Friday, 20 November 2015


Devolution will happen; it’s on the agenda, and there is a good deal of cross-party support for it. Although I have reservations about some aspects and details of the government’s proposals, the direction of travel is essentially right.

But we need a dialogue and debate about two important issues.

The first is the importance of codifying the powers of local government and its relationship with the centre. Currently, there is a real danger that some powers and aspects of policy will be devolved to local councils, but that other powers will be removed from local councils, and more controls introduced in their place.

For instance, at the same time that parliament is considering The Cities and Local Government Devolution Bill, it is also considering a Housing and Planning Bill which expropriates a large number of planning issues from local decision-making and gives them to Whitehall.

In the last parliament, the government portrayed the stand-alone housing revenue accounts as a major mechanism of decentralisation—a means of devolving power to local councils—but has now announced measures about rent-setting and determination which reverse devolution and move back to a centrist approach.

My point is that we need a time of reflection, with a discussion between Government, local government and this House about the framework for the constitutional relationships between the centre and local authorities of whatever kind, including combined authorities, so that we can look at the balance of powers and perhaps put down some markers or mechanisms for ensuring that the devolution we all support today is not taken back tomorrow. We need something of that kind. A constitutional convention has been mentioned—the Government may not like those words, but we need some mechanism to enable that to happen.

My second concern is about fiscal devolution. Last year, the Select Committee I chair produced a report on an all-party basis. It was overwhelmingly supported by the London Finance Commission, the Mayor of London and London boroughs, and the core cities. But it was dismissed by the government as something that it didn’t want to pursue.

However, the government is now pursuing the total localisation of business rates, but proposes to retain council tax capping and control by referendum. No other tax requires a referendum on any increase. I no more agree with this policy now than previously. Further, it is ludicrous that there has been no revaluation for council tax purposes for 25 years. And the government is simply refusing to consider any localisation of stamp duty or other property taxes or of income tax.

We need a serious look at wider fiscal devolution. Ultimately, simply giving to local councils the power to spend money that has been handed out from the centre is not real devolution at all.

Note: This is a summary of some contributions I made to the debate on the Cities and Local Government Devolution Bill. You can read more at:

Monday, 16 November 2015

Last chance!

It’s countdown time. On the 21st November it will be too late.

If you are not on the electoral register before then, you won’t count when changes are made to election boundaries in 2016. If you, or your family or friends aren’t on the register by then, when you do get organised to get on the register to vote, your vote will have less value than it should.

So, what’s going on? And why do you need to act this week?

The new system of Individual Electoral Registration (IER) changes how you register to vote. In the past, electoral registration was the responsibility of ‘the householder.’

But, things have changed. Now, you need to register yourself. The problem is that the Conservative government have rushed these changes through and have not properly informed voters.  They think it is in their interests not to have a comprehensive electoral register. As a result, up to a million people may not have even realised what they have to do.

Young people and students are amongst the groups worst affected, alongside people who live in private rented accommodation, those who move frequently.

We can’t sit by and watch this many people lose the right to vote. That’s why this week is crucial. We must do everything we can before the deadline to make sure that everyone who wants to vote in future elections can.
If you are not on the register, you not only lose the right to vote. You may also find that you are denied access to a range of services or products that most people take for granted. Not being on the register will almost certainly stop you opening a bank account or getting a mortgage, credit or a loan, except at an extortionate rate.
So, you have to act this week to ensure you get counted on the 1st December electoral register.

And, it’s not just you. Please spread the word. Ensure your family and friends know just how important this is.

It's actually really easy to register, just visit and in three minutes it will all be done.

Crunch time for housing

We have a rapidly growing housing crisis. 

I had to remind the Conservative Secretary of State this week that I had been previously been critical of the former Labour government for not building enough homes, but that the biggest problem was that this last Conservative-led coalition government had built even fewer. 

David Cameron has promised that 1 million new homes will be built in this parliament. Let me tell you that there is not a cat-in-hell’s chance of that happening unless the government does a complete u-turn and invests in new social housing for rent, by councils or housing associations. There is no sign of that happening.

