The Case for Public Housing

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When did property ownership become such a major aim in the life of ordinary people? When did living in council owned housing become a stigma? When did mortgages did multi-generation mortgages come to be considered? Who has benefitted? In the light of current levels poverty and homelessness, why did we all go along with it all?

Sarah Glynn’s article looks back at the change in housing over the last hundred years or so.

The Case for Public Housing

By Sarah Glynn, Occupy Times

A home is such a basic need that the provision of adequate and decent housing should be a fundamental requirement of a fair society. But what do we require of a home beyond sound and safe shelter that can accommodate our household in a reasonably convenient location? Security of tenure is a vital basis for secure lives, and affordability is crucial. We may also need the option to move without penalty as and when circumstances demand. And most of us enjoy the opportunity to personalise our home.

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These should be the major considerations behind any housing policy, but increasingly they have become subservient to a free market politics that views housing as a major source of wealth and investment. None of the basic requirements listed above are dependent on home ownership – in fact affordability and moving house can be easier if you are not a homeowner.

Politicians like to claim that homeownership is a ‘natural’ aspiration, but it has been deliberately cultivated and subsidised by our capitalist society. As successive politicians have argued, homeownership encourages people to identify with conservative ideas about private property, and workers tied to a home and a mortgage are less likely to risk taking part in strike action.

One hundred years ago, almost everyone in the UK rented their homes, but they rented them from private landlords who sought to extract maximum profits. For working-class people, that meant dreadful, overcrowded conditions, insecure tenancies, and extortionate rents. State-subsidised council housing was brought in after the First World War because the private system wasn’t working – and because the government feared the growth of revolutionary ideas if they weren’t seen to be doing something about it. By the end of the 1970s, one third of households in the UK – and over half in Scotland – lived in publicly-owned, state-subsidised rented housing, and living conditions had undergone a massive improvement. But these developments were not without problems. An emphasis on quantity over quality meant housing estates were often poorly designed, serviced and maintained; and problems were compounded by distant, bureaucratic management.

Meanwhile, homeownership grew even more significantly, becoming associated with higher social standing. Investment in private property took on a growing role in national and household economics. Home owners used their property wealth to climb the economic ladder, leaving renters behind in relative poverty. Three decades of neoliberal free market policies have sold off the best council homes, restricted funding for those that remain, and created a disastrous property bubble. Private renting is again on the rise, along with all the problems that made public housing necessary in the first place. Landlords are amassing easy money as tenants hand over ever higher proportions of their income in rent. Housing benefits only serve to subsidise the landlords.

It needn’t have been like this. Public housing can provide everything that we want from a home, and fiscal rules can be drawn up so that homeowners do not gain a financial advantage over those who rent. Well considered and resourced housing policies can make a substantial contribution to a fairer, more equal society. In 1960s Sweden, a combination of regulations and subsidies ensured that tenants were not penalised with respect to owner occupiers; in modern Helsinki, 80% of land is publicly owned and half of homes are subsidised rented houses, which are often indistinguishable from their privately owned neighbours; and even in the UK there have been successful experiments in tenant management.

Public housing in the UK has been given bad press because vested interests did not want it to be too successful. Inadequate funding and bad management ensured its second class status. Its increasingly “safety net” role has led to it being stigmatised as poor housing for poor people. And there have been some spectacular failures. However, despite all this, the majority of schemes provided good homes that made a real difference to working-class living standards. And if we learn from past mistakes, we could see public housing playing an even more significant role in the future. There is no reason why we couldn’t plan for good quality, well-subsidised public housing for all who want it. This might seem extravagant, but it would be an investment in better life chances and a more cohesive and equal society. This time we could construct a system of local management, incorporating tenant involvement. Public housing also offers the possibility of co-ordinated planning, taking account of all the other things that make a community, and making efficient use of green technologies.

Public housing satisfies urgent practical needs as well as offering opportunities for a much more holistic approach to creating fairer and more sustainable communities.

By Sarah Glynn | sarahglynn.net

This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 Unported License.
– See more at: http://theoccupiedtimes.org/?p=11971#sthash.1imXPAAp.dpuf

See also: Uniting the People – Houses for People, not Profiteers

ConDemed: The Great Housing and Welfare Swindle: Part 2

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ConDemed: The Great Housing and Welfare Swindle: Part 2

ConDem Nation by Marxist Nutter, previously published here

See Part 1

How we got here…

Part 1 was a potted history of UK housing and welfare policy. The aim was to answer the question: How did we get here? It is important to establish the context of current policy, if we are to contest it and, in Part 1, I wanted to draw out some key contextual themes which are I think are often overlooked when contesting current government policy.

First, the 1980s marked a radical break with UK economic and social policy. Thatcher’s response to the crisis of Keynesian economics led to the establishment of a New Right hegemony. Her elevation of the individual over society (for there was ‘no such thing’) drove the thinking behind Right to Buy (RTB) policy, which still haunts UK housing policy even now. Her hegemony expanded in to numerous areas of social and economic policy and became a new ‘common sense’ understanding of reality and one based on neo-liberal economic assumptions. New Labour (1997-2008) were very much constrained by this hegemony and rather than contesting it, further sedimented it.

[…] it was during the New Labour years that neoliberal, free-market fundamentalism finally became “common sense”. “I would say that New Labour come closer to institutionalising neoliberalism as a social and political form than Thatcher did. She destroyed everything in order to have a flat plane on which to build, but there was serious opposition and struggle. Thatcherism was a slash-and-burn strategy. With Blair, the language became more adaptive; it found ways of presenting itself to Labour supporters as well.”

Interview with Stuart Hall

Second, New Labour, unable or unwilling to challenge global capitalism, sought to mitigate its worst effects through a massive expansion of the welfare state. Rather being a safety net for people who had ‘hit hard times’ the welfare state, under Labour, became a means by which the UK government subsidised employers. By introducing Tax Credits and also through housing benefit New Labour provided government payments to low paid workers to cover their cost of living. This allowed employers to pay low wages and so remain competitive in the global marketplace. New Labour’s approach was underpinned by the assumptions that the economy would always continue to grow (no more boom and bust) and this would cover the cost of government borrowing, credit would always be freely available to government, businesses and individuals. This allowed them to pursue very expensive policies on welfare and housing.

Third, when the credit crunch came, the Right were, once again, better able than the Left to articulate the hegemonic interpretation of events. A new hegemony was constructed which managed to frame the (global) economic crisis as a problem caused by too much government spending. The analogies with household debt and the ‘national credit card’, although bordering on the absurd, were very powerful and allowed the Right to articulate a powerful discourse that ‘the money had run out’ and large spending cuts were required.

Fourth, this resulted in a new and dangerous hegemony (the hegemony of ‘austerity’) which constructed welfare recipients (and through certain slippages in the discourse sometimes social housing tenants) as a primary source of high spending and a key target for government cuts and closed off crucial policy alternatives such as further government borrowing (the cost of which is currently low) in favour of a discourse of ‘austerity’.

Where we are now…

Opposition against government policy often revolves around providing evidence about the effects of the proposed or recently implemented policy. This assumes policy is decided rationally and can be contested through the presentation of rational arguments and evidence. Such a strategy ignores the affective dimension of policy. In Part 1, I drew on the work of the Psychoanalyst Jacques Lacan to show the fantastmatic dimension of the current discourse of welfare. According to political theorists David Howarth and Jason Glynos, the fantasmatic dimension of a hegemony explains why it ‘grips subjects’, or in other words, why people become especially attached to particular interpretations of reality. A Lacanian approach emphasises people’s emotional investment in a hegemony rather than the assumption that people are convinced by an argument (or discourse) through reasoned dialogue and evidence.

