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The first instruction: Why Andy Burnham is right to prioritise rough sleeping

“I will soon go through that door behind me and issue my first instruction: to end rough sleeping in our country.”

Andy Burnham’s first speech as Prime Minister set out his ambition to tackle one of the greatest injustices in our society. But why did he do it? Why rough sleeping, why now, and why should this agenda be a priority for the Prime Minister?

Because ending rough sleeping will rebuild hope

Across England, nearly 300,000 households are experiencing the most severe forms of homelessness. This includes people sleeping rough, staying in unsuitable temporary accommodation, living in hostels or refuges, sofa surfing, or sleeping in places not intended for habitation. More than 176,000 children are growing up in Temporary Accommodation. All of these numbers are at record highs.

Rough sleeping is only a small proportion of this broader crisis: best estimates suggest around 4,800 people sleep rough on a single night in England, and around 15,000 people sleep rough at some point over a year. Of all forms of homelessness, people sleeping rough are at greatest risk of severe harm, including rapid deterioration in physical and mental health, exposure to violence and abuse, loss of employment prospects, and premature death.

Public polling consistently finds overwhelming agreement that nobody should have to sleep rough, across supporters of all political parties. Recently, visible rough sleeping has also become a major test of people’s confidence in government and public services: when the public sees the same people sleeping outside supermarkets, railway stations and high streets night after night – often suffering from deteriorating health – it feeds a sense that ‘the system doesn’t work’. Every day, thousands of people stop to offer food, water, money or simply a conversation because they cannot bear to walk past someone sleeping on the streets – but beyond these everyday acts of kindness, they have no meaningful way to help someone leave rough sleeping for good.

Ending rough sleeping will not end homelessness, but it is the clearest and most visible place to start. Making a difference here will demonstrate that government can solve problems and strengthen communities, and will start to restore confidence in public services and hope that things can get better – that we can be better, as a country. While the barriers to supporting people out of rough sleeping should not be underestimated, with focus and dedication meaningful change is possible.

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Because rough sleeping is socially and fiscally destructive

Beyond the hugely damaging consequences for individual people, rough sleeping also comes with enormous fiscal costs for local and central government through additional pressures on the NHS, police and other public services. Analysis from the charity Crisis shows that a year of rough sleeping costs an estimated £20,128 per person, versus £1,426 for a successful prevention intervention.

In the absence of joined-up public policy to prevent and solve homelessness, an expensive ‘homelessness management industry’ has built up, weighing heavily on both the benefits system and local authority General Funds. To take one example, supported housing – where care and support services are provided alongside homes – must be a crucial part of any strategy to prevent and resolve rough sleeping. But as funding for publicly controlled provision has dried up, an exploitative ‘exempt accommodation’ subsector has filled the gap, with bad faith actors attracted by the higher housing benefits rates allowed for supported housing compared to standard social or private tenancies.

The housing Select Committee has described the system as a ‘complete mess’. An absence of regulation has led to some extremely poor quality provision and truly abhorrent treatment of residents, so that too often the safety net needed to prevent people falling into rough sleeping in the first place simply isn’t there.

When the supported housing safety net fails, more people enter rough sleeping and find it harder to exit, leaving them with no option but to sleep on the streets and in shop doorways. Beyond the horrific consequences for individuals, this affects nearby residents, local businesses and everyone who wants safe, welcoming town centres.

Because Number 10 can drive solutions across government

The reasons for a national mission to end rough sleeping are clear. The other side of the ledger is that Andy Burnham believes it can be achieved. This is partly based on his experience of driving Greater Manchester’s A Bed Every Night programme to provide a safe place to stay for anyone sleeping rough or at imminent risk of doing so. This hasn’t ended rough sleeping in Manchester, but it provides crucial lessons for how local and regional government can work together to coordinate provision – and about the limits of what can be done without changes to policy at the national level.

Crisis, Homeless Link and homelessness organisations across the country have spent years building the evidence base and practical expertise needed to prevent rough sleeping and help people leave the streets for good. Frontline services know a great deal about what works. The opportunity now is to combine that expertise with something the sector cannot provide itself: the convening power of Number 10, action across Whitehall and the resources of the state.

Crucially, many of the drivers of new rough sleeping are directly controlled by government. Above all, there is no justification for people to end up on the streets when they leave institutions like prisons, hospitals, psychiatric units, the care system, Home Office accommodation, and sometimes the armed forces. Official data shows prison leavers are by far the largest institutional route into rough sleeping, and that those who fall into rough sleeping have a substantially higher likelihood of reoffending. Allowing this situation to continue is in no one’s interest.

But with responsibility for these drivers split across multiple government departments, progress must be led from the very top. Andy Burnham and his team can provide the leadership, momentum and cross-government co-ordination to overcome departmental silos, allowing mayors and local leaders to build on the early success of A Bed Every Night in Manchester.

Because housing policy is about people, not ‘units’

Beyond all this, Andy’s national mission offers an opportunity to put a clearer human purpose at the heart of Labour’s housing policy. We rightly talk about the homes we need to build and the targets required to deliver them. But ultimately, housing policy is not about ‘units’. It is about whether people have somewhere safe, secure and affordable to call home.

Ending rough sleeping is far from the whole solution. But it’s a great place to start.

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Why the Government’s New Towns strategy is likely to fail

In March, the Government provided an update on its New Towns strategy following its response to the New Towns Taskforce report of September 2025. But there is a major unanswered question: how will the infrastructure needed to support these New Towns actually be financed?

