Industry News
Landowners
make £13bn
profit in one
year, as high
land prices
stifle affordable
housing
Landowners are pocketing billions of
pounds of profit every year just for
getting planning permission, which
raises prices and makes it harder than
ever to buy land for new social housing,
according to the Centre for Progressive
Policy and the National Housing
Federation.
A new report shows that landowners in
England made more than £13bn in profit
in 2016/17 alone (1).
In 2014/15, the figure was £9bn, the
research from the Centre for Progressive
Policy has found. This means that profits
have increased by around £4bn in only
two years.
Landowners’ total profits are more than
the global profits of Amazon, McDonald’s
and Coca Cola combined (2). Meanwhile,
in the UK, the six biggest energy suppliers
made a combined profit of £913m in
2017 (3).
At the same time, the National Housing
Federation has found that organisations
trying to build social housing are
increasingly outbid on land by private
developers.
Local government finance
settlement date confirmed in
government response to Hudson
review
Local authorities will have more
certainty to plan their budgets as
government confirms it will aim for set
dates each year.
Local authorities will have more
certainty to plan their budgets as
government confirms it will aim for
set dates each year for the provisional
and final local government finance
settlements, the Minister for Local
Government Rishi Sunak MP confirmed
today (24 October 2018).
The minister outlined the move in a
response to an independent review
into the department’s oversight of the
business rates system.
The review, led by former Director
General at HM Treasury Andrew
Hudson, found the department has
managed the increasing complexity
of the business rates and associated
systems well, but its processes for
managing the local government finance
system should be strengthened further.
This is in anticipation of future
challenges from the forthcoming Fair
Funding Review, the 2019 Spending
Review and the changes to business
rates and their retention by local
authorities.
The review also found the timetable
for announcing both the provisional
and final local government settlements
has over the past few years moved to
later in the year, allowing less time for
scrutiny and for local authorities to set
their budgets.
It recommended that future provisional
settlements be on or around the 5
December and the final settlement no
later than the 31 January.
In a letter to the Chair of the Housing
Select Committee, the Minister for Local
Government Rishi Sunak MP confirmed
the department will accept all of
Andrew Hudson’s recommendations and
outlined the department is aiming to
publish the provisional settlement for
2019 to 2020 on Thursday 6 December
2018.
The letter also outlines the need to
make sure each year that the settlement
timetable aligns with fiscal events and
Spending Reviews.
Minister for Local Government Rishi
Sunak MP said:
I thank Andrew Hudson for carrying
out this thorough review. We accept
his recommendations, and have
already taken steps to ensure their
implementation.
We recognise taking a more planned
approach towards the provisional local
government finance settlement in future
will be fundamental to ensuring local
authorities are given more certainty,
and the time and space to consider their
financial positions for the coming year.
“We desperately need tens of thousands more social homes to
be built every year, which is why we are disappointed that the
Government has missed a real opportunity to overhaul how land
is sold.
The National Housing Federation has
responded to the Chancellor’s Budget
statement in the House of Commons.
“The current set up means last year landowners pocketed
more than the global profits of Amazon, McDonald’s and Coca
Cola combined, raising the cost of land and making it almost
impossible for organisations who want to buy land for social
housing to afford it.
Responding to the Autumn Budget, Kate Henderson, Chief
Executive of the National Housing Federation, said:
Housing
“The Chancellor’s announcements on housing today are not the
wholesale changes needed to fix our broken housing market.
“More of this profit must be used for building social housing. The
housing crisis will never be solved until the price of land radically
changes.”
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