TRIGGERnometry - Why We Have a Housing Crisis： Liam Halligan

00:00:00.700 Broadway's smash hit, The Neil Diamond Musical, A Beautiful Noise, is coming to Toronto.

00:00:06.520 The true story of a kid from Brooklyn destined for something more, featuring all the songs you love,

00:00:11.780 including America, Forever in Blue Jeans, and Sweet Caroline.

00:00:15.780 Like Jersey Boys and Beautiful, the next musical mega hit is here, The Neil Diamond Musical, A Beautiful Noise.

00:00:22.660 April 28th through June 7th, 2026, The Princess of Wales Theatre.

00:00:27.120 Get tickets at Mirvish.com.

00:00:30.000 hello and welcome to trigonometry i'm francis foster i'm constantin kissin and this is a show

00:00:40.960 for you if you want honest conversations with fascinating guests our brilliant returning guest

00:00:46.860 this week is an economist journalist and the author of this brilliant book home truths which

00:00:51.640 is about the housing crisis liam halligan oh it's me it's me it's you welcome back to

00:00:57.340 Nice to see you guys. And congratulations on your success with the podcast.

00:01:01.880 Well, it's partly thanks to you. You were one of the very few people who came on the show initially.

00:01:06.640 You had to twist my arm.

00:01:07.660 I did have to twist your arm.

00:01:08.820 All those Russian tactics.

00:01:10.460 I did have to twist your arm, but you were very kind. You came on and now we're very glad to welcome you back.

00:01:14.760 You've written what I think is a book about probably the crucial issue of our day at the moment.

00:01:20.260 I don't see a bigger issue that's a challenge to our society in real terms right now, the housing crisis.

00:01:26.500 And one of the things I didn't know before reading the book was it's so much worse in this country than it is around the West, which I didn't know was the case.

00:01:34.080 So before we get into into talking about it, lay out the scale of the problem for us.

00:01:39.420 Well, the scale of the problem is that home ownership in the UK has gone from 73 percent of households a decade ago to a little more than 60 percent now.

00:01:47.800 But within that, home ownership among 25 to 39 year olds has actually absolutely plummeted from well over 60 percent to well below 40 percent, that crucial family forming age.

00:02:01.460 At the same time, today's young adults are spending more on rent and are less likely to own their own property than in any decade since the 1930s, which, of course, was the decade of the Great Depression and massive countrywide, indeed worldwide austerity.

00:02:20.380 And it's not just that, you know, nice professional people called Jonathan and Sophie can't buy homes.

00:02:26.300 It's that many, many other people can't even get social housing, lower down the income scale.

00:02:31.900 And it's not just a shortage of homes to buy because we haven't been building enough.

00:02:35.720 It's also a shortage of properly affordable homes and indeed social housing, sometimes called council housing.

00:02:41.680 that means we've now got a proper homelessness epidemic, massive overcrowding in this country,

00:02:49.800 so-called concealed households, which I write about in my book, Home Truths.

00:02:54.120 And this situation is more acute in the UK than practically any other Western country.

00:03:02.140 The average house now costs about eight times annual earnings, annual average earnings.

00:03:08.180 That's the average across the country.

00:03:10.800 It's much, much worse in London than the southeast, of course,

00:03:13.560 but multiples are way above historic levels in the Midlands,

00:03:17.340 in the northwest, in the west country, even parts of the northeast

00:03:20.780 where the economy is a little bit slower, with all respect.

00:03:25.180 I thought you were just going to say where no one wants to live.

00:03:27.980 No, no, no.

00:03:28.900 The northeast is a story.

00:03:30.340 There's pockets of...

00:03:31.740 We have a big bit of banter with our northern fans.

00:03:35.080 Sure, sure.

00:03:36.000 It's Grimlock North.

00:03:36.680 And that eight times average earnings, average multiple is up from four times just 20 years ago.

00:03:43.800 So if you're a couple and you're both earning, right, you're both full time working, you can't get a mortgage for eight times annual earnings.

00:03:51.340 That's before child care. And that is the nub of the crisis.

00:03:54.700 We built too few homes, far too few homes. And that's why rents and prices to buy are now way, way beyond earnings.

00:04:04.920 And you touched on the homelessness situation. I want to just explore that a little bit. You mentioned a stat in your book that I found utterly heartbreaking. The charity Shelter said that it was one in every 200 people they estimate are homeless in this country.

00:04:21.640 That's right.

00:04:22.120 That doesn't just include homelessness on the streets, which is rough sleeping, which is obviously ghastly.

00:04:28.880 And it's often elided with issues to do with mental and family breakdown and so on.

00:04:35.880 It's also people who are in temporary accommodation, bed and breakfasts and so on.

00:04:41.440 Yeah, I'm from a first generation home ownership family.

00:04:45.520 Right. I'm from a working class Irish family, North London, common story.

00:04:51.180 my dad came over in the 50s, managed to buy a house in the 60s, and it completely revolutionized

00:04:57.500 his view of England. He made his peace with England, gave him some stability. My mum grew

00:05:03.540 up in a council house, one of 10 kids. The fact that they were able to buy a home, they're non-professional

00:05:08.480 people, they're working people, completely transformed their life chances and their children's

00:05:14.860 life chances. And so I set out to write a book as a kind of love letter to home ownership and why

00:05:20.920 we mustn't lose sight of the merits of home ownership. But I ended up writing quite a lot

00:05:27.320 of the book post-Grenfell about social housing, about the lack of social housing, and indeed

00:05:32.820 homelessness. Because we've built hardly any social houses, basically, since the end of the

00:05:39.700 1980s. The figure plunged during the 90s. Under Blair and Brown, we built almost no council homes,

00:05:47.880 And we're only building single-digit thousands each year now.

00:05:51.680 Back in the 60s, 70s, 80s, we were building 60, 80, 100, 150,000 council houses a year.

00:06:00.460 And you have to have that stock of council housing, of social housing,

00:06:04.580 because you're always going to have like a fifth, something like that of the workforce

00:06:08.880 who just don't earn enough.

00:06:10.900 They need sub-market rents.

00:06:13.740 Yeah, it's not their own fault.

00:06:14.600 they're just doing jobs that don't command enough salary to buy a house or rent a place on the open

00:06:20.440 market. And what we've done, France, is instead of building social houses that the state can own

00:06:25.420 and give people stability, some kind of stable tenancy, we've instead given private landlords

00:06:33.240 housing benefit to house those people and often housing them in much more substandard

00:06:39.940 conditions. And we're now spending £25 billion a year on housing benefit, which is absolutely

00:06:49.380 huge. It's like half of what we spend on schools. It's really, really massive. Rather than the state

00:06:57.820 borrowing money to build homes, and then it doesn't have to pay the... And it's got that

00:07:01.840 asset on the state balance sheet too, so it net-nets neutral. And they don't have to spend

00:07:06.180 all that huge amount of money on housing benefit. So in the book, you outlined how you use the term

00:07:13.900 NIMBYs, not in my backyard. Yeah, that's a common term now. Yeah. So for people who are saying,

00:07:18.320 well, I don't want houses being built in my backyard, all the rest of it. But since 2010,

00:07:24.720 the perception has changed because we all accept we're in this crisis. Why is it not being solved

00:07:30.660 thing it's starting to change yeah nimby is now a well-known acronym slightly less well-known but

00:07:36.520 gaining fast is yimby yes in my backyard there are yimby groups yeah yimby groups that i've been

00:07:42.960 in touch with all across the uk all across many um big cities in the western world particularly

00:07:50.060 young people who want more homes built so they've got a chance of you know renting somewhere decent

00:07:55.040 or even better, buying their own place and getting a stake in a growing economy.

