“Housebuilding under the Tory-led Government is 26 per cent down on the average achieved under the last Labour Government”.
Jack Dromey, Shadow Housing Minister, 30 April 2012
Long before the economic downturn house building has been a contentious issue between the major UK parties. Yesterday Jack Dromey MP released research revealing that the problem has worsened by 26 per cent since the coalition came to power, apparently in contrast with the last Labour government.
Labour contrasted this with a quote from the Housing Minister in 2010:
“Building more homes is the gold standard upon which we shall be judged. The idea is to get a system which delivers housing in this country.”
Grant Shapps, Housing Minsiter, 13 September 2010
So which Government has the best record?
The figures look specifically at house completions. They took an average of all of the quarters during Labour’s last long stint in power, and then an average of quarters in the two years since the current Government has taken the reins.
However, as Full Fact has previously pointed out, using quartely data to measure trends during a Government’s stint in office is problematic because governments tend to enter office in May – while the second quarter of a calender year covers April to June. So the crossover point between administrations is blurred when comparing quarters.
In this case, Labour’s analysis started from the second quarter of 2010 and the second quarter of 1997 – so there is consistency in the periods used – however the above caveat must still be taken into account.
As Labour found, the average across all the quarters of the previous Labour Government is approximately 36,180 housing completions per quarter, while under the current Government it is around 26,620 completions per quarter; 26 per cent less.
The quarterly figures since 1990 can be seen in this chart, made up of the DCLG statistics:
However, as the graph makes apparent, this analysis doesn’t quite tell the whole story. Housebuilding has declined sharply since the end of 2007 – the time of the financial crisis. In fact, the number of completed dwellings per quarter fell substantially in the last two years of Labour government, and has remained broadly stable since the Coalition took over.
Housing completions is a “lagging indicator”: it takes months or even years for a started project to reach completion, making it hard to judge the Coalition’s record for encouraging these projects just yet. What we can say is that they are working from a lower baseline than was the case for much of Labour’s time in office.
What will be most interesting is whether levels of housebuilding completions will rally back to their pre-crisis levels, and how quickly they do so.
Labour is correct that, based on averages, the Coalition Government have built 26 per cent fewer houses than Labour did during their time in office.
However this only tells half the story. The number of completions has been falling since 2007, and given that it takes time for policies to have an effect on the number of completed housing projects, it may be too early to judge whether or not this decline has been arrested or reversed.
Labour may wish to argue that the Government could do more to increase the number of housebuilding projects seen through to their finish, however a look at the trends of the past few years shows that the decline to the current low watermark began before the present administration took office.