Economy & Finance

What is simultaneously the most significant cause of London’s decline and Sadiq Khan’s greatest failing as Mayor? It is, of course, the failure to deliver new homes, which has devastated London’s economy. The housing crisis has taken a particularly heavy toll on the lives of working-age Londoners, who are priced out of homeownership and ripped off by rents that are rising faster than wages. Sadiq Khan has shown he is both ideologically and managerially incapable of delivery – the net is wide open for a more ambitious Conservative housebuilding agenda. 

One only has to do the lightest research to be overwhelmed by the evidence of London’s housing challenge. The UK has some of the smallest and most expensive homes in the OECD, with the average Londoner having the same-sized living space as a Tokyoite. This housing shortage has fueled rocketing rent prices; a report by City Hall last month found that low-income Londoners in their late twenties now spend 77% of their income on housing. It rightly concludes that “young Londoners face an almost impossible situation of high rents and house prices that are out of kilter with incomes.”

The housing crisis is not just impacting poorer Londoners, Rightmove’s latest house price index put the price of the average London home at an eye-watering £686,844. That means even high-earning young people find it more difficult to buy and remain stuck in the high-rent trap. Those in their forties cannot afford family homes, so it is unsurprising that, also, fertility rates are nosediving. This is not because of personal failure, as dubiously suggested by some commentators, but policy failure. 

The economic impact is dire, as ever larger numbers are pushed out of London, sacrificing the compounding economic benefit that a city’s proximity should provide. The cost of skyrocketing rents is passed on to businesses; look at the over 1,000 venue closures during the reign of Khan’s nightlife Czar, Amy Lamé. 

Despite the slick spin of Khan’s PR, his record on housing is poor. As pointed out by Guido Fawkes in February, the official Greater London Authority (GLA) target for affordable housing starts until 2026 is 23,900-27,100 per year. In the last three quarters, Khan has managed just 874 – a dismal 4% of the target. Council house starts under the £4.8 billion ‘Building Council Homes for Londoners’ programme in May number exactly zero.

Khan has not just failed, but has become an active hindrance. An independent review found “persuasive evidence that the combined effect of the multiplicity of policies in the London Plan work to frustrate rather than facilitate the delivery of new homes on brownfield sites, not least in terms of creating very real challenges to viability … Without a step change, it is highly unlikely that the housing targets of the London Plan will be met within its 10-year period and, as a consequence, the current housing crisis will continue, if not worsen.” Working-age people do not want this and will reward the party brave enough to take action. 

Khan’s failures are ideological in origin, evidenced by his enthusiasm for social housing over private delivery. This mindset ignores that the planning system is holding back building rather than boogeyman developers, whom the left finds more comfort in blaming. His calls for rent-capping powers overlook the lack of evidence for their effectuality and portray an ignorance of supply-side reform as the only way to temper growing demand in the long term. 

It is Khan’s phobia of market forces that will pave the way for a new centre-right pitch in London. Conservatives can champion a market-based approach to unlocking new homes, offering to use the Mayor’s powers towards a new era of house building. Committing to go beyond London’s pre-war house building peak of 80,000 per year should be the minimum. In a world where the ingrained system kicks back hard against housing delivery, we need elected Conservative politicians to set a clear direction and be accountable. 

Britain Remade’s recent Get London Building report provides wonderful ideation for a Conservative renaissance in London. Building density around train stations, revising urban land use and regenerating run-down estates could unlock hundreds of thousands of homes. These measures are all within the Mayor’s gift through the London Mayoral Plan, Mayoral Development Orders (MDOs) and the ability to drive through significant housing applications. 

Conservatives have always been best when delivering – just look at Macmillan’s housing boom or Heseltine’s redevelopment of London’s Docklands. Making this pitch could win back working-age people who have turned away from the Conservative Party party in droves. Britain Remade estimates that copying successful policies from New Zealand would create a £6,000 saving for a young family renting the average two-bed. Offering young people a home of their own or significantly lowered rental costs would be a slam dunk, but to win voters’ trust, it must become front and centre of our pitch. 

It is time for Conservatives to start a new conversation about who we are and what we stand for in London. The old maxim that we can win a small section of outer London and hope inner London does not turn out has been tested to destruction. There is now an opportunity to win both inner and outer London by building the homes we desperately need. Susan Hall’s recognition of the challenge has been a welcome first step. We must now be bolder in articulating the scale of change that needs to come about, whilst also holding Khan to account for his failures. 

