Former head of the civil service says the government should also look at increasing grant rates in response to covid crisis

The former head of the civil service and permanent secretary at the communities department has said the government needs to consider extending the Help to Buy scheme in order to help the industry recover in the wake of the covid-19 crisis.


Lord Kerslake, also previously chief executive of Homes England’s predecessor body the Homes and Communities Agency, said the government would also need to look at raising grant rates for social housing.

Speaking to mark his appointment as chair of construction procurement specialist Pagabo, Kerslake (pictured, right) told Housing Today that the government should reconsider the future of the Help to Buy scheme. The scheme aids buyers with an equity loan worth 20% of the value of a property, but is due to be reined in from April next year and then cancelled in 2023.

Kerslake said: “I think the challenge is going to be to restore confidence after what has been a big health and economic shock. The sort of things you’ll be looking for is where the government can give confidence to the market, particularly on build for sale, with things like Help to Buy… I think they should at least be putting it on the list of things to be talking about.

“And I think also they’ll need to look at the grant rates for new affordable housing.”

The Home Builders’ Federation, which represent UK private sector housebuilders, is already understood to have raised with the government the issue of the reform of and possible extension to Help to Buy in the light of the covid-19 crisis.

Meanwhile the Chartered Institute of Housing, which represents housing professionals, has led calls for a boost to grant rates for affordable housing in the wake of the crisis, calling last month for an investment package worth £12bn a year.

Kerslake said the lockdown measures had “clearly had a serious economic impact”, and added that government and the sector was going to need to think hard about how to get itself ready for “the recovery phase.”

He said: “Into the recovery phase the government will want to see the economy revive as quickly as it possibly can, and I do think that getting projects, that are probably paused at the moment, underway, and getting them underway quickly, actually, is going to be critical to the recovery.

“A lot of people are going to be giving thought to how we best achieve that.”

He added that he didn’t see any reason why contractors wouldn’t be able to rebuild capacity and get sites up and running again very quickly once it was safe to do so.

Nick Walkley-HomesEngland-Portrait-B-HiRes098

Kerslake’s comments come after the current Homes England chief executive, Nick Walkley (pictured, left), raised the prospect of a post-covid support package for the sector in an end of year missive last week. This week Tom Copley, London’s deputy mayor for housing, said he will be drawing up a recovery package for the sector in the capital.

The Help to Buy equity loan scheme, introduced in 2013 by former chancellor George Osborne as an economic stimulus measure, has since seen £14bn invested in support of sales of more than 250,000 properties, and is widely credited with turning round housebuilders fortunes in the wake of the global financial crisis.

But builders hoping to get sales of houses supported by the current version of the Help to Buy scheme will need to complete construction of the properties by 31st December this year, potentially a challenge depending upon how long the current lockdown lasts.

A spokesman for the HBF last week said the body was “discussing with government a range of initiatives that will help the economy to recover as quickly as possible by generating activity and creating jobs”.

Kerslake’s comments come after Cenkos analyst Kevin Cammack last week joined calls for an extension to Help to Buy. He said: “If I were lobbying for housing right now the focus would be on requesting a deferral of the planned restrictions to Help to Buy in March 2021 and cessation two years later. That I think is a battle that could be won once we come out of crisis mode.”