The Infrastructure Challenge

Roads, rail, utilities, schools and other infrastructure must be built before homes are occupied, creating a substantial financing challenge. It has been estimated that the infrastructure cost per New Town of 10,000 homes is in the region of £4bn. Some of the New Towns are expected to have more than 40,000 homes, which will drive up infrastructure costs considerably. Furthermore, infrastructure often has to be delivered at a larger scale to generate a positive net present value for the project. My own estimates (from assessing projects across city-regions where demand for housing is high) indicate upfront infrastructure costs are likely to be between £4bn-£13bn.

Although there has been no specific announcement on how the Government is planning on funding and financing the seven announced New Towns, it did announce its infrastructure strategy in June 2025. This implies the use of a mixture of Government grants, as set out in the Spending Review, alongside Public Financial Institutions such as the National Housing Bank (NHB).

The core problem for any Government trying to fund infrastructure is to solve for the “maturity mismatch problem”, and to do it without damaging the public finances. New Towns require billions of pounds of investment upfront, but many of the revenues they generate only arrive over decades.

Various solutions to this problem have been successfully deployed since the 19th century, when public corporations issued long term debt backed by identified hypothecated cash flows to pay back the bond holders.

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A Proven Financing Model

For example, 40-year bonds were issued by the Metropolitan Board of Works to finance Bazalgette’s sewer system for London. The Central Electricity Board in the 1920s issued debt at similar maturities to pay for the National Grid. The post-war New Towns borrowed at 40-year maturities from the Public Works Loan Board during the 1950s and 1960s.

This method has been copied widely across Europe since. The Oresund Bridge linking Denmark and Sweden issued debt with a payback period of 50 years, building out between 1995 and 2000. When Paris embarked upon the Grand Paris Express (a major project to improve public transport and open up new areas for housing) in 2010, they issued debt of up to 40 years.

In all these cases, the infrastructure was delivered swiftly and bondholders were paid back from long term hypothecated revenue streams. Typical revenue streams include land value capture from selling plots with planning permission, business rates and revenue from car parks, affordable housing, transport and utilities.

This approach also improves the public finances. It delivers infrastructure (which is vital to boosting productivity growth) while not placing any claims on future tax revenues. Instead, because these projects generate their own long-term revenues, they can repay the borrowing that was required to build them. This reduces the need to issue sovereign debt, maintaining lower government borrowing costs for current government expenditure.

Why the Government’s Strategy Falls Short

Despite the successful use of this mechanism to build large swathes of the UK’s infrastructure, governments since 1992 have pushed for a combination of government grants in conjunction with loans and subsidies to enable private projects to get off the ground. But this approach struggles to solve for the “maturity mismatch problem” (where projects have high short-term costs with longer term revenue streams) – hence the Rachel Reeves’s decision to propose a Public Private Partnership for New Towns. This approach will come up against significant barriers.

First, the increased capital investment earmarked in the 2025 Spending Review for Ministry of Housing, Communities and Local Government (MHCLG) and Department for Transport (DfT) already appears to already be allocated: the bulk of the additional MHCLG grant will support the Social and Affordable Homes Programme while £15.6 billion has been allocated to transport for Northern elected mayors. Hence, it is highly unlikely to be allocated to New Towns.

Second, there is very limited fiscal headroom for the Government to issue more gilts. With Government debt to GDP close to 95%, gilt investors are increasingly wary of further issuance given the declining demand for gilts. This is one reason why gilts have become so volatile in the face of external shocks – and also explains why so few European governments use this approach for infrastructure.

Third, although the Government’s Infrastructure Strategy allocated £16bn of financial capacity to the NHB (a mixture of loans, equity and guarantees) the Treasury’s own forecast for the use of Financial Transactions (Table B4) from now until 2029-30 indicates MHCLG will only use £5.4bn of capacity, while the Department for Transport will use none. The Government only expects to use a third of the capacity of the NHB. This will also mean the amount of private sector capital that can be crowded in will be significantly lower, and insufficient to allow a PPP approach to work. There is also little evidence that similar arrangements through Private Finance Initiatives have delivered good value for money in the past.

The current approach is therefore wholly unsuited to delivering the upfront public infrastructure the New Towns need if they are to be successful. There is not sufficient grant funding available, and the Government’s public private partnership (PPP) does not work at scale by the Treasury’s own admission. Where the PPP approach can work is for small-scale private projects that need a government subsidy to get off the ground. An example is the redevelopment of Brent Cross, where the developer was provided with a £100m subsidised loan alongside a £500m grant and a £140m Homes England loan to enable more than 6,000 new homes. But it would not work for 40,000 homes.

A Better Way Forward

This is why a group of investors managing about £2 trillion in assets wrote to Rachel Reeves in February, expressing their interest in buying public corporation debt to pay for New Towns including along the OxCam arc. These bonds provide good returns for investors, will help drive productivity growth, and place less pressure on the public finances, as they are self-funding.

Yet rather than doing what has worked well elsewhere, and in the UK in the past, the stated approach will struggle to scale, place greater pressure on the public finances and keep gilts volatile during periods of stress. Unless the financing model changes, the Government risks repeating a familiar pattern: ambitious plans that never achieve the scale originally promised.

This article is reproduced here with the kind permission of the Bennett School of Public Policy, on whose website an original version appeared in April 2026.

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Two things the new Prime Minister could do immediately to boost social rent supply

Andy Burnham’s commitment to deliver the biggest programme of council and social housebuilding since the post-war era is both ambitious and hugely welcome.

