Why Spend More?

Government cuts merely shift the burden, and associated costs, from one department budget to another. Often providing poorer value to the taxpayer as a result. If there is to be a change in policy direction highlighting the absurdities of arbitrary cost cutting in the Welfare State, and capital funding in infrastructure more generally, is needed.

Working in housing you can get caught up in a couple of broken records, repeating time and time again that social housing is needed; and that please, won’t someone think of the poor people. It can all sound a bit noblesse oblige but often you’re one a very few voices pushing those messages. Changing tack, if only for the sake of your sanity, is therefore occasionally necessary.

Show Me the Money

What is often left out in arguing the need for a more progressive approach to policy making in this country is that being a tight arse as a Government often ends up costing the taxpayer (directly and indirectly) more than is saved.  If you have time to read his works, the University of Cambridge based economist Ha-Joon Chang is worth a visit. Whilst the forever left (behind) Owen Jones interviewed him the other week, he has been vocally critical of trickle down economics and Austerity for some time. Notably because the former is bollocks as a theory and the latter more costly for economic growth than expected.

Post-Brexit is seems ‘experts’ (i.e. people who’ve spent years learning about a particular subject) are old hat, who needs them when you’ve got a former Investment Banker (but not part of the establishment) and a former journalist with a penchant for Shakespearean-esk melodrama to tell you the truth+. But it is perhaps worth listening to the various research pieces/staff notes coming out of the world-renowned hotbed of Marxist thinking, the IMF. It has released a number of critical pieces on more recent macro-economic policy approaches and how they’ve failed to solve inequality and provide sustained growth.

It should be noted that the contents of such works represent the views of the authors and not necessarily the IMF itself. Bloody economists, they’re always particularly anal about caveats and detail. Almost as bad as accountants. To ram home the point reading Naomi Klein’s The Shock Doctrine highlights how the IMF, amongst others, has been fundamental in pushing many of the policies that have actually caused greater economic damage than progression.

What Does this Mean for Housing?

Well, being selfish, it means that it is probably worth setting aside more capital funding for infrastructure projects (like building social and affordable housing). It would also be worth re-visiting plans to strip back the welfare state to the point where all that’s available is a couple of turnips* and stale corn flakes. Both of these pipe-dreams are unlikely to happen any time soon. But redirecting the narrative is desperately needed where Central Government and the Welfare State is concerned (a bit like Own Our Future, but without the OOF acronym). Thanks to excellent research from the likes of the Joseph Rowntree Foundation the negative impact of inequality on households is well-known. However, the more recent admission from the IMF that inequality negatively impacts growth should provide the ammunition to make the case for investment over cuts. Or as Olivier Blanchard put it:

what is needed in many advanced economies is a credible medium-term fiscal consolidation, not a fiscal noose today

So change-up the language and change the focus of dialogue. The old adage of needing to spend money to make money (or in this case, save money) is useful here. By highlighting that through investing in secure, good quality, affordable housing the state, and by extension the taxpayer, gets far more bang for its buck (though I would say that, wouldn’t I?). When you can show the cost effectiveness of preventing individuals and households from hitting crisis point (and therefore requiring acute, high cost interventions) you’ve won half the battle.

Not Convinced?

Just count the cost of housing those accepted as being statutory homeless, count the cost of those sleep rough on the streets. Count the cost of those relying on friends and family for a sofa to sleep on. Count the cost of the severe damage to job prospects, education and even health that is caused by insecure, poor quality housing. Add that up and investing in social housing and a Welfare Sate is frankly a snip at the price.

Because, why spend more?

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+Is this a dagger I see before me? No Michael Gove, it’s your political ambitions going up in smoke.

*In fairness, in Worcester (my home town) this would probably make you King…

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A Problem Shared, A Problem Halved?

In many ways the Shared Ownership product is a rather useful metaphor when looking at the Social Housing sector in the UK. Those who know it, who ‘get it’ tend to champion it to the bitter end. Outside of the bubble rumour, misinformation and gossip tend to undermine something that, in the right place, at the right time and the right people can be an invaluable alternative to mainstream housing. Oh that’s the other thing, it’s totally outside the norm for most people as well.