A rational perspective of current events would perhaps interpret the increase of welfare expenditure as primarily driven by the (New Labour) desire to mitigate the effects of stagnant wages, inflation and the increasing cost of housing on low paid workers. Certainly the evidence would seem to suggest that the unemployed (so called ‘benefit scroungers’) account for only a fraction of the welfare bill. Thus a slippage in discourse is required in order to make significant cuts to the welfare bill that will affect low paid workers and yet allow this to be interpreted as mainly affecting ‘benefit scroungers’. Rationally speaking, cutting benefits for the unemployed would make very little difference to the overall benefit bill (see Part 1). Indeed rationally speaking it may make sense to increase taxes on the wealthy, and increase government borrowing to provide a Keynesian style stimulus for the economy. Recent economic performance that has resulted from the coalition’s economics of austerity also seems to show that the hegemony of austerity is self-defeating and irrational, in terms of economic growth. The hysteria peddled by the coalition parties in 2010 which compared the UK economy to Greece was also, without a shadow of a doubt, a highly irrational argument. In short the hegemony of austerity has nothing to do with evidence or reason; but it does serve certain interests key to the coalition partners. It serves to make the poor and unemployed the target of cuts and detract focus from the banking sector and the crisis that runs to the core of a neo-liberal system, which all parties are heavily emotionally and intellectually invested in. It closes off competing interpretations of reality which may call for higher taxes for the well paid/ asset rich and a re-structuring of the economy away from privatisation toward nationalisation. Certainly, under the politics of austerity privatisation has continued and expanded into health, prisons and the police, to the great benefit of private capital and is likely to lead, as history is shown is often the case with privatisation, to poorer services at higher costs for the end users.

Only in the context of this irrational hegemony of austerity and its strong fantasmatic appeal does current government welfare and housing policy make any sense. Welfare and housing policy are not based on evidence or reason; but the ability of the Right to articulate a hegemonic interpretation of current economic and social reality that also happens to serve elite interests. Therefore contesting this agenda through evidence and reason is to fundamentally misunderstand the nature of policy and could even be seen as an irrational strategy.

Contours of Current Policy

The coalition government have made and are making wide ranging reforms to housing and welfare policy. In keeping with the hegemony of austerity most of these take the form of cutting government expenditure. Let us have a look at the range of policy measures introduced under the coalition government.

One of the first moves of the coalition government was to abolish the Audit Commission and Tenant Services Authority (TSA). Certainly the Commission was expensive and had perhaps already done its best work in driving up standards in housing provision. The one size fits all KLOE approach to inspection was arguably stifling innovation. However, in what has now become a key theme of the coalition, spurious claims about savings generated from the closure of the Commission are unlikely to be realised (see also).

The abolition of the TSA and its functions being absorbed into the Homes and Communities Agency (HCA) led to a massive watering down of its new regulatory framework (published just a year before its closure) in terms of tenant empowerment. Although much of the wording of the TSA Framework remains intact, the emphasis shifted from tenant empowerment to the financial viability of housing providers. The new regulatory committee (part of the HCA) make it clear they will only regulate proactively when it comes to issues of governance, financial viability and value for money and will avoid becoming involved in ‘consumer issues’. An interesting con –trick was played here. Under the guise of empowering tenants to regulate landlords (co-regulation) the new regulatory regime actually dis-empowers them by removing support from the regulator to back them up. Under the TSA regulatory framework, landlords were required by regulation to allow themselves to be scrutinised by tenants. Although technically this is still the case, now the regulator has made it clear that it will only enforce these regulations where there is a ‘serious detriment’ to tenants (i.e. it is a matter of life and death) and so in most cases will not get involved to support tenants in holding their landlord to account. This is spun as passing the role of regulation to tenants and so empowering them, in reality without backing from the regulator one wonders how much power small groups of tenants will have to hold large landlords to account.

In line with the cuts agenda, the government significantly reduced the grant funding of new affordable homes. Instead of grant funding being the primary vehicle for the construction of new social housing, the coalition’s approach was to stretch the definition of ‘affordable homes’ to the absurd. Their new development funding model involved the development of (so called) ‘affordable housing’ at near market rents (known as ‘affordable rent’). The projected extra income generated by these new ‘affordable rent’ homes can be used by developing landlords to secure finance. This model requires landlords to draw down their own reserves and sweat their assets to build homes that are let at higher rents with minimal grant funding.

Reforms to the private rented sector have already been wide ranging and it is possible more is on the way. These reforms include capping of local housing allowance (LHA) rates, the abolition of the single room rate for people under 35 years of age (meaning these people will only get housing benefit to a level that will cover shared accommodation, regardless of the fact there is a lack of such accommodation in many areas). LHA rates were also set at the level of the bottom third of local rents as opposed to the median level (meaning fewer homes would be available for people on housing benefit). The coalition’s rationale for these reforms is as follows:

The measures announced will provide a fairer and more sustainable Housing Benefit scheme by taking steps to ensure that people on benefit are not living in accommodation that would be out of the reach of most people in work, creating a fairer system for low-income working families and for the taxpayer. It will avoid the present situation where Housing Benefit recipients are able to live in very expensive properties in areas that most working people supporting themselves would have no prospect of being able to afford. [My emphasis]

Source

Consider the above in the context of the argument made in Part 1, concerning the fantasmatic dimension of welfare discourse, bearing in mind that in an increasing number of cases housing benefit recipients and working people are one in the same.

In addition to the above, reforms stemming from the Localism Act (2011) and revised allocations guidance to local authorities allows them to discharge their homelessness duty into the private sector, which is made much harder by LHA reforms which limited the amount of accommodation available to people claiming housing benefit in the private sector (this just is one of many examples where government policy seems to contradict itself). The allocations guidance also encourages local authorities to prioritise ‘working people’.

The Localism Act also reformed social tenancies through the introduction of fixed term tenancies which abolishes the right to secure tenure for new social housing tenants. This policy may allow housing providers more flexibility to manage their stock by making it easier to terminate tenancies when a tenant’s circumstances change (e.g. kids have moved out so the housing provider can now force the tenant to take a smaller property); but are also likely to result in significant administrative burdens for providers of social housing. What is very fanciful indeed is the idea (put forward by the government) that social tenants will have got higher paid jobs and will be able to move into home ownership or the private rented sector at the end of their fixed term tenancy. These claims seem somewhat out of touch with the reality of social mobility in the UK, the fact that private rents are increasing and the dim prospects of home ownership for the majority of future social housing tenants. The government like to emphasise that security of tenure for existing tenants is protected; but this is not entirely true; as should a secure tenant chose to transfer to (or exchange into) a property let on ‘affordable rent’ terms they would potentially lose their security of tenure.

The fact private rents are increasing is not a fact the government are willing to accept. Both the former Housing Minister (Grant Shapps, the one who likes to change his identity) and the Prime Minister continuously claimed their LHA reforms led to private rents decreasing despite their being a great deal of evidence to contradict this assertion.

Grant Shapps has a dodgy record when it comes to statistics, trying to argue black is white in terms of house building. He has gone to extreme lengths to paint the sorry state of house building under the coalition in a positive light. Despite the dodgy Shappstistics affordable home building declined under his watch and many of the homes built were ‘affordable rent’ (which are not affordable in many cases, see above).

As noted in Part 1, many issues associated with the lack of affordable housing can be traced back to Thatcher’s RTB policy. In this context, then it seems strange that the coalition would seek to ‘re-invigorate’ it! Although there has thus far been a low take up of this policy, it still serves as a master class in media spin and manipulation. The Department of Communities and Local Government (DCLG) have spent £660k to advertise the scheme, which shows that despite the nation being ‘broke’ there is still money available to support pet projects close to ministers’ hearts. This policy was always going to be controversial with the housing sector, which may explain the decision to release the consultation just before Christmas 2011 and have a shorter than recommended consultation period (which was mainly taken up with the Christmas break) – leading to a certain sense of panic among some local authorities who clearly felt they were not given adequate time to respond.