For the millions of people trapped in England’s housing crisis, including the 176,000 children growing up in temporary accommodation, that ambition cannot come soon enough.

The good news is that momentum is already building. Thanks to decisions already made by the Government, councils and housing associations increasingly have the confidence, funding and policy certainty to ramp up delivery of social rent homes. NHF figures show a 57% increase in social rented homes started last year.

These are the green shoots of a renaissance in social housebuilding. But they are fragile and progress could easily stall. To sustain momentum and translate ambition into delivery, there are two immediate steps the new Prime Minister could take.

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The first is to immediately confirm successful bids for Strategic Partnership funding under the Social and Affordable Homes Programme (SAHP). These bids have been submitted and assessed and are now awaiting political approval before they can be announced. Councils and housing associations have schemes waiting, planning secured, and just need the funding confirmed to get building tens of thousands of homes. A summer of delay and uncertainty on grant funding could bring the current momentum to a halt. This creates a real risk that providers will be forced to delay, scale back or even abandon development opportunities, ultimately leaving families trapped in unaffordable temporary accommodation or private rent for longer.

The second is to top up the funding for this and subsequent years of the SAHP – either via redirecting existing budgets immediately or via new funding at the next fiscal event. The £39bn for social housing announced at last year’s spending review was a generational shift in support, but it is spread over 10 years, with the funding profile weighted toward later years, while many schemes are ready to proceed now.

We could build more homes, more quickly, on schemes that are ready to go, if more funding was available early on, for both Continuous Market Engagement and Strategic Partnership funding routes.

Doing these two things immediately would sustain momentum, get spades in the ground and more households into desperately-needed social rent homes as quickly as possible.

There are opportunities to go much further, to deliver the increase in social housebuilding we need, whether through seizing the opportunities of devolution, New Towns, Land Value Capture, reforming council housing debt rules, or exploring new models of public ownership. Councils and housing associations stand ready to work alongside communities and the government to unlock these opportunities, but they will take time to bear fruit. In the meantime, we must maintain and accelerate the progress already being made.

England’s housing crisis is one of the defining social and economic challenges of our time. It damages life chances, drives homelessness, places unsustainable pressure on public services and undermines economic growth. The government has laid important foundations for a new era of social housebuilding. The priority now is to turn that ambition into delivery – building more homes, more quickly, for the people who need them most.

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Spatial Development Strategies are a critical part of the Government’s planning reforms – but why?

A key part of the Government’s growth mission is reform of the planning system. Two years since the Labour Party set this out in the Manifesto, we now have a major new Planning and Infrastructure Act and a complete rewrite of the National Planning Policy Framework, heralding a new approach to plan-making and a standardised approach to decision-making policies.

A System Without Plans

Over the last 15 years we have had a plan-led system in name only.  We currently have less than 25% up to date local plans in England, with no certainty for developers and investors around where development should be located, or for local communities around how their areas will change over time.  To fix the system the Government is bringing back a two-tier approach to plan-making with the introduction of Spatial Development Strategies (SDS), which will sit above local plans.

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When Minister Matthew Pennycook introduced the new system of SDS last year, he made it clear that these must not be ‘big local plans’ and had to act as ‘spatial investment frameworks’.  Framing these in a positive light, being enablers of good growth and not restrictive planning documents, is a necessary part of their implementation – but what does this mean in practice?

A Framework for Growth

Over the last 15 years, since the abolition of regional spatial strategies, all the political, financial and technical risk in planning decisions has been at the local authority level. Bringing back a two-tier plan-making system and separate governance arrangements for SDS will hopefully help fix this.  Most of the heavy lifting will now be done through the SDS system. They will have to provide a long term framework for growth, setting out a spatial strategy for transforming places over a 20 to 30 year period and an investable pipeline of infrastructure. They will have to provide a spatial articulation of local growth plans and their economic priorities, allocate housing targets to each local planning authority, identify where Green Belt reviews are needed through local plans, prioritise strategic infrastructure and determine where strategic growth areas should be, which may include new towns in some areas.

Unlocking Investment

Vitally, the new strategic planning system will have to help rebuild investor confidence if we are going to deliver the infrastructure we need to support growth and the right type of housing we need to solve the housing crisis. We can no longer rely on the public sector to foot the bill and developer contributions will only go so far.  We need a different investment model and that means different investors. Institutional investors have made it clear that they are willing partners in this, but they want the new system to be up and running, providing more stable conditions for them to support the delivery of development and infrastructure.

We are seeing this start to play out in areas with Mayoral Authorities and with the support of Homes England Strategic Place Partnerships. Sites that have been unviable for years are now becoming a realistic possibility. Alongside the new funding regime, we also now have the English Devolution and Community Empowerment Act which brings with it significant new planning tools to support delivery of the priorities set out in SDS. For the first time in years, we will have strategic plans where there is a direct relationship between those preparing the plan and those delivering them, as a result of a much greater role in planning for Mayors. This can only be a positive boost for investor confidence in these areas.

Not all places will benefit equally, however. The more mature the devolved arrangements are, the more the Strategic Planning Authority will be able to directly influence delivery.  Those areas that already have Mayoral Authorities are off and running in the race to be the first to get their SDS in place. All going well, within the next 2-3 years we will see the first SDS adopted and very soon after that, the place transformation will begin. 

