What can the next Prime Minister do to help Britain’s cities?

Only one way to settle this... FIGHT! Image: Getty.

After two years of speculation about the future, the Conservative race to be the next Prime Minister is underway. Brexit will be the biggest task the next occupant of Number 10 faces, but closer to home there are many important policy issues – flagging national productivity, stark geographical inequality, the housing affordability crisis, underfunded adult education, creaking social care – that have fallen by the wayside since 2016. Brexit can no longer be the excuse for not addressing these.

Despite warm rhetoric about the need to rebalance the economy, this government has been cooler on the Northern Powerhouse than its predecessor, has stalled on introducing the Shared Prosperity Fund, and the pace of urban devolution has slowed at exactly the same time as Westminster politicians turned their attention away from domestic politics.

The importance of cities in the national political debate has been overlooked lately. Despite this we are an urban nation and cities matter. They account for just 9 per cent of UK land but are home to over half the population, 60 per cent of jobs and 62 per cent of GVA. While Conservative Party’s heartlands may be in the shires and just one contender this evening has an urban constituency, any of those hoping to take up the One Nation mantle needs to have a programme for government that improves the lives of people living and working in cities.

To do this, here is where they should start:

Address local government’s funding problems

In the last decade, cities have shouldered nearly three quarters of all local government funding cuts, despite being home to just 54 per cent of the population. When measured per head, since 2009 people living in cities saw a local government cut of £386 each, compared to just £172 elsewhere in Britain.

These unequal spending cuts have severely hampered the ability of many economically weaker cities to effectively deliver public services and grow their local economies. Added to this, increases in the demand for social care have meant that other services have had to face even deeper cuts.

Some of the leadership candidates have pledged to increase public spending. This needs to apply to the Fair Funding Review for local government. But in addition to more money there are several almost cost free measures that would help cities better deliver public services and grow their economies.

The next Prime Minister should give local authorities more powers to raise and spend money as they see fit, including letting them set multi-year budgets. They should also find a long-term solution to our social care crisis as the current system is unsustainable.

Build homes where they are needed

The housing crisis is one of the biggest domestic challenges that this country faces. There is now rightly a political consensus that we must build more housing and the government has set itself an ambitious target to build 300,000 new homes each year. I would be surprised if any leadership contender reneged on this goal.

But contrary to popular belief, we do not have a national housing supply crisis; supply in many parts of the country is more than able to keep up with demand. It’s in places where demand is high and increasing, many of which are in the Greater South East, where supply has been unable to respond to demand, and in fact has actively restricted the provision of new homes by giving undue weight to the concerns of existing homeowners.

To ensure that housing supply meets demand in popular areas, the next Prime Minister should reform the planning system and introduce a flexible zoning system based on the Japanese system. They should also stop inflating demand by subsidising homeownership through government initiatives like Help to Buy. These policies only raise prices, increasing the wealth of existing homeowners and further pushing up rental costs in already expensive cities.

This shift is likely to be a difficult pill to swallow for a party that holds property ownership as a central tenet of its philosophy. Yet homeownership as a share of private housing has declined in every city since 1981. The next Prime Minister should recognise that buying is now an unattainable goal for many people and do more to ensure there is a ready supply of secure rented homes in places where people want to live.

Improve transport connections within cities

Politicians find it hard to resist the allure of the hard hat and hi-vis jacket that accompany any big infrastructure project.

The transport policy focus in recent years has reflected this. HS2, Northern Powerhouse Rail, and a third runway at Heathrow all aim to improve connections between cities, either in Britain or internationally. But this focus risks misunderstanding the reality of everyday travel for most people.

Some 50 per cent of people live in one local authority but work in another. But more than 75 per cent live and work within the same city region. So people are travelling to work but the vast majority are not travelling long distances.

The reality that the vast majority of people live and work within their home city-region, rather than commuting between them, should inform the new Prime Minister’s transport policy. Investment in local transport to efficiently take commuters from the suburbs to the city centre should be priority.

On a practical level this means improving buses and suburban and light rail connections, encouraging cities to exercise their powers over their local transport networks and implementing TfL-style integration on the network.

Minimise trading barriers with the EU

Sadly I cannot finish a blog on priorities for the next Prime Minister without mentioning the B- word. Like the country as a whole, Britain’s cities are overwhelmingly dependent on the EU for trade. It is the largest export market for every British city.

Cities generate 77 per cent of Britain’s total services exports, and over half of these go to the European Union.  London, Edinburgh and Cardiff would be among the biggest losers should Britain leave the EU without a comprehensive deal which includes services.

The next Prime Minister should be mindful of the importance of the EU to the livelihoods of people living in Britain’s cities – a majority of the country’s population – and ensure that any future Brexit deal keeps trade with the continent in both goods and services as frictionless as possible.


This leadership contest is particularly interesting for those of us focused on urban policy; it may well be the first one in British history in which a politician goes from a city hall to Downing Street – potentially setting a precedent for aspiring future prime ministers.

