Measure should be first step in reform of property taxation and devolution, housing association group says
The G15 has called on government to allow London to retain a quarter of the UK’s stamp duty receipts to create a new fund to tackle homelessness.
The housing association body, in its submission ahead of the budget on 28 October, pointed to figures showing London generates more than a third (37%) of the £13.9bn of stamp duty receipts in the UK last year.
It said: “The same high property values that generate those receipts also sit at the heart of London’s housing pressures. They make home ownership harder to access, increase the cost of private renting and make it more expensive to provide permanent affordable homes. Those pressures feed directly into homelessness and temporary accommodation.
“There is a strong case for creating a direct fiscal link between the revenues generated by London’s housing market and investment in fixing its housing system.” Its proposed London Housing and Homelessness Investment Fund would support permanent social housing and interventions that reduce reliance on expensive temporary accommodation.
Under the G15’s proposal, the move would be a first step while property taxation is reformed, with the aim of replacing council tax and stamp duty with “a fairer, more efficient, devolved proportional property tax.”. The call for greater fiscal devolution and a review of property taxation was also made by the G15 and Housing Today in this year’s State of the Capital report earlier this year.
The G15 is also calling for London’s Social and Affordable Homes Programme to be “fully devolved”, with London given greater certainty over its share of national housing investment and the Greater London Authority granted full authority to allocate funding without individual decisions returning to Whitehall.
The G15 also repeated its call for a shared ownership staircasing mortgage pilot, allowing housing associations to use recycled grant to fund a time-limited mortgage-rate discount and release capital for reinvestment. It wants a raising of the London household shared ownership income cap, which has remained at £90,000 since 2016 despite substantial increases in earnings and housing costs.
It also said the government should give London greater freedom to use public land and land-value growth to unlock housing equity participation and land-value-sharing (see full list of recommendations below).
The G15 report said: ”These policy changes would help make the most of existing public commitments, mobilise more private investment, reduce spending on housing failure and strengthen London’s contribution to growth across the country.”
The G15 recommendations in full
The group says over the long-term, the government should:
- Give London a meaningful and enduring share of locally generated tax growth, providing multi-year certainty and genuine flexibility over investment in the foundations of growth.
- Fully devolve London’s Social and Affordable Homes Programme, giving London greater certainty over its share of national housing investment and the GLA full authority to allocate funding without individual decisions returning to Whitehall.
- Work with London to reform property taxation, with the objective of replacing Council Tax and SDLT with a fairer, more efficient, devolved proportional property tax.
- Give London greater control over the Growth and Skills Levy and employment support, allowing investment to respond to London’s distinctive labour-market challenges and the workforce requirements created by housing, retrofit and infrastructure investment.
- Give London greater freedom to use public land and land-value growth to unlock housing, including deferred payments, equity participation and land-value-sharing.
It said this budget specifically should:
- Protect the full £39bn SAHP commitment, maintain London’s share through future phases of the programme, and roll out low-interest loans quickly in a way that strengthens providers’ delivery capacity.
- Launch a shared ownership staircasing pilot, allowing housing associations to use recycled grant to fund a time-limited mortgage-rate discount and release capital for reinvestment.
- Review and raise the London household shared ownership income cap, which has remained at £90,000 since 2016 despite substantial increases in earnings and housing costs.
- While long-term reform of Council Tax and Stamp Duty is being developed, allow London to retain 25% of Stamp Duty receipts to create a London Housing and Homelessness Investment Fund, supporting permanent social housing and interventions that reduce reliance on expensive temporary accommodation.
- Protect the full Warm Homes Plan commitment and guarantee substantial multi-year funding for social housing, alongside longer-term certainty over government support for net zero.
- Reform the Economic Crime Levy for not-for-profit housing associations, ensuring liability reflects relevant regulated activity rather than the scale of providers’ wider social housing operations.
- Reduce the VAT cost of investment in residents’ homes, including permanent zero-rating of energy-saving materials and further consideration of retrofit, regeneration and fire-safety works
- Extend access to Residential Personal Emergency Evacuation Plans (PEEPs) funding to leaseholders where registered providers are responsible for implementing the regulations.
- Protect low-income households from housing insecurity, including reviewing the household benefit cap and the case for a protected minimum level of Universal Credit.
- Provide long-term funding for Jobs Plus, maintaining existing pilots until at least autumn 2029 and beginning wider rollout from 2027.
- Restore Local Housing Allowance to the 30th percentile of current rents and uprate it annually, while reforming the outdated temporary accommodation subsidy system.
- Rebase temporary accommodation Housing Benefit subsidy against contemporary accommodation costs to help reduce long-term reliance on temporary accommodation.
No comments yet