Andy Burnham has announced the comeback of the council house as he unveiled a £10bn package to build 70,000 new homes in England.
Building thousands of new council houses was one of his “day one’ priorities when taking over from Sir Keir Starmer in July, when he warned that “no child should be raised in a hostel room and no family should wait 10 years for a front door of their own”.
It marks the first major spending announcement of the Burnham government – although the cash comes from a £39bn fund agreed by Sir Keir and ex-chancellor Rachel Reeves in the 2025 spending review.
It builds on the government’s commitment to deliver 1.5 million homes this parliament, including the biggest boost to council, social and affordable housing in a generation – amid concerns the target will be missed. It also comes as the prime minister has made ending rough sleeping a major priority.
The announcement will see councils across England receive the cash to build thousands of new homes with new powers to get building accelerated and make decisions in their areas.
“I have said from my first day in this job that everything starts with a good home,” said the prime minister, who has also pushed a decentralisation policy.
“Nearly £10bn will go to councils and housing associations to build genuinely affordable homes, most of them for social rent, in the places where families are waiting longest.
“Councils built this country out of a housing crisis once before. Backed properly, and trusted to get on with it, they will do it again.”
The move is meant to be the start of a reversal of the social housing crisis, which has its origins in Margaret Thatcher’s mass sell-off of council houses to occupants in the 1980s.
Failure to replace sold-off stock, along with added bureaucracy around building new homes, has left some areas with waiting lists as long as 50 years.
The announcement comes just 24 hours after Reform UK revealed their plans to build 50,000 social-housing homes a year but prioritising married people, military veterans and only making them available to people born in the UK.
Reform deputy leader Richard Tice, who was a property entrepreneur, admitted the failure to replace council housing stocks after the Thatcher sell-off had been “a mistake”.
But Tory shadow housing secretary Sir James Cleverly claimed that Mr Burnham’s package was “a sleight of hand” and warned that it is “yet another unfunded spending commitment”.
He said: “The small print shows homes won’t have to be delivered until 2039. And the funding has been backloaded to fall outside the Spending Review and this Parliament, meaning Andy Burnham will never have to pay for it. Instead, it'll be another cheque written by Labour PM and left for future generations to cover.
“Fewer homes will be delivered than previous programmes in this Parliament as social rent is more expensive. Labour have scaled back their affordable housing programme and expect us to thank them for it.”
According to the government around a fifth of the funds, £2 million, will go to London to build thousands of homes.
Greater Manchester, where Mr Burnham was until recently mayor, gets the second highest allocation with £529m for 4,400 homes.
The West Midlands will get £409m for 3,200 homes; the North East £445m for 3,400 homes; West Yorkshire £441m for 4,000 homes; Liverpool £380m for 3,100 homes; and South Yorkshire £249m for 2,200 homes.
Housing secretary Angela Rayner said: “Families can’t be left raising children without a place to call home, and none of us should spend years waiting for somewhere safe and affordable to live.
“I know how important fixing this is – because I’ve been there. A safe and secure home was the foundation for a better life – I couldn’t have got to where I have today without it.”
The allocation is only the first stage of a 10-year programme. More than £16bn remains to be allocated outside London in what is intended to be the largest expansion of council housing in decades.
London mayor Sir Sadiq Khan said: “Tackling the housing crisis is one of my top priorities and I’m doing everything I can to deliver more affordable homes that Londoners desperately need. We’ve built record numbers of council homes in London, but the number of families and children without a permanent home stuck on housing waiting lists is still unacceptable. I want to work with this new government to deliver a step change in how many council homes we can deliver across the capital.
“Thousands of Londoners will benefit from this new wave of new social and affordable homes, which will help people out of temporary accommodation and provide good, affordable homes to live in for the long-term, as we build a fairer, better London for everyone.”
Housing associations and other providers will continue to play a vital role in delivering the social and affordable homes the country needs.
Alongside councils, they will be central to delivering the government’s ambition to increase housebuilding and expand access to genuinely affordable homes.
Kate Henderson, chief executive of the National Housing Federation, said: “It is hugely welcome to see this much-anticipated funding confirmed, something we have been calling for to kickstart construction on tens of thousands of desperately needed new social homes.
“This is a major vote of confidence in not-for-profit housing associations and in the vital and distinct role they play in this country, as organisations that work for the long-term benefit of their communities.”
Gavin Smart, chief executive at the Chartered Institute of Housing, said: “We welcome the strong focus on homes for social rent and the ambition for council housebuilding, and the recognition of the vital role that councils, housing associations and other providers will play in delivering the next generation of genuinely affordable homes. If delivered at pace, this investment has the potential to reduce homelessness, ease pressure on temporary accommodation and help more people access a safe, secure and affordable home.”
