The Landlord Investment Show June 2019 kicked off in earnest yesterday in London Olympia with a crowd-attracting guest panel, including Ken Livingstone, former Mayor of London, moderated by broadcaster and journalist Andrew Neil.
Discussing the topic of “The Future of the UK Housing Market”, the panel included Knowledge and Product editor for This is Money, Sarah Davidson; Less Tax 4 Landlords founder Tony Gimple; Mortgages for Business managing director Steve Olejnik, alongside former London Mayor Ken Livingstone.
The guest panel convened just as Conservative Party MPs gathered in Westminster for the first round of a new leadership ballot. Within minutes of the opening debate, Boris Johnson MP, Ken Livingstone’s successor as Mayor, topped the leadership ballot’s first round, with 114 votes from MPs.
Failure to build homes
The subject of housebuilding dominated discussion during the opening debate at the Landlord Investment Show June 2019. Andrew Neil recounted that successive governments have built fewer homes since the 1970s, despite the population continuing to grow significantly since that period.
Ken Livingstone addressed the topic, saying: “That’s the tragedy of our politicians, when the simple fact is, they’re all terrified of pushing up public spending.”
Sarah Davidson focused on the Labour government’s record, under Tony Blair. Looking at the period of low housebuilding in the late 1990s, she claimed: “If you were being cynical, you could argue that it’s politically driven, in terms of winning votes. People like to feel richer…a very easy way of achieving that is to inflate the value of their homes.”
Ms Davidson clarified this, saying that the Treasury had scrapped the use of the Retail Price Index (RPI) as part of inflation targeting during Gordon Brown’s tenure as Chancellor of the Exchequer during Mr Blair’s time as Prime Minister.
RPI, an inflation measure which included housing costs, was abandoned in favour of an inflation target relative to the Consumer Price Index (CPI). As a result, policy-makers stopped focusing on the housing market when formulating economic policy, as it continued to inflate, in her view.
The Livingstone legacy
During much of the Blair Government’s time in office, Mr Livingstone was Mayor of London, a role he was first elected to serve in 2000 before being re-elected in 2004. His Mayoralty ended when he came second in the Mayoral 2008 election against Boris Johnson. He failed to unseat Mr Johnson when he challenged him for the Mayoralty in 2012.
Property Notify asked Mr Livingstone what he could have done as Mayor to build more affordable homes in London.
Mr Livingstone replied: “The tragedy is, when Tony Blair created the office of London Mayor, there was a clause that said the Mayor will have no responsibility or power over housing…It took my entire Mayoralty to get Tony Blair to lift that…That restriction was lifted just as I lost to Boris.”
When Property Notify asked what he would do in current Mayor Sadiq Khan’s position today, Mr Livingstone referred back to his time as Mayor, claiming he had fostered an environment that encouraged greater housebuilding.
He explained: “When I became Mayor…the planning rule in London was that 25 per cent of homes should be affordable. I raised that to 50…House construction doubled in those eight years. Boris got in, he took it back to 25 per cent, and housing construction declined.”
Mr Neil interjected, stating that official data suggested that Mr Livingstone was incorrect, and that in actual fact, Mr Johnson had seen more houses built during his tenure as London Mayor.
Mr Livingstone lamented the current situation regarding housing, saying: “For decades, we’ve had all politicians, national and local, failing to tackle this housing crisis, and you can damn them all.”
Calls for a shake-up
Speaking exclusively to Property Notify after the panel, Less Tax 4 Landlords founder Tony Gimple dismissed Mr Livingstone’s claims on housebuilding. He said: “It was the usual political evasion. To improve the supply of housing, you’ve got to…want to improve the supply of housing.”
Reflecting on Mr Livingstone’s record on housebuilding as Mayor, Mr Gimple said: “He could have stopped politicising it…the difference between a fairy story and a manifesto is ‘once upon a time’ and ‘if I am elected’. Neither comes true…The fact of actually having a de-politicised housing ministry would give you that longevity.”
He also added: “Planning is no longer a science…the only way to improve the supply of good-quality dwellings…is join up local authorities, planners, developers, landlords…Whoever’s in County Hall or Number Ten will be looking to make sure they get re-elected on populist measures.”