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Thursday, March 23rd, 2017
As there are greater and greater budgetary constraints placed upon social housing providers in endeavouring to meet the ever growing demand for housing, there is a shortsightedness which stems from this prioritisation of the March 31st date of whichever year we are in. This results in an ongoing demand for greater expenditure elsewhere, due to, for example, greater health needs, higher levels of crime, the consequences of a lack of educational attainment (in educational services, subsequent lack of employment or employment in lower paid jobs, which results in less income tax revenue and a weaker purchase power of the employee, etc).
The lack of strategic planning with regard to social policy maintains this silo, short-termist approach towards social policy, which is only occasionally, and tokenistically tackled by programmes to perhaps enhance the ability of some to get on the home ownership ladder, and thus make more rented properties available for others. This superficial and headline seeking approach doesn’t in any way tackle the more profound impact of the lack of affordable housing – owned or otherwise – and how we in the UK as a whole view housing – somewhere to live? An investment for the future?
This inability to see beyond any given financial year and beyond owner occupation are 2 of the myriad weaknesses in the current pre-dominant mindsets of those who hold power within the UK. Addressing the range of issues which, if tackled, would enhance how we view housing and the availability of housing would be a PhD thesis. I shall therefore only briefly address a couple of key points here: the continuing emphasis on owners occupation over rented accommodation, and the fact that putting money to social housing is an investment, not an increase in the subsidy for social housing tenants, as many right wing commentators would have it.
Preferable tenure – owner occupation over rented accommodation
The predominant housing tenure aspiration within the UK has been to own for many years, and the introduction of a right to buy policy which robbed the UK of so many affordable and secure rented homes only strengthened this. We have now moved on to the extent which social housing, which was originally aimed at helping to create communities of a range of people with a range of jobs and a range of incomes, is being painted as the tenure of last resort. Indeed, there is such an inadequate supply that only those in the most dire of housing need have a prospect of being granted a social housing tenancy. Given that many people who are not in such dire need will not have sufficient income a) to save for a deposit and b) to get a mortgage, home ownership is out of their reach. They must therefore resort to the private rented sector (PRS).
There are many excellent landlords within the PRS and there are many excellent properties for rent, but, unfortunately, the opposite also applies. Additionally, however, even if the landlord is excellent, the property is of a great condition and rent is paid when due, there is something within the UK that cannot be guaranteed, unlike a social tenancy with an up to date rent account, or an owned property with a fully paid up mortgage. The nature of PRS tenancies is that they are not and can never be secure. There is always the possibility that once the contracted period of the tenancy comes to an end the statutory 2 month notice may be given to the tenant. There’s a further additional problem I wish to refer to, and that is with regard to rents. Us Greens want a form of rent control, but many, including landlords and governments, do not. Consequently, with there being demanded for PRS properties and with renting being the main income source for many landlords they will follow the money and seek opportunities to increase rents to levels beyond what many believe to be affordable, beyond what a housing benefit system will allow and beyond the means of many tenants.
Germany provides us with an example which shows us that housing policy, and the prevailing housing culture, can bring with it a very different response . privately rented accommodation is much more the norm in Germany. Tenancies are more secure, there is a rent regime which is much more fair to tenants. As a consequence of this, a lack stigmatising of rented accommodation , a greater fear of acquiring debt through obtaining mortgages and a lesser framing of owned homes as investments rather than just homes, the almost necessity to aspire to home ownership which exists in the UK doesn’t there, and this in a country which has been governed from the right for many years!
Whilst we are swimming against the tide here, for the sake of people in housing need who stand little chance of getting a secure, affordable tenancy within the social housing sector, or of getting a mortgage to own their own home, we must work towards rent controls, changes in tenure within the PRS, to enhance security and a lessening of the emphasis on owned accommodation as the sole tenure of aspiration. In terms of aspirations, this expectation has become entrenched within our culture and is, therefore, extremely difficult to tackle. To do so would be generational, but that does not mean it is a battle which shouldn’t be joined.
We need more social housing
Many social and political commentators, alongside stigmatising social housing as the tenure of last resort, will refer in ‘these harsh times’ to the unaffordability of constantly subsiding social housing tenants to the detriment of areas of greater need (Trident?). Increasingly, given that the right wing media is only too happy to play along with this message, this is an open door. Those who see cuts in their schools, in their local hospitals, in their social care provision, etc, when they regularly hear this message, are only too happy to take on board the argument that ‘we subsidise council tenants too much’. This has a couple of areas of impact. Firstly it helps to stigmatise the council tenant and secondly it lessens the motivation of the policy makers to ensure that more social housing is built.
The problem with the argument that social tenants are subsidised by the taxpayer is that it is wrong – plain and simple!
There are 2 major budget pools controlled by local authorities within which sit many headings for the services they relate to – the General Fund and the Housing Revenue Account (HRA). The HRA relates solely to rented housing managed by a local authority. It includes the rental incomes, however rents are paid, and the expenditure on those properties – staff, repairs and management and capital projects. Consequently, when tenants pay their rent it is this income which pays for the management of their tenancy, for its repair and improvement and, perhaps, for the building of new houses. There is no payment from us, the taxpayer, or council taxpayer, to maintain these properties – that’s the General Fund, which is separate!
Bearing in mind that tenants, in effect, and over many years, pay for the management and maintenance of their home, and for the servicing of any loans to complete capital projects, through their rent, and that the property remains the asset of the council, tenants are, in effect, subsidising councils rather than the other way around!. Consequently, given levels of demand, the idea that more social housing should be built, to lessen levels of homelessness and housing need and to create greater levels of security within communities (which has subsequent positive impacts upon education, health, employment and crime levels) should be a no brainer! Yes, there is short term borrowing, but the rent from tenants will pay for this and for the subsequent management and maintenance of the new homes.
That there is a need for, and a positive argument for more social housing, needs pushing further through policy proclamations. That is not to say that there aren’t a whole variety of other means to enhance housing options, these are small step towards not a ‘property owning democracy’, but towards a democracy not fearful of where the next rental payment will be coming from or where a family will be residing this time next year.
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