The grounds for urgency are that the consultation period is so short (6 weeks, over the Christmas period) that it has not been possible to go through the usual process. However the consultation relates to proposed major changes to Right to Buy (RTB) discounts and has major implications for Sheffield. It is important that we provide a strong response to these proposed changes. Source

When the policy was finally announced it also differed significantly from the proposals outlined in the consultation. However the greatest example of media manipulation and spin, I leave until last. This was the constant claim made by Grant Shapps that the policy would result in a ‘one for one’ replacement, no doubt to mitigate criticisms of the original RTB policy (see Part 1). For a start the social rented homes lost would only, at best, be replaced by ‘affordable rent’ homes (so hardly a like for like replacement). Grant Shapps was quoted in the media as saying that homes sold ‘will be replaced on a one-for-one basis by a new affordable rent property, ensuring there is no reduction in the number of affordable homes’. This implied that all homes sold under the RTB scheme would be replaced; however this is not the intention. RTB had technically never stopped and homes have continued to be sold under RTB ever since the policy came in. The new coalition policy was to change the discount rates to encourage more people to buy their council house. It is not the intention of the re-invigorated right to buy to replace all these homes; indeed special emphasis should be given to the word ‘additional’ in the quote that appears on DCLG’s website.

[..]we are also determined to maintain the number of affordable homes for rent – so for the first time, every additional home that is sold will be replaced by a new affordable home on a one-for-one basis. The new homes for affordable rent will help get the nation building again, and help councils meet housing need

What is meant by this is that an obscure formula is to be used to calculate how many homes would have been sold (under RTB) without the change in policy and then any additional sales (on top of those given by the calculation) would be ‘replaced’. Therefore despite the impression given, not all homes sold under RTB would be replaced (even by ‘affordable rent’ homes). In addition, despite the unequivocal rhetoric from the government the consultation document did not seem so certain that one-for-one replacements could be achieved, even within the government’s own terms. Speaking of certain models for the delivery of ‘replacement homes’ the consultation said:

[…]it would be unlikely that all the available receipts were used for replacement homes and so would be very unlikely to deliver one-for-one replacement at the national level.

And

However, while directing councils on the use of receipts is likely to increase the number of replacement homes (compared to the Local Model), it is still very unlikely to achieve one-for-one replacement across England

The delivery model chosen was deemed to only be able to provide one-for-one replacements at the national level; however at the local level, affordable homes would often not be ‘replaced’

Under this model some areas would not be able to replace all additional Right to Buy sales while for others replacements would exceed sales.

This means that certain areas (where house prices are low) could see a real reduction in their affordable housing stock and as housing allocations are decided locally could put a real strain on certain local authorities and communities. These details were, however, predictably absent from government press releases.

Having outlined some of the government’s major housing reforms and changes to how housing benefit was delivered in the private rented sector, let us now turn to look in detail at the relationship between welfare reforms and the social rented sector.

Welfare Reforms and Housing

An aspect of government discourse, which I have alluded to a few times so far, is the slippage in discourse between the construction of the benefit recipient and that of the social tenant. I think this should be the subject of more in depth analysis (and I may take this project on myself if others do not); and certainly warrants a paper in its own right. However it is certainly interesting in this context to note that one key aspect of the welfare reforms are aimed specifically at social tenants. This is the size criteria or ‘bedroom tax’. This reform targets those deemed to be under-occupying in the social rented sector, through a reduction in their housing benefit. This is calculated based on the claimant’s housing benefit eligible rent, so those deemed to be under-occupying by one bedroom will have their benefit reduced by 14% of their rent (25% for those deemed to be under-occupying by two bedrooms). This has some nasty consequences working people as well as the unemployed.

For example, take somebody (deemed to be) under-occupying by one bedroom, whose housing benefit eligible rent is £100/week. If they are unemployed and on full housing benefit they will lose £14/week housing benefit so their total housing benefit payment would be reduced to £86/week; however somebody who is in work (on a low income) and only receives partial housing benefit of £14/week will lose all their benefit.

This reform was ‘sold’ by the government as trying to encourage the better use of social housing; however in many cases there is a lack of suitable social housing for people to move to, in order to avoid the penalty. Also the projected savings of this measure that the government outline in their impact assessment would not be realised if the policy were to achieve its stated aim and result in tenants moving to smaller accommodation. It has also been recognised that this policy will have a particularly devastating effect on disabled people.

[The government] know that any saving for the nation’s housing benefit bill depends, paradoxically, upon people not moving, staying put and ‘absorbing’ the benefit cut. Indeed, if everyone downsized to the PRS [private rented sector], the housing benefit bill would be substantially higher. They claim the change will incentivise people to work. But they also know, as made clear by the DWP’s own Equality Impact Assessment, that over two-thirds of the households affected include a tenant with a long-term illness or disability.

Source

An aspect of welfare reform which is especially interesting, if we bear in mind the fantasmatic appeal of government narratives, is the benefit cap. This will affect people in both the private rented and social sector. The impact will mainly be felt by poor and low paid people with large families who live in expensive parts of the country (such as London and the South East). This reform caps benefits to the level of the average household (net) income of £26,000/ year. The following quote explains the rationale of the reform, and I would ask the reader to once again recall the discussion of the fantasmatic narrative of the ‘benefit scrounger’ articulated in the media (noted in Part 1) as they read it:

I would like to make some general points about the rationale for the household benefit cap. First, there is a principled point that households should not be able to receive more on benefits than the average working family in Great Britain earns in work. Secondly, people on benefits should face the same choices as working families, including about where they can afford to live. Thirdly, someone in work should always be better off than someone on benefits. The proposed cap of £500 a week is equivalent to an annual salary of £35,000 a year before tax. We have set the cap at the median earned income for working families after tax and national insurance [My emphasis]

(Source: HL Deb 23 January 2012 c806 )

A Bleak Future?

I hope the reader has followed me thus far through my whistle stop tour of the coalition government’s housing and benefit reforms. It is worth pausing now to consider the impact these reforms have had and are likely to have.

Certainly allocations and LHA reforms have played a role in the 26% increase in homelessness and the increase in rough sleeping experienced since the coalition has come to power. It is also likely that they have played a large part in the 44% increase in the use of temporary bed and breakfast accommodation to house homeless people, in spite of central government trying to blame local authorities.

In an excellent article for the Independent Stuart Hodkinson spells out the likely impact of welfare reforms:

The government’s own figures – which almost always under-state the real impact – suggest that 660,000 households will lose on average £14 a week with 120,000 households losing more than £20 per week. Ministers, well-versed in Orwellian double-speak, say it’s all about fairness to the taxpayers’ subsidising the ‘spare rooms’ and to those forced to live in overcrowded conditions or on waiting lists by the under-occupiers. But this is just nonsense. For families affected, what the state defines as a spare room will typically be a child’s bedroom; for many single tenants, this will have either been their home for decades or the only available home they were offered at the time due to the chronic shortages of social housing that resulted from earlier waves of privatisation and cuts… Tenants will be forced to choose between greater poverty or moving home – but where will they go? Perhaps in the Coalition’s fantasy world, under-occupiers will magically swap with over-occupiers but in the real world this can’t happen for two simple reasons. First, there is a general shortage of single occupancy social housing so people can’t downsize; and secondly, most of the over-crowding is in the South and most of the under-occupancy is in the North.The Department for Work and Pensions’ own impact assessment spells out the consequences: “individuals may have to look further a field for appropriately sized accommodation or move to the private rented sector, otherwise they shall need to meet the shortfall through other means such as employment, using savings or by taking in a lodger …”

So far in this article, I have not discussed the changes to incapacity benefits and the assessment process led by the company Atos. This has been widely reported and is certainly a huge scandal. The targeting of cuts on the poor and disabled has already led to much suffering, depression and death; and it is likely the welfare reforms yet to come will only make this worse.

