Penny Cameron NEW B&WCameron Penny is a financial services lobbyist, East End resident and member of the Conservative Party for over a decade. He was a senior officer of the UK’s largest university-based Conservative Association and stood as a local council candidate for the party. Follow Cameron on Twitter.

Often in our politics what we need and what we want are
things that all parties can agree on. The differences lie in how to deliver
these. So, as a starter for ten, everyone is agreed that the UK needs growth
and lots of it. Particularly if the OBR's projections are to start reflecting
reality at any point in the near future. We hear much from the Labour benches
about the need for ever greater borrowing. This would, we are told, be spent on
massive capital expenditure projects to boost the UK's infrastructure. Hoover
had his dam, Balls…well we're not exactly sure but something big, with lots
of concrete, perhaps some glass and a railway line or two. Either way such
borrowing definitely wouldn't be spent on ever more generous public sector
remuneration or pension provision…

The Conservative Party on the other hand is torn between the
Chancellor and his Prime Minister who are in no rush to slash and burn for one
simple reason; we're far too close to a General Election. Whilst there are
others on our side who argue that what's really holding the economy back is far
too much red tape. If only the most flexible labour laws in Western Europe were
more akin to the 'hire and fire' culture of the USA then we'd suddenly see a
return to 2, 2.5 or even 3 per cent GDP growth.

These positions merely skim the surface. They are
short-term, as so much of politics is, and no party has yet to address the key
weakness holding back the UK economy. At a time of stagnant growth, effective
wage deflation in the private sector, an ongoing farce in the Eurozone and debt
projected to reach over 85 per cent of GDP by 2018, now is the time to end the
complicit deceit in our politics that is holding back growth.

It's not about credits for this and that or about getting
people into work – that is happening. It is fundamentally about how we
accomodate our population. For there can be no hope of substantial growth
whilst rents go up, house prices go up and mortgage supply is restricted
through ever higher deposit demands. When the average property costs around
seven times average earnings, in London anywhere from 10 – 15 times and the
average age of first time buyers is 35 years – we have a problem.

The Chancellor has attempted a dramatic intervention with
Budget 2013. £3.5bn to loan to people for seven years so they can put up the
cash for their deposit and £130bn for the state to guarantee mortgages on LTV
ratios of 95 per cent. Sorry, but highly leveraged mortgage provision provided
for by state agency? It's all going a bit Fannie and Freddie if you ask me.

The truth, however unpalatable, is that house prices in the
UK have risen far too high. It risks creating a fissure between generations
that is currently being plastered over by parents raiding their equity to pass
to their offspring. That's fine if your parents have got equity or savings in
the first place. Instead of goosing the property market yet further or the
state spending taxpayers' money on massive new social housing there is only one
way forward; we must loosen planning regulation. This means ignoring the
prudish objections of the curtain-twitchers in the shires. We must make it as
easy as possible for developers to build up and/or out. Opening up home
ownership by making fundamental changes to the supply side of the equation is
the way to give young people, and not so young, their first footing on the
property ladder. That would build a truly aspirational nation.

This needs to be done in a responsible manner, policymakers
shouldn't correct their first mistake – a housing market boom out of all
proportions to earnings growth – with a second i.e. a massive collapse in
property values. Initially relaxing planning regulation on 1 and 2 bedroom
properties would protect the value of family homes whilst helping young people,
particularly in the South East and London, who are trying to save for and buy
their own home but who see London becoming a ghetto for housing foreign capital
and customers of the Bank of Mum and Dad. So let's expand the supply of housing
and in the process lower the threshold for entry to the property-owning
democracy. Let's allow the next generation to shift their disposable income
from saving for an ever more elusive deposit or lining the pockets of wealthy
property owners through ever higher rents to stimulating demand in the economy.
We should also remember the massive employment growth that would result from a
significant increase in building activity.

To those who want ever-increasing prosperity in this country
I have three words and one mantra:

Build, Build, Build!