House Building: London

David Mundell Excerpts

Wednesday 5th November 2025 Westminster Hall

[Several hon. Members rose—]

[David Mundell (in the Chair)]

I am going to impose an informal five-minute limit, and we will see how we get on.

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[Emily Thornberry (Islington South and Finsbury) (Lab)]

I begin by congratulating the hon. Member for Old Bexley and Sidcup (Mr French) on getting this slot. As he can see, the subject is close to the hearts of so many of us; more importantly, it is close to the hearts of our constituents.

In Islington, those who want affordable housing have to have social housing. Nothing else works. In Islington, we therefore need to have a policy to maximise social housing. People can rent privately, but the only way they can afford to rent privately is by renting out one room each: that means having a single person sleeping in the sitting room, and other single people sleeping in the bedrooms. We have lots of large, dark, sad tower blocks that were built under the Liberal Democrats, which have been bought for investment purposes and are not used. Their lights are off at night, nobody is on the voter register —they are just there, and they laugh at the 17,000 people on the waiting list in Islington who desperately need social housing. Those are Islington people who want to live in Islington, and there is no space for them.

Frankly, politics in Islington begins and ends with housing. We have some very rich people, some lucky people and some very poor people in Islington, but moving to Islington is impossible for an ordinary person. We have a vibrant community. We are a tiny community—Islington is one of the tiniest boroughs in Britain. Let me give hon. Members some stats about it: Bexley borough is four times bigger and Bromley borough is ten times bigger than Islington. The Minister is likely to say that 20% of something is better than 35% of nothing. I get that, but I do not think that one size fits all, particularly in little brave Islington.

Since the current Chief Secretary to the Treasury was in charge of housing in Islington, we have had a policy that 50% of all new developments need to be affordable. We say to the developer, “Fine. The land is expensive. You’re going to make a killing on the flats that you build. But half of them have to be for local people, which means that they have to be affordable, which means they have to be social, because nothing else is affordable in Islington. We will let you have half, but half of it has to be for us, and that is how it is.”

We have been doing that, and it has not meant that we have got nothing. Since 2020, seven schemes have gone through in Islington, which has resulted in nearly 1,000 affordable homes. That may not seem like a lot, but it is in somewhere as cramped as Islington where the opportunities are as few as we get. I have the least amount of green space of any MP in the whole of Britain. I have 120,000 people crammed into the seventh smallest constituency in the country. We have 15,000 people per kilometre. Our opportunities for development are limited.

I appreciate that it has recently become more difficult for local authorities to build by themselves, but until recently the joke was that if someone left their garage in the morning to drive to work, by the time they came back the local authority would have built a flat there. It is a political and social imperative to build as much housing for our people as we possibly can, and that is what we want to do. Unlike the Bromleys and the other boroughs, we have only little infill sites. We do not have big developments. Please do not give everybody instructions to do exactly the same thing because that is not going to work.

I ask that we look at what can be achieved and allow Islington to continue to insist on 50% so that when we do get our tiny little sites available for development, we can say to a developer, “You are very welcome. Welcome to Islington. We are headbangers. We have 17,000 people on the waiting list. You have to build half of it as affordable housing. You know that because we have been saying it for 15 years and we will continue to do so.” We would rather the Government did not undermine that so that we can continue to do it.

It is more difficult to get those developments, and it may be that those sites will take a bit longer to be developed. However, we would rather such tiny sites as we have be developed for social housing and local people and take a bit longer to develop than yet another great big tower block that is empty, dark and owned by people in China who have decided to build to buy a flat in Islington instead of a gold bar. That is the reality of housing in Islington.

I know that the Minister knows what I am talking about. I know that he is very thoughtful and an absolute expert in housing and wants to do exactly what we want. We know that the housing crisis can be solved only by building more housing. Absolutely—he has my full support on that. But we need to have housing that local people can live in. The reality of the economy in central and inner London is that we must have affordable housing. Otherwise people will continue to come.

Whenever I speak about housing in Islington, I try not to cherry-pick; I just talk about the last time someone spoke to me about housing. Someone spoke to me about housing on Saturday. I knocked on their door and there was a terrible noise. There was a child in the corridor screaming and screaming. Mum had her headphones on because the child is clearly autistic. She came to the door and said, “Emily, I’ve been to see you so many times and you just cannot get me rehoused, can you? There’s five of us in this one-bedroom flat.” That is the reality. That is why we have to build more social housing in Islington. That is how people live, and it is wrong. Our absolute priority must be to build more homes that families like that can live in.