Another (hidden) reform that has received little attention and about which little is currently known is council tax reform. This will vary from local authority to local authority. However the proposals I have seen from some local authorities will certainly have dramatic impacts on the incomes of poor households. Combined with other welfare reforms the effects of council tax reform could be devastating and may well be the final straw for many hard pushed people.

It seems likely as well that the introduction of universal credit will not go smoothly and the introduction of direct payments to tenants will impact housing providers’ revenue streams making it even less likely that they can deliver the much needed new build affordable housing.

Affordable house building has already declined under this government, despite it being the ‘gold standard’ on which they are to be measured. The government’s new ‘growth strategy’ (in quotation marks as it is better described as a back of a fag packet idea) has already led to confusion for affordable housing. The government has now been forced to admit that it could lead to 10,000 fewer affordable homes being built. The passage of the Growth Infrastructure Bill will only incentivise developers to sit on their sites and not build, while they await the Bill’s passing so that they can take advantage of it to drop the amount of affordable homes they are required to build under section 106 agreements and so boost their profits to the further detriment of affordable housing provision. These plans will completely stall house building in the short term (during the passage of the Bill) and (as the government admit) seriously risk resulting in fewer affordable homes in the long term.

The relationship between welfare reform and the ‘affordable rent’ model for the supply of new homes would also seem to be something the government have failed to think through. ‘Affordable rents’ mean higher rents and if these higher rents are being paid for by benefits then it follows benefit expenditure may well increase. This is certainly a convoluted way to fund new housing supply, even before we consider the impact of welfare reforms. Rather than paying direct grant subsidy to build new homes, rents are increased and these higher rents are, in part, funded by benefit payments which help to generate funds for new supply. It would seem simpler to just pay grants rather than subsidising new build through benefits. The ability of housing providers to gain finance on the basis of these rents is crucial to this model and may well be put in jeopardy by the introduction of universal credit and direct payments to tenants. In addition, a damning report by the National Audit Office (NAO) warns that welfare reforms will increasingly make all types of housing unaffordable for the working poor.

The National Audit Office says that within five years 48% of England’s 275 local authorities would have more than twice as many benefit claimants as two-bedroom dwellings, the most popular housing stock, available to rent. In January the government capped housing benefit payments, so that on a two-bedroom home the maximum benefit payable would be £250 a week. The allowances are also being scaled back by pegging them to the bottom third of rents in any borough – and then from next April benefits will rise more slowly than rents. The result is that in many towns and cities there will not be enough affordable homes to rent for those claiming local housing allowance, the benefit paid to tenants of private landlords.The NAO warns: “More households would need to top up rents from other sources. Households in areas with larger shortfalls in ‘affordable’ private housing will face strong incentives to move to areas with smaller shortfalls or surpluses.”

Source

Contesting the Coalition or Contesting the Hegemony?

The rational case, the evidence and perhaps even basic human morality are all stacked up against the government. The power of the government’s position does not come from rational argument or evidence, it comes from the establishment of a hegemony of austerity that justifies cuts. This hegemony is sedimented through the emotional investment people have in it through fantastmatic narratives about ‘benefit scroungers’. These narratives both justify and garnish support for cuts that will harm a great number and diverse range of the British public. This is not just a party political issue. All political parties (despite their minor differences) have bought into this hegemony. They are all neo-liberals; they all believe that cuts to welfare are needed (or that public feeling on the issue makes them necessary) and they all advocate various forms of austerity.

I am a great fan of Jules Birch’s blog in Inside Housing magazine; however in a recent blog (which is excellent and would encourage people to read it) I think he misses these crucial points. He calls for more evidence from the government around the benefits of the Growth and Infrastructure Bill. I think Birch is making a well-intentioned and common mistake (common amongst those lobby groups, charities etc involved in contesting government policy) in thinking that policy is about evidence. I have written elsewhere about evidence based policy and the dangerous (New Labour) rhetoric of ‘what works’, for now I will simply quote Wayne Parsons on the issue.

[T]he policy orientation is, above all, contextual. Lasswell would have considered the question of ‘what works?’ as arrant and dangerous nonsense. ‘What works’ is about: what works, for whom, when, and how?; or what kind of evidence works for what kind of problem/ policy in what context, and for whom? … ‘Evidence’, as postpositivist approaches to policy analysis argue, is inextricably interconnected with the problem of participation, power and inequalities in power’

Source

Hence I have emphasised context (the whole point of Part 1) and power (elite interests served by the hegemony of austerity) and now raise the issue of participation with, or rather, contestation of government policy. I would add one important component into Parsons’ mix however and that is the role of emotion and the affective (fantasmatic) dimension in policy making.

No matter how much evidence is brought to bear against government policy, no matter how rational and well argued the cases made by Shelter, The Joseph Rowntree Foundation, disability rights activists and others, nothing will change unless we find a way to contest the entire hegemony of austerity (and we probably need to contest the neo-liberal hegemony on which it rests as well). There is no point in just campaigning against the Conservatives or the Liberal Democrats either. New Labour bought into Thatcher’s neo-liberalsim and they have bought into the coalition’s austerity as well. We need to campaign against the entire hegemony – we need campaign against the dominant view of ‘common sense’.

What sediments any hegemony is its fantasmatic logic. This is all about emotional investment; not reason or evidence. Evidence will have no impact on somebody’s emotional investment in a policy agenda. Here Shelter has the best approach. Shelter often focus on cases of individuals affected by policy – they engage the affective dimensions of the policy debate – in other words they appeal to emotions. Any counter narrative to the current hegemony will need to skilfully weave in affective argument with reasoned dialogue and evidence, balancing these appropriately for each intervention. However policy should no longer just be contested on a case by case basis. The entire policy framework, the hegemony in which it is articulated and the historical context of the hegemony all need to be brought into the debate (as I have attempted to do here).

Here I think we should support the Occupy movement who seem to have moved furthest in this direction; but there is a need for a strategic and aligned approach that resists the tendency to break up into factions. We must work together – the stakes have never been higher.

ConDemed: The Great Housing and Welfare Swindle Part 1:

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ConDemed: The Great Housing and Welfare Swindle Part 1:

A Potted History of the Context of UK Housing & Welfare Policy

By Marxist Nutter previously published here:

Introduction: The Rise and Rise of the New Right

A dangerous new hegemony is emerging from the right and it has been made possible through New Labour’s sedimentation of the Thatcherite hegemony. This new hegemony is the hegemony of austerity.

This hegemony has wide reaching effects in terms of the UK economy and social policy; however nowhere is it more pronounced than in housing. Before going on to look at the effects of the New Right on housing and welfare in the UK, let us first recall its history.

The Thatcher government was responsible for the biggest ever sell off of public assets in the form of the ‘Right to Buy’ (RTB) scheme. Since the 1940s local authorities had been building large amounts of social housing which was affordable for the people of Britain and by the 1980s social housing constituted a very large and important national asset.

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(Graph reproduced from http://www.significancemagazine.org/view/index.html)

Thatcher’s RTB sought to sell off social housing to enable social tenants to become home owners. As these social homes were never replaced and building of social homes has been in long term decline, there has been a substantial change in the tenure mix of UK housing, much of which can, to a large extent, be attributed to Thatcher’s RTB policy.

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(Graph reproduced from http://www.statistics.gov.uk/hub/index.html)

Research shows that the RTB policy enacted in the 1980s has led to unintended consequences such as the proportion of social homes, sold under RTB, that have ended up as private rented accommodation as opposed to owner occupied, in contradiction to the initial policy aims which were to turn social rented homes into owner occupied homes. Recent estimates suggest that the effect of RTB properties ending up in the private rented sector may have increased benefit expenditure by as much as £2bn per year (Sprigings and Smith 2012). What was once a valuable national asset is now a tool for the generation of private profits which have been subsided by the tax payer, first through the RTB discounts themselves and now through benefit contributions paying for the high private rents being charged by the new owners of what was once social housing.

