Understanding Housing Policy 9781447330479

Table of contents :
UNDERSTANDING HOUSING POLICY
Contents
Detailed contents
List of boxes, figures and tables
Boxes
Figures
Tables
List of acronyms
Acknowledgements
Preface
1. Understanding housing policy
What is housing policy?
Understanding housing policy
Laissez-faire economics
Social reformism
Marxist political economy
Behavioural approaches
Social constructionism
Overview
Questions for discussion
Further reading
Websites
2. Housing policy: continuity and change
Housing becomes a social problem
Housing, health and the public good
The slum
The housing issue circa 1906
Housing policy: 1915 to 1939
Labour 1945–51: a planned solution
The Conservatives and housing policy, 1951–61
Housing policy 1961 to 1979: consensus years?
Cities in the sky
‘Thatcherism’ and housing policy
New Labour
The coalition government (2010–15)
The 2015 Conservative government
Devolution
Overview
Questions for discussion
Further reading
Websites
3. Governing housing
The Westminster core executive
Department for Communities and Local Government (DCLG)
Department for Work and Pensions (DWP)
Homes and Communities Agency (HCA)
National Infrastructure Commission (NIC)
The English regional dimension
Local government
Housing associations
Tenant empowerment: exit and voice politics
The financial institutions
The construction industry
Private landlords
The European Union
Devolution
Overview
Questions for discussion
Further reading
Websites
4. Comparative housing policy
Why compare?
Housing policies: five national case studies
USA
Germany
Sweden
Spain
The Czech Republic
The ‘convergence’ thesis
Policy transfer
Housing outcomes (EU)
Housing outcomes (USA)
Overview
Questions for discussion
Further reading
Websites
5. Need, demand and supply
Private landlordism
The 1919 Housing, Town Planning, etc. Act
A golden housebuilding age?
The ‘numbers game’
Lean years
Housing requirements
Devolution and development
Promoting housing supply
Overview
Questions for discussion
Further reading
Websites
6. ‘Affordable’ housing
What is ‘affordable’ housing?
Affordability in the 19th century
Standards and affordability
From producer to consumer subsidies
Housing benefit
Private landlord subsidies
The Right to Buy
Low-cost homeownership
Allocating social housing
Immigration and ‘social’ housing
Scotland, Wales and Northern Ireland
Monitoring housing affordability
Overview
Questions for discussion
Further reading
Websites
7. Homelessness
What is homelessness?
The causes of homelessness
Homelessness: constructing a social problem
The 1948 National Assistance Act
The 1977 Housing (Homeless Persons) Act
‘Perverse incentives’ and the 1996 Housing Act
The 2002 Homelessness Act
Preventing statutory homelessness
Rough sleeping
Homelessness: the coalition government
Overview
Questions for discussion
Further reading
Websites
8. Decent and sustainable homes
The slum
The 1930s clearance drive
The bulldozer returns
Clearance or improvement?
Income selectivity and home improvement
‘Decent’ homes
New Labour and sustainable homes
Overcrowding
Measuring overcrowding
Overcrowding: its impact
Bed and breakfast hotels
Houses in multiple occupation
The 2004 Housing Act
Regulating the private landlord sector
The coalition government
The 2015 Conservative government
England: progress and stability
Overcrowding
Scotland, Wales and Northern Ireland
Housing conditions in Wales, Scotland and Northern Ireland
Overview
Questions for discussion
Further reading
Websites
9. Neighbourhood deprivation
Area-based programmes in the 1960s and 1970s
Priority estates
Architectural determinism
New Labour and unpopular housing
Low demand
Balanced communities
New Labour and mixed communities
Mixed communities: do they work?
New Labour and neighbourhood deprivation: evaluation
The coalition government
The 2015 Conservative government
Overview
Questions for discussion
Further reading
Websites
10. Housing and social justice
What is social justice?
Social justice and social exclusion
Why is social justice in housing important?
Social class
Tenure
Property wealth
‘Social’ tenants
Housing and income distribution
Gender
Ethnicity
Disability
Supported housing
Lifetime homes
Disabled Facilities Grants
The bedroom tax
Need and supply
Scotland, Wales and Northern Ireland
Overview
Questions for discussion
Further reading
Websites
11. Conclusion: Let’s be builders
Laissez-faire
‘Radical’ social reformism
‘Moderate’ social reformism
Ameliorative social reformism
Marxist political economy
The behavioural approach
Social constructionism
Housing politics
Brexit
Let us be builders
Fixing our broken housing market
References
Index
Untitled