Naturally, some who are reading this will guffaw at the notion of a YIMBY Conservative party. This is not unwarranted, given some of our MPs’ more militant NIMBY tendencies, but the Conservative Party’s strength has always been in redefining itself around the challenges of the day. Backing measures to increase density in inner London is the perfect sweet spot – providing the biggest economic boost whilst minimising outer London voters’ disgruntlement. 

Sceptics will say we cannot risk offending our voter base in an attempt to deliver for younger people and those living in inner London. I argue that the need for action will only become more pressing; the choice now is how long we swim against the rising tide. 

James Cowling is the Founder and Managing Director of Next Gen Tories and an Associate Fellow at Bright Blue.

Views expressed in this article are those of the author, and not those of Bright Blue.

This month, a landmark Bill got one step closer to becoming legislation. The Tobacco and Vapes Bill, if enacted, has the potential to save thousands of lives and billions of pounds for the National Health Service (NHS). The creation of a ‘#SmokeFreeGeneration’ would protect young people from the dangers of tobacco and be a key building block of a healthier future. It would also build a lasting legacy for the Prime Minister, for Labour have promised to back the Bill.

Prevention lies at the heart of the Bill. It is prevention that holds the key to easing pressure on a healthcare system that is buckling under a backlog of cases and reduced staff capacity, to include a waiting list which currently stands at 7.6 million. It is a failure in prevention that lies at the heart of the surge in post-pandemic childhood obesity, and the sharp rise in the number of measles cases. 

Prevention needs to be the thread that runs through public policy when it comes to protecting our health. It is vital to building a healthier and more productive future.

But a productive future is not going to be possible without a healthy workforce. People in England’s most deprived neighbourhoods work longer hours than those in more affluent areas, but live shorter lives with more years in ill health, costing an estimated £30 billion a year to the economy in lost productivity and causing enormous harm.

Last month, the ONS published data showing that up to 3 million people were not looking for work due to ill health. This should cause deep concern. To get our economy moving again we need to put the health of the public further up the political agenda. More than that, public health needs to be everyone’s responsibility.

For millions of people in our workforce, it already is their responsibility. Allied health professionals, sports and fitness trainers, town and country planners, community health champions, emergency services, pest control workers, environmental health officers, cleaning and hygiene operatives and many more all do their bit to protect and promote better public health – sometimes without knowing it.

It is occupations like these that make up the UK’s Wider Public Health Workforce.  Working across a vast range of settings, environments and workplaces, the wider workforce makes a huge net contribution to protecting the health of the public. Expanding it should be the next step in the UK Government’s public health strategy. There are up to 1.5 million people in the wider workforce that could help support better public health outcomes with more training and support. A national workforce strategy for the whole public health workforce would be a cost-effective, bold policy move from the Government and would be cost effective.

Whether it is making sure our food is safe to eat, the air we breathe is clean, the communal spaces we use are hygienic or the places we live in are designed with our wellbeing in mind, the wider workforce do a huge amount of work that isn’t always recognised. Yet they are not considered specialists in public health and their impact is not taken into account when making health policy.

The Royal Society for Public Health has recently published a report outlining how the Government can tap into the huge potential in the Wider Public Health Workforce. 

First, the UK and devolved nation governments ought to develop a cross-sector national strategy for the whole UK Public Health Workforce. This would include business, public health and other industries.

Second, the public health sector and relevant government departments ought to think collectively about how to resource, upskill and empower the Wider Public Health Workforce to maximise their impact. 

Third, the Wider Public Health Workforce should be better recognised as contributing to public health and prevention.

And last, the Wider Public Health Workforce needs clearer routes into public health and ways to develop and be recognised for its expertise in public health. These would also create better career development opportunities and progression into more specialised public health roles.

We want more people to develop and grow their public health skills. A better skilled workforce will be a net positive for society. It will ultimately help reduce pressure on the healthcare system as the wider workforce has a key role to play in prevention. 

Policymakers have nothing to lose and everything to gain when it comes to investing in public health. Doing nothing to address the UK’s declining health is going to cost us much more in the long term. 

William Roberts is the CEO of the Royal Society for Public Health.

