Property Tax - Labour on the ropes in key media interview

A Labour frontbencher has failed to explain why the party has no plans to reform council tax based, in most cases, on the estimated value of properties a third of a century ago.

Households’ council tax liability depends on the band their properties sit in but in England and Wales those bands are based on the price properties would have sold for in 1991. In Wales it is 2003 and Northern Ireland 2005. 

A series of campaigns have been waged to have bands revalued on contemporary property prices, but politicians have shied away because of two factors - the cost and time of the exercise, and the likelihood that while some homes would see a consequent reduction in council tax, others would see an increase. 

Yesterday Pat McFadden, Labour’s national campaign coordinator, was asked repeatedly during an interview on BBC Radio 4 if the party could opt to recalculate council tax bands. 

He said: “There is nothing in the manifesto that we publish today that requires any change in tax rates beyond what we have already announced.” Asked again on whether Labour could recalculate council tax bands, Mr McFadden said: “There is nothing in our plans that requires a change in that or other taxes.”  

When asked why Labour was content to levy a regressive tax based on such outdated valuations, McFadden merely repeated that the party had no plan to change that or other key tax rates.

Meanwhile in the Labour Party manifesto itself, there were no surprises when it came to pledges on housing.

In a section titled ‘Break Down Barriers To Opportunity’ it says: “Security … means having a secure roof over your head. That is not the case for too many renting their homes privately. Labour will legislate where the Conservatives have failed, overhauling the regulation of the private rented sector. We will immediately abolish Section 21 ‘no fault’ evictions, prevent private renters being exploited and discriminated against, empower them to challenge unreasonable rent increases, and take steps to decisively raise standards, including extending ‘Awaab’s Law’ to the private sector.”

And in a section titled ‘Strong Foundations’ it sets out its broader housing commitments: “The dream of homeownership is now out of reach for too many young people. The Conservatives have failed to act even though the housing crisis is well known to be one of the country’s biggest barriers to growth. Labour will get Britain building again, creating jobs across England, with 1.5 million new homes over the next parliament.

“We will immediately update the National Policy Planning Framework to undo damaging Conservative changes, including restoring mandatory housing targets. We will take tough action to ensure that planning authorities have up-to-date Local Plans and reform and strengthen the presumption in favour of sustainable development. 

“Labour will support local authorities by funding additional planning officers, through increasing the rate of the stamp duty surcharge paid by non-UK residents. We will ensure local communities continue to shape housebuilding in their area, but where necessary Labour will not be afraid to make full use of intervention powers to build the houses we need.

“Labour will take a brownfield first approach, prioritising the development of previously used land wherever possible, and fast-tracking approval of urban brownfield sites. But brownfield development alone will not be enough to meet our housing need.

“Labour is committed to preserving the green belt which has served England’s towns and cities well over many decades. Under the Conservatives, greenbelt land is regularly released for development but haphazardly and often for speculative housebuilding. Without changing its purpose or general extent, Labour will take a more strategic approach to greenbelt land designation and release to build more homes in the right places. The release of lower quality ‘grey belt’ land will be prioritised and we will introduce ‘golden rules’ to ensure development benefits communities and nature.

“In partnership with local leaders and communities, a Labour government will build a new generation of new towns, inspired by the proud legacy of the 1945 Labour government. Alongside urban extensions and regeneration projects, these will form part of a series of large-scale new communities across England.

“Housing need in England cannot be met without planning for growth on a larger than local scale so we will introduce effective new mechanisms for cross-boundary strategic planning. Labour will require all Combined and Mayoral Authorities to strategically plan for housing growth in their areas. We will give Combined Authorities new planning powers along with new freedoms and flexibilities to make better use of grant funding.

“Labour will further reform compulsory purchase compensation rules to improve land assembly, speed up site delivery, and deliver housing, infrastructure, amenity, and transport benefits in the public interest. We will take steps to ensure that for specific types of development schemes, landowners are awarded fair compensation rather than inflated prices based on the prospect of planning permission.

“Labour will deliver the biggest increase in social and affordable housebuilding in a generation. We will strengthen planning obligations to ensure new developments provide more affordable homes; make changes to the Affordable Homes Programme to ensure that it delivers more homes from existing funding; and support councils and housing associations to build their capacity and make a greater contribution to affordable housing supply. 

“Labour will prioritise the building of new social rented homes and better protect our existing stock by reviewing the increased right to buy discounts introduced in 2012 and increasing protections on newly-built social housing.

“Labour wants exemplary development to be the norm not the exception. We will take steps to ensure we are building more high-quality, well-designed, and sustainable homes and creating places that increase climate resilience and promote nature recovery. We will implement solutions to unlock the building of homes affected by nutrient neutrality without weakening environmental protections.

“Labour will work with local authorities to give first-time buyers the first chance to buy homes and end the farce of entire developments being sold off to international investors before houses are even built. And we will introduce a permanent, comprehensive mortgage guarantee scheme, to support first-time buyers who struggle to save for a large deposit, with lower mortgage costs.”