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UNDERSTANDING HOUSING POLICY

Brian Lund

THIRD EDITION

Understanding welfare: Social issues, policy and practice

UNDERSTANDING HOUSING POLICY

Also available in the series Understanding health and social care (Third edition) Jon Glasby “This welcome third edition updates a most useful textbook for UK social science and social policy students. Its policy analysis is also particularly relevant to professional readers seeking to know how we arrived at the state we’re in.” Jill Manthorpe, Director of the Social Care Workforce Research Unit, King’s College London​ PB £21.99 (US$36.95) ISBN 978-1-4473-3121-6 HB £75.00 (US$105.00) ISBN 9978-1-4473-3120-9 232 pages January 2017 INSPECTION COPY AVAILABLE

Understanding community (Second edition) Politics, policy and practice

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UNDERSTANDING HOUSING POLICY Third Edition

Brian Lund

First edition published in 2006, Second edition published in 2011, Third edition published in Great Britain in 2017 by Policy Press North America office: University of Bristol Policy Press 1-9 Old Park Hill c/o The University of Chicago Press Bristol 1427 East 60th Street BS2 8BB Chicago, IL 60637, USA UK t: +1 773 702 7700 t: +44 (0)117 954 5940 f: +1 773-702-9756 [email protected] [email protected] www.policypress.co.uk www.press.uchicago.edu © The Policy Press and the Social Policy Association 2017 British Library Cataloguing in Publication Data A catalogue record for this book is available from the British Library Library of Congress Cataloging-in-Publication Data A catalog record for this book has been requested ISBN 978-1-4473-3044-8 paperback ISBN 978-1-4473-3043-1 hardcover ISBN 978-1-4473-3045-5 ePub ISBN 978-1-4473-3046-2 Mobi ISBN 978-1-4473-3047-9 ePdf The right of Brian Lund to be identified as author of this work has been asserted by him in accordance with the Copyright, Designs and Patents Act 1988. All rights reserved: no part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise without the prior permission of Policy Press. The statements and opinions contained within this publication are solely those of the author and not of the University of Bristol, Policy Press or the Social Policy Association. The University of Bristol, Policy Press and the Social Policy Association disclaim responsibility for any injury to persons or property resulting from any material published in this publication. Policy Press works to counter discrimination on grounds of gender, race, disability, age and sexuality. Cover design by Qube Design Associates, Bristol Front cover image: www.alamy.com Printed and bound in Great Britain by by CPI Group (UK) Ltd, Croydon, CR0 4YY Policy Press uses environmentally responsible print partners

Contents Detailed contents List of boxes, figures and tables List of acronyms Acknowledgements Preface

vi xi xiv xvi xvii

one Understanding housing policy two Housing policy: continuity and change three Governing housing four Comparative housing policy five Need, demand and supply six ‘Affordable’ housing seven Homelessness eight Decent and sustainable homes nine Neighbourhood deprivation ten Housing and social justice eleven Conclusion: Let’s be builders

1 23 51 77 103 127 155 179 209 231 261

References Index

289 333

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Understanding housing policy: third edition

Detailed contents one

Understanding housing policy What is housing policy? Understanding housing policy Laissez-faire economics Social reformism Marxist political economy Behavioural approaches Social constructionism Overview Questions for discussion Further reading Websites

two

Housing policy: continuity and change 23 Housing becomes a social problem 24 Housing, health and the public good 24 The slum 26 The housing issue circa 1906 27 Housing policy: 1915 to 1939 29 Labour 1945–51: a planned solution 32 The Conservatives and housing policy, 1951–61 34 Housing policy 1961 to 1979: consensus years? 35 Cities in the sky 37 ‘Thatcherism’ and housing policy 39 New Labour 44 The coalition government (2010–15) 45 The 2015 Conservative government 45 Devolution 47 Overview 48 Questions for discussion 48 Further reading 48 Websites 49

