Labour has warned that if the UK leaves the EU it could result in the loss of 18,000 affordable homes by 2020.
According to the Institute for Fiscal Studies, a vote to leave the EU would mean a budget deficit between £20 billion and £40 billion higher than presently forecast, meaning ministers would have to make a further spending cuts to meet current fiscal plans.
Labour said that the Department for Communities and Local Government could see its budget cut by up to £1.1 billion – enough to fund between 9,000 and 18,000 new affordable homes by 2020.
John Healey MP, Labour’s shadow secretary of state for housing and planning, said: “These stark figures show the big risk to new housing if we leave the EU.
“We know from the last six years that Conservative ministers always cut investment first to meet their fiscal targets. New affordable housing will be first in the firing line in a post-Brexit Osborne Budget, risking thousands of affordable homes to rent and buy.”
Labour said that a UK exit from the EU could also mean the withdrawal of funding for a further 20,000 new affordable UK homes announced in April by the European Investment Bank.
Healey said: “After six years of failure on housing, from rising homelessness to falling home-ownership, we can’t afford the risk of a further loss of affordable homes. Add in the wider risks of Brexit to the housebuilding industry, and to the vital funding for housing we currently get from the European Investment Bank and it’s clear that when it comes to housing Britain is better off in the European Union.”