00:08:01.400 What's happened since about 2010 is that the government has started to give more planning

00:08:08.420 permissions. Local authorities have started to give more planning permissions to build more homes.

00:08:12.800 But a lot of the big developers, particularly in the UK, they act as what we call in economics

00:08:18.600 an oligopoly. It's like a monopoly of a few number of suppliers. So they deliberately go

00:08:24.200 slow on building out those planning permissions. And the fact that they hold the planning

00:08:28.080 permissions stops smaller firms that build quicker getting them. So prices are kept artificially

00:08:34.240 high in the face of relentless demand. In the book, I call it contrived scarcity. And

00:08:40.240 the big house builders do this. They boast about it in opaque language in their annual

00:08:46.880 report. So from their point of view, the logic is if they hold on to these planning permissions

00:08:52.160 and the land, that the price of that is going to go up.

00:08:55.040 So it's a no-brainer for them.

00:08:57.060 They make a lot more money speculating on land

00:08:59.480 than they do on building houses.

00:09:01.040 Particularly if they can make more money

00:09:03.000 building fewer houses on a much bigger margin.

00:09:05.840 And the margin for some of these big house builders

00:09:07.600 is like 25%, 30%, which as anyone in business knows,

00:09:11.200 is a stonking margin.

00:09:12.820 It's the sort of thing you make

00:09:13.640 when you've got a brand new technology

00:09:15.340 and you've invested in years in patents

00:09:18.260 and developing things.

00:09:19.780 These guys are knocking up houses

00:09:21.280 the way the Victorians did.

00:09:23.040 And now it's easy.

00:09:23.940 You've got plastic plumbing, right?

00:09:25.880 And so they're making massive, massive margins.

00:09:28.600 But look, I totally understand

00:09:30.680 that for people existing in a location,

00:09:35.780 new building, there's no upside.

00:09:37.660 It's a lot of disruption.

00:09:39.220 There's not going to be new schools and hospitals.

00:09:41.160 There's not going to be new transport facilities.

00:09:43.480 So it gets more crowded.

00:09:45.100 Of course, they're going to object.

00:09:46.800 And that's why, of course,

00:09:47.680 their house price might even suffer.

00:09:49.620 And that's why the politics of planning

00:09:51.140 at the local level is so fraught. But what I argue in Home Truth, and it's like the centerpiece of

00:09:56.600 all the proposals that I've laid out, is that when you give land planning permission,

00:10:02.620 the value of that land can go up like 100, 200, 500 fold, just the stroke of a bureaucrat's

00:10:09.620 pen. That massive gain, we call it planning uplift. In most other countries in the Western

00:10:15.500 world, and particularly in Asia, big parts of the States, a lot of that planning gain goes to the

00:10:20.740 state, particularly the local authority, so they can use that huge value uplift to fund new schools,

00:10:27.320 new hospitals, new roads. So people are like, yeah, we'll take the houses because where we live

00:10:32.040 will get better. And actually our value of our house will go up and we'll take the disruption.

00:10:36.380 Of course, some people object, but it's a much more balanced conversation. Here in the UK,

00:10:40.600 we've had these very opaque mechanisms called a Section 106 and a community infrastructure levy,

00:10:46.920 which are complicated ways of saying the state tries to claw a little bit of money back particularly

00:10:52.700 from the big house builders but they're often rebuffed and the big powerful house builders at

00:10:57.160 the local level say we're not going to build these houses this year unless you let us off

00:11:01.140 these community obligations and this amount of money we say we pay to for local facilities

00:11:07.540 and this happens behind closed doors and it means that often new housing does not come

00:11:13.520 with the public facilities, if you like, the community assets, the extra infrastructure

00:11:20.060 that makes it worthwhile for existing residents. So we have to learn to share this planning game.

00:11:26.840 And in Home Truths, I say we should share that planning game straight down the middle,

00:11:32.720 50-50 between the local authority and the house builder slash developer, whoever owns the land.

00:11:39.580 It's often a sort of offshore trust, by the way, in this country.

00:11:43.380 And that would mean that the local politics of planning would be completely revolutionized.

00:11:48.360 And the UK would start spending as much on infrastructure, you know, three, three and a half percent of GDP that many continental European countries do and Asian countries do rather than spending what we currently spend one, one and a half percent of GDP because it's all out of, you know, straight taxation rather than planning game.

00:12:05.380 So you bring up politics and the local politics issue is complicated.

00:12:10.020 I understand the point that you're making.

00:12:11.840 But also in the book, you go through and you give quote after quote from politician after politician who keep saying the housing crisis is a crucial issue.

00:12:21.460 We must address it. We must tackle it.

00:12:23.560 And yet it doesn't it's not happening. Right.

00:12:26.160 So why is there this lack of political?

00:12:28.820 I mean, one of the things I've always thought is that in an overinflated housing market, if you're a government that allows the housing market to correct, the people who own houses may well never vote for you again.

00:12:42.480 Right. So there is that inherent problem, isn't there, where the politicians have a disincentive to actually address this problem.

00:12:50.980 That's right. You've put your finger on something very important there. And by the way, I'm going to steal this mug.

00:12:58.820 You're welcome to it.

00:13:00.200 Does it still count as stealing if I tell you I'm going to steal it?

00:13:04.340 In the book, I talk about the iron triangle of vested interests that are keeping policy where it is.

00:13:10.160 So it's in a state where the big house builders control everything and can have contrived scarcity to keep prices high.

00:13:18.460 We're massively undersupplying the demand for housing.

00:13:22.680 So prices keep going up and up ahead of earnings.

00:13:24.880 I don't want to see a house price crash.

00:13:26.340 I want to see prices levelling out so earnings over a period of time can catch up.

00:13:32.580 That's a completely different scenario.

00:13:34.380 But the Iron Triangle of vested interest, as you say, and the politicians understand this implicitly, is existing homeowners.

00:13:41.060 They don't want more houses built for the reasons we've discussed.

00:13:44.200 But that's starting to change, as you say.

00:13:46.480 Social attitudes are starting to change.

00:13:48.680 People, even well-heeled people, are understanding that their well-heeled, well-educated children can't buy homes.

00:13:55.260 Why are you talking to Francis when you make it?

00:13:57.680 Because I'm clearly the one in this place who doesn't own a fucking home.

00:14:02.520 Well-heeled and pointing at Francis in his Fred Perry show.

00:14:07.900 Geysers are not owning that.

00:14:09.860 But it's true.

00:14:10.980 You're well-heeled.

00:14:11.900 You come with your oligarch money.

00:14:13.900 Yeah, he's got his...

00:14:15.140 If you think this is an oligarch jacket...

00:14:17.600 If we're in London and one, he's got his yacht parked outside.

00:14:21.620 So you've got existing homeowners, right?

00:14:23.960 Now, that's starting to change. You're right. Politicians don't want to mess with existing homeowners, because in general, the political geometry has been that they are the majority of voters.

00:14:33.440 Absolutely. But as homeownership's gone down, as we said at the beginning, that's starting to change.

00:14:38.880 The second side of the Iron Triangle of vested interests are the house builders and the landowners, right? Massive, massive donors, particularly to the Conservative Party.

00:14:48.460 Right. Right. They've got a kind of headlock on Conservative governments.

00:14:52.740 A million quid they gave, didn't they?

00:14:54.760 It's massive.

00:14:55.820 It's absolutely massive.

00:14:56.940 Second only to the financial services industry, the construction industry, in terms of political

00:15:01.200 donations to the Conservative Party.

00:15:03.580 And then the third leg of that, the third side of that iron triangle of vested interests,

00:15:08.600 another massive interest group, the banks.

