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The last Administration left the biggest budget deficit in our peacetime history, with the state forecast to borrow £146 billion a year in 2010-11, or £400 million being borrowed every single day. This was unsustainable. The coalition Government, through the Emergency Budget and spending review, have taken steps to tackle this deficit, restoring market confidence. These measures will help eliminate the structural current deficit over the next five years. This will help keep interest rates down for home owners, restore economic stability and reduce the amount of taxpayers' money that would otherwise be spent on debt interest.
Within the agreed public spending envelope, we have taken steps to support house building, given the important contribution it makes to economic growth and the need to build more homes in light of demographic change. This has included using departmental unallocated funding to support housing (e.g. the Growing Places Fund). We have also configured our housing policies to tackle the particular problems currently being faced in the housing market:
Lenders are not lending enough—with high deposit requirements excluding young people and families from home ownership. Hence, we are promoting schemes such as Firstbuy, extending the Right to Buy and supporting a new and innovative new build indemnity scheme.
Builders are not building—without consumers ready to buy, and without enough land for development or access to finance. Hence, we are promoting policies such as the Getting Britain Building investment fund and the Build Now, Pay Later programme for public sector land.
We are also investing £4.5 billion in new affordable housing over the spending review period and £2.1 billion on Decent Homes to improve the condition of existing social housing.