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Britain Needs Better Homes

Over the past weeks, we have all sought shelter in our homes from abnormally high temperatures. Households will have struggled to keep their home cool, just as they struggled to keep their property warm last winter. Many people were stuck inside properties suffering from damp, mould, poor ventilation, and general disrepair. The extreme heatwave has been a stark reminder that we don’t just have a problem with the number of homes being built, but a significant housing quality crisis too.

For millions of households, their home actively harms the health, wellbeing, and life chances of everyone who lives there. According to the English Housing Survey, 15 per cent of properties fail the Decent Homes Standard. Those who rent privately are twice as likely to occupy a non-decent home (22 per cent), compared to those who live in a home for social rent (10 per cent). This could be due to hazards like fire dangers and trip hazards, poor energy efficiency, or broken roofs and windows.

While every part of the country has non-decent homes, there are significant geographical differences. Nearly one in five properties in the South West and Yorkshire (18 per cent) are non-decent. This is twice as high as the North East (9 per cent), and significantly higher than London (13 per cent). And the problem is often worse in more rural areas, as local authorities like Westmorland and Furness, Cornwall, and North Yorkshire have large proportions of people living in substandard homes.  

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Labour’s record

Since 2024, the Labour Government has acted on poor-quality homes. The Renters Rights’ Act will apply a new Decent Homes Standard to the private rented sector, and Awaab’s Law will tackle damp, mould and other hazards in social and private rented homes. The long-term social rent settlement will enable providers to invest in existing stock, while they build thousands of additional high-quality homes.

But the next Prime Minister must go further. While building 1.5m new homes is a necessary ambition, improving existing stock so everyone has access to a safe, secure and accessible home should be a priority too.

This would speak to our history as a party. For more than a century, Labour in government has focused on raising housing standards. The first Labour Government passed the Wheatley Act 1924 that delivered a wave of high-quality council housing, providing an alternative to the slums. The Attlee Government repaired hundreds of thousands of existing homes in six years, while the Wilson Government provided grants to improve housing stock of every tenure. And New Labour’s Decent Homes Programme delivered a sustained programme of public investment that improved around one million social homes. 

It is also something that the public favours. Our survey with YouGov found 66 per cent of English adults supported investment to ‘improve existing properties to meet basic housing standards, even if it means reducing the number of homes that are built each year’. Just 15 per cent favoured building more homes at the cost of neglecting improvements to existing properties.

Building while improving

However, the Government does not have to choose between more homes and improvements in existing stock. There is an enormous opportunity to target public investment in streets, blocks of flats, or entire estates for regeneration that builds decent homes in every community. Indeed, the Northern Housing Consortium has estimated over 500,000 good quality homes in the North alone can be created through housing-led regeneration.  

The Fabian Housing Centre has set out how we can improve homes in every part of the country, with a specific focus on tackling poor-quality rented accommodation.

The Government should invest £470m a year over a decade specifically to replace and regenerate homes across streets, flat blocks, and whole estates. All funded regeneration projects should be required to show no loss of homes, particularly for social rent. Where affordability challenges are highest, these regeneration projects should be required to increase the number of homes through greater density – particularly for social rent. This funding should be devolved to strategic authorities to deliver estate renewal, in partnership with local councils.

This should be accompanied with specific funding for improvements and maintenance in the social housing sector. A new long-term fund to provide investment over ten years, in predictable waves, will enable all social renters to live in a safe, secure, warm and accessible home. And by helping social housing providers with their maintenance and improvement bills, the Government can unlock financial capacity to build new social homes.

The Government has rightly prioritised housebuilding in the first half of this parliament and must continue to do so. But existing homes need investment too. Funding for regeneration and social housing improvement is required. The next Prime Minister must deliver this to tackle the housing shortage and the housing quality crisis together. That can be a legacy for Labour to be proud of.

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Andy Burnham’s Housing First philosophy

In last week’s speech laying out his economic vision, Andy Burnham confirmed what many in the homelessness sector have been speculating about since he entered the leadership contest. Should he become Prime Minister, Burnham intends to adopt a ‘national housing first philosophy’ based on the premise that ‘everything starts with a good home’.

This is extremely welcome news and something Crisis and Homeless Link have long advocated for: to end rough sleeping and homelessness for all. Housing First is a nationally and internationally evidenced approach to ending homelessness underpinned by a clear set of principles: housing is a human right and people need a permanent, affordable home and appropriate support to end their homelessness.

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While people may be familiar with Housing First as a programme – a highly effective service for people who have experienced trauma and have multiple and complex support needs – what Andy Burnham is advocating for is a transformational shift that applies the Housing First principles to whole of the housing and homelessness system. It’s not simply about tackling rough sleeping, it is about applying an urgency for permanent housing over temporary accommodation. This has the potential to be groundbreaking in addressing homelessness in England.

We have a lot of the building blocks to work from. First established in 2010 in England, Housing First has expanded to around 140 services countrywide and there have been three regional government pilots, with one in Greater Manchester. Crucially, it works – we see people able to sustain tenancies long-term, improvements to health and wellbeing, and more community integration. It also works for the economy – for those with the most complex support needs, it returns benefits well above its cost at roughly £2 saved for every £1 spent.

Finland is held up as the gold standard. By embedding Housing First across its entire homelessness system, it has achieved what many countries still consider aspirational – a sustained reduction in all forms of homelessness. Alongside Finland, Denmark, Japan and Spain have all demonstrated that homelessness can be reduced when secure housing, not temporary accommodation, becomes the starting point of support.

