Chancellor refuses to back Javid’s £50bn housing plan

PHILIP HAMMOND, the Chancellor, has rejected a suggestion from Sajid Javid that the Government could borrow £50billion to build hundreds of thousands of new homes.

Earlier this week, the Communities Secretary suggested ministers should take advantage of record low interest rates to help solve the nation’s housing crisis. But Mr Hammond distanced himself from the idea as he insisted it was not Government policy.

The issue was raised by Sir Vince Cable, the Liberal Democrat leader, during the final Treasury questions session in the House of Commons before the Budget on Nov 22.

Sir Vince said: “The biggest fiscal step that can be taken to reduce unemployment is public sector investment in housing. Can I therefore welcome the Communities Secretary’s statement that the Treasury has agreed to increase net borrowing by, I think £50billion in order to enable this to happen. Will you confirm that this is Government policy?”

But the Chancellor replied: “No and that was not what he said, as you very well know.

“I would, however, agree that in- creasing activity in the construction sector is a very good way of creating jobs, but you will know that our economy is approaching full employment and the output gap is extremely small.”

Mr Javid said on Sunday that the housing crisis represented the “biggest barrier to social progress in our country today”.

He said ministers were examining plans to “invest for the future” and that the Government wanted to ensure it was “using everything we have available” to deal with the housing crisis.