Some Light Reading

If you haven’t had a chance I would strongly recommend reading Orbit and the CIH’s report on making Shared Ownership the 4th mainstream tenure. It rather accurately and succinctly sums up the product and doesn’t shy away from drawing out some of its deficiencies (in its current form) notably:

  • Inflexibility around moving between shared ownership properties
  • Potentially costly requirements tied to stair-casing
  • Failure to market a consistent product
  • Localised variations to a nationally offered product
  • Considerable difference between supply and demand
  • Limited lender appetite

There are of course some significant pros, for the most part:

  • A pathway to full home ownership for those marginalised by the existing market
  • Security of tenure for those looking for a way out of private renting
  • Flexibility (to a point) to adapt one’s housing situation to their financial one
  • Affordability in an increasingly disjointed housing market

The Broader Context

The Government has substantially increased funding available for Shared Ownership, tying in to a belief (ideological as much as anything) that Home Ownership is the main tenure that should be supported. After the inevitable willy waving, and blaming of a party that hasn’t been in power since 2010, the detail is interesting to say the least. A total of£4.7bn has been set aside for Shared Ownership and Affordable Homes for the 5 year period 2016 to 2021. That mulla will fund:

  • 135,000 homes for help to buy and/or Shared Ownership
  • 10,000 for rent to buy
  • 8,000 for supported and older people accommodation (these could fail to materialise if LHA restrictions, currently delayed, are implemented)
  • 0 social rent properties

The last figure on that list isn’t actually included in the prospectus, indeed you can’t actually find any reference, aside from rent to buy,to renting – either social or affordable. With the current funding stream for that out of favour tenure due to end in 2018 grant funding for none home ownership products could very well cease. That should set all sorts of alarm bells ringing, especially at a time when every form of homelessness is on the increase. But you know, politics, money goes where votes are. And baby, there’s a bucket load in home ownership.

Opportunity Knocks

Considering the historic mis-match between demand and supply for Shared Ownership any increase in this type of housing tenure is welcome. Particularly a product that allows those worried about the insecure nature of private renting, but ineligible for social housing and unable to afford outright ownership, a type of housing that meets their needs. It also allows the sector to right some historic wrongs.

I can count on one hand the number of non-housing people who know about Shared Ownership housing. They all now own one, this is largely typical of when people know about S/O they like the idea (if not always the reality). Finding Narnia is often easier than finding, and then buying a S/O property. And that is before you hit the administrative cock ups our side.

Having worked in and studied the sector for a while the horror stories of bungled S/O are legend. Legal documents without HAs on them (bit awkward when the lender sort to repossess), all sorts of faux pas around tenant rights and responsibilities. A fundamental lack of knowledge about the product outside of one bloke who left in the late 90s. In short S/O doesn’t have a glorious history. This funding regime can provide a consistent, coherent product that can help one element of the 3 sub-crises that make up our current of the housing crisis. And gloss over years of ballsing it up.

The Catch

This Government seldom gives without taking something, the Housing and Planning Bill, along with the latest funding regime, are designed to steer HAs away from social and affordable rent provision. Though in truth some don’t need much steering. So far there has been a complete blindness to the need of a diverse set of policy interventions from Cameron et al, home ownership is truly king. Don’t get me wrong, S/O is a darn good product, but it is not for everyone and it is not a silver, gold or even rainbow coloured bullet for our housing woes.

Whilst some in the sector might be getting moist at the thought of becoming even more a provider of housing for sale instead of rent, it is worth remembering why we are here. If you are having a bout of amnesia, just look at the DCLG figures homelessness. Might be worth showing your local Tory MP as well, because the recent rise is largely their party’s fault.

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The Liar, The Witch and The Wardrobe

The latest attack piece on the sector isn’t about the ‘shock’ of Housing Associations not ‘pulling their weight’ in terms of building homes. It is Neo-Liberal fetishism disguised as a solution to a problem that doesn’t exist.