And yet a lack of political will has left this proven intervention sorely underutilised in England. Successive governments have been hesitant to scale up Housing First into a fully funded national programme, and the model has operated in parallel to the more traditional staircase homelessness system – where people are required to progress through a series of temporary housing stages before earning permanent independent housing.

We have also failed to apply the philosophy that guides Housing First to our overall approach to tackling homelessness. As a result, over 176,000 children are trapped in temporary accommodation and councils are spending more than £2.8 billion a year. At the same time a confused and expensive supported housing system, also intended to be temporary, is failing the thousands of people with significant health and social care needs trapping them in cycles of repeat homelessness. We’re paying huge sums to keep people homeless.

In Greater Manchester Andy Burnham has already taken the model a step further, beginning to integrate Housing First into the wider system – from ensuring the regional Housing First pilot evolved into a thriving mainstream service, to rolling out A Bed Every Night to ensure people are brought off the streets and connected to the right support they need to end their homelessness and implementing the Good Landlords Charter. And in 2024 he established a dedicated Housing First Unit to coordinate delivery across all ten boroughs.

Burnham’s aim is ambitious but completely achievable: to move away from costly, short-term accommodation and instead prioritise the creation of permanent homes, backed by genuinely affordable house building. He knows that the investment will be worth it, ending homelessness while reducing reliance on a range of costly health and social care services and the criminal justice system.

So, what would this look like nationally? Most importantly, it would mean a fundamental shift in mindset: away from managing homelessness as an endless emergency, and toward preventing and ending it altogether.

Integral to the approach is preventing the trauma of homelessness from happening in the first place. And in situations where it does occur, people would be moved into their own secure social or privately rented home as quickly as possible, without meeting strict conditions first, and then provided with the support they need to make it work.

This creates a system built around dignity, choice and what people need to thrive. Instead of asking people to navigate a maze of services before they can access a secure home, it first provides the stability needed for someone to rebuild their life and engage with support on their own terms.

Crucially, there would be minimal time spent in temporary accommodation and very few transitions before someone moves into a settled home. We currently have record numbers of households stuck in unsuitable accommodation for months on end. Homelessness has never been worse. But we’ve never known more about how to end it. And it’s those solutions we need to start investing in.

This means investing in addressing the chronic shortage of affordable homes through a renewed emphasis on social housebuilding, and whilst those houses are built, unfreezing Local Housing Allowance, which is pushing people into homelessness, leaving local authorities to bear the cost. It means ensuring social housing is allocated to people experiencing homelessness and supporting local authorities to plan and fund how they will transition from over reliance on temporary accommodation to rapidly rehousing everyone into a home of their own, with the support they need to keep it. We must empower mayors and local leaders to take bold, locally tailored action and establish a national Homelessness and Rough Sleeping Unit rooted in a Housing First philosophy to coordinate delivery and ensure consistency, with all departments pulling in the same direction and moving forward together.

We wholeheartedly welcome the prospect of a Housing First philosophy at the heart of Government. It would be transformative with benefits for employment, health, and economic growth. That’s why it must, as Andy Burnham says, be at the top of the country’s priority list.

Fiona Colley – Director of Social Change, Homeless Link

Francesca Albanese – Executive Director of Policy and Social Change, Crisis UK

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Why the growing consensus on rent controls shows us now is the time to act

Rents are too high. Since the turn of the millennium, private renters in the UK have been paying around a third of their income on rent, and much more in higher cost cities. Recent, above inflation rent increases have worsened this situation, pushing the rents even higher.  

Behind these figures are stories of people struggling under the weight of high rents. Families are cutting back on spending, going without the essentials or losing their home altogether when they’re hit with a rent rise they cannot afford.

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At the same time, this affordability crisis is placing significant cost on the public purse, through a growing housing benefit bill and spiralling temporary accommodation costs which are pushing councils to breaking point. 

The current government has been right to place a significant focus on new housing supply, repeatedly stating its intent to build 1.5 million homes over the Parliament with a view to lowering house prices and rents. This target, and their efforts to deliver if through planning reform and funding, are welcome. But these efforts – as important as they are – will take time and on their own will be insufficient. OBR analysis shows that were this target to be met, rent and house prices will still not fall through this Parliament.

Furthermore, hitting this target looks increasingly unlikely (and exceeding it unlikelier still). Market housebuilding has slumped – a function of low effective demand driven in large part by higher interest rates – and this will take time to recover. While the finances and strained capacity of councils and housing associations make it harder to build more social homes to counter any fall in private output.  

Why action is needed now

Action on rents is needed now and, given the pressures on renters and the challenges Government faces acting on them with the tools currently available to them, intervening more directly on rents looks increasingly appealing. This is why an increasing number of organisations – JRF included – have recently called for caps on rent increases.

As our research has found, capping rent increases would have significant and immediate impacts for renters. Implementing a cap on rents which limited them to rising by CPI within tenancy and CPI + 2% between tenancies would save renters around £400 a year. Government finances also benefit from rent controls.  If rent controls had been in place since 2025/26, they would create £600 million in net savings to the Housing Benefit bill by 2030. Rent controls offer a practical, fiscally sensible strategy for driving down rents – with further benefits in giving renters certainty that their rents won’t suddenly jump, allowing them to plan and preventing them being forced out of their homes by unaffordable rent hikes.

Some argue that intervening on rents in this way would present challenges, first to investment in the existing stock of homes and second to construction of new ones. It is therefore worth setting out why we feel it is possible to confront these challenges.

