Figures released today by the Office of National Statistics show that UK wealth grew nearly 10% during 2016. The largest rise on record, this puts the UK’s total net worth at £9.8 trillion. But far from being the kind of growth that will help people, it is one of the trends exacerbating inequality and making homes less affordable.
Since the financial crisis, land wealth has grown nearly twice as fast each year as wealth held in machinery and equipment, and eight times faster than wealth held in intellectual property – debunking the idea that the UK’s economic growth is driven by jobs or innovation. Instead, today’s release reveals that land wealth, which accounts for half of the UK’s wealth, rests on shaky foundations; generated not by a productive and innovative economy, but by financial speculation.
This is the latest in a long line of wake-up calls which demonstrate the urgent need for reform of the way land and housing works. Instead of selling off land, the government should be making the most of it. We need greater control over how wealth associated with land is generated and used.
To prioritise people’s basic needs over headline figures and the profit of private developers, the government must halt the public land sale, and instead support a People’s Land Bank – retaining land for public or community ownership and the development of homes suitable to community needs. And it should strengthen compulsory purchase powers to help retain land value rises for public benefit.
Read more on our how selling land is fueling the housing crisis, and what should be done instead.
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