RTB was certainly an advantage to the generation who were able to buy the council homes under the scheme (and who benefited from significant rises in the value of their property) and is now an advantage to private landlords able to command high rents due to the lack of supply of affordable housing. RTB however has been very costly to the treasury.

Today, the cost of housing benefit is an important political issue; but it is the tenants of the remaining social homes especially who are constructed as the reason for this (as the problem) and not the policy that transferred public assets to private ownership. Certainly, not all in receipt of housing benefit are social tenants, many live in private rented accommodation and some in former social housing which was sold under RTB, and yet this distinction is often blurred in public discourse. It is also true that the majority of people in receipt of housing benefit are either retired or in low paid work, yet in public discourse housing benefit is often linked with unemployment. This is because the New Right have succeeded in framing the housing and welfare debate in a certain way.

The New Labour Years: A New Hope

Thatcher’s greatest success was how she dragged the entire political spectrum to the right by articulating together a critique of Keynesianism with her vision of a strong state and a free market (see the work of Stuart Hall for more details). Thus when even the broken electoral system of the UK managed to reject the Conservatives in 1997, it was unable to reject Thatcher, as her ghost haunted the Blair government even more than the Major government. Labour were never able to challenge neo-liberal orthodoxy. The neo-liberal interpretation of reality had, by this time, become ‘common sense’ – this is perhaps the simplest definition of hegemony. Hegemony is where a single contingent interpretation of reality emerges from a field of multiple possible interpretations to become ‘common sense’ (See Howarth, D. and Stavrakakis, Y. for more details.

By 1997, the prevailing view at the top of the Labour party was that there was no public appetite for socialist principles or an opposition to capitalism, and in order to maintain credibility with the electorate the party must accept a ‘common sense’ view of the world. Privatisation and the fetishisation of the private sector were (and still are) the order of the day. Nationalisation was off the table (let alone workers seizing control of the means of production). Councils, despite successes in previous decades, were viewed as inadequate vehicles to drive affordable housing development.

This new common sense is well articulated in the book On The Edge edited by the Third Way philosophers Will Hutton and Anthony Giddens, (both huge influences on New Labour).

The world’s top corporations …have become not only centres of concentrated economic and financial power; they have become the bearers of the prevailing laissez-faire, globalist ideology. As their economic power grows, so does their political and intellectual reach, at the expense of the nation state that once balanced private economic power with public purposes and national stabilisation policies. The very economic success of global corporations is taken as proof that their world- view has to be correct: that global laissez-faire is the optimal way to organise a modern economy.

[An aside: It is also worth noting (because) that this was not long after the collapse of the USSR and Francis Fukuyama’s famous declaration of the End of History.]

Blair and Brown believed they were largely impotent in the face of the power of global capital and that the only possible way to deal with the neo-liberal reality was to try and mitigate the worst effects of unrestrained capitalism especially for the poor and low paid. New Labour introduced Working Tax Credits in 1999 (as Working Family Tax Credits – see O’Reyes on discourse of Hard working families in Torfing and Howarth eds ) and by the time the coalition came to power Tax Credits accounted for the greatest slice of welfare expenditure. Therefore the biggest single aspect of government welfare expenditure goes to people in work. This fact is rarely mentioned in public discourse, as it does not fit neatly within hegemonic framing of the problem. The second largest aspect of the government’s welfare bill is housing benefit and increasingly housing benefit claimants are also workers in low paid jobs. New Labour, through Tax Credits and Housing Benefit, were thus attempting to address the problem, that increasingly wages in the UK were not sufficient to cover the cost of living, for many low paid workers. Therefore one may argue that rather than subsidising households, New Labour policy was subsidising employers to pay low wages (and thus allowing the UK to be more competitive in the global labour market) by providing benefit payments which allowed workers to cover the cost of living near and/or travelling to their jobs – costs which were/are increasingly not being met through their wages alone.

Meanwhile New Labour encouraged local authorities to either sell off their housing stock to housing associations (Large Scale Voluntary Transfers or LSVTs) or to separate out the management function of social housing from other council functions through the creation of arms-length management organisations (ALMOs). LSVTs had access to credit which local authorities did not and due to changes to the housing funding regime ALMOs had access to funds to improve their neglected (council) housing stock. In addition, the Audit Commission and its inspection regime was used as a hammer to bash housing providers, of all kinds, ‘into shape’. Therefore through a combination of heavy handed inspection and regulation, the availability of grant funding and various ‘public-private’ solutions, and the diversification of social housing (through the Housing and Regeneration Act) to include certain home ownership and near market rented ‘products’ (an so open the door to cross subsidisation within the housing sector), New Labour were able to improve the quality of a great deal of the nation’s (remaining) social housing stock. However, once again, a big part of the New Labour solution involved throwing money, not at the problem per se, but the symptoms caused by the problem. Grant funding of new build social housing was expensive and did not generate anything like as many new homes as the local authority led building programmes of the mid 20th century. The Audit Commission may have improved standards, in some cases, but was an expensive and unwieldy beast that hammered in a ‘one size fits all’ approach to housing management through its Key Lines of Enquiry (KLOE) inspection regime and so arguably stifled innovation meaning that many of the (perceived) advantages of privatisation were perhaps not fully realised.

All in all the New Labour approach of avoiding the problem and mitigating its effects was very costly and involved a great deal of public and private borrowing; but nevertheless did succeed in insulating the nation’s poor and low paid from the worst effects of global capitalism.

The Credit Crunch: The Revenge of the Markets

New Labour’s approach was to mitigate the effects of global capital and not challenge it, for they felt impotent to do so. There was also, no doubt, an element of hubris to their approach in the form of their belief in neo-liberal doctrine; the inexhaustibility of cheap finance and the mistaken notion that they had ‘put an end to boom and bust’. I have noted how they used the benefit system to subsidise low wages and allow British businesses remain competitive in a global marketplace. This combined with the easy availability of credit, underwritten by rising house prices, allowed the majority of people to not perceive the effects of long term wage stagnation. For this reason the stagnation of wages was not commonly constructed as a problem within mainstream politics or the media. This stagnation was caused by the greater problem, of which it was a symptom, which is global capitalism – the very problem that ‘common sense’ dictated was impossible to address, and indeed did not ‘feel’ like a problem for much of their time in power. New Labour, in a sense, constructed a ‘house of cards’ from the benefit system which was propped up via government borrowing and masked by the availability of credit to ordinary consumers. This ‘house of cards’ was how New Labour sought to reduce the effects of the core problem it either did not perceive or felt it could not address. The housing benefit bill continued to rise as did rent levels. New Labour were both paying for the increasing costs of lack of affordable housing supply (through benefit payments) and, at the same time, paying out grants to address this problem. This, in retrospect, was a very expensive and ineffective (in terms of the generation of new housing supply) approach. It also generated a ‘slow burn’ of resentment among the population, who perceived more and more people ‘living on benefits’; living in better quality housing at the expense of the public purse. This resentment probably was exacerbated by issues with immigration, which I do not have the space to discuss here; but was also, for the most part, mitigated by the availability of cheap credit for many people and, for home owners, the fact the increasing price of their property was offsetting their mortgage.

However, in 2008, with the global financial crash, New Labour’s house of cards came tumbling down. The over-exposure of private lenders to risks based on the over-valuation of certain financial products (many of which, based in the last instance, on house values) became apparent. This phenomenon first arose in the USA, but due to the inter-connected nature of global capital, its effects penetrated every aspect of the global markets. With banks in trouble suddenly what was impossible for manufacturing firms years earlier became possible; and the government found billions of pounds to bail them out. The availability of credit was so crucial to the neo-liberal project and to New Labour’s ‘house of cards’ that the banks could simply not be allowed to fail. There are numerous issues that could be discussed at this juncture such as: the contradiction that high salaries/bonuses are justified due to the risks entrepreneurs take; yet when push came to shove these risks were borne by the state, the issue that global capitalism meant it was impossible for government to save manufacturing industries and people’s jobs, yet when the finance industry was in trouble suddenly the impossible became possible; however although these are fascinating topics, discussing them in depth would lead this article astray.