Irrespective of who triumphs on the BBC tonight, and who goes on to win this contest, the next Prime Minister has a big in-tray waiting for them – and Brexit is just the start.

Andrew Carter is chief executive of the think tank Centre for Cities, on whose blog this article previously appeared.

 
 
 
 

The Tory manifesto promises to both increase AND decrease the rate of housebuilding

Housing secretary Robert Jenrick. Image: Getty.

In his 2014 Mansion House speech, the then-chancellor George Osborne expressed with uncharacteristic honesty the motives at the heart of how the Conservatives see British housing politics: “The British people want our homes to go up in value, but also remain affordable; and we want more homes built, just not next to us.”

Five years later these contradictions remain unreconciled and present in their manifesto, which contains two different and contradictory – but clearly extensively targeted and focus-grouped – sets of policies.

The Conservatives have two housing targets. The first is to make significant progress to hitting “our target of 300,000 houses built a year by the mid-2020s”. The second is their aim to build “at least a million new homes” during the next parliament, which implies a target of 200,000 homes a year. This is not only 100,000 lower than their initial target but also lower than the current rate of housebuilding: 213,660 new homes a year. They have therefore implied at separate points in the same manifesto that they intend to simultaneously increase and decrease the rate of housebuilding.  

There are similar conflicts in their approach to planning. They intend to make the “planning system simpler” while simultaneously aiming to introduce community-led design standards for development and planning obligations to provide infrastructure for the local community.

None of this is unsurprising, The Tories don’t seem to know if they want to build more houses or not – so of course they don’t know whether they wish to make it easier or harder to do so.  

Politicians like obfuscation on housing policy to placate NIMBY voters. Take for example prospective Conservative MP and ‘environmentalist’ Zac Goldsmith’s crusade to save treasured local car parks. The manifesto can equally be accused of pandering to NIMBY instincts, protecting their shire voters from all housing, including ones they might actually need or want, by promising to protect the greenbelt.  

Instead, Conservatives intend to foist development on Labour-leaning inner-city communities and prioritising brownfield development and “urban regeneration”. This requires massive, infeasible increases in proposed density on brownfield sites – and research by Shelter has shown there are simply not enough brownfield sites in cities like London. Consequently, it is not clear how such a policy can co-exist with giving these inner-city communities rights on local design. Perhaps they intend to square that circle through wholesale adoption of YIMBY proposals to let residents on each street opt to pick a design code and the right to turn their two-storey semi-detached suburban houses into a more walkable, prettier street of five-storey terraces or mansion blocks. If so, they have not spelt that out. 

Many complain of NIMBYism at a local level and its toxic effects on housing affordability. But NIMBYism at the national level – central government desire to restrict housebuilding to make house prices rise – is the unspoken elephant in the room. After all, 63 per cent of UK voters are homeowners and price rises caused by a housing shortage are hardly unpopular with them. 


There is anecdotal evidence that protecting or inflating the value of homeowners’ assets is central to Conservative strategy. When George Osborne was criticised for the inflation his help to buy policy caused within the housing market, he allegedly told the Cabinet: “Hopefully we will get a little housing boom, and everyone will be happy as property values go up”. More recently Luke Barratt of Inside Housing noted that most Conservatives he spoke to at the 2018 party conference were scared “they’d be punished by their traditional voters if the values of their homes were to fall”. He was told by a Conservative activist at the conference that, “If you build too many houses, you get a Labour government”.

But the senior figures in the Conservative Party are painfully aware that the continuing housing shortage presents major long-term problems for the Party. As the manifesto itself acknowledges: “For the UK to unleash its potential, young people need the security of knowing that homeownership is within their reach.” Perpetual increases in house prices are incompatible with this goal. The problem has greatly contributed to the Conservatives’ severe unpopularity with a younger generation priced out of decent accommodation. 

Equally, there is increasing evidence that ‘gains’ from rising house prices are disproportionately concentrated in the south of England.  The differences in housing costs between regions greatly reduce labour mobility, suppressing wage growth in the north and midlands, which in turn leads to greater regional inequality. The policy of coddling southern homeowners at the expense of the economic well-being of other regions is a major long-term stumbling block to Conservative desires to make inroads into the ‘red wall’ of Leave-voting labour seats outside the south.

Before dealing with the issue of where housing should go, you must decide whether you want to build enough housing to reduce the housing crisis. On this issue, the Conservative response is, “Perhaps”. In contrast, even though they may not know where to put the necessary housing, the Labour Party at least has a desire in the abstract to deal with the crisis, even if the will to fix it, in reality, remains to be seen. 

Ultimately the Conservative Party seems to want to pay lip service to the housing crisis without stopping the ever-upward march of prices, underpinned by a needless shortage. Osborne’s dilemma – that the will of much of his party’s voter base clashes with the need to provide adequate housing – remains at the heart of Conservative housing policy. The Conservatives continue to hesitate, which is of little comfort to those who suffer because of a needless and immoral housing shortage.

Sam Watling is the director of Brighton Yimby, a group which aims to solve Brighton’s housing crisis while maintaining the character of the Sussex countryside.