In a major announcement, Chancellor Rachel Reeves has revealed Labour’s plan to tackle the housing crisis and revive the economy through infrastructure development.
In her first speech as chancellor after Labour’s victory in the general election, Reeves pledged to create a new taskforce to accelerate stalled housing sites and restore mandatory housebuilding targets. She also promised to build 1.5 million homes by the end of this parliament, including affordable and council homes.
“We’re not in the business of reneging on our manifesto commitments,” Reeves stated, emphasizing the strong mandate given to Labour by the people. “We’ve received that strong mandate. We’re going to deliver on that mandate.”
Among the measures announced by the chancellor were an end to the onshore wind farm ban and the creation of a new task force to support local authorities with 300 additional planning officers across the country. Reeves also highlighted the need for a review of previously rejected planning applications that could benefit the economy.
Additionally, the chancellor emphasized the importance of prioritizing brownfield and greybelt land for development to meet housing targets when necessary. She also pledged to reform the planning system to ensure the delivery of necessary infrastructure for the country.
Reeves also addressed concerns about the Conservative government’s previous pledge to build 300,000 new homes a year and the subsequent scrapping of mandatory building targets for local authorities. She stated that Labour will reinstate these mandatory targets, but with a focus on local communities having a say in where the housing is built.
“We will bring back those mandatory housing targets so the answer cannot always be no,” Reeves affirmed. “So it’ll be up to local communities to decide where the housing is built, but it has to be built.”
The chancellor also shared that the government has already taken steps towards fulfilling its housing promises by approving the construction of 14,000 new homes in Liverpool Central Docks, Worcester, Northstowe, and Langley Sutton Coldfield. She also mentioned that Deputy Prime Minister Angela Rayner is reassessing planning appeals for data centres in Buckinghamshire and Hertfordshire.
In addition to housing initiatives, Reeves also addressed the economic challenges facing the country. She acknowledged the difficult circumstances inherited by the new government and revealed that the Treasury has conducted an analysis showing the potential growth of the UK economy if it had followed the average rate of other OECD countries.
According to the analysis, if the UK economy had grown at the average rate since 2010, it would have been £140 billion larger and could have generated £58 billion in tax revenues in 2023 alone to fund public services. Reeves announced that this analysis will be presented to parliament before the summer recess, with a full budget and forecast from the Office for Budget Responsibility to follow in the autumn.
When asked about the timeline for economic growth, Reeves assured that the government is already taking steps to revive the economy. “These are our first steps to bring back economic growth,” she stated. “I mean business and we are getting on with that work to unlock that growth.”