00:15:12.180 The banks are now up to their neck in property loans.

00:15:16.320 Now all the building societies have become banks, been amalgamated into the banks.

00:15:21.440 Something like 65%, 70% of all loans in this country extended by banks are linked to property, right?

00:15:28.480 So the Treasury will tell every housing minister, oh, don't mess with the housing market because if prices level out or go down a little bit,

00:15:37.020 then the collateral that the banks hold will become worth less and you'll have another banking crisis.

00:15:41.460 I think that's massively overstated.

00:15:43.600 I think that's completely alarmist.

00:15:46.120 We have such massively high multiples of housing on earnings.

00:15:49.740 There's so much increase that we've got in the tank over the last 10, 15 years that house prices could level off and even go down a bit.

00:15:58.080 And it wouldn't touch at all the strength of the bank balance sheets or threaten the crisis.

00:16:05.860 I think that's completely apocalyptic.

00:16:08.620 So you've got this iron triangle of vested interests, which means that politicians want to talk big about building more, but they don't actually change incentives to make it happen.

00:16:19.300 They don't tackle this Iron Triangle of vested interests.

00:16:22.600 But in the last few years, something has started to change, not just those social attitudes that France is alluded to.

00:16:32.640 What's also changed is that politicians, particularly the Tories, are starting to hear this coming up all the time, even in the shires.

00:16:41.540 And when Jeremy Corbyn came within just a few thousand votes, frankly, of power in 2017,

00:16:47.460 a lot of that was a surge of support from young people.

00:16:50.740 And it wasn't just people in their 20s who you sort of expect to vote Labour, right?

00:16:54.180 If you don't vote Labour in your 20s, then you're a bastard.

00:16:56.640 Didn't you all say that?

00:16:57.860 You're the Orwell.

00:16:59.020 To paraphrase the great man.

00:17:01.140 And if you don't vote Tory in your 30s, you're a knob.

00:17:04.580 Did he say that?

00:17:05.320 He didn't quite say it like that.

00:17:07.360 He was an educated man, Labour.

00:17:09.040 You get the point.

00:17:10.240 You get the point.

00:17:10.920 But a lot of those first time Corbyn voters in 2017 were first time Labour voters who gave the Tories a hell of a scare.

00:17:17.840 Yes, May was crap, a campaign or the rest of it.

00:17:19.560 But a lot of them were into their sort of adult life and they still hadn't been able to buy a home generation rent.

00:17:27.160 And they were angry and they're still there and they're still angry. Right.

00:17:31.380 Now, in the last election, of course, Corbyn took a hammering, but he still did very, very well because he lost a lot of working class votes.

00:17:39.360 He still did very, very well among that kind of educated, professional Labour voting class who haven't got houses.

00:17:47.060 And those people are still there and they're not going to get any less angry as they get older.

00:17:51.220 A lot of, you know, when I wrote Home Truths just before Christmas, it was published.

00:17:56.740 I've had a lot of people writing to me saying, you're exactly right.

00:18:01.240 My life, my girlfriend's life, my boyfriend's life, we're on hold.

00:18:05.700 We're in rented accommodation. We're not having kids.

00:18:08.320 we're stalling and there's an astonishing graph in the book that shows that back in the early 90s

00:18:14.400 the average age for a woman in the UK to have their first child was 27 right that's since gone

00:18:20.060 up to 28 right but back in the 90s at the age of 27 only 15 percent of women in the UK were in

00:18:28.400 rented accommodation right now it's 40 percent wow so you see the point you've got a lot of people

00:18:34.940 young adults renting often when they don't want to right yeah great this life the one of the

00:18:41.960 archetypal um sitcoms if you like well dramas of the 90s yeah they're all kids in london they're

00:18:49.140 renting they're having a great time at certain times in your life you want to rent if you're

00:18:53.140 more itinerant person you want to rent i'm not saying there shouldn't be a private rented sector

00:18:57.680 there should be but our private rented sector has gone from 10 of households to over 20 households

00:19:03.280 in little more than a decade and you've got a lot of youngsters locked into rental contracts

00:19:09.140 locked into a rented house situation when actually they want to be owning homes they're often from

00:19:14.900 families where their first generation at university their parents were manual workers

00:19:19.980 non-professional people with respect their parents bought a nice house and they can't

00:19:25.320 so you've got some sort of reversal in generational fortunes here which tears at the social fabric

00:19:31.600 Broadway's smash hit, The Neil Diamond Musical, A Beautiful Noise, is coming to Toronto.

00:19:37.380 The true story of a kid from Brooklyn destined for something more, featuring all the songs you love,

00:19:42.640 including America, Forever in Blue Jeans, and Sweet Caroline.

00:19:46.640 Like Jersey Boys and Beautiful, the next musical mega hit is here, The Neil Diamond Musical, A Beautiful Noise.

00:19:53.460 Now through June 7th, 2026 at the Princess of Wales Theatre.

00:19:57.380 Get tickets at Mirbish.com.

00:20:01.260 I knew everything was better in the 90s.

00:20:03.940 It was. The music was better. You could buy everything was better.

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00:21:20.540 But Liam, you make this point, and I think this is why I think it's such an important issue.

00:21:26.720 issue, that it's not just about economics or housing. The impact of this kind of challenge

00:21:34.120 on society in general, I mean, you're talking about demographics, right? Demographics is

00:21:38.860 going to be a part of this. You're talking about social cohesion.

00:21:40.960 Yeah, it's affecting the birth rate now.

00:21:42.260 Right. So tell us about that.

00:21:43.800 Demography is destiny, right?

00:21:45.120 Yeah.

00:21:45.480 It is affecting the birth rate. It's also affecting people's view of capitalism. Capitalism for

00:21:53.960 a lot of people isn't working if you can't get any capital you don't like capitalism so it does

00:21:59.220 lead to more radical politics a society of homeowners tends to be a more stable society

00:22:06.600 a society a lot of academic work shows where people are happier there's more civic and community work

00:22:12.720 um you you have a stake you know british people don't mind other people getting rich but as long

00:22:19.740 as they have a chance. And home ownership since the Second World War has allowed an awful lot of

00:22:25.440 working class people to get a stake, to get a little bit of capital behind them, to have some

00:22:30.320 life choices, right? They can downsize and buy himself a smaller place, give some money to the

00:22:36.020 kids, and everyone's happy. If you have this generation of 30, 40, now into 50-year-olds

00:22:42.900 who are renting when they want to buy, what happens when they stop work? And they can't

00:22:48.180 afford to rent? Where's the social housing for them? I mean, the housing benefit bill is going

00:22:53.320 to go to the moon. That's the thing about if you have a mortgage and buy, you pay lots of money

00:22:58.240 for your home. But when it's yours, it's yours. And then you're living in it rent free. And you

00:23:03.400 have that asset. You have that security. And now the UK home ownership, this nation of homeowners

00:23:10.120 is well below the EU average. And I personally think that's a reversal of our national fortune.

00:23:18.180 And the current decline in home ownership is such that we're going to be on course to be having owner-occupiers as a minority of households by the end of the 2020s.

00:23:28.820 I think that's a terrible thing.

00:23:30.600 I think that will completely change our national character and indeed our politics.

00:23:36.200 And Liam, I mean, the government have introduced, tried to introduce certain schemes, for instance, to help to buy schemes.

00:23:41.980 So, for instance, when I was a teacher, there was a lot of, you know, advertisement saying, you know, we'll help you get onto the housing ladder.

00:23:48.300 You can get this new property and wherever it is.

00:23:50.960 And it's a way for you to make a step up and to make that difficult first sleep.

00:23:55.920 Was that a good thing?

