Barratt Developments and housebuilders take a knock as Ed Miliband asks why construction firms are seeing profits increase

By Belinda Robinson

PUBLISHED: 08:44 EST, 16 December 2013 | UPDATED: 05:16 EST, 17 December 2013

Shares in Britain's housebuilder took a tumble today after Labour leader Ed Miliband launched a scathing attack on Britain’s construction firms, noting that their profits soared during the 'worst housing shortage of a generation.'

Speaking in Stevenage, the Labour leader criticised the country’s largest firms –Barratt, Berkeley, Persimmon and Taylor Wimpey - which have all pocketed large sums of cash - but have failed to build enough houses.

The housing supply crisis has prompted Miliband to launch a commission to look at ways of tackling the dire shortage in building new homes.

Enlarge   Show home: Labour says that there are not enough homes being built across Britain

Show home: Labour says that there are not enough homes being built across Britain

Among the big housebuilders, Barratt saw its shares shed 3.4p to 325.5p in reaction to the Labour leader's criticism, with Berkeley down 5p at 2,509, Persimmon losing 18p at 1,118p, and Taylor Wimpey off 0.4p at 105.3p.

Taking a direct stab at the builders, Miliband said: ‘Profits for our four biggest housing developers are going through the roof. They have soared 557 per cent since this Government took office - even though homes have been built at their slowest rate witnessed in peacetime for almost a century.'

‘There are large amounts of land - enough to build more than a million homes - earmarked for houses which have not been built,' Milliband added.

 

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Problems of supply in the housing sector come about because developers, and other landowners, sometimes hoard a bank of land with which to work.

Labour is now calling for changes to be made in how land is managed.

Miliband added: ‘The next Labour government will give councils powers to charge fees or, if necessary, purchase such land, so that developers have an incentive to do what they went into business to do.'

‘We will back home builders. But we will tell land hoarders with sites that have planning permission that they must use it or lose it,’ he said.

MILIBAND: LABOUR'S HOUSING PLANS FOR 2015

  • If Labour wins the 2015 general election, it plans to give councils support to resolve disputes with neighbouring authorities
  • Labour will also build 200,000 homes a year in England by 2020

In far-reaching proposals, which would swing into place if Labour won the 2015 general election, councils would get support through the planning process to resolve cross-border disputes with neighbouring authorities opposed to developments.

Four Labour-controlled councils have already signed up to the initiative dubbed ‘right to grow’ areas.

The party also vows to build 200,000 homes a year in England by 2020 to tackle the ‘worst housing shortage for a generation.’

Meanwhile the commission to tackle the shortage will be led by ex-BBC Trust chairman Sir Michael Lyons and look into the ‘right to grow’ scheme and will also consider how councils can identify sites for new towns and garden cities, which could be underwritten by Treasury guarantees.

In further plans, the commission will look at simplifying rules surrounding the Housing Revenue Account to give local authorities more flexibility in how existing public funding is spent and examine how communities can benefit from windfalls gained from the granting of planning permission.

Using an example of how red-tape affects house-building, Miliband said the Labour-controlled authority in Stevenage was being prevented from ambitious house building plans because of objections from neighbouring North Hertfordshire Council.

Stevenage, Oxford, Luton and York have signed up to become the first ‘right to grow’ local authorities, with an immediate potential to build 40,000 new homes.

Ed Miliband: Labour see legislating for the right to grow as one of the key policies to begin tackling the housing shortage

Ed Miliband: Labour see legislating for the right to grow as one of the key policies to begin tackling the housing shortage

Labour see legislating for the right to grow as one of the key policies to begin tackling the housing shortages.

The planning inspectorate would examine different local plans, and arbitrate between authorities to allocate housing based on need, and then oversee a fast track consultation to agree housing development.

Hitting out at ‘home blocking’ councils, Mr Miliband said: ‘Of course it is right that local communities have a say about where housing goes. But councils cannot be allowed to continually frustrate the efforts of others councils to get homes built.

‘So the next Labour government will unblock this planning process and unlock the potential to build tens of thousands of new homes where they are needed,’ he added.

The Labour leader also accused the Government of focusing on schemes such as Help to Buy which drive up demand, but of not doing enough to improve the supply of new housing.

‘David Cameron is presiding over the lowest levels of homes built in peacetime since the 1920s - and already families are suffering from some of the worst housing shortages for a generation. This is now part of a cost-of-living crisis for millions of people for whom the dream of home ownership is fading into the distance,' Milliband said..

 

The result is a broken market where it now takes ordinary families over 20 years to save enough for a deposit and where those renting privately are paying as much as half their income in rent.

‘At this time of year, when family is so important, there are parents who fear their children will never get a place of their own,' the Labour leader said. 

‘At current rates we will be two million homes short of what Britain needs by 2020. If families are to prosper and our country is to succeed, Britain needs new homes. The next Labour government will lead a non-stop drive to build them,’ Milliband concluded.

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Labour, jealous and hating of success as usual. They are dangerous and god forbid they ever get in power again.

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Why do the Wealth takers always bash the Wealth creators!!!

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In 2009 Barratt made losses of £678 Million, Barratt's also made losses in 2010 and 2011. They have made profit over the past two years of £100 and 104 million What Labour should remember that had they taken better care of taxpayers cash Barratt's may not have lost so much, Barratt's also pays Corporation, VAT, and personal taxes to the Government, They also provide a lot of jobs to the Construction Industry. Barratt's run a business and if it does not make a profit it cannot support jobs or taxes

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Please Ed and Clegg - keep going with your wise announcements and ideas. We aren't North Korea and we have a choice of leadership. The more you spout off the better chance we have of never seeing you in power ever again.

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The trouble is that whenever Milliband, Balls or Clegg spout off, they make Cameron and Osborne look like paragons of virtue and political wisdom. They are not! They are making a decent job of the UK recovery and would do better if Clegg wasn't Deputy PM. But where they have failed monumentally is not giving us the promised EU referendum.

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Poor old Ed he would love this country to be like North Korea,but we are not and building companies will always lag the market anytime they have got it wrong and built too many houses they have had to discount and have a fire sale because they always build with bank money and need the turnover to repay the loan,the other problem is they do not build houses where people want to live and work,Cambridge a boom place ,where have the big builders got houses Northampton ,and right at the bottom of the problem is that people and planners have still not grasped that green belt has to be built on because we have too many people in this country.

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Milliband has become the worlds best corporate vandal and wiped millions of peoples pensions with his attacks on the companies that pay them. God help us if he ever gets any real power.

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Build on brown field sites simples

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My husband used to work in the timber industry and has always said he would never buy a Barrett house. He told me they used to buy up all the cheapest and crappest materials.

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Shares in Britain's housebuilder took a tumble today after Labour leader Ed Miliband launched a scathing attack on Britain¿s construction firms, noting that their profits soared during the 'worst housing shortage of a generation.' The worst housing shortage in a generation and all caused by his party when in office. The sheer brass neck hypocrisy of Socialists is unbelieveable. They were in office for over thirteen years yet did nothing yet now in opposition they have all the answers.

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Mean while while out of office this idiot is wrecking people saving and pension provisions with his stupidity, stating what they will do to successful firms if ever they get the opportunity

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