This week the government will announce a major overhaul of planning rules that will encourage the construction of far more affordable homes, as it seeks to tackle the economic and social legacy of 14 years of Conservative rule.
Deputy First Minister Angela Rayner will present a new National Planning Policy Framework to MPs on Tuesday before they go into their summer recess, tightening the requirements for building far more affordable homes in areas where they are needed from this autumn.
Writing for the Observer Before the announcement, Rayner said ministers had found a “frankly scandalous legacy” “under every stone we lift” since taking office in government.
She says that with so many people struggling to find a home or roof over their heads, “delivering social and affordable housing at scale” is her “number one priority”.
“We simply don’t have enough homes,” she writes. “In the death throes of the exhausted Conservative government, they gave up governing and deepened their housing failure. In the first three months of this year, 41% fewer homes were started on the building block compared to the same period in 2023.”
Rayner’s move follows the announcement on Monday by Chancellor of the Exchequer Rachel Reeves of the findings of a Treasury inquiry into Labour’s spending legacy.
To prepare the public for the tough choices ahead – on spending and tax – Reeves is expected to reveal a larger-than-expected “black hole” of around £20 billion between spending and revenue.
A government spokesman said the audit had found that “the previous government made significant financial commitments for this financial year without knowing where the money would come from”.
The spokesman added: “The review will show that Britain is broke and broken – and reveal the mess that populist politics have made of the economy and public services.”
Keir Starmer and his ministers continue to blame the previous government for a series of decisions they plan to take in the coming months that will prove controversial and unpopular, including a series of tax rises announced in the autumn budget and severe spending cuts.
Last week, Starmer first rebelled in Labour over his refusal to scrap the two-child benefit cap, leading to him suspending the party leader and seven of his MPs for six months.
On Saturday is the Financial Times reported that Reeves would delay a number of unfunded road and hospital building schemes. There is speculation she could pull the plug on a proposed £1.7 billion road tunnel under Stonehenge, as well as the 14-mile Lower Thames Crossing, a road and tunnel under the river expected to cost £9 billion.
But ministers are also prepared to focus on what they call an urgent need: restoring public services and generating economic activity.
Unlike the Tory-Liberal Democrat coalition, which has launched a period of across-the-board austerity across the state, Reeves is expected to agree an above-inflation pay scheme for millions of government workers, including teachers and NHS staff. Pay bodies representing the groups have recommended increases reportedly around 5%, which ministers say can be fully met to avoid more damaging and costly strikes.
Increasing house building by removing blockages in the planning system is seen as a way to generate economic growth and address the growing supply and affordability crisis.
Sources close to Rayner, who grew up in social housing in Stockport, said she was focused on delivering more social housing. There are 4 million households in social housing, but almost 1.3 million are on waiting lists for social housing.
During the 13 years of Labour in power, between 1997 and 2010, almost 363,000 new social housing units were delivered, compared with just over 171,000 during the 13 years of Conservative power, between 2010 and 2023. Of these, 45% (over 77,000) were delivered in the first two years, meaning they were likely the result of the affordable housing programme introduced by the previous Labour government.
Jeremy Hunt, the shadow chancellor of the exchequer, said Labour’s claims that the public finances were suddenly in such dire straits were complete nonsense.
“Since we founded the OBR [Office for Budget Responsibility] In 2010 the books are wide open and what they show is a healthy, growing economy – not the fiction that Labour is now selling, which is widely rejected by independent commentators.
“Their motive is clear: after promising not to raise taxes 50 times before the election, they now need a pretext. But trying to defraud the British people so soon after their election is a high-risk strategy that is doomed to fail.”
Rayner makes it clear she is taking on Conservative opponents of more housing.
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“This Labour government is not afraid to take tough decisions in the national interest to drive growth in every part of the country. We were elected on a mandate to build the homes Britain needs and to make the tough choices to unblock the planning system and make it a reality. When it comes to housebuilding, we will no longer ask ‘if’, but ‘how’.
“Delivering social and affordable housing at scale is not only my number one priority to ensure everyone has a safe roof over their head. It is also a crucial step towards 1.5 million homes, helping the sector out of this crisis. That is why we will take action to inject confidence and certainty into the social housing system, so that local authorities and private providers can get back to building.
“Local leaders who know their areas best will play a key role in making these bold ambitions a reality.
That’s why we work with local government to plan new homes in the best possible locations, with the supporting infrastructure, public services and green spaces that residents need.
“We will also make the development of wastelands our first priority and ensure that a green belt that emerged in the mid-20th century continues to function well in the 21st century.”