My interpretation of events was that, faced with a dislocatory event that threw New Labour ‘common sense’ into disarray, Gordon Brown’s administration fell back into the conventional wisdom of Keynes. There was also, no doubt, a realisation that their entire house of cards was built on the availability of credit and as such the government felt compelled to do all it could to sure up the banks and encourage them to keep lending. Certainly there is some evidence to suggest that Brown’s small scale Keynesian stimulus was a more effective short term response to the crisis than current Coalition policy. Whatever the reasons, the decision to bail out the banks transferred the private debt crisis into a sovereign debt problem. This certainly impacted the ability of any future government to continue with the approach to housing and benefits pursued by New Labour during the late 90s and early 21st century.

The New Right Strikes Back
The other result of this crisis was that the issues of wage stagnation were no longer as well masked by credit. The resentment of the welfare system was also made more acute as people on middle incomes started to feel the pinch (although this did not happen right away). As much as I think this was a factor it is an inadequate explanation for the increasing feeling that the benefit regime was too generous.

It seems probable, if not likely, that at least some of those who are resentful of the benefit regime would also be on low wages and so are the major (in monetary terms) beneficiaries of the system. Therefore the growing resentment with welfare and benefits from those who gain most from the system appears irrational. What is crucial here is how the argument was framed. The media, to the great benefit of the forces of fiscal conservatism, managed to construct the credit crunch as a problem with public spending. In fact the data do not seem to support such a simplistic interpretation. Certainly New Labour had, as I have already noted above, pursued a very expensive approach to dealing with the effects of wage stagnation, however the massive gap between revenues and spending (the budget deficit) that happened in 2008 was largely due to a huge drop in revenue from taxes (see graph below) and to a lesser extent from the decision to prop up the banks (the financing of which is often excluded from the measurements of public spending).

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(Graph Reproduced from http://falseeconomy.org.uk/)

The discourse that the New Labour had ‘run up the national credit card’ gained currency (became hegemonic) and became the dominant, if misleading on a number of fronts, interpretation of the problem. This then allowed for another very clever sleight of hand. Drawing on a certain pre-existing resentment with the welfare system, beefed up with evidence that welfare spending was set to increase massively (for the reasons outlined above) the new Coalition government (that came to power in May 2010) were able to detract emphasis and public anger which, at the time, was well and truly aimed at banks, MPs and the wealthy (interests strongly aligned with the Conservative Party) and direct it toward welfare recipients. This involved a slippage in how the evidence was constructed and presented through conflating the ever increasing benefit bill with a very small hardcore group of unemployed benefit claimants. As we have seen, the increasing benefit bill was/is in fact driven by the combination of stagnant wages and increasing house prices, which in turn is caused by global market pressures and the lack of affordable housing supply (caused in part by the RTB policies of the 1980s). Unemployment benefits actually make up a very small proportion of the overall benefit bill and are lower than most comparable nations.

Benefits in the UK are comparatively lower than other industrialised countries; with one of the lowest benefit rates relative to earnings. In addition the actual value of benefits in the UK has declined over the last thirty years due to a change in the policy of up-rating benefits.

Source

So the Coalition government (together with the right wing press) successfully and misleadingly conflated the rising cost of benefits with the image of the ‘lazy scrounger’ who has no job and ‘lives off’ benefits and thus developed a hegemonic discourse of the ‘lazy scrounger’ who is responsible for the rising cost of welfare expenditure. The reason why the coalition has been so successful in hegemonising this interpretation is due to what we can call (following the French Psychoanalyst Jacques Lacan) the ‘fantasmatic’ dimension of the discourse. The notion of the benefit scrounger closely follows the contours of the ‘stolen enjoyment thesis’ identified by political theorists David Howarth, Jason Glynos and Yannis Stavrakakis. The theory is quite complicated here and not easily put in a ‘nutshell’, so I will quote at length:

The promise of a full enjoyment which escapes our attempts at identificatory capture and which serves as the motor of desire is linked to what Lacan calls the objet petit a, the object-cause of desire, and it is this object which forms the centre-piece of a subject’s fantasy. When Lacanians say that fantasy supports reality …, they tend to mean that the credibility and salience of any object of identification relies on the ability of the fantasmatic narrative to provide a convincing explanation for the lack of total enjoyment. Ontologically, of course, this lack of total enjoyment is necessary. However, in the subject’s economy of desire this ‘truth’ must be actively forgotten, and it is this dialectic of confrontation with, and denial of, lack, which gives rise to the logic of fantasy. Indeed, oftentimes the cause of the lack of enjoyment is attributed to someone who has ‘stolen it’. Romantic nationalist histories, for example, are frequently based on the supposition of a golden era (Ancient Greece and/or Byzantium for modern Greek nationalism, the Jewish kingdom of David and Solomon in many versions of Jewish nationalism, etc.). During this imagined golden age, the nation was prosperous and happy, only to be later destroyed by an evil ‘Other’, someone who deprived the nation of its enjoyment. Typically, nationalist narratives are rooted in the desire of each generation to try and heal this (metaphoric) castration, and give back to the nation its lost full enjoyment. The identity of the evil ‘Other’ who prevents the nation from recouping the enjoyment it has lost shifts as a function of historical context. It may be a foreign occupier, those who ‘always plot to rule the world’, some dark powers and their local sympathizers ‘who want to enslave our proud nation’, immigrants ‘who steal our jobs’, etc. In this view, the obstacle to full enjoyment shifts depending on the specificity of the fantasmatic narrative at stake, but the formal logic remains the same.

Source

‘Benefit scroungers’ are, as such, constructed as the (horrific) obstacle preventing the majority from enjoying ‘full enjoyment’ – ‘the evil ‘Other’’ (illustrative example). In this ‘fantasy’ the benefit scrounger is constructed as the reason for high government spending and while they (the benefit scrounger) enjoy a ‘champagne lifestyle’ courtesy of the state, we (non-scroungers) are having to make sacrifices and cut backs. The fantasy is thus that if the ‘benefit scroungers’ are dealt with (the obstacle is overcome) then the nation will be better off and the majority can reach full enjoyment by no longer having to make cut backs. It is thus that ‘benefit scroungers’ are constructed as the obstacle – as stealing our enjoyment – the reason that we must live as we do and not as we would like to. This can be further sedimented by the fact that people often report knowing somebody ‘who never works and enjoys sitting in the pub, living the high life on benefits’. This allows them to give a real ‘face’ – an example – in which they can fully emotionally invest in as the target – as the ‘they’ which are stealing ‘our’ potential full enjoyment. See the following as an example of how this fantasy is constructed at the fringes of official discourse.

Mr Bateman’s daughter Jessica, 18, who is from a previous relationship, said she was ashamed of her ‘useless’ father. She said he walked out on her family when she was five years old. ‘I am so ashamed of him. That family seems to be living the life of Riley, when my family works hard to earn a living and can’t afford half of what they can,’ she said. ‘They go out for McDonald’s meals that cost £60 a go and yesterday one of Joanne’s daughters had a stretch limo ride for her 13th birthday. ‘If my dad can ride that motorbike he has in his back garden then he can sit on a till somewhere. It is just pure laziness.’

From the Daily Mail

Articles such as this back up tough government policy on welfare, allowing government MPs to draw on the vilification of people on benefits without explicitly vilifying them themselves. Consider, for example, the following David Cameron quote, in the context of the Daily Mail quote, above:

We should ask this question about housing benefit: if you’re a young person and you work hard at college, you get a job, you’re living at home with mum and dad, you can’t move out, you can’t access housing benefit. And yet, actually, if you choose not to work, you can get housing benefit, you can get a flat. And having got that, you’re unlikely then to want a job because you’re in danger of losing your housing benefit and your flat.