[David Mundell (in the Chair)]

I call Peter Fortune, who I am sure will stick to the five-minute limit.

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[Dame Meg Hillier]

I hear what the hon. Lady says, but I also recognise that there are financial challenges with the Treasury signing a fairly blank cheque to say that all public land could become housing. We need to be creative about this, and that is where we need a mixture of local knowledge and some flexibility from the Treasury. For example, the change of use of school sites was quite gummed up in the Department for Education under the previous Government. We need to make sure that any change of use can be dealt with relatively quickly. It will be better for health and education outcomes if we use that land for other things.

We need a national mission on housing, and I applaud the Minister for leading on that. Does he have any plans to limit further overseas purchasers buying these properties? It is great for developers, because they get that cash in, but we need to prioritise local people, and tax does not seem to be doing it. Does he have any thoughts about restricting Airbnb? I know well the blocks that my right hon. Friend the Member for Islington South and Finsbury was talking about, because during covid, people paid rent to go to those places to isolate, but they were not proper homes. That is having a devastating effect on school numbers across London. Could the Minister look at the costs of building? The long-term costs of not doing it will be enormous, and we need to support those families who desperately need social rented housing.

[David Mundell (in the Chair)]

I ask our last three speakers to stick to their five minutes.

[Mr Calvin Bailey (Leyton and Wanstead) (Lab)]

It is a pleasure to serve under your chairship, Mr Mundell. I thank the hon. Member for Old Bexley and Sidcup (Mr French) for securing this important debate. Few issues affect Londoners more directly than the shortage of decent and affordable homes. I want to begin by talking about one of the clearest symptoms of that shortage: the rising cost of temporary accommodation. In Waltham Forest, the net overspend on temporary accommodation this year alone is £14.3 million. In my constituency, 7,300 applicants sit on the housing register, and the average wait for homes is irreconcilable—10 years for a three-bedroom home, and 14 years for a four-bedroom home. In neighbouring Redbridge, 3,000 families sit on the temporary accommodation register, and a wait for a three-bedroom home is 18 years, which is the lifespan of a child.

Behind those numbers are people. One of my constituents, a mother and a nurse, has been without a stable home since she was 13. For 20 years, she has moved between insecure rentals and temporary housing, despite working as a public health worker and a nurse, and caring for a child under treatment at Great Ormond Street. She faces eviction, instability and anxiety, all because of a shortage of social housing. That is what the housing crisis looks like for humans. The slowdown in house building has tightened competition for homes, driven up prices and pushed councils to rely on hotels.

The causes are many: the lingering impact of the pandemic, high interest rates since the 2022 mini-Budget, Brexit-related labour shortages, soaring construction costs, and the new fire safety and building regulation requirements. I therefore welcome the agreement by the Mayor of London and the Government to boost house building, which includes a £322 million injection from City Hall in the form of a developer investment fund, which will leverage private capital, and a wider £11.7 billion from the social and affordable homes programme, with low-cost loans from the national housing bank.

We must face the scale of the problem. London councils are trapped in a vicious cycle of rising costs while funding to cover them stays static. Councils even outbid one another for the same limited supply. Many constituents are now housed far outside their own boroughs—we read about that today in an article about Waltham Forest.

The situation is worsened by competition with the Home Office, which also relies on temporary accommodation for asylum seekers. The bidding war benefits a handful of landlords but leaves councils and communities footing the bill, and people from within our communities are sent outwith them. A constructive answer would be to re-establish co-ordination between the Home Office and London Councils, reinstate a cap on bids or prioritise boroughs with the greatest need. I therefore welcome the Home Office’s commitment to develop a more sustainable model of accommodation, but it must go further by reducing competition and expanding supply to restore fairness and stability to local housing markets.

Councils are not only victims of the crisis, but essential partners in solving it. Redbridge is delivering 600 council homes through its own affordable homes programme, and Waltham Forest has bold regeneration plans, particularly at Avenue Road and Montague Road, which I have spoken to the Minister about previously. At Avenue Road, the council could deliver 617 new homes, including 242 for social rent. Montague Road would add 223 new social homes and about 200 additional properties. That is more than 1,000 new homes in total, which would improve the lives of the wonderful community that lives there at the moment.

But like many London schemes, those have stalled. Across the capital, 111,000 homes are paused, and the rate of converting planning approvals into completions is below 10%. That is why our Government’s intervention is vital. It will not override local councils but empower them. Our Labour councils have a strong record of innovation, using infrastructure, finance and land value capture to support house building as part of the regeneration. With modest, well-targeted funding, Waltham Forest could unlock more than 5,000 new homes through estate renewal and redevelopment in underused sites.