Owner-occupation is falling rapidly. The proportion of households who can actually afford to buy is falling rapidly. The number of people in their 20s and 30s who are staying home with their parents is rising day-by-day. Homelessness is on the increase. Low income families are being forcibly re-housed from higher rent areas, away from their jobs, their children’s schools and their families. On nearly every indicator, the problem is getting worse each and every day.
So, what is David Cameron’s response?

First, he has stopped councils from requiring developers to include affordable homes in new build schemes. He has replaced this policy with his Starter Homes’ initiative. And, do you know the price of these Starter Homes – up to £450,000 in London and £250,000 in the rest of England. Anyone who thinks most young families can afford £250,000 let alone £450,000 has simply lost touch with reality.
Second, he has taken decision-making, about where these homes should be, away from local communities and councils and moved to Whitehall. So much for localism!

Third, he’s introduced right-to-buy for social housing tenants, but it is absolutely clear that there will not be one-for-one replacement, and the discounts are to be funded by forcing councils to sell more homes. Even Conservative MPs are lining up in droves to object, asking for exemptions for their communities; those in rural areas say this policy will lead to the end of any affordable homes for rent in vast areas of the country.

Fourth, Cameron is imposing new rent control arrangements on both councils and housing associations – tearing up existing arrangements without notice – which will cut the number of new homes they can build by thousands. The independent Institute for Fiscal Studies (IFS) now says that most social housing tenants would not benefit from any rent reduction, but the policy will benefit the exchequer. 

The consequence on new house-building is also dramatic. The government’s own Office for Budget Responsibility (OBR) predicts that 14,000 fewer social sector properties will be built between now and 2020–21 as a consequence. Locally, Sheffield Housing will lose £27m over 5 years and South Yorkshire Housing Association will lose £7m.

And, just to rub salt into the wounds, Cameron and Osborne have now confirmed that they believe that two hard-working adults each earning the Living Wage is to be defined as having a High Income for which it should be rewarded with a significant increase in rent.

From April 2017, social housing tenants with household incomes above £40,000 in London, and above £30,000 elsewhere in England, will have to pay more rent. IFS estimates that more than 250,000 households will be hit. The details are yet to be revealed, but we could see some households getting a £1 annual increase in income being forced to pay a £1000 or more in additional rent.
It’s crunch time for housing. Far from addressing the challenge, Cameron just keeps adding to the crisis.

Wednesday, 11 November 2015

Rising to the challenge

We have a housing crisis. On just about every indicator, the direction of travel is wrong.
Housing costs as a proportion of earnings remain unsustainably high. We are spending 1.4 per cent of UK GDP on subsidising housing costs, compared with 0.14 per cent in Germany. UK housing benefit has doubled in a decade to £24.2bn.

Last week, Conservative Housing Minister Brandon Lewis claimed that his Housing and Planning Bill will  kick-start a national crusade” that will “get one million homes built by 2020” and “help deliver the homes hard-working people rightly deserve, transforming generation rent into generation buy”. 

It’s nonsense. You should put even less faith in Lewis’s claim than that of his predecessor, Grant Shapps, who told me in 2010 that “Building more homes is the gold standard upon which we shall be judged”, before going on to deliver a post-WW2 record low of 135,500 new homes in 2012/13.
Meanwhile, David Cameron proudly proclaims his new Starter Homes’ initiative. These are set to cost no more than £250,000 outside of London and £450,000 within London.  Starter homes at £450,000? Cameron thinks that this is ‘affordable’? Only on Planet Eton! It’s no wonder that ordinary people think politicians are out of touch.

Cameron and Lewis have plucked a promise of “1 million new homes in this Parliament” out of mid-air. Let’s be clear; there is no chance of this being achieved, let alone the 250,000 minimum housing starts required each year, without a significant investment in social housing which is essential to meet housing needs as well as economic objectives. But Cameron, for ideological reasons alone, has set his face against social housing with his latest hugely subsidised right-to-buy scheme for housing associations. 