(David Cameron on the Today Programme September 2012)

The coalition (aided by right wing media at the margins of official discourse) have also a managed to conflate the ‘benefit-scrounger’ with the social housing tenant. However this has not been a simple process. In fact the social construction of social tenants has oscillated wildly under the current government depending on which policy they seek to emphasise. When advocating a policy that seeks to ‘re-invigorate the Right to Buy’ social tenants were seen as aspirational and hard-working; however when it came to welfare reform they were benefiting from a subsidised public asset. A key part of this process is the creation of the term ‘a culture of dependency’ which was best expressed by a Policy Exchange report which blamed social housing for poverty and dependency on benefits.

[…]evidence of the dependency caused by social housing under the existing system comes from the fact that even in 2007, before the recession began, 63% of social housing tenants in housing associations were reliant on Housing Benefit to pay their (already subsidised) rent Source

This short quote is full riddled inaccuracies, not least that social rent is somehow subsided, which is, by no means, an uncontroversial assertion. I have already noted, elsewhere, the approach to evidence taken by the author of this report…

Having briefly outlined the context of current UK housing and welfare policy, Part 2 will focus on present policy and briefly examine strategies for challenging it.

Uniting the People; Homes for People, Not Profiteers!

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Building Homes for People, not for Profiteers

In the depths of a housing crisis, people are divided.  History has taught us what happens when a society is divided. Those without blame each other. How convenient it is for the elite to watch ordinary people attacking each other. With the intention of whipping up hatred Cameron talks of strivers and scroungers, now we are invited to blame immigration. Anything but  admit the truth, that is that there are not enough affordable homes for people to live in.

The pensioner, mortgage finally paid off from long hours at work, has paid many times over.  He’ll tell you how he struggled with a mortgage at 15% interest rates, constantly  fearing  repossession. Maybe it was once  a people-owned-council-home, then mortgaged to a bank. Enduring poor pay and conditions the new mortgagee didn’t  dare strike, for fear he would be sacked and his family made homeless. All nice profits for the bank.

The young family find poor wages today, high childcare and extortionate rents mean that even working long hours, it is not enough to pay for a home, without Housing Benefit support. Now the awful Bedroom Tax, removes dignity from working families, and from the disabled. It adds to suffering, and  so cruelly divides people. Thatcher’s policies are to blame.

Osborne seems to want to fuel a new housing bubble which will just haemorrhage further wealth to bankers and corporations. These are policies which cannot be sustained and can only result in poorer and poorer living conditions and a free-fall to Victorian times.The housing stock sold off by Margaret Thatcher was deliberately not replenished. House prices have risen out of reach.

A third of ex-council houses are now owned by rich landlords. They can charge what they choose. The only alternative if you cannot afford to buy is to rent privately.  More nice profits for the landlord,  and the Buy-to-Let   Banks. George Osborne might be a trifle embarrassed at the £400K profit  from sale of  his constituency home. Or maybe not.

And what better to do with the profits than buy more to let, holiday homes, grander houses. Osborne will make it easier for wealthy multi property ownership with his Help to Buy Scheme.  As with Buy to Let schemes, all this will do will push up house prices further out of the reach of people who need a home.

Peopleless Homes

To Free- Market Capitalism (neoliberalism), we say, “Never Again”!

And, once Whitehall is rid of this destructive Coaltion government, and we look to build our communities again, we need to be aware of dangers and , banish those myths.

  • Myth 1.”Buying a home is an investment, as house prices increase – “. There is no guarantee that house prices will rise – in fact this approach is basically gambling, and who would gamble with their home?
  • Myth 2. “Rising house-prices is a good thing.” House price rises just mean other people are less likely to be able to obtain a home, leading to homelessness.
  • Myth 3. “People claim Housing Benefit so they don’t need to work.” Most claimants are at work, high rent prices effectively mean the only one to benefit is the landlord. Without benefits, working people could simply not survive.
  • Myth 3: “Buying a house saves money – renting costs more in the long run.” Buying a home costs much more than the cost to build, interest rates always benefit the banks and financiers. Rents are kept artificially high.
  • Myth 4: ” In a recession the government cannot afford to build homes”. The government can produce its own money for building, providing jobs, and boosting the economy, frankly the government can not afford not to build.
  • Myth 5: “Young people can stay at home with parents.” Many have no parents, their parents may have no homes, or no space. Undue pressure and overcrowding will have a detrimental effect on family relationships.
  • Myth 6: “People don’t deserve a subsidised home, I worked hard for mine.” Everyone deserves a decent home, and a job, enabling them to participate in society for mutual benefit.”

 

Today, construction workers find it difficult to find work, as ONS shows a further decline in the  Construction Industry  ( pdf January 2013)

While construction workers are  seeking work, people are homeless, and yet every day we see waste-land, already destined for homes, lying unworked because property prices have fallen since the plans were passed.  The houses are not being built, merely because there is not enough money to be made.  Profits these days come before people’s needs. There was a time when we built houses because people needed them. There was a time when a house was a home.

The political message  in 1945 was clear. Reeling from two world wars, and the defeat of fascism, ordinary British families, bereaved and broken, damaged yet determined set about rebuilding Britain.

This led  to a Socialist Labour government which promised full employment, a tax-funded universal National Health Service, a massive housing programme and the embracing of Keynesian economic policies.

Labour’s cradle-to-grave welfare state, presented with the campaign message ‘Let us face the future’ brought everyone together for common good.

Collectivism was implicit, everyone was valued for their contribution, mutual respect prevailed, society thrived and so did people. Working class people who grew up in the sixties and seventies benefited with opportunities their forefathers never knew.

All this was turned on its head in the eighties. The positive idea of collectivism, the interdependence of people, the power of solidarity, and of trade unionism was crushed. Margaret Thatcher’s ominous words, “There’s no such thing as society,” were destined to haunt many future generations.  That is where we began to lose touch with each other.

The Victorian working classes survived against the odds, given their appalling living conditions. Inner city housing for working class families was inferior to farm animals, and this was reflected in the very high mortality rates, and incidence of disease.. The sanitary conditions in Birmingham back-to-backs at the turn of the century are documented here.

Against this background, socialist and Labour groups campaigned for municipal housing. The homes would be owned by the people, were intended put an end to the slums.

Fred Knee secretary of the Workers National Housing Council in the 1890’s said “It is not the housing of the poor, but the housing of the people by the people themselves, that we must work for – not the herding into slums for the benefit of private enterprise, not the crowding into barracks in order to provide interest for municipal bondholders, but by a feasible honest system and plan “

Early struggles for Council Housing…and the opposition to it 1900 to 1945 (John Grayson) 

The core principle is that the houses would be decent homes, improving health and living standards for working people. The idea was unpopular with Tory Councils because some saw housing, not as people’s homes, but as a source of income. The idea of collective ownership in any form was seen as a threat.

John Grayson’s document of History of Housing from 1900 until 2007  (recommended) recounts the development of the municipal housing, and how Conservative policies deliberately targeted rents, making housing unaffordable leading to social and racial divisions.

Beveridge (Lib) had identified poor housing as one of five great evils, and it was at the forefront of Nye Bevan’s policy with over one million homes being built. However, by 1957 Conservatives had already started to withdraw subsidies, causing municipal rents to treble, and discrimination in private rental market led to racism and division.

In 1968 council housing 31% of tenants were from the poorest 30% of households nationally, 46% from the richest 50% of households. Those attracted to council house living were actually a good cross-section of working class and professional middle class families. Councils by building houses for rent were also able to attract what we now call ‘key workers’ to their areas, and provide ‘labour mobility’ .

Council housing in 1978 at its all time high, nearly a third of housing (32%), but Labour had also encouraged owner occupation (54%). 1978 was a year when there was serious housing choice. Campaigns forced Labour to pass the Homeless Persons Act 1977, and the Race Relations Act in 1976, which brought in many tenants who had been excluded. In 1979 councils were still housing in rented accommodation 20% of the richest tenth of the population.