00:23:57.400 No, it was it was a disaster.

00:24:00.140 And it is a disaster.

00:24:01.160 Liam hates teachers.

00:24:04.460 What did you teach?

00:24:05.640 What did I teach?

00:24:06.500 Look at the disbelief on his face.

00:24:09.220 I did.

00:24:09.540 I taught year six, the last year of primary.

00:24:11.980 It's all English and maths, yeah.

00:24:13.300 Good man.

00:24:14.140 We're going to cut this out.

00:24:15.240 No one cares.

00:24:15.900 No, no, no.

00:24:16.540 It's unbelievable.

00:24:17.340 That's the only time I've seen genuine respect in Liam's face.

00:24:21.220 It's not.

00:24:21.860 It's like complete horror.

00:24:24.040 I'm just covering it well as you get back in there.

00:24:27.800 So.

00:24:28.700 The help to buy scheme.

00:24:29.460 Yeah.

00:24:29.740 So one of the great things about writing home truths is reaching out to an understanding.

00:24:37.600 there is actually believe it or not quite a consensus of opinion across politics about what

00:24:44.000 i've written so on the cover of my book you'll see praise quotes from shelter you know the

00:24:49.600 quintessential housing charity pretty much on the left but massively respected around the world

00:24:56.880 um as a sort of um for their practical help they give homeless people but also their research

00:25:02.780 search expertise. And then you've got Andrew Neil, you've got the Centre for Policy Studies on the

00:25:07.380 right, you've got, you know, Tory chancellors praising the book, other ministers. Because

00:25:13.120 there is a consensus. And one of the consensuses actually, from think tanks on the left and the

00:25:18.640 right was that help to buy was a bad idea and is a bad idea. Because when you've got massive pent

00:25:23.520 up demand and still constraints, constrained supply, if you give people the ability to buy

00:25:29.200 with even more money funded by taxpayers prices are just going to up loads which is what happened

00:25:33.940 so the margins that the big help to buy only helps you if you buy a new build so what help to buy did

00:25:40.180 and it's cost like 20 to 30 billion so far is it just massively increased the profits of the big

00:25:45.700 house builders who were then giving loads of campaign donations um but they weren't didn't

00:25:51.420 actually end up building more homes the big house builders are still building far fewer homes than

00:25:56.100 they were before the financial crisis and we've had very few small builders now because they were

00:26:01.020 all wiped out by the financial crisis and they haven't been able to get a foot in the door they

00:26:04.940 can't get hold of land because the big guys have got it all sewn up that's why it is as i say an

00:26:09.760 oligopoly some people would say it's a cartel which is actually illegal the big house builders

00:26:14.320 would deny that i think there is very compelling evidence now which the big house builders deny

00:26:19.820 your honor of a cartel of actual restrictive practices that's why i call in the book for a

00:26:28.900 full competition commission inquiry like an uh you know where we actually examine if the market

00:26:34.300 is operating properly i don't think it is um the house lords economic affairs select committee the

00:26:41.120 chairman michael forsyth read home truths they're now doing an inquiry into house building industry

00:26:48.500 I gave evidence to it and I and I repeated that recommendation that we see now competition commission inquiry just to get numbers on the concentration of the house building industry is pretty difficult at the moment.

00:27:02.740 They're being very coy about their actual output.

00:27:06.600 So we'll see if the House of Lords takes up that recommendation and what happens.

00:27:11.260 But help to buy is a great for a short term headline if you're a chancellor and it's good for some of the people that it helps.

00:27:18.500 But a lot of the people that it helps, and I've made documentaries for dispatches about this, have ended up in lashed together, substandard new build homes because the big house builders know they're a captive audience because they're using help to buy.

00:27:36.860 Right.

00:27:37.860 And so you end up with this situation where all that's happened is that help to buy has pushed up the price of increasingly bad quality new build homes for those who can get access to help to buy.

00:27:49.780 And the like 95 percent of home buyers who can't get access to help to buy have to face even more higher prices.

00:27:57.260 And then you and then you highlighted the bonuses that these chairmen were getting these companies.

00:28:03.100 Insane.

00:28:03.480 And it's it's in the tens of millions.

00:28:05.140 Yeah, I don't mind people making money.

00:28:07.100 Again, if they've done something incredible and brought new technology online.

00:28:10.840 You know, I'm a capitalist.

00:28:11.780 I like profit.

00:28:12.660 But these are like mediocre executives overseeing badly run companies with ghastly customer service records.

00:28:23.860 I'm looking at you, Persimmon.

00:28:25.600 And they're using, as I said, technology that's been around for, you know, available to anybody.

00:28:31.220 You know, go to a builder's yard and all the secrets are there.

00:28:34.420 Talk to any number of blokes propping up bars around the UK.

00:28:38.520 They tell you how to build a house.

00:28:40.460 And yet they're making bonuses of like tens of millions of pounds a year.

00:28:44.920 That is a clear signal the market is not working, right?

00:28:49.180 I like capitalism, but capitalism needs to work.

00:28:53.240 And what we got here with the house building industry isn't capitalism.

00:28:56.740 It's a grotesque distortion that's giving capitalism a bad name and is working only for the firms and not for the customers and broader society.

00:29:08.040 And you mentioned the term rabbit hutch Britain in your book.

00:29:11.360 Can you just explain?

00:29:12.180 Because, again, I mean, it's the lefty, but I found that very upsetting.

00:29:15.840 No, but there's this thing particularly that just blew my mind, which is councils are using thermal drones.

00:29:22.580 Oh, unbelievable.

00:29:23.420 Yeah.

00:29:23.580 It's fucking crazy.

00:29:24.800 So there's two things there.

00:29:25.580 So on the on the rabbit hutch Britain, what's happened because because all the planning gain, all the uplift goes to share to landowners and developers and these shadowy, opaque land agents.

00:29:37.520 Right. It means everyone's got an incentive to just sit on land and do nothing.

00:29:42.100 Right. And so land prices have gone exponential in the face of massive demand for new homes.

00:29:51.960 And that means that when a big house builder does get hold of some land, it costs shitloads of money.

00:29:59.460 So the average house that's sold in Britain now, the average new build, the land accounts for 70% of the price.

00:30:06.360 Back in the 50s and 60s, the land would account for like 5% or 10% of the price.

00:30:11.200 That's how messed up the market for land now is.

00:30:14.220 That's why we need to share this planning game to calm it down, to take the speculation out of it or some of the speculation out of it, as I say.

00:30:21.060 But when you're building a house and the land is 70% of the price of the land, you're going to squeeze as many houses on your building plot as you can.

00:30:28.840 That's why you go to a lot of these new build estates.

00:30:32.240 And, you know, there are good new build house builders in this country.

00:30:35.020 I'm not saying new builds are always bad, but a lot of the more ropey end of the market, they'll be very, very small.

00:30:42.180 The gardens will be almost non-existent.

00:30:44.440 You'll find the drive is too narrow.

00:30:46.420 The garage, you drive the car in the garage, you can't even open the doors.

00:30:50.020 Yeah, but I've seen you British people.

00:30:51.400 You don't use your fucking garages.

00:30:53.480 Let's be honest.

00:30:55.520 It's always storage or a fucking workshop.

00:30:57.600 So you've got, yeah, it's where you sleep when you're drunk, right?

00:31:01.840 How do you know what that?

00:31:03.600 So the houses are very, very small.

00:31:06.080 And we're building homes these days, again,

00:31:11.060 with the smallest living rooms and the smallest bedrooms,

00:31:14.460 again, since the 1930s.

00:31:16.580 Absolutely crazy.