Tackling the housing crisis requires some radical interventions. Simply building more homes will not redress the problem of absurdly high house prices fuelled by the absurdly high cost of land.
Where planning permission is given for housing, it’s the public purse which should benefit from increase in value. This principle was enshrined in the 1947 Planning Act. The landowner would receive the current use value plus a helpful top up but not the windfall bonus of today’s system.
Denmark and Germany have led the way in addressing the challenge of brining housing land in to use at lower prices, using land value taxes and planning powers. It’s little wonder that they can deliver house-building rates double or treble ours, whilst cutting the cost of housing. If they can do it, so can we.

Building enough new homes is a huge challenge. Getting a fair deal for taxpayers is an even bigger challenge. Land value reform now has to be on the agenda.

Tuesday, 10 November 2015

Steeling ourselves

Between 1979 and 1984, Sheffield lost more than 50,000 jobs in steel and engineering – more than the whole of the UK coal industry lost in any 5 year period. We understand the devastating long-term impact that such changes have on the whole economic, social and environmental status of a community. 

With major changes in the technology of steel-making, the location of raw materials, costs of energy, production capacity and patterns of demand, it was inevitable that there would be massive implications for the UK steel industry. The key political issue was not about change itself but about how such change was managed. 

For Margaret Thatcher’s government, wholesale redundancies and the destruction of local economies were seen as ‘the price worth paying’. To add insult to injury, Thatcher then blamed the victims and used that as a justification for minimising investment in managing the transition. It is little wonder that anger about those policies is so ingrained in Sheffield, South Yorkshire and other communities which were similarly affected.

As a matter of interest, a few years’ later I visited Anshan – Sheffield’s twin city in China – which is dominated by coal and steel production. I met the small team from Davy’s (now DavyMarkham) in Sheffield who were installing some modernised plant to improve efficiency in the steelworks. They explained that the plant they were installing was by no means cutting-edge; it was 20 year old technology. However, its installation would ‘only involve the redundancy of about 10,000 steelworkers, which was the maximum number that it was felt could be redeployed and retrained over the course of the next year’. In other words, continuous improvement in efficiency and effectiveness, but at a pace which could be managed. 

Let us roll forward to today with is devastating news that the decision to end 170 years of steelmaking in Redcar has resulted in 2,200 direct job losses, 1,000 onsite contractors have been laid off, and 6,000 job losses are expected in the local economy. The decision by TATA Steel to close its Long Products business has resulted in 900 jobs being lost in Scunthorpe, and the closure of plants in Dalzell and Clydebridge in Scotland, with 270 job losses. Caparo Industries have also filed for administration which puts at risk 1,700 jobs across the country.

In addition to the immediate job losses, the British economy can ill-afford further loss because steel is fundamental to a number of important sectors in which the UK is world-leading, including aerospace, automotives, defence, construction and energy infrastructure.

The industry faces a number of key challenges which can only be overcome by adopting a co-ordinated and active industrial strategy for steel, aimed at securing a long-term future for the industry. The industry is also being adversely affected by Chinese dumping of low-price steel.
But, this Conservative government has not only been sleeping on the job, it is reluctant to become involved at all. The Business Secretary has made it clear that he is ideologically opposed to having an industrial strategy. The contrast with Germany and other European steel producers is dramatic.
To my mind, it is absolutely clear that Government needs to rethink its approach and take an active role in supporting industry and high skilled jobs. These are the actions that the Government, as a minimum, should be taking:

First, implement immediately the Energy Intensive Industry Compensation Package, which would address the high energy costs the sector faces; UK energy prices are far higher than our European competitors face, let alone those in SE Asia and S America;

Secondly, take action to stop low-cost dumping. The Government must work with the EU Commission to back anti-dumping measures and review how effectively the Commission responds;
Thirdly, the Government should explore what other support the industry could be offered, including temporary action on Business Rates, reviewing how regulatory frameworks impact the industry, and promoting local content and sustainability in procurement contracts.

Fourthly, as a matter of long-term security, we should ensure that the UK continues to have the ability and capacity to produce a minimum amount of steel for the UK economy.

Fifthly, we need an urgent assessment of the impact of the loss of bulk-steel production on the long-term prospects for the production of specialist steels and alloys and engineered products for which the Sheffield City Region is renowned.