Understanding profit in the Private Rented Sector

On the first, it is often argued that reducing landlords’ ability to hike rents would either lead them to invest less in the homes they rent out, reducing their quality, or to exit the market completely. Landlords exiting is not in itself a problem, as once sold the homes are either bought by someone to live in or by another landlord, social or private. Studies of rent controls even show a positive impact on homeownership rates, which may be a desirable consequence. But too rapid a sell off could cause problems for renters unable to move quickly into home ownership, if fewer homes are available to rent where there’s high demand.

To understand this risk further we commissioned the Autonomy Institute to look at landlord returns. Their work found that landlords have historically been making returns far in exceedance of those from other investments or ‘normal’ benchmarks. Even in the most recent period they studied (2024), after interest rates have risen and inflation has pushed costs up, most landlords were found to be making above average returns.

This tells us that it is possible to push down these returns while keeping most landlords in profit.

Our research has also found that the minority of landlords whose returns are particularly exposed to higher costs (principally borrowing costs) can be protected from the impacts of a rent control.  Were the Government to bring back landlords’ ability to offset their mortgage interest costs against their tax liability, while applying employer and employee NICs to rental income (to offset the lost revenue) we find that the share of landlords making a loss, even in a scenario with rent controls, would fall. In fact, applying these tax changes and a rent control would see fewer landlords making a loss by the end of the Parliament than if the Government does nothing.

Protecting future housing supply

On the second challenge, it is important that action on rents doesn’t stop homes being built, but we believe it is possible to introduce a rent control and protect housebuilding. While international evidence is clear that rent controls can worsen construction rates, the same research finds that well designed rent controls, with for example exemptions for newly constructed homes, have no impact on housebuilding.

Moreover, there is no reason to think a rent control should have this impact in the UK. The typical UK landlord does not build homes. Rather, as the research on landlords’ returns above shows, the growth in the Buy-to-Let sector was marked by landlords buying up existing homes. It is perfectly possible for a rent control to be designed in such a way, and sit as part of a broader package of reforms, which could reorient our housing market away from this model of an unproductive and extractive rental market, towards a rental model more focussed on the creation of new, high-quality homes.

Renters need action now, and capping rents can and should be part of the solution.

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Can England afford (not) to build council homes?

Before the 2024 General Election, I had the privilege to work with England’s largest council landlords on Securing the Future of Council Housing. The report set out five key recommendations to allow councils to once again play a major role in housing supply, and to refurbish and improve existing homes and neighbourhoods after decades of under-investment.

It is an ambitious vision for a new, better relationship between central government and council landlords. Over 100 councils led by different parties across the country backed the report, laying the ground for a powerful coalition which has successfully influenced Government policy since. Every council involved has been essential in raising the volume of council housing’s voice, but particular credit should go to the London Borough of Southwark under Kieron Williams’ leadership for kickstarting the campaign, and to Sheffield City Council and Leeds City Council for helping it spread.

On Monday, Andy Burnham pledged the ‘biggest council housebuilding programme since the post-war period’ – a period when councils delivered over 4 million homes in 36 years. Since that time, more council homes have been sold than new ones delivered. It’s been a long wait, but it may finally be time for a renaissance in council housing.

But can we afford it?

Yet serious questions are being asked about whether we can afford it. This is not just because it costs money to build low-cost social homes. It is because councils are public bodies, and their borrowing is ‘on balance sheet’. Most social homes in England today are owned and delivered by non-profit Housing Associations, whose borrowing is ‘off balance sheet’. It doesn’t count towards public debt. That difference has shaped housing policy for decades.

In this blog, I’m going to try to demystify the impact of council housing on public debt, and how the UK’s fiscal rules change things.

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How council housing came under financial attack

Council housing is treated differently from all other council-owned assets in accounting terms. Council landlords keep rental income in a Housing Revenue Account (HRA), which is kept separate from other council income. This is to protect social tenants’ money, so it doesn’t get used to fund general council services.

In 2012, the Government and councils agreed a ‘self-financing settlement’ aiming to make HRAs more independent and more sustainable. The settlement was supposed to give councils the financial certainty to invest in their homes, but it was quickly ripped up. Social rents were cut and capped with little notice, borrowing rates for councils were increased overnight, and councils had to sell more homes with bigger discounts following Right to Buy reforms. Top it all off with a pandemic, geopolitical turmoil and rising inflation and interest rates, and the unsurprising result is that most HRAs are in poor financial health. A 2024 report from Savills and the Chartered Institute for Housing suggested that debt cancellation of £17bn would be needed to make HRA borrowing sustainable across the board. This means many council landlords cannot invest in homes in the ways communities need.

Accounting for council housing

In the UK’s national accounts, all HRAs are consolidated and treated as a single ‘non-financial public corporation’. This means they count towards public debt for the purposes of the UK’s fiscal rules. Fiscal rules are the Government’s self-imposed limits on how much it can borrow, spend and accumulate debt. They are designed to reassure financial markets that the public finances will remain sustainable and so keep the Government’s borrowing costs lower.

Before the 2024 autumn budget, the UK used Public Sector Net Debt (PSND) for our fiscal rules. Council housing performed particularly poorly under this measure. Borrowing to finance public investment – including in council housing – increased the headline debt figure, even if the Government acquired valuable assets in return.

The current Government switched from PSND to Public Sector Net Financial Liabilities (PSNFL). The new rules still count debt the Government owns, but they also count financial assets the Government owns – though not physical assets like homes.

