Less than a third of UK’s £4.2bn housebuilding fund spent

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Good morning.

We start with an exclusive story on UK housebuilding. Despite the chronic shortage of housing across the country, more than two-thirds of a government fund aimed at unlocking hundreds of thousands of new homes in England remains unspent more than six years after its launch.

The £4.2bn Housing Infrastructure Fund was created in 2017 in an attempt to jump-start housebuilding by providing local authorities with grant funding for key infrastructure such as transport and utilities connections.

However, just £1.3bn of the pot — or about 31 per cent — has been spent to date, with the bulk of that sum spent in 2021 and 2022, according to a Freedom of Information request submitted to the government and shared with the Financial Times.

The government also confirmed that work had begun on fewer than one in 10 of the promised homes, and that it had downgraded its delivery target through the fund from 340,000 to 270,000 homes, after a number of schemes withdrew or had funding pulled. Jennifer Williams has the full story.

And here’s what else I’ll be watching today:

• Economic data: US job openings, a proxy for labour demand, are expected to have declined in November when they are released today. Germany also reports labour figures.

• US Federal Reserve: The Federal Open Market Committee issues minutes from its last meeting in December.

Read our special edition of the Week Ahead newsletter for big moments in the diary for the year ahead.

Five more top stories

1. A senior Hamas political leader has been killed in an explosion in Beirut, along with at least two of its military commanders. The Palestinian militant group and Lebanon blamed an Israeli drone strike, which if confirmed would mark the first targeted attack against a Hamas leader outside of Palestinian territories by the Jewish state since the war started. Here’s what we know so far.

2. Exclusive: One of the biggest investors in Thames Water has slashed the value of its stake by nearly two-thirds. The Universities Superannuation Scheme, a UK pension fund serving more than 500,000 university sector members, holds almost 20 per cent of Thames Water’s parent entity, Kemble Water, through an investment vehicle. Read the full story.

3. Exclusive: Labour has quadrupled its use of consultants as it prepares for a general election, despite shadow chancellor Rachel Reeves vowing to cut their deployment in the civil service if her party takes power. The UK opposition party received £287,000 in donations of staff time from consultancy firms in the year to September 2023, up from £72,000 in the prior 12 months. Anna Gross and Jim Pickard have more from London.

Sign up for our Inside Politics newsletter by Stephen Bush for the inside track on British politics and policy.

4. Carmakers have warned that tearing up the Inflation Reduction Act will hurt the growth of US electric vehicle sales after former president Donald Trump’s advisers told the FT he planned to gut the country’s cornerstone green legislation if he were elected. Here’s what’s at stake for the industry if subsidies are rolled back.

• Presidential election: Trump has sued to reinstate his name to Maine’s primary ballot after its secretary of state said he was disqualified because of his role in the January 6 2021 attack on the US Capitol.

5. US companies have been piling into the market for convertible bonds in a rare flurry of activity in otherwise subdued corporate fundraising markets. Issuance of convertible debt climbed by 77 per cent last year to $48bn, making it one of the only areas of capital markets to return to pre-pandemic averages after 2022’s market downturn. Here’s why companies are diving in.

The Big Read

On Sunday morning, a Bangladeshi will cast the first vote in their country’s fraught national elections and set in motion the most intense and cacophonous year of democracy the world has seen since the idea was minted more than 2,500 years ago. Some 2bn people, about half the adult population of the globe, will have the chance to vote in 2024, far more in one year than ever before. But even as they mark the spread of political freedom, these elections are also taking place amid spreading illiberalism and creeping disillusionment.

We’re also reading . . . 

• Russian murderers: Thousands of prisoners convicted of gruesome crimes have been pardoned in exchange for fighting against Ukraine, to the horror of victims’ families.

• SoftBank’s bad bet: The founders of IRL are locked in competing lawsuits with the Japanese group, which ploughed $150mn into the social media app that sought to be the next Facebook. But the platform’s former staff tell the FT there were problems from the start.

• The free world: Democracy is on a downward trajectory, writes Janan Ganesh, but so is a boxer who loses a round after winning six. Have we given autocrats too much credit?

• Inflation: The US, UK and eurozone are on course to declare victory against inflation this year, but difficult trade-offs await, writes Chris Giles.

For more from Chris on the next phase of rate-setters’ battle with inflation, premium subscribers can sign up for his weekly Central Banks newsletter. Or, upgrade your subscription here.

Chart of the day

Wall Street stocks have begun the year with a technology-led hangover after the rally that ended 2023 turned cautious, sending tech stocks to their worst day in more than two months. Apple was among the largest fallers — here are the other companies that dragged down the Nasdaq and S&P.

Take a break from the news

A spirit of inclusiveness is driving a trend for running clubs that are convivial, not competitive. The FT’s Emma Jacobs joined the Runners High Run Club and discovered the perks of slow running.

Additional reporting by Gordon Smith and Emily Goldberg