Podcast Summary

Overview

Episode Title: Housing: The Crisis That Divides
Podcast: LSE: Public Lectures and Events
Date: September 29, 2014

This episode brings together four key experts at the LSE Institute of Public Affairs debate, held during the Conservative Party Conference, to discuss the escalating housing crisis in Britain. With population growth, affordability issues, and political challenges driving the subject up the agenda, the speakers unpack why the crisis exists, what perpetuates it, and how it could be solved.

Key Speakers

• Tony Travers (Chair, LSE Government Department)
• Richard Blakeway (Deputy Mayor for Housing, Greater London Authority)
• Sir Merrick Cockell (Councillor, Royal Borough of Kensington & Chelsea; Former Chairman, Local Government Association)
• David Orr (Chief Executive, National Housing Federation)
• Professor Henry Overman (Professor of Economic Geography, LSE)

Main Discussion Points & Insights

Introduction & Context (00:00–02:14)

• Tony Travers underscores housing as a rising and divisive issue—touching on increasing house prices, lack of supply, and affordability. Travers frames the debate: “Housing has rushed up the political agenda in Britain in the last three or four years… there are several different ways of manifesting itself.” (00:31)

1. Richard Blakeway: Infrastructure, Supply & Fiscal Autonomy (02:14–09:02)

• London's Unprecedented Population Growth: On January 6th, 2015, London’s population will hit an all-time high (8.6 million), with ongoing growth placing immense pressure on infrastructure, particularly housing. (02:44)
• Housing as Infrastructure: Blakeway calls for a “seismic change” in treating housing as core infrastructure, not just a market commodity—central to how cities plan for growth. (03:23)
• Challenges for Industry: Questions current models—who builds, with what capital, and what types of homes? Demand for authorities and pension funds to invest in housing. Concern for industry’s cyclical “feast and famine” in materials and home-building capacity.
• Community Engagement & Housing Design: Highlights the need for aesthetic, flexible housing that suits evolving demographics and local identity. (06:34)
• Call for Fiscal Devolution: Argues London and other cities should control more revenue (e.g., stamp duty) to address deeply local and long-term housing challenges, not remain dependent on central grants. (08:37)
  • Memorable Quote: “We are almost entirely dependent on government grant to address… fundamental, long-term and very local challenges. And clearly it is now time… for a mature discussion about the level of fiscal autonomy you see in the big cities…” (08:49)

2. Sir Merrick Cockell: Local Government Empowerment & Pension Investment (09:12–16:32)

• The Numbers Game: The UK needs between 230,000–300,000 new homes annually; local government committed to 50,000 over 4 years if borrowing caps are lifted, but Cockell describes this as “not quite the exciting offer...” (09:42)
• Ambitious Proposals: Push to increase local government’s target to 500,000 over 4 years—provided cities and rural areas get devolved powers and trust. (10:26)
• Diversity of Housing Types/Policy Innovation: Praises schemes that use developer obligations (S106) for private renting at affordable rates, better integrating young professionals into central London communities. (11:31)
• Local Government Pension Funds as a Solution:
  • The collective £178 billion in local government pensions is underutilized compared to models abroad (e.g. Holland’s ABP fund). Cockell suggests even 4-5% invested in housing would yield significant results. (12:17)
  • London Pension Fund Authority’s recent start: a small £43.5m investment is going to 200 homes in Newham.
  • Memorable Quote: “We don’t need to be looking for international sovereign wealth funds. We’ve got the resources and the capability of doing it ourselves…” (15:18)
• European Examples: Argues the UK lacks the coordination seen in places like Holland, urging reform in the next 10 years.

