Angela Rayner says government “does expect London to take steps to boost its output” on housing, reports Noah Vickers, Local Democracy Reporter

Angela Rayner (left) and Sadiq Khan (right)

Sadiq Khan has been warned by the new Labour government that the number of homes being built in London needs to “increase markedly” – as the rate is lower than half of what it should be.

In a letter on Monday, Deputy Prime Minister Angela Rayner told the mayor that while she understands the capital faces “unique issues” with house-building, the government “does expect London to take steps to boost its output”.

As a “demonstration of the government’s commitment to working in partnership” with Khan, Rayner said she was withdrawing an order from former Housing Secretary Michael Gove which had required the mayor to “partially review” his London Plan – a vital document which guides new developments in the city.

The deputy PM, who has replaced Gove as head of the The Ministry of Housing, Communities and Local Government (formerly the Department for Levelling Up, Housing and Local Government) said Khan should instead take a fresh look at industrial land in the capital which could be used for new housing, as part of a wider update he was already planning to make to his London Plan.

The mayor’s office blamed the “disastrous housing inheritance” left by the previous Tory government and said it will “take time to turn things around to deliver the homes we need”.

In July, Rayner announced that the government plans to increase its housing targets across the country from about 300,000 per year to 370,000 per year, while also making local targets mandatory, rather than advisory.

But in London, the local annual target will be reduced from roughly 99,000 homes to about 81,000.

In her letter to the mayor, the deputy PM said the last government had made the city’s target artificially high, due to “an arbitrary 35% uplift to each and every London borough,” which had resulted in “a target for the capital that is divorced from reality”.

She wrote: “It effectively made tens of thousands of homes a fiction, existing on paper but never realistically planned for, when if reallocated to other places these numbers could have been delivered.”

However, Rayner warned that London’s current building rates were still far from close to meeting the new government’s “ambitious but deliverable figure for London of nearly 81,000” homes per year.

“To achieve it, output in the capital will have to increase markedly from the current average of 37,200 homes per year (2019-23),” she told the mayor.

“I appreciate fully the scale and breadth of the housing delivery challenge in London, and I recognise that the city faces unique issues, but the government does expect London to take steps to boost its output.”

Striking a more positive tone, the deputy PM then said she was “withdrawing the previous administration’s direction of 18th March 2024 requiring you to complete a partial review of the London Plan by 30th September 2024”.

She explained: “Withdrawing the direction will allow the government and the Greater London Authority to take a new partnership approach on our shared aim to deliver the homes London needs. This will be critical to achieving our joint goal of tackling the housing crisis.”

She also invited the mayor to work with her department on its proposals “to optimise [housing] density by providing increased certainty in relation to brownfield development and to release low-quality grey belt sites through Green Belt reviews”.

A spokesperson for Khan said: “The mayor welcomes this new constructive approach from the government, as part of a partnership to accelerate housebuilding in the capital.

“Against the backdrop of a disastrous housing inheritance, it will take time to turn things around to deliver the homes we need. The need for significantly more high-quality homes across the capital cannot be underestimated.

“Everyone will need to play their part, working together to ensure the required infrastructure and funding is in place to meet London’s housing needs. The mayor’s new London Plan will underpin our efforts to drive higher house-building as part of building a better, fairer city for everyone.”

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