00:31:17.940 And you talk about heat seeking drones, Constantine. Yes, because I also write in Home Truths. And I go back to where I grew up in Kingsbury, North London. Pretty, you know, fantastic place to grow up massively ethnically diverse now as it was when I was a kid, a huge privilege to grow up there.

00:31:38.480 and I went back there and I walked down the street where I grew up

00:31:42.720 and I walked around the neighbourhood

00:31:44.280 and if poking down the side of houses you can see

00:31:47.640 so many gardens now have sheds in them

00:31:51.340 that are clearly residential accommodation

00:31:53.980 often put up illegally

00:31:56.100 and people renting there, not paying council tax

00:31:59.460 and so what Brent Council did in north-west London

00:32:03.220 and this is happening not just in London

00:32:05.220 but in Salford, in Bristol, in Manchester, in Oxford, this beds and sheds crisis.

00:32:12.920 In Brent, they used heat-seeking drones to see if people were sleeping at night,

00:32:18.740 to see if people were sleeping in outbuildings because of the heat of bodies they could see.

00:32:22.880 So they could actually say to people, these people are living there.

00:32:25.740 You didn't put the rent on your tax return.

00:32:27.380 And they're not paying council tax to try and, you know, curtail this illegal activity because it's not just a tax thing, because often these outbuildings, you know, electricity, plumbing, it's it's medieval.

00:32:42.120 It's it's unhygienic.

00:32:44.120 kids. And so that is, again, is a sure sign that the market is not working when we're crowding

00:32:51.520 residential accommodation illegally into gardens in suburban Britain. That is what is now happening.

00:33:00.260 And yet there's, you talk to central government about this, they're like, oh, really? I mean,

00:33:04.180 they have no idea. They have no, there's no audit of any of this. There's no grip on the scale of

00:33:10.780 this issue the beds and sheds issue which is absolutely massive see in russia the way we'd

00:33:15.580 solve it is we'd put missiles on the drones but i do like you're the one who raised heat-seeking

00:33:21.700 drones it's like it's in your blood we must vomit to the ground but liam let's turn to an issue that

00:33:28.380 i know a lot of people watching this will be having at the back of their mind right now and

00:33:32.400 you tackle it head-on in the book which is you know people are not stupid they do the maths and

00:33:37.680 they go, look, we've had a mass wave of immigration over the last 15, 20 years. Obviously, if you

00:33:43.440 don't have enough houses, lots of people come. Immigration caused the housing crisis. You tackle

00:33:47.840 that issue quite directly. I do. There's a whole kind of subchapter on that. And you have to tackle

00:33:55.860 it head on. The problem isn't immigration. The problem is that we haven't been building enough

00:34:01.580 houses. So immigration has exposed and made worse the problem rather than causing the problem.

00:34:07.680 And in the book, there's quite a detailed series of paragraphs that are very closely argued comparing the UK and France.

00:34:15.440 Right. And over the last 20 or 30 years, France has actually had more immigration per head than the UK.

00:34:23.000 France has built twice as many houses as the UK.

00:34:26.360 So house prices in France have gone up, but not nearly as wildly in front of earnings as they have in the UK.

00:34:33.860 So you just need to build more houses.

00:34:35.960 And then people will say, oh, but we're full. Really? If you look at the landmass of England, what percentage of the landmass of England do you think is taken up with residential accommodation? It's 1.1%. And that includes gardens. There is tons of space, right?

00:34:55.460 We haven't built a new town in this country like Milton Keynes or Welling Garden City or Harlow in my lifetime.

00:35:04.960 And I'm, you know, I'm 50. It's completely crazy.

00:35:08.320 We have had our own demography leading to increases in population and immigration, too, particularly since 2013 and accession.

00:35:17.220 But the answer isn't, I mean, I voted Brexit. As you know, one reason was partly because I accept that a big part of the population doesn't want to stop immigration. We are a nation of immigrants. They just want to make sure there are controls so there can be some kind of ability to accommodate and provide for schools, hospitals and all the rest of it.

00:35:40.700 So the pace of immigration means that lifestyles aren't undermined, particularly for people at the lower end of the income scale.

00:35:49.300 Completely fair.

00:35:50.240 It happens in New Zealand, Australia, you know, Canada.

00:35:53.720 All great racist nations.

00:35:55.260 The most liberal countries in the world, effectively.

00:35:58.220 It's crazy.

00:35:59.360 No, we're totally on board with that.

00:36:01.180 It's not the problem isn't immigration.

00:36:03.480 The problem is, as the French example shows, we just haven't built enough houses.

00:36:08.280 So if you build more houses, you know, we are building fewer houses per head of population in this country than Bulgaria.

00:36:15.200 Right. With all respect to my Bulgarian friends.

00:36:19.740 I think we were the slowest construction rates of any country in the EU before we left, I think, with the exception of Malta.

00:36:29.280 I mean, it's completely mad. This is a country that's like full of people that know about building.

00:36:34.060 And people say, oh, where's the label? Well, let me tell you, I'm from an Irish building family.

00:36:37.940 There are a lot of people who are plumbers, who are bricklayers, who are driving cabs because in their part of the country, the building works just too slow.

00:36:46.840 And the big house builders treat them so badly.

00:36:49.640 So if you had some decent house builders with access to land, if you had the sharing of planning gain,

00:36:56.540 if planning permissions had to be built out in a certain period of time or companies were fine.

00:37:00.880 so it's like a contract to build rather than an ability to build,

00:37:05.400 then you could have a much, much higher rate of house building in this country

00:37:09.240 to accommodate the wave of immigration that we've had

00:37:12.600 and to accommodate the immigrants that we will continue to have,

00:37:16.620 albeit in a more controlled environment.

00:37:23.720 We've got an exciting new sponsor, haven't we, Constantine?

00:37:26.940 Yes, we do. It is, in fact, The Economist.

00:37:29.160 And The Economist is a fantastic publication because it just doesn't just deal with economics.

00:37:34.260 It also deals with politics, science, technology.

00:37:37.440 If you want to read what some of the finest journalistic minds are writing about today, then The Economist is a publication for you.

00:37:45.360 Yeah, I was reading an article that very recently, incredibly insightful into the U.S. Democratic primary.

00:37:50.400 So if you want that kind of insight into all kinds of things, politics, economics, etc., I really recommend it.

00:37:57.300 It's been a trusted source of intelligence for people for over 170 years.

00:38:01.160 So they're doing something right.

00:38:02.500 And when you say a trusted source of intelligence, you make it sound like the Soviets used it.

00:38:07.200 Thanks for that little bit of casual racism, which we now have to cut from the ad.

00:38:12.680 And there's a very, very divisive issue, which you've sort of touched on, which is the green belt.

00:38:19.340 You know, because it gets very emotive.

00:38:21.680 People get very upset about it, you know, building on Gingland's green and pleasant land.

00:38:25.760 Yeah. Look, we have in this country demarcated national parks, right? No one's saying build on them. No one's saying build on areas of outstanding natural beauty. No one's saying build on, you know, parts of the green belt that have aesthetic merit and provide access to ordinary people to exercise and get thick and live and get some fresh air.

00:38:50.180 but the green belt isn't being concreted over and hang on to your hats guys the green belt is now

00:38:56.500 over 140 percent bigger by area than it was in the late 70s because councils keep adding to it

00:39:03.480 the green belt was meant to be around london five miles wide it's now almost 50 miles wide in places

00:39:09.260 you get these massive commutes because people are like jumping over the green belt twice a day

00:39:14.860 to go live in some rabbit hutch, you know, an hour and a half from London.

00:39:19.740 Are mental health issues anyone?

00:39:21.400 Family breakdown anyone?

00:39:23.520 And a lot of the green belt is urban scrub.

