New body to run military housing as MoD plans decade-long accommodation overhaul

Ministers are set to create a new quango to run military housing after concluding the Ministry of Defence was not up to the job.

The new Defence Housing Service, to be announced by Defence Secretary John Healey on Monday, will take over management of service accommodation after years of complaints about poor quality homes.

It will operate as an arm’s-length public body, with Mr Healey saying the new service would “deliver better value for the taxpayer and fulfil our promise to provide homes fit for heroes”.

When created, it will be one of the largest publicly owned housing providers in the country.

Sources said the Ministry of Defence (MoD) had “not been very good” at operating service accommodation itself, and would be better able to focus on “core defence responsibilities” once housing was hived off to the new body.

Earlier in the year, Prime Minister Sir Keir Starmer pledged to reduce the number of quangos (quasi-autonomous non-governmental organisations) to improve accountability and cut back on bureaucracy.

But defence sources said they had been allowed to create the new housing service as the MoD was still a “net reducer” of quangos, pointing to a “significant” consolidation of innovation bodies.

The creation of the new body is part of a 10-year defence housing strategy, also launched on Monday, that will see £9 billion invested in service accommodation and 100,000 homes built on surplus MoD land.

Mr Healey said: “Our British forces personnel and our veterans fulfil the ultimate public service. Our nation is rightly proud of them. And the very least they deserve is a decent home.

“This new strategy will embed a ‘forces first’ approach that tells our forces, our veterans and their families: we are on your side.”

The “forces first” approach, announced at Labour’s party conference in September, will see military families given “first dibs” on new homes built on defence land.

The strategy will also see almost all of the 47,700 military family homes, known as service family accommodation (SFA), either refurbished or replaced.

It follows a decision earlier in the year to take 36,000 SFA homes back into public ownership, which the MoD said saves the taxpayer £600,000 per day.

The MoD has also promised to carry out an “urgent review” of single living accommodation (SLA), which houses more than half of military personnel.

Mr Healey has described the strategy as “the biggest renewal of armed forces housing in more than 50 years”.

Military accommodation has been heavily criticised in recent years, with a Commons committee last year finding problems with maintenance and historic underinvestment leaving two-thirds of SFA housing “essentially no longer fit for purpose”.

MPs also found around a third of the 133,000 SLA spaces were not fit for purpose.

Complaints include persistent damp and mould problems, long delays for maintenance work, outdated facilities and furniture, and poor communication from those responsible for operating the accommodation.

Poor accommodation has been cited as one reason for the military’s struggle to retain personnel, with 40% of service members saying it had made them more likely to leave the armed forces.

Shadow defence secretary James Cartlidge said: “With retention still one of the most critical issues in defence, it is vital our armed forces families are provided with the best quality accommodation.”

Arguing that the previous Conservative government had decided to buy back the defence estate and create a new Forces Housing Association, he said it “remains to be seen if Labour’s new Defence Housing Service will have the operational independence to perform that role to the same degree”.

Mr Cartlidge added: “We will carefully consider Labour’s proposals but, like all their defence policy papers so far, this is months late and we now need to see real ambition in practice when it comes to overhauling defence accommodation.”