Government to build homes to claw it out of recession

The 2020 Group, which is headed by Bank of England policymaker Kate Barker, has made the recommendation that the UK government should use the construction of public housing as a stimulus to resurrect the construction industry and boost the economy.

The recommendations are to build 100,000 new homes over the next two years in order to prevent shortage of housing supply and protecting against future inflating property prices, as well as safeguarding 30,000 jobs.

The 2020 Group, which is a collaboration of building bodies, councils and unions, have called for the urgent demand for new housing to maintain the construction industry, although the government has already committed to building 12,500 affordable homes over the next two years.

David Orr, the chief executive of the National Housing Federation, has said that without this radical action the construction industry will lose even more jobs, whilst over 5 million people could be on waiting lists over the next two years.

A major housing programme as first recommended in 2004 in the Barker Review, would allow the 500,000 people who are currently living in bad housing to be re-housed as well as avoiding an even bigger property boom post recession.

The recommendations of the 2020 Group have been made at a time when Gordon Brown and chancellor Alastair Darling are in the process of brokering a financial stimulus package in the next budget.

Story link: Government to build homes to claw it out of recession