Tipping the Balance of Society

Thirty years ago there was balanced, sustainable council housing alongside owner occupation. Because of the cross section of manual and professional workers, communities were balanced, and necessary skills widespread. Thus the Thatcherite housing policies destroyed the heart of society. They destroyed the cohesion of communities, leading to areas of great deprivation, and poverty.

Before 1979, Conservative policies allowed council tenants to take on their homes in exchange for maintaining them. Thatcher’s polices of Right-to Buy Council homes led many to buy their homes at a discounted price and with rents rising their hands were forced. Thatcher did not permit the housing stock to be replenished, leading to an acute housing shortage and glimpse back in time, to the days of unscrupulous landlords.

Unreasonably high and unaffordable rents need to be subsidised by Housing Benefit because that is the only way people can afford to live in them, despite many working long hours. Shamefully, Tony Blair’s New Labour governments did not address the housing crisis. Neoliberalism, out of control capitalism, hid behind the illusion of an ever-growing housing bubble.

People were led to believe that a society based on escalating property prices and neoliberalism could thrive. Meanwhile manufacturing industry closed down with the business emphasis on finance, mortgages and insurance. Blindly, many took on debts they could not afford. House prices rose uncontrollably and we witnessed the greed of buy-to-let mortgages which put the prospect of any home out of reach of young people. It is an impossibility for such a system to continue indefinitely, and a crash was inevitable.

Homes for the Future – The People’s Recovery

Instead of Cameron’s divisive Aspiration nation, Miliband’s One Nation should be aiming for full employment for everyone who can work, and allow all to participate as fully as is possible, to enjoy a decent home, and reasonable life-work balance, without debt, or impacting negatively on the future finances and environment of our grandchildren. Why, in a world where there is adequate resources for all, are people living without homes? Why are homes left empty? Where is the justice in a world where some have many homes, and others none at all?

James Murray  and the Think-Tank CLASS (Campaign for Labour and Social Studies ) have recently published “Time to Step-in”, and call for government intervention in Housing policy and and investment in publicly funded social housing initiatives. It is the responsibility of government to determine where homes are built, and the type of homes.

Murray’s emphasis of the need not to rely of the profit driven markets to deliver housing is exemplified in that the Coalition government are considering reviewing energy and disability regulations  in order to boost a building boom.

The Government plan to cut fire safety and wheelchair regulations in attempts to give the construction industry an economic boost.

Ministers have ordered an across the board review, to examine whether regulations, across energy, water, security, accessibility and whether builders should be given the option of self- regulation, should be introduced to cut costs for the industry.

This coincides with the governments relaxation on home building, David Cameron  has announced a ‘free for all’, allowing home owners to be able to extend their houses by up to 8 metres without planning permission from the local council.
Plans to give the construction industry a boost come from shocking figures that house building is at its lowest since the 1920’s, resulting in rent costs at an all time high, and potentially blocking a whole generation out of the property ladder.

It is unacceptable for housing initiatives to be merely driven by profit, and almost inconceivable that such risks to safety are contemplated.

Homes must be secure, safe and affordable, but also need to be built in areas where there is suitable employment, and where people want to live. Homes built in Ghost Estates in Ireland lie empty, never occupied. Simply pursuing policies of a profit-driven society, without consideration of employment, education and training needs, eventually lead to the social divisions we see today. This can result in a persistence of poverty in some urban areas, despite restructuring communities as revealed in the study, Why Neighbourhoods remain poor.

  • Economic restructuring, particularly the decline of the manufacturing sector in Birmingham, plays an important role in explaining this.
  • The loss of these jobs has disproportionately affected already deprived areas.
  • Birmingham is becoming a low-wage economy. Since 2001, wages have fallen in real terms and at a faster rate amongst the lower-paid.
  • Internal migration within the city has also tended to concentrate less advantaged people within already deprived areas largely due to the cost, tenure and availability of housing.
  • The availability of affordable housing – either social rented or cheap private housing – in particular areas mean that those with least choice tend to move to those places. Looking forward we must be ready for the Conservatives who will attempt to block every initiative for common ownership, and policies aimed at redistribution of wealth. We all need homes, decent ones, as we need food water, and energy, and this is why a Housing Policy must always put need before profit.

Boosting the Construction Industry 

The government’s policy of deep cuts during a recessions is more disaster politics. A massive building initiative of public building, providing jobs worked in 1945 and will work again.

We must be mindful of corruption and  insist on transparency about construction companies and ensure that they publicise any self interest and detail their finances and tax contributions. Never again should we allow public assets to be stripped away for personal profit. Here, Sir John Banham is advocating the use of pensions funds for Local Authority workers to fund housing.

 The Telegraph reports on a year-long study by the Future Homes Commission, which is chaired by City grandee Sir John Banham, proposes that money from local authorities’ pension funds should be used to create a £10 billion Local Housing Development Fund, which would build mixed-tenure housing in communities suffering from a shortage.

With the courage reminiscent of the socialist Labour Party of almost 70 years ago, with innovative design, planning and, and a commitment to improve living standards and people’s well-being, we can finally turn our back on the damage inflicted by Margaret Thatcher.

Homes for the Future

The document Homes for the Future, more affordable sustainable  2007, foreword by Yvette Cooper outlines detailed plans for communities and plans for building expansion not seen for forty years. A future Labour government must be prepared to make funds available for the investment our communities need, this time not for the benefit of private enterprise, but for people, because it is they who matter, and it is they who are the source of wealth and mutual benefit regardless of contradictions of Conservative propaganda.

Land left, unused yet fit for building should be made available for building, not left waiting to turn a profit. Investment should be made to modernise old housing stock, by retrofitting modern insulation, and fitting renewable energy micro-generation, for example solar panels.

We should invest in new-builds; well-designed homes, effectively insulated by modern building materials, truly sustainable homes powered by renewable energy and if these are to be collectively owned it would provide a win-win situation. Planning should encompass existing communities, equipped with the facilities residents need, and of a sustainable design. Such communities will be infinitely more suitable than building dense housing devoid of any infrastructure in order to maximise profits.

Rather than “investment” in homes, and a mortgage which feeds hidden bank accounts in tax havens around the world, this would be a real investment in the future and for which our grandchildren will thank us. The result would be a better, happier life for everyone.

References and Further Reading   

  1. The Guardian: The Bedroom Tax is an intrusion into the most private family space. 
  2. Daily Mirror:  A third of ex-council houses are now owned by rich landlords
  3. Metro:  Buy-to Let “Tax Avoiders” Shackle first time buyers
  4. George Osborne’s 400K profit on constituency home. (Telegraph)
  5. George Osborne pins hopes on Housing Boom (Telegraph)
  6.  ONS Figures for Construction Industry Jan 2013  (pdf)
  7. 1945 General Election – 
  8.  From warfare to welfare:
  9.  Living Back-to Back, by Chris Upton, published Phllimore
  10.  Grayson History-Housing: pdf document John Grayson
  11. CLASS: Think Tank:  Piece Time to step in 
  12. Government reviews energy and disability regulation in order to boost building boom
  13. Why Neighbourhoods Remain Poor 
  14.  Use pension funds to boost housing report, Telegraph 
  15. Communities and Local Government : Homes for the Future, more affordable more sustainable
  16. Poor Brum, Think Left
  17. Time to consider brick bonds , Think Left
  18. This isn’t Dickens, It’s Today: Winter’s Cold, Homeless and Hungry, Think Left
  19. Shelter: The causes of Homelessness
  20. Homelessness kills – Executive Summary An analysis of the mortality of homeless people
  21. No Green Coalition Efficien-City -Interactive Link , Greenpeace, Think Left
  22. The New Housing Plan is Flawed, Think Left
  23. Richard Murphy: The Courageous State