Just a Case of History Repeating

Setting aside the deja vu of Channel 4, The Times piece v1.0 and The Spectator‘s look at the sector (the latter managing to significantly undermine its argument by getting their figures very, very wrong).The argument that social landlords should be facto property developers studiously (and deliberately) ignores and conflates the nature of the beast.

As social landlords we don’t just do development or basic ‘bricks and mortar’ work. Many act as welfare states within a welfare state; providing money advice, tenancy support, employment support services, apprenticeships, out-reach programs, oh and of course new housing. Often in the areas where the state has all but decided to fuck off. Those services are essential to the nature of who we are, and what we do and belie the notion we are just required to build homes. Ultimately it is why painting HAs as bumbling builders misses the point. But then again, that is the idea with this type of attack.

No Smoke Without Fire

Though I’ll be damned if I take anything seriously from those nutters at the Tax Payer’s Alliance. Get out more and read a little less Von Hayek and Friedman you loons. I am not going to blindly defend the sector. A number of the points raised by the article are a little too close for comfort. In particular, efficiency and getting value for money is of concern. Whilst claims of inertia over building is an unfair and loaded accusation given the broader context of what we do. We are occasionally too slow to develop and innovate, largely because we’ve never had a pressing need to, apart from when Government Policy changes.

We also have too many chefs in the kitchen. The fact that you can have several social landlords operating in the same street is just utterly bizarre. And although commendable for the work they do, as a small organisation development opportunities are limited. Merging or entering into a Group Structure with a larger set of organisations is probably the best move forward. Frankly if you’re under 5,000 units you will struggle in the next decade. Ultimately, as a sector you can’t own your future if you are a disparate bunch of fiefdoms pulling in different directions. That helps no-one, collapsing down is inevitable, embrace it when and where it works for your organisation.

You’re talking crap mate

As someone who works in Performance its the utter lack of context that befuddles me. Numbers in a vacuum (or in this case a deliberately narrowed tunnel of vision) mean nothing. To measure the worth of an organisation on one isolated variable, to conflate building with performance, is utter bullshit. External policy is underplayed as a influencing factor, all the additional work we do as a sector is ignored in its entirety. In short the overall context is deliberately skewed. Exactly why doesn’t become clear until you look at the end piece tied to the headline. It is a push for the debt of the sector to be wiped, and for HAs to be ‘free’. Presumably at this point being ‘born again’ for-profit organisations they could pay Chief Execs whatever they wanted?

Whilst written with an attachment to the real picture at hand that is tenuous at best, here is the rub of it. The article by The Times holds the crux of the debate as to where we are heading as a sector, it is also a warning shot to the sector from Central Government. Selling off HA debt and giving ‘freedom’ to the sector is the basis of one the Policy Exchange’s their main policy papers on Housing. And whilst I am delighted that Alex Morton is leaving his role Housing Policy Advisor to No10, they still hold a lot of clout. Consequently, lobbying hard to ensure this doesn’t happen will be a key challenge of this Parliament. That’s if the big boys and girls want to. I have a feeling some will be watching the potential for going solo with great interest.

You can find more of my stuff here and follow me on Twitter here.

Nunquam Securus Via (Never the Easy Way)

I’ve always joked that as a sector that if there was an easy and a hard way of doing things to get the same result, that we pick the harder option every-time. Like someone with an unhealthy set of masochistic tendencies we tend to choose self-flagellation. Though I guess sometimes it’s because we don’t know what we don’t know and find comfort in doing things the way we’ve always done them. It’s time we broke that cycle.

As you’ve probably guessed from previous posts I have no love for the vast majority of what this Government (or its immediate predecessor) has done Housing Policy, or Welfare Policy-wise. Though in the interest of balance, the Blair/Brown Governments were pretty crap as well, they tolerated social housing, but Policy was just as fragmented back then as it is now.  Of particular concern, more recent initiatives/areas of Policy that aren’t utterly counterproductive (e.g. the principle of Universal Credit), have been swamped by an utter shite-storm of ideologically driven reforms (e.g. the reality of Universal Credit). Belief has repeatedly trumped evidence and as a man of science, not faith, I can only feel concern when that occurs. But this be the land, time and space we currently occupy. Howling to the wind won’t make a damned bit of difference. Don’t get me wrong, I have howled to the moon and back, anyone who has read even a couple of my blogs will know I don’t tend to hold back on passion, or swearing. But ultimately I’m not looking to change policy (not through this blog at any rate), just highlight to people what the sector does, where it is heading and the current policy climate.