3. David Orr: The Human Cost, Market Failures & Political Will (16:35–25:28)

• The Rhetoric vs. Reality of 'Crisis':
  • Points to the superficial acceptance of crisis language while NIMBY ('not in my backyard') attitudes persist: “We have a housing crisis… but I’m not sure we’ve really yet got to the point where everyone believes the words that they’re saying.” (16:49)
• Locked Out by Income & Capital Barriers:
  • Half of UK households earn less than the £36,000 now needed to buy a first home; 2/3 of all first-time buyers now receive parental help, up from 1/3 five years ago. (18:35)
  • “We have created a housing market that has locked out half of the population or more.” (19:27)
• Unaffordable Rental Sector:
  • Private renters typically spend more than 40–50% of their income, compared to 30% in social housing and 20% as owner-occupiers. (20:38)
• Historic Perspective:
  • In the baby boom era, 300,000 homes/year were built; now, with population at its highest, only 120,000/year are built.
• Economic Impact:
  • Housing inaccessibility is the biggest brake on the economy, per the Bank of England and business leaders, as firms can’t attract talent—which leaves the country or region. (22:12)
• Call to Action:
  • The ‘Homes for Britain’ alliance demands politicians pledge to “end the housing crisis in a generation”—with real plans, not platitudes.
  • Memorable Quote: “The single most important thing that we need to do if we are to deal with [the housing crisis] is to want to deal with it.” (24:27)

4. Henry Overman: Debunking Zombie Stats & Prioritizing Supply (25:30–35:30)

• Supply Focus—Land, Not Stock-Shifting:
  • All speakers agree: increasing supply is key, primarily by addressing land, not just capital.
  • Criticizes popular but misleading “zombie stats” used in the housing debate:
    • The “1 million empty homes” stat—real figure is only 232,000 long-term empties in the UK.
    • The “25 million empty bedrooms” stat—mainly elderly who won’t downsize, a political dead end.
    • Foreign buyers blamed for affordability—actually under 1% of all London transactions.
    • The “400,000 housing permissions” stat—based on misleading data, only about 150,000 plots are actually unstarted.
  • Memorable Quote: “Any politician who tries to do this is [committing] suicide… you’ve got a 15 million constituency on one side who… aspire to three bedrooms when your kids have left home.” (29:44)
• Key Point: Redistributing stock or restricting foreign buyers will not solve the crisis; only building more homes—through reform of the planning system and land supply—will.

Notable Quotes & Memorable Moments

• Blakeway:
  • “It is fundamentally important that we have this seismic change in terms of how we approach supply if we’re to increase it to the levels required.” (03:23)
• Cockell:
  • “We don’t need to be looking for international sovereign wealth funds. We’ve got the resources and the capability… in our local government pension funds.” (15:18)
• Orr:
  • “We have created a housing market that has locked out half of the population or more.” (19:27)
  • “The single most important thing…if we are to deal with it is to want to deal with it.” (24:27)
• Overman:
  • “You can’t kill the zombie stats… [like] the 1 million empty home zombie stat… it comes around again and again.” (26:09)
  • “Any politician who tries to do this is suicide… three bedrooms when your kids have left home is something that most people would aspire to.” (29:44)

Key Timestamps

• 00:00 – Tony Travers' introduction and framing
• 02:14 – Richard Blakeway on London's population and supply challenge
• 09:12 – Merrick Cockell: local government power and pension funding for housing
• 16:35 – David Orr: The human cost, economic impact, and urgency of political will
• 25:30 – Henry Overman: Debunking myths and reinforcing the supply imperative
• 35:30 – Closing remarks and summary by Tony Travers

Conclusion & Further Reflections (35:31–End)

Tony Travers reiterates the extraordinary nature of the UK’s current housing tenure shifts and the emotional stakes surrounding topics like the greenbelt. He calls for a more rational, evidence-led debate about both immediate supply needs and the long-term consequences of changing housing patterns.

For Listeners: Actionable Takeaways

• The consensus among experts is unequivocal: Britain’s housing crisis is rooted in insufficient, poorly planned supply.
• The crisis is not just about houses, but about the economy, social opportunity, and urban futures.
• Solutions will require bold policy reform: devolution of fiscal powers to cities, harnessing domestic pension capital, and an honest public conversation about land use—especially the greenbelt.
• Listeners should challenge “zombie stats” and demand evidence-based, ambitious plans from political leaders and policymakers.