Spending £6bn on affordable homes 'would bring jobs boost'

LABOUR leadership candidate Ed Balls has called for 6bn to be invested in affordable housing as he put his economic credibility at the forefront of his Labour leadership campaign.

The Morley and Outwood MP claimed the radical plan to build an additional 100,000 affordable homes would create hundreds of thousands of private sector jobs, boost economic growth and tackle the housing shortage.

Mr Balls, who trails both Miliband brothers in the race to lead the party, believes the government should use half of a 12bn windfall to the public finances in recent months to fund the rapid expansion of house building.

He denied the leadership election had become a two horse race – David and Ed Miliband have so far won the support of considerably more MPs than their rivals – and said he believes his economic credibility will be crucial to his chances.

Speaking last night as his national campaign tour arrived in Yorkshire, he said: “The biggest concern I have come across so far is that people want to know that there is an alternative on the economy.

“People’s jobs are at risk and they want to have a choice.

“The Conservative choices on the economy are very dangerous, and I believe I am the candidate with the credibility and economic understanding to offer an alternative.”

Mr Balls warned that the conflict between the Miliband brothers could create a split reminiscent of the Tony Blair and Gordon Brown divide.

He said: “This contest is not a two horse race, but there is a danger that it becomes a backward looking debate.

“It could become like the old Blair versus Brown, and people do not want to see that.”

Mr Balls will reveal his policy later today at an event held at the National Housing Federation in London.

The launch comes as a new think-tank report suggested housing developers should be allowed to offer “very substantial” cash incentives to win the support of residents for new construction projects.

The Policy Exchange report said that decisions on new housing should be made by a ballot of affected residents, taking the decision out of the hands of council planners and preventing a vocal minority from blocking developments which are supported by the majority.

The proposal is one of a number of ideas designed to increase the supply of homes and stabilise property prices, to reverse a “housing crisis” which has led to swollen waiting lists for social homes and excluded many would-be first-time buyers from the market.

The think-tank said its proposed overhaul of housing policy could save taxpayers around 20bn a year, principally by bringing down the cost of Housing Benefit and making it easier for social tenants to find work.