Housing Needs (The Morning Star)
Later today there will be a debate in Parliament about housing policies, as the issue at long last begins to climb the political agenda.
The issue is very stark. The number of households in Britain is increasing by 189,000 per year and the total number of dwellings constructed is 150,000. Thus every year there is a 40,000 increase in the gap between supply and need, thus compounding a problem that is already there.
House prices are rising very fast all over the country with the highest in London and South East but other areas rising quickly. Increasingly many in work simply cannot afford to buy anywhere and thus have to stay with their parents if possible, or rent at exorbitant private sector levels. Indeed the biggest and most lucrative mortgage market is now in “buy to let”.
For those in desperate housing need the option of a council dwelling is fast reducing. In London and the South East the number on Council registers for housing has increased by over 70 percent. According to Government figures the number of households on the waiting list has grown from 1,019,475 in 1997 to 1,548,083 today.
For the vast majority on those lists there is no hope whatsoever of being allocated a place under current policies.
The background to the problem is not hard to find.
Post World War Two there was an acceptance that the awful housing conditions that the majority lived in could only be dealt with by Council building. Huge building programmes from 1945 to 1980 produced many good homes and ensured many lived decently; it also produced some awful system built estates as the rules of accountancy and density took over from human scales in 1960’s and 1970’s. In 1979 the outgoing Labour Government presided over the construction of 100,000 council homes.
Thatcher’s Tories had an ideological obsession about destroying Council housing and creating a market to meet demand. The introduction of the “right to buy” at huge discounts meant tens of thousands of homes were sold. They also de-regulated the rent system so boldly done by the 1974 to 79 Labour Government, promoted Housing Associations at the expense of local authorities and restricted Housing Benefit payments to “market rents”.
Very quickly the whole scene changed into a reduction in overall building levels and an emphasis on the private sector.
After 1997 a lot should have changed, but not everything did.
To their credit the Government did tackle the repair backlog. Tory cash restrictions forced Council’s to save on repairs and maintenance. The adoption of decent homes standard and money for renewals helped a lot, but like everything to do with New Labour it came with ideological baggage.
To qualify for estate improvement money Council’s had to establish an ALMO (arms length management organisation) or transfer their stock to a housing association. They also insisted that money be raised from land or building sales and that “mixed communities” be created in place of single landlord Council or Housing Association management.
The obsession with mixed communities seems to be one way. The working class cannot be trusted to live in one community runs the thinking; there are no Government plans to encourage social housing in Mayfair, Belgravia, Stoke Poges or Aldersley Edge. Indeed when developers are forced to provide a proportion of “social housing” in new developments they can find willing Councils who allow them to build elsewhere or simply pay the Authority to spend on social housing at some indeterminate time in the future. Anything, it seems, to avoid providing for those in most need.
The policy enunciated by John Prescott during his time as Minister responsible for housing has been of promoting the private sector and pressurising Councils into stock transfer or ALMO’s. He has resolutely rejected the “fourth option” of allowing Councils to build and run estates either from fear of phone calls from the Number 10 policy unit, or because he does not believe that Councils have a role in housing policy.
The poor result Labour achieved in last years General Election, especially in London and the even worse result in this year’s local elections have begun to concentrate minds.
The Government’s own study on housing by Kate Barker called for 200,000 net additional properties per year and in her study she made the point very clearly that social housing should be a priority.
However the Government’s policy is still skewed in favour of the private sector with only 75,000 new homes by 2008, the vast majority of which will be provided by Housing Associations. We are nowhere near even these modest targets. In 2004/5 a total of only 16,637 “social” dwellings were build in England, and only 6,175 in London where the need is at its most acute.
Unless the next spending review puts huge amounts of investment into housing, by Councils, the current crisis will intensify.
What is not measured in all this is the social effects of over-crowded flats on children, the pain of endlessly living in hostels or short term accommodation. Bad health, crime and family break up are all exacerbated by inadequate housing. The pain and strain of huge mortgage payments on young people simply trying to put a roof over their head is also a factor.
There is another huge area of waste. Housing Benefit to cover rent costs is paid to those in receipt of Income Support. There are market limits to what will be paid but in essence the system is of great benefit to unscrupulous private landlords.
In London a Council or Housing Association rent is usually around £100 per week for a flat. The private sector routinely charge at least double and I have come across cases of former council homes being rented for up to £400 per week. Housing Benefit pay most of this from the public purse. No normal thinking person would begrudge those in need having their rent being paid but would question a short sighted policy of refusing to invest in bricks and mortar and instead, subsidising the private sector.
There is also a benefit trap. Those placed in leased property at high rents by local authorities often cannot afford to work. To get a job and lose income support and up to £15,000 of housing benefit would soon result in homelessness. The situation calls for urgent market intervention to control rents and invest in housing for those in desperate need.
The Tory years proved that market solutions do not work in meeting social need. Eight years of New Labour have proved that a refusal to undo the Tory years has cost many poor people very dearly as they are forced to live in expensive poor quality rented accommodation.
Now is an excellent time to change policy and leave the Tory years behind.
