Thursday, 26 April 2012

HOW TO END LONDON'S HOUSING CRISIS

Make somewhere else the capital


First, some simple maths to show how current thinking is failing to solve London's housing shortage. There are 350,000 people on social housing waiting lists in London. London Mayoral candidates promise to build hundreds-of-thousands of new homes, but experience shows us they are unlikely to do this and certainly not fast enough – over the past eight years, in Ken Livingstone's and Boris Johnson's respective tenures at City Hall, barely 110,000 affordable homes were built. At that sluggish rate of construction it would take 25 years to house those on today's waiting lists, and that does not take into account anyone else joining those lists over that period.

Now here's a statistic that represents part of the solution. There are 122,000 civil servants working in London, 27 per cent of the national total. If we move most or all of them out of the city, then their homes and offices become available for occupation to the rest of us. This is not as mad as it sounds. The BBC is moving most of its activities to Manchester, and many government agencies and departments have moved out in the past, such as Companies House to Cardiff and tax offices to Bradford.

Moving the remainder of government out of London, including MPs and peers, will provide much needed space for the city's burgeoning population and hard-pressed private sector, both of which are being priced-out by spiralling rents, sales prices and occupancy costs. Whitehall could become a new business district, or, if the buildings are not suitable for modern office use, transformed into a highly desirable residential area. This makes more sense than moving the city's vulnerable to social housing estates in Stoke-on-Trent which is what Newham council wants to do.

An added benefit – it would give an economic boost to whichever city became the new capital of the United Kingdom. All those politicians, lobbyists and civil servants spending money in shops and restaurants – what city wouldn't want that? Moving the capital out of London to a new geographical location could have political benefits too. I would suggest Liverpool – it is in the middle of the island of Britain, closer to Scotland, around the corner from Wales, across the water from Northern Ireland and immediately in touch with struggling industrial towns in the English North and Midlands.

During this Age of Austerity it makes financial sense for government to move north. It can sell or lease-out government-owned property for high prices in expensive London, while buying and leasing its new premises beyond the city for a fraction of that cost. Civil servants will be amazed by how much further their salaries will stretch outside London, even with London-weighting taken off – another saving to the taxpayer.

As Germany, China and the United States have shown a country's political and commercial centres do not need to be in the same city.

As analysis consistently shows, such as The Wealth Report by Citi and Knight Frank, London is the world's top city, but it needs room to expand, to provide more homes and work places. Redeveloping the Docklands into a new financial services sector, with space for new, affordable and suitable offices, has helped London beat off commercial competition from Frankfurt and New York since the late 1980s, but now it needs to adapt again. Yes, building more homes and filling empty properties will partly solve London's housing problems. But more must be done. If London is to remain capital of the world, then it may need to stop being capital of the United Kingdom. As the increasingly cosmopolitan make-up of London's populations shows, it has outgrown that role.

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