Views expressed in this article are those of the author, and not those of Bright Blue.

For many years, Westminster has been enthralled with the idea of “taking the politics out of” various realms of decision-making. The prevailing narrative argues that independent bodies help avoid the day-to-day grind of Westminster politicking, the transitory influence of focus groups and opinion polls and the short-termism which is embedded in Parliament. However, de-politicisation means we miss out on important benefits of political decision-making: electoral accountability, voter representation and transparency.

The ongoing public sector pay disputes have highlighted that navigating state spending on the NHS is incredibly political and cannot be left to unelected experts. Decisions on these matters, where public, taxpayer’s money is concerned, demand democratic accountability. 

There are multiple areas of politics where significant power has been transferred from elected politicians to unelected officials, but one of the most significant is fiscal and monetary policy. In the realm of fiscal policy, whether we raise or cut taxes is a decision we would assume is accompanied by high levels of democratic accountability. However, the Office for Budget Responsibility (OBR) – the organisation responsible for setting the limits for changes to fiscal policy – is essentially free from accountability and scrutiny.

A recent review of the work of the OBR has highlighted that the Budget Responsibility Committee exercises “a vice-like grip over the UK’s economic levers,” having recently sent ‘a warning shot to Conservatives’ considering tax cuts and told the Government to cut benefits. Chancellor Jeremy Hunt referenced the OBR’s forecasts over 50 times during his Autumn Statement to the House of Commons in 2023, also discussing the ‘headroom’ that the Chancellor will be ‘allowed’ in the Spring Budget by these forecasts.

Yet, OBR forecasts are never 100% accurate and we should not expect them to be. Between 2010 and 2023, the OBR’s one-year budget forecasts misjudged UK economic growth by £558 billion. Their forecasts are so incorrect that the average yearly error is equivalent to the combined contribution of the British auto manufacturing, agricultural and pharmaceutical manufacturing industries. This is not because the OBR is any worse at analysis than other forecasters, but because they are in the business of estimation. Our public debate and political system must recognise that we should not bestow so much influence on a single body which was established for the purposes of forecasting.

Another area where politicians have shirked responsibility is monetary policy. Until 1997, monetary policy was within the remit of the Treasury. Then Labour made the Bank of England ‘independent’ by transferring power to set interest rates to the Bank’s ‘Monetary Policy Committee.’

It seems the Government has forgotten just how political monetary policy is. Interest rates are hugely influential on the public finances, although their greatest impact is on households. Recent increases in the ‘base rate’ have seen fixed-rate mortgage payers renewing their payments at 6.5% or higher. The recent rate-raising campaign by the Bank of England has seen many households paying an additional £500 per month for their mortgage.

If burdening homeowners with additional mortgage expense was not political enough, higher interest rates also widen inequality. This is because lower income workers are more likely to be in ‘problem debt’, which they will now pay higher rates on. Meanwhile pensioners and high earners, who are already typically wealthy, will benefit from the higher interest payments they receive on their savings.

This would not be such an issue if the Bank of England was an accountable institution. However, the individual responsible for rate changes and their detrimental effects on households – the Governor of the Bank of England, Andrew Bailey – cannot be voted out or even sacked by the Prime Minister. Whilst the Governor is subject to a degree of scrutiny via Select Committees, we must ask whether it is appropriate that the power to set policy, influencing the finances of millions of Britons, rests with someone unaccountable to voters and someone who is practically unimpeachable until the end of his contract in 2028.

The OBR and Bank of England are just two examples of elected politicians handing off power and responsibility for decisions which are deeply political. Each demonstrates, to differing degrees, the undemocratic culture of “taking the politics out of” decision-making processes, which have profoundly political consequences for business, families and working people.

Politicians are far from perfect, and are often not the best listeners or critical thinkers that Britain has to offer. But, their singular overriding quality which outshines all others is that, when they get it wrong, voters can boot them out. The electoral accountability of MPs means their decisions are likely to be more representative and transparent than those made by ‘experts’ behind closed doors. 

Westminster must stop relying on undemocratic bodies to shape policy. It is time that those who are democratically accountable started acting with the authority given to them by the electorate.

Callum Westwood is the winner of Bright Blue’s Tamworth Prize 2023.

Views expressed in this article are those of the author, and not those of Bright Blue.