[David Mundell (in the Chair)]

Order. I have to draw you to a close there, Mr Bailey.

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[Fleur Anderson (Putney) (Lab)]

It is a pleasure to serve under your chairship for the second time today, Mr Mundell. I welcome this important debate and thank the hon. Member for Old Bexley and Sidcup (Mr French) for securing it. I declare an interest, as my son is studying construction management at London South Bank University—I hope he will be one of the house builders of the future. I also do so because, like all the other hon. Members in this debate, this is one of the biggest issues for my constituency—for so many people who come to my surgery and whom I see every day when I go out and about in the constituency, but also for my own children. I do not know whether they would ever be able to afford to live in my area, and that is no way to build a community. People need to be able to know that their children and grandchildren will be able to live near them, to have work near them and to live in areas that they can afford. At the moment, we do not have that in London; we have a broken housing situation.

Tackling the housing crisis has always been a top priority for the Mayor of London. Despite some of the claims made today, the facts speak for themselves. Sadiq Khan has started more new council homes in London than has been the case at any time since the 1970s. Before the pandemic, he completed more homes than had been the case at any time since the 1930s. That is not luck; it is Labour leadership in action and working hand in hand with Labour boroughs, such as Wandsworth, to deliver for Londoners. Since 2018, 23,000 council homes have been built or are being built with the help of City Hall funding.

We know that the challenges are real. House building is facing a perfect storm: the legacy of Conservative under-investment and, in Wandsworth, Conservative total pandering to developers; sky-high interest rates; soaring construction costs; and the lasting impact of Brexit. Those pressures demand bold, urgent action. That is why I welcome the emergency, time-limited housing package announced by the Government and the mayor, working together, in October. It is a serious intervention, with £322 million of new investment for a City Hall developer investment fund, which will be used to keep affordable housing rates as high as they can be. Like other hon. Members, I hope that we will not just see more dark houses. It is really important that local people have first dibs on all the new houses being built. We need to have those stalled projects unlocked and getting shovels in the ground.

I will highlight two housing developments in my constituency that I think all hon. Members will be very interested in. This is good news. The first is New Acres, which is a £500 million, purpose-built neighbourhood on a brownfield site that has brought 1,034 new rental homes to Wandsworth; it was completed last year. The original plans were that 23% would be affordable. The mayor called the scheme in, and it is now 35% affordable, with 55% of that built in the first phase. It has not been a case of leaving it all to the next phase and then it perhaps not happening. It is there; it is real. It is in my community in Wandsworth. It is one of the UK’s largest build-to-rent schemes and it is—I underline—35% affordable.

The second development is the Alton estate renewal, which just two weeks ago, in the UK’s largest ever regeneration ballot, was overwhelmingly endorsed by residents—82.4% voted in favour. That is the result of the Labour council coming in and saying that the previous Conservative council’s plans just did not work and were being imposed on the community. The Labour council said, “Let’s start again and work with the community.” The community could see that the plans would provide what they wanted for their area. There will be new GP surgeries; dedicated youth facilities, which I am obsessed with; a family hub; improved shops; green spaces, and up to 650 new homes—the developer is the council, so it will be able to ensure that it has the affordable housing and that the whole development is what the community wants—thanks to £100 million in investment from the council and £16 million in Greater London Authority funding, with a focus on family-sized homes.

We need more affordable homes. I am grateful for the Renters’ Rights Act 2025, and for all the work the Minister did on it. I am also grateful for Awaab’s law and its extension to private renters, because the link between housing and mental health issues is very strong. But I agree with other Members that overseas sales need to be reduced. Buy-backs are very important, as is local government funding for repairs. Too many homes stay empty for too long between periods of use. Councils need more money to repair them along the way.

A Labour mayor with a proven track record of house building, backed by a Labour Government with the ambition to deliver, and a Labour council, as we have in Wandsworth, is how we will solve London’s housing crisis. That is how we will build a fairer, stronger city for future generations.

[David Mundell (in the Chair)]

I call Luke Taylor on behalf of the Liberal Democrats. You have eight minutes.

