Philip Hammond’s plans to ease the housing crisis will fail unless he allows local authorities to borrow more money to build council houses, a powerful committee of MPs has warned.
The Treasury select committee said that a national cap on how much councils can borrow to build new homes should be abolished to kick-start a housebuilding revolution.
For the last 50 years the private sector has built around 150,000 homes per year, half the Government target of 300,000.
When housebuilding was at its peak in the late 1960s around 420,000 homes were built, but almost half of those were built by councils, compared with around 4,000 council-built homes today.
The committee said that only by allowing councils to borrow more would the Government be able to come close to its target.