’s Labour and Co-operative Leader Cllr Yvonne Gagen.

“It is absolutely ridiculous,” she said. “We were blindsided.”

Gagen’s council has overdelivered in recent years – building an average of 441 homes a year since 2021 – and has also embarked on its own housebuilding journey through council-owned Tawd Valley Developments.

“We are not going to be able to reach the new targets and we will be pushing back and writing to government,” Gagen said.

“There needs to be an open and honest conversation about what is doable.”

While West Lancs is willing to fight, Stockport Council seems to have resigned itself to the fact it will probably have to let go of its hard line brownfield-only approach and release some of its Green Belt to meet a housing target that has increased from 1,097 to 1,906 under the new algorithm.

Stockport Council has paused consultation on its long-awaited local plan in light of the revised targets. The draft plan proposed none of its 14,480 acres of Green Belt would be built on but this will likely have to change.

A different perspective

Many local councils are upset at the prospect of having to find more land to build on. However, Redcar and Cleveland, whose 1,438% housing target increase was the largest of any local authority, is relishing the opportunity to do its part to solve the housing crisis.

Leader Cllr Alec Brown said the increase in housing targets has come at an “ideal time” as the council reviews its local plan.

Redcar and Cleveland’s target has shot up from 45 a year to 642 but Brown is not daunted.

“It is a significant increase but we have been building 350 to 400 homes a year so it is not as big as it looks on paper.”

The need to deliver more homes will present both hurdles and opportunities, according to Brown.

“Undeniably there will be challenges [but] we have lots of [brownfield] sites in areas where there have been ex-council estates like South Bank and Grangetown.”

Brown added that Redcar and Cleveland is planning to deliver some of the increased need itself.

“[The increase] has given us the impetus to relook at social housing.

“We are looking at building as an authority. Private developers are profit-focussed, which impacts delivery of affordable and social homes.”

Brown’s determination to ramp up the delivery of affordable and social homes in his borough aligns with deputy prime minister Angela Rayner’s vision of a “council house revolution”.

However, long-standing issues around resourcing within councils, viability, and labour shortages stand in the way of the government’s ambitious targets ever being more than just numbers on a spreadsheet.

And even if Labour does manage to address these issues and mend the broken system, it might be time for another election before the government can point to any measurable uptick in housing delivery.