However, as a sector, we need to do more and whilst some are attempting to do just that (Homes for Britain and SHOUT come to mind) we need to be a bit smarter in how we go about things. This Government does not care about how much we invest in communities, it doesn’t care that we are acting as a welfare state within a welfare state for many of our customers. It’s not getting politically battered for that. Where it is getting hurt is in the number of homes being built and the affordability of them. It’s why they are so pissed at our surpluses not (in their opinion) getting put to good use (i.e. being used to build homes). It doesn’t help that our go-to line is “give us money and we will build homes for poor people who can’t afford it and/or aren’t economically active”. That may play well with progressives, but to the conservative with both a small and big ‘C’ it’s like mocking their favourite brand of humus. They take personal offense to the very idea. If you haven’t already I would strongly recommend reading the Policy Exchange‘s various attempts at writing about housing. Whilst a similar experience to eating quinoa (i.e. utterly unfulfilling, and slightly perplexing) it will give you an insight into how this Government is thinking. It is no good brushing up on your French when the other person speaks Russian.

Ultimately, we still haven’t mastered the art of influencing the opinion of the public, or for that of Government (at least no consistently). Unless you state your argument repeatedly, simply and in as many places as possible you are not going to get anywhere. I am as guilty as the next chap in terms of entering into overly technical arguments, it muddies the water. Whilst this may result in a moral victory, it won’t stick in the minds of the general population. What David Cameron is a master at is sound bites, take his”bunch of migrants” statement for example. Stink caused, fuss created, message received and understood. As a sector we need to have just as clear (if less repugnant) message, and stick to it. You might look a bit like Ed Miliband but the message will get through. Just got to herd the bunch of cats that this sector is and we’ll be tout sweet.

Problem solved, well probably not as shown today by Jeremy Hunt, just because you have public opinion, evidence and a professional body on your side, it doesn’t prevent the Government from just going ahead and doing what it wants regardless. Still, no harm in trying.

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Hey you! Old Patronising Person, shut up.

So, Edwina Currie is alive. Who knew? Not me, alas her latest interjection into the world is as misguided as it is baffling. Called Hey Youngsters! No pension? No Home? No wonder. Look at you! The article is a middle class, public school going, Daily Mail believing wet dream. A ladies what lunch brigade tirade at the perceived ills of the ‘yoof’ of today. In short, it is 100% bollocks. Tell me Edwina, what the fudge is a gadfly way? I’m not as up with street parlance as I once was, so you will have to explain that to me, perhaps over a glass of Pinot Grigio at Les Chalets de la Serraz, so I can show you who skis in the French Alps (spoiler: it ain’t me and my mates).

It was odd reading your piece as I really couldn’t decide whether it was unintentional satire or an interesting insight into how far removed your ilk are from the travails of modern day lives for those of us under 30 and not living off a trust fund. I refuse to take seriously the opinion of anyone who found John Major sexually alluring. So you are immediately on the backfoot opinion-wise. But enough of your life choices, lets have a look at some of your arguments.

Firstly Louboutins and Manolo Blahniks!? What on God’s green Earth is a Manolo Blahniks? What do you think people under 30 spend their money on? Let me give you a hint, it’s rent for the most part. In the past year alone rents have risen by nearly 12%, and are set to rise further, potentially overtaking increases in house prices. Given that the majority of under 30s who aren’t living at their parent’s house (presumably getting moist over John Lewis’ latest magazine update by your logic) rent privately, we are unduly affected by such changes. This means an ever increasing proportion of income is being taken up by rent, and other household bills. Not by Lou-fucking-boutins purchases (I’m more of a Next man myself, their jeans are cracking value for money).