00:39:25.820 It's of absolutely no aesthetic value whatsoever.

00:39:28.640 It's just like a sort of cordon sanitaire so the bien pensant

00:39:34.460 don't have to have any oiks living next to it.

00:39:36.660 It's like an ethnic cleansing mechanism.

00:39:38.520 It sounds appropriate to me.

00:39:39.880 I'm serious.

00:39:40.540 No, no.

00:39:40.920 So let's keep some of the green belt, but let's get this in perspective.

00:39:43.880 The green belt is growing and growing all the time as councils keep adding to it because they know it's popular, because it locks in the advantages that people have.

00:39:52.940 What I'm saying is if we share planning gain, if we give more access to land to small builders, if we make planning permissions into contracts to build rather than permissions to build, get houses built, use that planning gain to build infrastructure,

00:40:06.360 then the politics of planning changes and there'll be a lot less local support for the NIMBYs and to

00:40:13.420 continue to lock people out. People know their kids need somewhere to live. Families are breaking

00:40:18.340 up because kids have to move miles and miles and miles away from their ageing parents. This is

00:40:24.420 having massive, massive negative implications for ordinary British folk. And the Green Belt is one

00:40:32.580 of the big issues we have to grab. And I'm glad that in the book, even the likes of Vince Cable

00:40:37.420 and the Lib Dems of, you know, past masters at increasing the size of the Green Belts or Yimby

00:40:42.700 Central, even Vince Cable says in my book in an interview that you can't be serious about solving

00:40:49.980 the housing crisis without examining parts of the Green Belt and giving them over to house building.

00:40:56.480 Liam, I just want to come back to the immigration issue, simply because I, having seen, you know,

00:41:02.200 youtube comments and people reply oh yeah there's a very simplistic way of thinking and i think the

00:41:06.920 angrier people become the more simplistic the thinking becomes so it's very much like well

00:41:11.920 we've had a lot of immigration if you put two and two together you get four you know uh but one of

00:41:16.600 the points you actually make and before i say this as i'm someone who who very much agrees with

00:41:22.320 even though i voted remain with what you said about brexit you know people have a right to feel

00:41:26.400 that they want to have the level of immigration into their country that they are comfortable with

00:41:30.800 They want people to have the time to integrate.

00:41:32.940 And it's still net positive.

00:41:33.460 It's still, you know, 100,000, 150,000 every year,

00:41:36.840 but not 350,000 every year.

00:41:39.940 There is a level of immigration.

00:41:41.100 See the size of leads every year.

00:41:42.400 I mean, there is a level of immigration that's reasonable for a country to have.

00:41:46.240 And we need it.

00:41:47.340 Yeah, but for that to be rising more and more is not what people want.

00:41:50.700 And I fully accept that, and I actually agree with that personally.

00:41:54.000 But anyway, my point is one of the points you make in the book about immigration

00:41:57.220 is that actually a lot of the people who are coming and building the houses are actually

00:42:02.060 immigrants. So in some ways, I just want you to address that very issue because I know it's

00:42:07.820 something that a lot of people in very tokenistic, simplistic language talk about, that the housing

00:42:13.820 crisis is the result of immigration. It's massively exacerbated. And actually, personally,

00:42:19.240 before I read the book, I kind of believed it. Yeah. The housing crisis would be the result of

00:42:25.060 immigration if we didn't have the ability and the space to build more houses. But we clearly do.

00:42:30.460 And actually, house building is good for the economy. Every single recovery from recession

00:42:35.420 in recorded British history has been associated with a big increase, a big boom in house building,

00:42:42.440 except the recession that followed the global financial crisis. And that recovery from recession

00:42:47.820 since the global financial crisis has been the slowest, most lukewarm, most limp recovery from

00:42:54.000 recession we've ever had partly because we're not building homes when you build homes you inject

00:43:01.180 cash and activity into sort of you know communities you know people borrow locally they

00:43:10.200 buy materials locally they use local labor local diy local you know curtain makers and furniture

00:43:18.000 suppliers and then nannies. It creates a virtuous circle of activity and you get big boosts to

00:43:27.500 local economies when you have house building. So we clearly can build more houses. We clearly have

00:43:33.500 the space to build more houses. As I said, only 1.1% of the land mass in England, the most crowded

00:43:40.340 of the four parts of this united kingdom has residential housing on it and so my family came

00:43:47.960 over from ireland and part of part of the reason you know there was a lot of racism around then

00:43:52.740 part of the reason the irish were able to win the respect of english people and i've talked to many

00:43:58.500 many people about this my you know for much of my life it's a big theme of my life is that english

00:44:04.620 people saw irish people getting up in the morning working their nuts off digging the roads

00:44:09.560 building houses yeah and that a lot of irish second third generation irish people in this

00:44:15.760 country the wealth that they have stems from that original effort of house building so house

00:44:20.920 building is a great way for um the immigrant community to make a stand and and build them

00:44:29.020 some wealth and respect and acceptance for themselves and their families and that's

00:44:33.680 absolutely fabulous so we do need some immigration and we do need some you know

00:44:38.200 bricklayers and plumbers and all the rest of it i'm not saying you know stop it stone dead

00:44:43.260 um but at the same time as having some immigration you also need to build a lot more houses

00:44:48.180 to cope because in the last 30 years we've built something like three million too few homes

00:44:55.160 we need roughly about 250 000 new houses a year um and the last time we built that amount was the

00:45:04.740 80s. In the 90s, the 2000s and the 10s, we built, you know, less than, you know, between one and

00:45:13.460 one and a half million. So there's a huge backlog shortage of homes, which is, which now the

00:45:20.840 implications of that on price and affordability are coming to pass. So yeah, let's have immigration,

00:45:27.320 but let's have it controlled. Within those quotas, let's have people who can help us build.

00:45:32.480 Let's get, you know, our own people living in the UK, wherever they're from, trained up.

00:45:39.840 There's a tremendous living to be made if there is a building, more of a building boom, plastering, bricklaying, plumbing.

00:45:48.720 And these are good trades that a lot of people would like doing if they had the training and if they had the opportunity.

00:45:55.620 And we touched a moment on for a little part of the interview on council housing.

00:45:59.900 You mentioned Grenfell, and Grenfell is an incredibly emotive, understandably so, issue.

00:46:06.880 Do we have a problem now with council housing, the cladding, all the rest of it?

00:46:12.200 Is council housing fit for human occupation now?

00:46:15.140 Some of the council housing in this country is very, very good.

00:46:18.040 It tends to be council housing that was built in the 30s and the 50s, low-rise, low-density council housing,

00:46:26.840 The kind of council housing that a lot of my mates grew up in, in the suburb, Kingsbury, Wembley, where I grew up.

00:46:34.340 We were all first generation owner occupiers or kids living in council houses.

00:46:40.340 What happened in the 60s, there was a change in legislation, which meant planning gain wasn't shared and house prices went to the moon.

00:46:49.780 And councils couldn't afford to buy enough land for low density, low rise council housing.

00:46:55.420 So they started building tower blocks.

00:46:56.840 right it's absolutely linked to this change in legislation 1961 an act that i'm trying to get

00:47:02.960 reversed as people that read the book closely will understand that led to lots and lots of

00:47:08.820 tower blocks now in grenfell the issue was the cladding um and we're still in the situation

00:47:15.960 as the grenfell inquiry rolls on it must be absolutely hellish for the families so tragically

00:47:21.520 affected. You still have many, many, many hundreds of tower blocks with lots of social housing in

00:47:29.120 them with the same cladding. So the cladding changing of that to use non-flammable material

00:47:36.700 is very, very, very slow. And there's lots of rows about who should pay for it, the local

00:47:40.600 authorities, central government, the contractors, and that's going to roll on for a long time.