This is where things get interesting for council housing.

By far the largest source of borrowing for council housing is from the Public Works Loan Board (PWLB): effectively, councils borrow money from the Treasury, which raises the money by selling gilts on the international markets. When the Treasury lends to council landlords in this way, under PSNFL it actually creates an asset for the public sector: the money councils owe to HMT.

The result is that investing in council housing is a lot easier than it used to be. Let’s say the Treasury agrees to ‘forgive’ £100 million of unsustainable HRA debt to give councils some breathing room, and councils then take out £100 million of new PWLB loans.

Under the old debt rules, this would have looked like the Government simply taking on more debt. Under the new PSNFL rules, it is treated more like cancelling an old loan and then making a new one. The council owes the Treasury £100 million, but the Treasury also owns a £100 million loan. That new loan is recognised as a public financial asset and is largely netted off public debt.

So there’s no reason not to invest in council housing?

Not quite.

New PWLB borrowing for council housing still increases the size of the Government’s balance sheet and the amount of money the Treasury has to raise from investors to finance the new PWLB loans: HMT has to borrow to on-lend to councils. It is unclear how markets would react to a large-scale increase in investment for council housing using the current model. That depends partly on the scale of new PWLB lending, but above all on investor expectations of the UK’s wider fiscal position.

There’s another problem for council housing. While PSNFL makes investing in council homes easier, it also makes other models of delivering social housing even more fiscally attractive. In February 2026, the Government announced a £2.5 billion scheme to provide loans to Housing Associations at 0.1% for 25 years. Incidentally, that’s a much better deal than councils are getting from the Public Works Loan Board at the moment!

Under PSNFL, these loans to HAs are ‘financial transactions’ because the Government acquires a financial asset (a loan) in exchange for cash. But unlike councils, when HAs take out loans from the Government it does not create a liability for the public sector, because their borrowing is ‘off balance sheet’.

If you can deliver the same kinds of homes using private borrowing via HAs, you may get the same policy results with less public sector borrowing and less gross balance sheet expansion. That should make it easier to maintain investor confidence and help keep the Government’s borrowing costs lower. And that may actually be key to increasing investment in social housing: if the UK can borrow more cheaply, we have more space to increase the size of funds like the Social and Affordable Homes Programme. That’s essential to unlocking more social housing supply.

Can we afford not to invest in council housing?

It’s complicated and there are no easy answers. But alongside asking if we can afford to build council homes, we also need to ask if we can afford not to. The clearest fiscal argument here concerns the high costs managing homelessness.

Councils in England now spend £7.7 million every day to put people up in expensive – often sub-standard – Temporary Accommodation. HAs play a vital role in tackling homelessness, but the buck for homelessness ultimately stops with councils. No one else is incentivised to act the way councils are. Getting councils off the bench and delivering homes may be the only way England stops managing homelessness and starts preventing it.

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Blog Post Renters' Rights Act

Designing rent controls for England

Today, 2.4 million households in the UK private rented sector are struggling to pay their rent. With the war in Iran pushing up mortgage rates again, affordability will worsen unless government intervenes.

The Renters’ Rights Act is a major step towards a fairer rental sector, but it does not address the cost of renting. IPPR is calling for a national rent stabilisation scheme as the logical next step.

Other levers to lower costs matter but they are either too expensive or cannot ease the pressure quickly enough. New supply takes years to build and longer still to lower rents. Social housing is vital, but delivery is slow and only reaches a fraction of private renters. Increasing welfare provision for renters would be extortionate – 70 per cent of struggling renters currently claim no support for their housing.

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Government has been uneasy about rent controls because their history is littered with cases – New York, Berlin, Massachusetts, Stockholm – where poorly designed systems have had negative consequences. But these examples obscure milder rent controls adopted across Europe, some of which have been in place for decades. France, Spain, Ireland, and Scotland’s revised scheme show that risks can be managed.

We recommend that rents should be ‘double-locked’, linked to wages and the Consumer Price Index (CPI), applied nationally, both within and between tenancies. This must be accompanied by exemptions for new-builds, expansion of support to meet new quality standards, and regulation on short-term lets. 

Not any rent control scheme will do, and our proposal tackles the key concerns that critics point to head-on: reduced supply; property quality; new housebuilding; inequality; and mobility.

Supply

The most common criticism of rent controls is that by limiting landlord profits, they reduce the supply of rental properties. At a time when vacancy rates are already low, a sudden contraction in supply would place even greater pressure on renters. 

This risk can be mitigated through a system that allows rents to rise broadly in line with prices. The aim is not to freeze rents, but to create a more stable and predictable path over time. The double-lock mechanism recognises that indexing to inflation alone leaves renters exposed to inflationary shocks, like Iran. Equally, a system linked only to wages does not allow a gradual closing of the gap between income and rents.

International examples also highlight the importance of preventing landlords from converting their properties. We therefore recommend a licensing scheme, like in Scotland or Wales, and a hard cap on the number of nights a property can be rented out short-term each year, like London.

Even under a mild rent stabilisation scheme some landlords will see lower returns, but recent analysis from JRF shows that most landlords still make substantial profits alongside long-term capital gains. When landlords do sell up, the government must strengthen the wider housing safety net.

Property quality

Controlling rents can remove the incentive for landlords to invest in their properties, but the government’s Decent Homes Standard and Minimum Energy Efficiency Standards will still safeguard quality. In fact, rent stabilisation directly addresses the risk of “renovictions” where landlords pass unaffordable renovation costs to tenants. There is not a single international example of energy efficiency standards being implemented without some form of rent control.