On the moving job bollocks you espoused. Yes you are right, many people have left behind the ‘stay with one employer all your life’ mantra and move jobs frequently. But this is not always through choice. If you haven’t noticed there has been a recession that has been painfully slow in sorting itself out. When the markets go tits up employers tend to be a bit more cautious in terms of hiring. Particularly when you are lower down the food chain (as most young people are) this results in fixed term contracts, zero hour contracts and in general being treated like cattle. Consequently, you tend to move job a lot more often, whether you like it or not. I myself, after graduating with a masters in 2012, only got my first permanent contract in 2015. At one point my ladyfriend was made redundant twice in a 6 month period. Between us we have had around 8 different positions in 5 different companies in 6 different cities/towns over the last 4 years. Trust me, neither of us wanted that.

I fully agree with you on contributions being a necessity in terms of paying for the welfare state. Having had jobs of one type or another since I was 18 I can assure you I’ve been more than paying my way in terms of taxes and national insurance (although I earned so little at one point I didn’t pay any tax, sorry). The same can be said of my mates. We must be a terrible shame for your misconceived visions of the youth of today. Paying our way, saving sensibly. Instead of passing the courvoisier we’re sharing the latest deals banks are offering on interest rates.

So in short, shut up Edwina or at least have the decency to do a Portillo and go make inane TV programs about Trains and/or Railways. I’ve got more pressing things to worry about than a patronising old muppet telling me that if I just rolled my sleeves up and graft everything will be OK, because I stopped believing in fairy-tales a long time ago. Your argument is as whimsical as having a Prime Minister that believes a house worth £250,000 (or £450,000 if you live in London) is affordable, trust me when I say it really goddamn isn’t.

*Update* I’ve edited some of this blog because 1 – spelling mistakes 2- a few points were, in hindsight, a bit close to the edge. Personal insults shouldn’t really be undertaken in any part of life. There’s enough crap out there without me adding to it.

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Want is not of need

The only thing more predictable than the unpredictable nature of the Spending Review/Autumn Statement is the flurry of blog posts after the fact. I won’t attempt to cover the ground that has already been well trodden. But the housing policy geek in me can’t help but chew the fat on a couple of points.

Firstly, the good points. Housing has finally got the increase in funding and political attention it desperately needs. A nod here must go to the NHF, CIH and the Homes for Britain campaigns. Further mentions to Generation Rent, Shelter and Crisis. Given how far down the list of priorities perceived by the general public a few months ago it is relieving to see the subject set as one of the focal points of the Spending Review.

Now the bad news. (Yet) again the debate has been skewed to one particular facet of the housing market. Whilst ideology does play a part, there is something more fundamental here. Politicians like stories with happy endings. The story itself might be one of woe, but there is a solution in sight (theirs of course, the opposition’s vision won’t work). With housing, its complex nature, myriad set of interests and unpredictability negates a happily ever after. For there must be losers in housing to ensure winners. Mr Osborne knows this, and has played his cards accordingly.

Previous blogs of mine have highlighted the perceived need by those in power to highlight problems (real or imaginary) that then need resolving (the deficit for example…). They have also pointed to the works of people like Adam Curtis and Naomi Klein who in turn note that such narratives often belie more troublesome endgames and unaccounted-for consequences. The Government for example has chosen to frame the housing crisis as a problem that is just about affordability for first time buyers.

As the JRF rightly points out this current crisis is not just about the inability to buy. But it’s a lot easier for politicians to willy wave about helping those buy their homes than tackle the overarching mindfuck that is the mess our housing system is in. Particularly when actually making housing more affordable would hit the pockets of those who have already won in the game of housing.

Approaches to tackle this narrow view of the housing crisis are thus deliberately limited in their scope. And even then all is not what it seems, many won’t come into effect for a couple of years. Anthony Hilton’s delightfully bitchy, but informed piece, highlights the tricks played by Osborne et al. in their attempts to address housing affordability quite beautifully. For those who can’t be bothered to read outside this article the points to take are:

  • The greatest house building program since the 1970s might not actually build (materially speaking) more homes than already had been slated
  • The affordable homes that are built won’t be that affordable
  • Houses have been reclassified as affordable by a sleight of hand, not in cash terms or in their genuine affordability

Indeed when looking at both the newest Housing Bill and the funding put in place by the Spending Review it’s as if a whole sub-section of society is being written off. Brandon Lewis’s belief that the poorest will be able to buy thanks to the flurry of housing policies is frankly misguided bullshit. When you can’t put money aside for a mortgage, when keeping your crappy rented property as the roof over your head buying doesn’t come into it. But when the narrative is set to that of home-ownership as the solver of all society’s ills I wouldn’t expect anything less.