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[Danny Beales]

I share the hon. Member’s view of the general public’s opinion on the issue, but as a cabinet member during seven years of planning and redevelopment in Camden, I rarely heard those voices in planning committees. Unfortunately, the voices that are heard are often disproportionately against development and do not represent the people on housing waiting lists. I just challenge the presentation of the public view through the planning system. Is it not true, too, that many local authorities take far too long to determine applications? In my borough—I have just had an email—it has taken six months to draft a section 106 heads of terms document, two years since the planning was approved. Is that not unacceptable?

[David Mundell (in the Chair)]

Order. Mr Taylor, you have taken two lengthy interventions. I am afraid that they will not be in addition to your time.

[Luke Taylor]

I thank the hon. Member for his intervention, but I will move on swiftly.

In my experience in Sutton we subscribe to the “yify”—“yes, if”—approach that I have spoken about a number of times. We do not need to water down community buy-in. We might need to make it faster and more efficient, but throwing out the baby with the bathwater will only lead to the wrong housing being built in the wrong places and leave us wondering, in 30 years’ time, why the mistake was not glaringly obvious to people today. That is not a new approach that has reared its head in these measures; the decisions to cut the portion of affordable housing expected from developments in the recent “Homes for Londoners” plan, and to set the annual national social house building target at just 20,000 social homes per year, show that the Government simply do not have a credible plan to provide the kind of housing the country needs.

We need an ambitious whole-of-Government approach to build up to 150,000 social homes each year. It can be done, and the Government need look no further than the Liberal Democrats’ plans. We would give local authorities the power to stop Help to Buy in their area and, as a last resort, to stop the right to buy too, and give them the first right to purchase all public land for social housing. We would also fix the Building Safety Regulator by ending the mismatch between fire safety standards and the Building Safety Act 2022, speeding up the backlog of confusion and incomplete assessments for remediation, while ensuring that the building safety levy covers all the costs so that leaseholders are protected from paying. As well as making it more affordable to insulate existing homes, we would ensure that all new homes are zero carbon and provide proper incentives for critical household infrastructure such as heat pumps. That is how we build more affordable homes—not by tearing up regulations with no regard to the impact, but by smartening regulations and intervening with serious, meaningful incentives to build the right kinds of housing.

Secondly, it will be news to nobody that the financial picture for London councils is dire. The city’s 32 boroughs overspent by £330 million on housing and temporary accommodation budgets last year alone—double the previous year’s figure. As London Councils has demonstrated, the cost of the London homelessness crisis is the greatest threat to the financial stability of London boroughs. Watering down the community infrastructure levy—perhaps the most notable way that councils recoup costs and benefits from house building in the short term—is simply another hammer blow in that regard.

[David Mundell (in the Chair)]

Order. I think this might be the point at which you need to conclude.

[Luke Taylor]

Skipping ahead, I invite the Minister to tell us why anyone who cares about solving the housing crisis and protecting local councils in London should vote Labour at the local elections in May, particularly when the only party consistently standing up for those hit hardest by the housing crisis, and for our cash-strapped local councils, is the London Liberal Democrats.

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[Gareth Bacon]

I am afraid I cannot, because we are under time pressure.

A report recently released by the Centre for Policy Studies described London as

“The City That Doesn’t Build”.

It is impossible not to agree with that when the mayor’s record is put under scrutiny. Under Sadiq Khan, housing starts have collapsed in London, with the number of private homes under construction set to slump to only 15,000 in 2027—a mere a quarter of what should be expected.

Analysis from the Centre for Policy Studies has shown that, over the last financial year, only 4,170 homes have been started in London, amounting to less than 5% of London’s 88,000 home target. In the first half of this year, that has hardly been improved on, with just 2,158 private housing starts, again versus a target of 88,000 per year. Those totals are disastrous. The mayor, the Secretary of State and the Prime Minister should be reversing those figures, not indulging or excusing them.

The picture becomes even worse when we look at affordable housing. Affordable homes had just 347 starts between April and June, which is around 15% of the total starts for 2023-24, and just 9% of the total starts in 2024-25. Prior to the general election last year, the Mayor of London was telling anyone who would listen that he needed £4.9 billion per year for the next 10 years to build affordable homes. The Government elected last July did not accede to his request. Given his appalling record over the past decade, I cannot say I entirely blame them for not trusting his ability to deliver.

At the last spending review in June, as has been mentioned, £11.7 billion was awarded for the next affordable housing programme, which will run from 2026 to 2036. At the last round of Ministry of Housing, Communities and Local Government questions, when I asked the Secretary of State what he was doing to hold the Mayor of London to account for his lamentable record of failure, he alluded to a pending announcement. As the hon. Member for Sutton and Cheam (Luke Taylor) noted, a written ministerial statement was snuck out without fanfare a couple of weeks ago that announced temporary reforms to London house building to try to cover the mayor’s decade of failure.