The Warm Homes Plan already includes some support for landlords struggling with compliance, but there is potential to expand this provision. Beyond minimum standards, limited exemptions for significant renovations – such as those in place in Paris – can help support high-quality housing stock.

New housebuilding

Only 8 per cent of new homes are built for rent but perception matters: even limited regulation can raise concerns about investor confidence.

Exempting new-build properties for a limited-time can help reduce this risk and doesn’t disadvantage struggling renters, as new-builds tend to serve the higher end of the market. Compared to other markets the UK rental market remains lightly regulated, and countries such as France and Spain demonstrate that strong housebuilding pipelines are possible with robust rent controls in place.

Finally, policymakers shouldn’t stick their heads in the sand about the already faltering housebuilding pipeline. A more active role for government is already needed to deliver housebuilding at the scale required.

Inequality and mobility

Rent controls have been known to create divisions between tenants benefitting from rent controls and those who don’t, which in turn can create disincentives to move. While London faces the most acute pressures, unaffordability is a problem for renters across the country. In the North East – where rental unaffordability is the lowest – 18 per cent of people are still facing high housing costs.

Implementing controls nationally prevents rent increases outside the controlled area as well as protecting from local government volatility. Applying controls for both sitting and new tenants reduces the disincentive to move out of a rent-controlled property.

Rebalancing power in the rental market

The cost of living is the public’s number one concern, and housing is people’s number one expenditure. Rent controls – if designed well – have the potential to directly tackle affordability and should be firmly on the table for any government making a serious offer for renters.

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Housing-led regeneration has untapped potential to tackle the housing crisis and to build a thriving North

Housing-led regeneration can unlock at least 500,000 good quality homes across the North of England and this is an opportunity that cannot be missed by Government.

As part of our Renew inquiry into housing-led regeneration for northern growth, supported by Homes for the North and Muse, we issued a Call for Evidence. The response was fantastic: we received submissions from organisations responsible for around 1 million of the North’s 1.4 million social homes, including insights from more than 160 regeneration schemes.

The message was clear – housing-led regeneration is essential to increase the supply of new homes, attract private investment, and boost economic growth in the North. It helps create great places to live; improves housing quality and residents’ health and wellbeing; generates jobs and skills opportunities; and promotes sustainability by providing greener, more energy-efficient homes that lower household bills.

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Housing-led regeneration in the North is not one single activity. It encompasses a wide range of interventions, from refurbishing individual homes to transforming neighbourhoods, reclaiming derelict land, and redeveloping urban centres. While these interventions differ in scale and approach, they share a common logic: that investment in homes and places can act as a catalyst for wider social and economic renewal. The scale of the opportunity is striking. Already, there are 100,000 homes planned in major city centre regeneration schemes, and our policy proposals aim to accelerate their delivery. Most of these homes are set to be built in our larger cities, so more support is needed to extend this to smaller towns and declining high streets to make sure no-one and nowhere is left behind.

A further 320,000 homes could be built on brownfield land; sites that are often derelict or underused but rich with potential to attract more investment and drive local growth.

Added to that, there are around 100,000 social homes which will be in need of regeneration over the next ten years. These homes tend to be concentrated in areas of deprivation and include older, colder terraced housing and tower blocks no longer fit for purpose. They do not meet the needs of residents, and weigh heavily on social housing providers’ balance sheets, preventing investment in new homes. For providers to play the fullest role in the delivery of new homes, and to prevent loss of social housing, ageing homes that require continual repair and investment must be renewed.

Despite its huge potential, a stubborn set of structural barriers continue to hold back housing-led regeneration in the North. Lower land values in many northern areas mean that developments are often less financially viable than in the South. At the same time, the high cost of remediating brownfield land, often contaminated or complex to develop, creates a funding gap that many projects cannot bridge without Government support.

The challenge is compounded for social housing providers. In the North, rental incomes tend to be lower, yet the costs of construction and refurbishment remain comparable to other regions. This creates a stark trade-off: invest in upgrading existing homes or inbuilding new ones.

The Renew inquiry’s recommendations set out how the Government can act to address these challenges and kickstart growth and opportunities in the North. Building on the very welcome £39bn, decade-long Social and Affordable Homes Programme for new build social homes, a £500 million per year, decade-long Place Based Regeneration Fund would provide the certainty and continuity needed to address ageing homes in need of replacement or refurbishment. Extending the National Housing Delivery Fund to a similar timeframe would unlock the most complex sites and help address the high upfront costs that currently deter development. Meanwhile, appointing a dedicated Minister for Regeneration could ensure cross-government coordination.

Equally important is building local capacity and trust. Establishing a National Centre for Regeneration in the North would help rebuild expertise, share best practice, and drive innovation. And placing residents at the heart of regeneration, through clear standards and rights, can ensure that development is done with communities, not to them.

The timing is critical. With increased devolution giving northern leaders greater control over housing, transport, and skills, there is a real opportunity to align policy and delivery in ways that were not possible before. Combined with significant government focus and investment in housing, the conditions are right to make a real difference.

Now is the time to put the final pieces of the jigsaw in place to tackle the housing crisis, build thriving places and healthier homes, and deliver northern growth. At the launch event for the Renew inquiry report in Parliament on Wednesday there was a real buzz in the room – I feel confident we can work together to deliver for the North, so that no-one and nowhere is left behind.

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