00:47:46.680 So some council housing in this country is very, very good. It tends to be the stuff built a while

00:47:50.440 ago. The more modern council housing tends to be lower quality, which is why lots of people don't

00:47:55.300 want it. But I would say that we need to de-stigmatise council housing. We need to accept

00:48:02.500 that a lot of people do need council housing and the government needs to use the strength of its

00:48:08.740 own balance sheet to borrow to build that council housing in order to offset the massive housing

00:48:14.260 benefit bill that we've got, paying for people to live in often substandard rented accommodation

00:48:20.080 when they should be in a council house

00:48:21.820 where they can have some stability in their own front door.

00:48:24.780 Now, there's an interview in there with a guy called Marvin Rees,

00:48:27.580 who's the mayor of Bristol,

00:48:29.820 the first mixed-race mayor of Europe, right, of Jamaican origin.

00:48:34.240 He's a fabulous guy.

00:48:35.160 I saw him speak at a conference and interviewed him afterwards.

00:48:38.700 And he says, you know, you want to solve knife crime,

00:48:40.880 you want to solve alienation of youth,

00:48:44.240 give them a front door, give them a kitchen table.

00:48:46.780 He reckons his council house literally saved his life.

00:48:50.980 And when he talks about it, he gets very, very emotional.

00:48:53.600 That's the best possible anti-knife crime, anti-gang policy you could have.

00:49:00.340 Give people a front door and a kitchen table and a little garden.

00:49:04.420 It makes a difference.

00:49:06.400 And so I think we should be focusing on council houses.

00:49:09.100 And some people will be saying, oh, but what about right to buy?

00:49:11.820 What about right to buy?

00:49:12.500 Now, right to buy was very popular in the 80s under Thatcher, but Thatcher stitched up Heseltine and students of politics and I'm talking about because Heseltine, who put that legislation through to make council the right to buy for tenants, he said, yes, we'll do the right to buy, but the money must go back to the local authorities so they can replace it with another council house.

00:49:36.240 right now in the end what happened was the money four-fifths of it went back to the treasury and

00:49:41.580 disappeared into the pot so those council houses were not replaced so what i'm actually calling

00:49:46.620 for and this will sound odd to some people given that i'm a telegraph columnist i'm calling for

00:49:51.980 the right to buy now which was reintroduced by david cameron to be suspended until we've actually

00:49:57.400 built more council houses the scottish parliament the welsh assembly has already suspended the right

00:50:01.620 to buy and i think that's the right thing to do at the moment while we have such a shortage of

00:50:05.260 council houses. Not in England. I think that should now happen. The problem is that local

00:50:10.920 authorities at the moment have no incentive to build social housing because if they build social

00:50:16.560 housing and people live in it for a couple of years, they then have to sell it to them at a

00:50:21.360 sub-market price, often less than the cost of building the thing, given that land prices are

00:50:26.220 so high. And then four-fifths of that money that the local council gets back, that denuded amount,

00:50:32.440 because the price is subsidized goes to the treasury so you know local authorities that

00:50:37.660 look into going through all the thickets of admin and madness that it takes to build some social

00:50:43.480 housing it's very very difficult it's not going to solve their problem because the way the

00:50:49.000 structures are incentivized now they could end up losing that social housing from the public realm

00:50:55.880 very very quickly. Liam as we head towards the end of the interview you mentioned that the

00:51:01.780 political landscape is gradually changing. Are you optimistic that this issue will be

00:51:06.660 tackled in the next 10, 15 years? Okay. No, I'm not. And as we're sitting here,

00:51:14.420 news is breaking around us, right? So when Estimate Fay was appointed housing minister,

00:51:20.760 she was the 18th housing minister in 20 years. We've just heard from the reshuffle,

00:51:27.480 she's been moved. So the housing portfolio is seen as like some ridiculous stepping stone to

00:51:35.040 the great offices of state. There should be in the cabinet, housing secretary, and it should be

00:51:40.760 a very big job with a big political beast with big ambitions behind it. That's what Macmillan

00:51:47.580 had in the 50s. That's what you had in the 20s when Lloyd George was doing Homes Fit for Heroes.

00:51:54.280 Why did Lord George do Homes for Heroes?

00:51:56.920 And I've got some of the cabinet minutes in my book.

00:51:59.520 Because they were petrified.

00:52:01.760 You just had the Russian Revolution, right?

00:52:03.800 They didn't want the British troops coming back to the Victorian slums.

00:52:08.080 They were going to be completely radicalized.

00:52:10.160 You had governments falling across Europe to extremism.

00:52:14.920 And so to make our country less extreme, more moderate politics,

00:52:19.140 the state got house building moving, got private house building moving,

00:52:23.020 got social house building moving. Actually, it was an incredible guy called Christopher

00:52:28.160 Addison, who was the health secretary at the time. But housing was front and centre,

00:52:34.280 right, in the 20s. Housing was front and centre in the 50s. Housing needs to be front and centre

00:52:41.760 again, because the political party that solves this housing issue will be in power for a very

00:52:47.660 long time. So Boris really needs to get hold of this. And sometimes I think he gets it, but

00:52:53.140 sometimes I really think he doesn't. And Sajid Javid, who appears in my book quite a lot,

00:52:58.460 saying some pretty radical things, agreeing with me on the record that planning gains should be

00:53:04.000 split 50-50. An interview that made front page news when the book was published just before

00:53:09.840 Christmas. We've just learned that he's gone. Now, he was community secretary with housing in

00:53:15.380 his portfolio. And he was putting out policy ideas that were really radical to try and shake up

00:53:21.300 the industry. He accused publicly the big developers of sitting on land and having,

00:53:27.380 in his words, a stranglehold on supply. That was in 2016. When he said that, he revolutionized the

00:53:34.460 debate on housing because stuff that I was saying suddenly went from being conspiracy theory to

00:53:40.560 like government policy, right?

00:53:42.520 In one speech, and I remember when he said it,

00:53:44.920 it was the Tory party conference in the autumn of 2016.

00:53:48.300 Again, it was front page news.

00:53:49.960 So the big developers will be delighted to see Javid go.

00:53:53.660 And I've no idea where he went.

00:53:54.980 This has literally happened while we've been recording, right?

00:53:57.320 And I haven't talked to him.

00:53:58.500 I don't know.

00:53:59.620 Hey, by the time this goes out, he could be prime minister.

00:54:01.660 Yeah.

00:54:05.080 But I do know that a lot of the big developers will be very,

00:54:08.640 very glad that he is now not the chancellor yeah and Sajid if you're listening we'd love to have

00:54:13.500 you on trigonometry come and talk why you fell out with Boris Sajid my usual feat on this point

00:54:19.780 about the party that fixes it will be in power for a long time I actually think given everything

00:54:24.020 that's recently happened unless the this uh recent reshuffle precipitates a complete calamity and

00:54:31.560 collapse of the Tory party in terms of the broader sweep of politics the the conservative party could

00:54:37.420 well be in power for 10 or 15 years, given everything that's happened, given the disastrous

00:54:42.720 Labour Party and how it's been acting lately. So they have an opportunity. But that opportunity,

00:54:49.480 I think, is tempered by the fact that if you are a party of the aspirational working class,

00:54:54.060 which is what the Conservative Party now is in terms of their electoral base,

00:54:57.860 you have to address this issue. Because otherwise, people aren't going to feel

00:55:03.520 aspirational if, as you say, they don't have capital. That's right. It's absolutely key.