Some of those proposals are welcome, including the sensible removal of elements that can constrain density, such as dual aspect and units around the core of a building, as well as some of the changes to the insistence on arbitrary and unviable affordable housing targets. However, it is deeply concerning that the Government are proposing to reward the mayor’s decade of failure by giving him more power to intervene on democratically elected local councils and take planning powers away from them.

Most worryingly, that gives the mayor considerable additional powers to concrete over the green belt. There is nothing in the statement about facilitating brownfield development, despite the CPRE report published last month that shows that Greater London has the capacity to deliver in excess of 462,000 new dwellings on brownfield land. The Minister is a very decent man; he is respected across the House, including by me. When we hear him speak in a few moments, I am sure he will give us invaluable insight into how the Government justify these shocking figures. However, to me, they are simply not doing enough to build or to hold the mayor to account for his failures.

The Home Builders Federation has written to the independent Office for Budget Responsibility to say that, without changes to boost affordability for first-time buyers and tax cuts, the Government will miss their national housing target. Another study by the planning and environmental consultancy Lanpro suggested that, at the present of rate of building, the Government would fall 860,000 homes short of their national target—that amounts to missing the target by 57%. Together, the Mayor of London and, more recently, the Government have shown that they are anti-business and anti-growth, with spending and borrowing rising, and with inflation at almost twice the target level, as well as anaemic growth, over-regulation and rising taxation curbing any chance of a housing recovery at every turn.

As I have outlined, this is being felt most in our capital city. I am deeply proud to be a Greater London MP, to have been the London Assembly member for Bexley and Bromley, to have been the Conservative leader at City Hall, to have been a London borough councillor, and to live and work in this great city. That is why I care so much about holding this Government—and specifically their shambolic colleague, the Mayor of London—to account for their abject failures to get house building in London to flourish. Action is sorely needed and desperately wanted. The Government need to do a lot more, and they need to do it now.

[David Mundell (in the Chair)]

I call the Minister to respond to the debate, and perhaps he can give Mr French a minute at the end to wind up.

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[Matthew Pennycook]

I am not going to comment on the use of the mayor’s planning powers in specific instances. We think these additional expanded powers are a sensible response to the crisis in house building that London faces.

Finally, we are providing £322 million of funding to establish a City Hall developer investment fund. Building on the success of the mayor’s land fund, which has already delivered 8,000 homes five years ahead of schedule, this new fund will allow the mayor to take a direct, interventionist role in unlocking thousands of homes, driving regeneration and creating thriving communities.

It is also worth noting that alongside the implementation of this package of support, the Government intend to clarify the use of section 73 of the Town and Country Planning Act 1990 so that an application under the section to vary a condition of a planning permission should no longer be used as an alternative means of reconsidering fundamental questions of scheme viability or planning obligations.

In the time available to me I am not going to be able to respond to all the points that have been raised. There have been a number of very good points. I could speak, for example, about what more can be done on TfL land. I think it is worth noting that Places for London is on site, constructing nearly 5,000 homes, 56% of which are affordable. It has already delivered 1,600, but there is definitely more we can do on TfL land around train stations. There is more that the Government are doing on the release of public sector land. I am happy to write to my hon. Friend the Member for Hackney South and Shoreditch (Dame Meg Hillier) about that in particular. I can assure hon. Members that our new social and affordable housing fund will leave a role for acquisitions to be funded.

We know that there is no single simple solution to the development crisis that London is facing. Action to address the acute viability challenges facing residential development in the capital is a necessary intervention, but it is not sufficient. We know that a revival of house building in the capital is dependent on other factors, including increased demand for private for-sale homes, but taken alongside the reforms we are making to the Building Safety Regulator and the significant grant funding we are allocating to London for land, infrastructure and affordable housing, this time-limited package will give house building in London a shot in the arm, and the Government look forward to working with the mayor and the GLA to implement the package and kick-start house building in our capital.

[David Mundell (in the Chair)]

Mr French, you have 30 seconds to conclude the debate.

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[Emily Thornberry]

On a point of order, Mr Mundell. I should have drawn the House’s attention to my entry in the Register of Members’ Financial Interests. I rent out my late mother’s flat. We bought it for her so that she could release our council house back to the council.

[David Mundell (in the Chair)]

Duly noted.