If allowed social rent will play an important role in helping with the issues in our housing system. Giving people the chance/space to breathe, get their shit in order then maybe one day buy. But until the narrative changes to admit that, we will continue on this merry-go-round of smoke and mirrors with the end result being that housing is utterly unaffordable for an even greater proportion of the country. And with it the chance of a happily ever after.

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Fool’s Gold

You may have noticed that housing had a small get together last week.  Yea… this is another Homes for Britain rally blog.  Sorry, it’s been a long week or so and these things don’t write themselves. It was good to see such that such a large cross-section of the housing world was in attendance.  Well they appeared to be based on the tweets.  I didn’t actually speak to too many people… SHOUT were also there in force and it was good to see so many people so passionate about (let’s face it) something that is a bit mundane to the average punter.

The speakers were from all the main political parties (and UKIP) plus a selection of informed contributors. My top 3 were: Ken Loach was full of passion, a fierce wit and an utter lack of respect for time limits.  It was worth the trip alone to see him in full flow. Though sorry fella but a planned economy is never happening.  Frances O’Grady – set fire to the 3rd bar and a few more besides. Full of rage against inequality and injustice, highly articulate and definitely worth listening to.  Finally, Miriam Ahmed. Homeless at a young age, visibly pissed at the hand people can be dealt with and determined to change things for the better. If you are holding a staff conference, or simply want to remind people of why we do what we do, I would suggest getting her along.  Your staff will be singing Les Marseilles quicker than you can say to the barricades.

What was clear however, despite all the glitz and glamour was the enormity of the task ahead. Two very key contributions came from Tim Montgomerie of Conservative Home. The other from Deborah Mattinson of Britain Thinks. Tim noting it is all well and good for all the speakers to say they believe housing is an issue at a pro-housing event but what are they saying elsewhere? Both Labour and the Lib Dems have had opportunities to do so, but haven’t.  This would suggest that neither the public or the political class deem housing to be a vote winner, not just yet at any rate.  This was supported by Deborah who pointed to the fact that polls still place housing down the agenda. That whilst people see housing as an issue they don’t see it an issue affecting them locally, something that is key.  ‘Cos you know if ain’t happening down their road most people don’t give a monkey’s.  Ironically enough a majority think more housing was needed, just not in their backyard thank you very much.

Mr Michael Green Grant Schapps duly popped in to play the pantomime villan (oh no he didn’t…sorry, I’ll stop now).  Whilst all the other parties admitted more work needed to be done on housing (well Farage just went on about brownfield sites, the days of yore and I think something about immigration) Mr Schapps sounded off a bunch of dubious figures with the general demeanour of someone stating, “you’re wrong” at every challenging remark.  He did at least manage a wry smile when reminded of his occasionally dodgy memory by the hostess with the mostess, Jonathan Dimbleby.

It was a hint of things to come from his colleague the Rt Hon Gideon George Osborne (honestly what is it with this lot and names).  In the final budget before the next General Election Mr Osborne popped out another demand side initiative.  A move that is seen as aiming to perpetuate a superficial feel good factor pre-general election. Short term political gain aside it will not do a lot (though it did get the ire of the Institute for Fiscal Studies, small mercies and all that).  Certainly it won’t help to resolve our housing crisis. The two best responses to the budget came from the JRF and Danny Dorling in the Daily Telegraph. I couldn’t put it better myself, so I won’t.

If you want a real downer from the upper that was the homes for britain rally I would suggest reading Mr Halewood’s piece on our inability to frame the terms of reference in the debate on housing.  And our failure to properly highlight our value for money to the taxpayer.  Turns out we save Joe Bloggs a bomb compared to housing poor people in private rent properties.

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