00:55:09.000 So, you know, I grew up in Margaret Thatcher's Britain. And what I saw around me, you know,

00:55:16.160 in my own social circles, as I became sort of politicized, I saw and heard working class people,

00:55:23.820 even working class Irish people, right, at the time of the Mays prison riot saying,

00:55:29.480 yeah, we like the Tories because there's more work about because they're giving us a chance.

00:55:33.520 Labour just want to keep us down and pay us benefits. And if you're not in a union, you can

00:55:38.980 go hang. And we're in a similar situation now where there's been a reversal where so-called

00:55:43.960 bootstrap working class Tories are coming to the fore. But as Boris Johnson rightly says,

00:55:51.100 they've only lent their vote to the Tories. You know, these northeastern seats, these West

00:55:56.300 Midland seats, the red wall in ruins, unless the Tories grab this and make their lives better by

00:56:02.600 bringing more prosperity to the region, better transport links, more housing for kids, better

00:56:08.800 quality social housing, then they're going to lose that trust. So I think the Tories are on

00:56:14.400 probation. But to solve the housing issue or address the housing issue by building social

00:56:21.680 housing, by not doing help to buy, which just pumps up the demand side, but doing supply side

00:56:30.560 reforms that are hard. You've got to take people on. You need a lot of administrative grit and

00:56:35.600 political courage to do it. That would do far more for the country and prosperity and the regions

00:56:41.240 and indeed for the Tories' popularity than HS2 or some mad trophy asset that just makes it easier

00:56:48.960 to get to London. And if you think about, a lot of the housing stock we have is actually in the

00:56:54.740 wrong place at the moment. So housing in the Northeast is a lot cheaper. It's still high

00:56:59.640 by our historic standards in terms of a multiple of the average wage, but it's a lot cheaper.

00:57:05.860 But if you have better transport links in the Northeast, if you had enterprise zones,

00:57:10.240 free ports, let's scrap corporation tax in those big Northeastern cities and watch businesses

00:57:16.960 move there. Watch people move there. It's a nice part of the country to live in. Fantastic,

00:57:23.280 you know, natural places to walk and air. It's a better pace of life for a lot of people.

00:57:31.740 But there's also a lot of housing there that's relatively well priced for young people to go

00:57:37.060 and live in if the industry and if the enterprise was there. So it's partly about building more

00:57:42.280 houses. It's partly about giving tax breaks to regions to better use the houses that we've got.

00:57:50.040 And on that note, thank you so much for coming on, Liam.

00:57:52.340 The last question we always ask is, do you want to do it, Constantine?

00:57:55.540 No, I want you to do it.

00:57:56.540 I want to watch you do it.

00:57:58.640 He says that to me many times.

00:58:00.480 I like to watch.

00:58:01.500 I didn't know it was that kind of podcast.

00:58:04.540 We've bonded.

00:58:05.420 Anyway, what's the one thing we're not talking about as a society

00:58:09.100 that we really should be?

00:58:11.520 Well, I guess in my field of economics,

00:58:14.040 the one thing that we're not talking about,

00:58:16.720 and I sort of touched on it here,

00:58:18.080 the the phrase i'd used is is anti-trust right what is anti-trust anti-trust uh harks back to

00:58:27.360 the likes of uh teddy roosevelt so the republican uh president at the turn of the 19th into the

00:58:34.520 20th century who forced by journalists and he was forced by journalists he took on the big

00:58:41.220 conglomerates, the big syndicates, as they were then called, famously the oil baron John

00:58:48.440 Rockefeller, but other big parts of the economy that had become silted up and controlled by

00:58:54.960 producers where capitalism had stopped working for ordinary people. This was all beautifully

00:59:01.780 portrayed in Mark Twain's satirical novel, The Gilded Age. And Roosevelt, in the end,

00:59:09.120 took on the big vested interests and made capitalism work better, got companies to break

00:59:16.820 up, injected competition. Capitalism doesn't happen completely organically. Every now and then

00:59:23.400 it needs a kick in the shins in order to shake it up and make sure that competition is actually

00:59:29.780 working. Every now and then you need a government with courage and a political class and a media

00:59:34.940 class to get hold of these issues. Otherwise, capitalism loses its legitimacy and you get much

00:59:41.040 more extreme interventionist, counterproductive policies taking over. I think we are now entering

00:59:47.840 a new gilded age. And that gilded age is a very pejorative term. Twain meant it as an insult.

00:59:55.920 Income inequality hasn't risen all that much, but wealth inequality has massively increased.

01:00:03.060 And as ordinary people are unable to buy homes, as they don't have pensions, that wealth inequality is only going to get worse.

01:00:10.920 Look, we still live in a country, the Brexit vote showed eventually of one person, one vote, right?

01:00:17.340 And if we have that policy of one person, one vote, in the end, we have to make sure that the system works for a broad range of people.

01:00:25.600 At the moment, it's only working well. It's working very well for an ever smaller and ever diminishing sort of gilded elite. And in order to break that, you need antitrust. You need policies that inject competition that make sure we're on the side not of big business, but of small business on the side, not of cronyism, but competition.

01:00:50.840 That's a great point, a very important point.

01:00:52.840 I think, you know, one of the things we talk about a lot on this show

01:00:55.680 is kind of the emergence of woke politics.

01:00:58.280 I think quite a bit of it stems from what you're talking about.

01:01:01.460 You know, if people can't have capital, they can't buy a house,

01:01:04.380 how do you expect them to be capitalists

01:01:06.360 and then these extreme ideologies become that much more appealing?

01:01:09.980 That's right.

01:01:10.480 And, I mean, you know, I'm not saying a lot of the identity politics agenda

01:01:15.920 isn't important.

01:01:17.960 I'm not saying that we shouldn't be polite to each other, but when ordinary folk who are literally trying to make ends meet hear endless television debates and endless stuff in their newspapers about issues that have no bearing on their lives, they think the political and media class is increasingly remote from them.

01:01:39.420 And so they withdraw. And that's the situation we're now in. The political and media class increasingly doesn't represent ordinary people. We've done very well in terms of diversity of colour and gender, but there's no diversity of opinion and class.

01:01:56.560 I mean, the equivalent of me now wouldn't get the media opportunities that I managed to get in my 20s and my 30s.

01:02:07.100 That's very, very sad.

01:02:08.340 So we need to make sure that we have a political and particularly a media class that actually represents and is representative of ordinary people.

01:02:18.420 And if we did have one, then books like Home Truths will be all over the place.

01:02:23.880 Well, they will be after this interview.

01:02:25.620 make sure you get this

01:02:26.720 it's a great book

01:02:27.520 very interesting read

01:02:28.500 and some really useful

01:02:29.980 I hope that all the politicians

01:02:31.180 read it first of all

01:02:31.980 that would be good

01:02:32.540 although many of them

01:02:33.580 already have

01:02:34.160 Liam thank you so much

01:02:36.100 for coming back

01:02:36.600 good luck guys

01:02:37.040 if people want to follow you

01:02:38.380 on social media

01:02:39.220 and where do they get the book

01:02:40.580 of course tell them

01:02:41.180 at Liam Halligan

01:02:42.080 just google

01:02:42.760 Liam Halligan Home Truths

01:02:44.060 you can get it on Amazon

01:02:45.380 any good bookshop

01:02:46.920 published by Biteback

01:02:47.860 out in paperback soon

01:02:49.760 alright

01:02:50.380 perfect

01:02:51.100 we'll see you again

01:02:52.060 in a week's time

01:02:52.620 with another brilliant episode

01:02:53.540 guys take care

01:02:54.220 take care and see you next week

01:02:55.540 We'll be right back.

TRIGGERnometry - March 02, 2020

Why We Have a Housing Crisis： Liam Halligan

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