England must launch the biggest council and social house building drive in its history to rescue millions of people from a future in dangerous, overcrowded or unsuitable homes, a cross-party commission has told the government.

More than 3m new social homes are needed in the next 20 years, more than were built in the two decades after the end of the second world war, according to a year-long housing commission launched in the wake of the Grenfell Tower disaster. Its commissioners include the former Conservative party chair, Sayeeda Warsi, the former Labour leader Ed Miliband and the former Conservative Treasury minister and Goldman Sachs chief economist Lord Jim O’Neill.

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The call represents a direct challenge to Tory ministers to dramatically increase social house building from its current level of just over 6,000 homes a year. The number of new homes proposed is equivalent to seven times more houses than there are are in Birmingham and 27 times more than in Milton Keynes.

It comes as the government plans possible new legislation on social housing following the deaths of 72 people at Grenfell Tower, with stronger regulation and more money for council housing. It has described public housing as a safety net and a stepping stone to home ownership, which Theresa May has said she wants to increase in line with the long-held Conservative belief in a “property-owning democracy”.

But the commission, convened by the housing charity Shelter, is arguing that council houses and social housing should be available to more than just the people in greatest need and those saving to buy. As well as the 1.3 million people it estimates are in greatest need because of hazardous homes, overcrowding, homelessness and disabilities, the new homes should be accessible to a further 1.2 million young people and 700,000 older people trapped in private rent. The commission puts the provision of housing on a par with health and education.

The idea has been costed at up to £225bn – more than four times the cost of the HS2 rail line and more than five times the annual defence budget. But savings to the £21bn annual housing benefit bill and the economic boost created by the programme means it would pay for itself inside 40 years, according to fiscal modelling for the commission by Capital Economics.

“The time for the government to act is now,” said Miliband. “We have never felt so divided as a nation, but building social homes is a priority for people right across our country. It is the way we can restore hope, build strong communities and fix the broken housing market so that we can meet the needs and aspirations of millions of people.”

Warsi said: “Social mobility has been decimated by decades of political failure to address our worsening housing crisis. Half our young people cannot buy and thousands face the horror of homelessness. Our vision for social housing presents a vital opportunity to reverse this decay. We simply cannot afford not to act.”

Other commissioners include Lady Doreen Lawrence, the justice campaigner and mother of the murdered teenager Stephen Lawrence, and Edward Daffarn, a social worker who escaped from his 16th floor Grenfell Tower flat and had predicted in a blog that “only a catastrophic event will expose the ineptitude and incompetence of our landlord”.

The commission represents the broadest coalition yet to urge a change in housing policy. Successive Labour and Conservative governments have sought to encourage the private rented sector as a solution to the housing shortage.

The number of families with children renting privately soared to 1.8m in 2017 from 566,000 in 2003 and the trend is part of the reason for the forecast rise in the housing benefit bill of about £5bn in the coming five years.

Yet conditions are often poor and uncertain with one in seven private rented homes posing an immediate threat to health and safety, according to the government’s own figures. Four in 10 private landlords surveyed say they operate an outright ban on renting to people in receipt of housing benefit, according to Shelter.

Investment in social housing in England has halved in real terms since 1980 and, in the last two decades less has been spent on housing, including benefits, than on defence, public order and safety, education, health and other welfare payments.

“There needs to be a profound shift to see social housing as a national asset like any other infrastructure,” said O’Neill. “A home is the foundation of individual success in life and public housebuilding can be the foundation of national success. It is the only hope the government has of hitting its 300,000-homes-a-year target.”

The commission is also demanding:

• a powerful new Ofsted-style regulator to inspect homes;

• greater influence for tenants over what happens in their buildings;

• the replacement of any sold-off social housing;

• a commitment to mix social housing with private homes of indistinguishable design and without separate “poor door” entrances.

The government has won praise from councils for lifting restrictions on borrowing to build, but levels of council house building have remained historically low, despite recent small increases. A survey of more than 30,000 people carried out for the commission found that a large majority believed there was not enough social housing.

James Brokenshire, the communities secretary, said the government had already launched a £9bn affordable homes programme to deliver 250,000 homes by 2022, which includes social housing, with an additional £2bn promised to 2028.



“Providing quality and fair social housing is a priority for this government, and our social housing green paper seeks to ensure it can both support social mobility and be a stable base that supports people when they need it,” he said. “We’ve asked tenants across the country for their views and the thousands of responses we’ve received will help us design the future of social housing. We’re also giving councils extra freedom to build the social homes their communities need and expect.”

The shadow housing secretary, John Healey, described the report as “a wake-up call for Conservative ministers”, adding: “It confirms that investment in new social homes has fallen dramatically since 2010 and that the Conservative redefinition of ‘affordable housing’ is a sham.”

The report states that “affordable rents” for typical two-bedroom properties work out at 30% more expensive than social rents and that “these rent levels are completely out of reach for most people who are eligible for social housing.”

Healey said the commission’s target of 3.1m social homes was consistent with the scale of Labour’s ambition to build a million new “genuinely low-cost homes” in the first 10 years after taking power.