three Governing housing The Westminster core executive Department for Communities and Local Government (DCLG) Department for Work and Pensions (DWP) Homes and Communities Agency (HCA)

vi

1 1 4 4 9 12 15 18 20 21 21 21

51 53 54 54 55

Detailed contents Detailed contents

National Infrastructure Commission (NIC) 55 The English regional dimension 55 Local government 56 Housing associations 59 Tenant empowerment: exit and voice politics 62 The financial institutions 65 The construction industry 67 Private landlords 68 The European Union 69 Devolution 70 Overview 75 Questions for discussion 75 Further reading 75 Websites 76

four

Comparative housing policy 77 Why compare? 77 Housing policies: five national case studies 79 USA 81 Germany 85 Sweden 89 Spain 91 The Czech Republic 93 The ‘convergence’ thesis 95 Policy transfer 97 Housing outcomes (EU) 98 Housing outcomes (USA) 99 Overview 100 Questions for discussion 100 Further reading 100 Websites 101

five

Need, demand and supply Private landlordism The 1919 Housing, Town Planning, etc. Act A golden housebuilding age? The ‘numbers game’ Lean years Housing requirements Devolution and development Promoting housing supply Overview

103 104 106 107 108 111 115 118 119 125

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six

Questions for discussion Further reading Websites

125 126 126

‘Affordable’ housing What is ‘affordable’ housing? Affordability in the 19th century Standards and affordability From producer to consumer subsidies Housing benefit Private landlord subsidies The Right to Buy Low-cost homeownership Allocating social housing Immigration and ‘social’ housing Scotland, Wales and Northern Ireland Monitoring housing affordability Overview Questions for discussion Further reading Websites

127 129 134 135 136 137 138 141 144 147 148 150 151 154 154 154 154

seven Homelessness 155 What is homelessness? 155 The causes of homelessness 157 Homelessness: constructing a social problem 157 The 1948 National Assistance Act 161 The 1977 Housing (Homeless Persons) Act 162 ‘Perverse incentives’ and the 1996 Housing Act 163 The 2002 Homelessness Act 164 Preventing statutory homelessness 165 Rough sleeping 167 Homelessness: the coalition government 171 Overview 177 Questions for discussion 177 Further reading 177 Websites 177 eight Decent and sustainable homes The slum The 1930s clearance drive The bulldozer returns

viii

179 180 181 182

Detailed contents

Clearance or improvement? 183 Income selectivity and home improvement 184 ‘Decent’ homes 185 New Labour and sustainable homes 188 Overcrowding 189 Measuring overcrowding 192 Overcrowding: its impact 194 Bed and breakfast hotels 194 Houses in multiple occupation 196 The 2004 Housing Act 196 Regulating the private landlord sector 197 The coalition government 197 The 2015 Conservative government 199 England: progress and stability 200 Overcrowding 201 Scotland, Wales and Northern Ireland 204 Housing conditions in Wales, Scotland and Northern Ireland 205 Overview 206 Questions for discussion 206 Further reading 206 Websites 207

nine

Neighbourhood deprivation Area-based programmes in the 1960s and 1970s Priority estates Architectural determinism New Labour and unpopular housing Low demand Balanced communities New Labour and mixed communities Mixed communities: do they work? New Labour and neighbourhood deprivation: evaluation The coalition government The 2015 Conservative government Overview Questions for discussion Further reading Websites

209 210 210 211 212 216 218 220 221 223 224 226 228 228 228 229

ten

Housing and social justice What is social justice? Social justice and social exclusion

231 231 232

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Detailed contents

Why is social justice in housing important? 233 Social class 233 Tenure 235 Property wealth 236 ‘Social’ tenants 239 Housing and income distribution 240 Gender 242 Ethnicity 246 Disability 252 Supported housing 254 Lifetime homes 255 Disabled Facilities Grants 255 The bedroom tax 256 Need and supply 256 Scotland, Wales and Northern Ireland 258 Overview 259 Questions for discussion 259 Further reading 259 Websites 260

eleven Conclusion: Let’s be builders 261 Laissez-faire 261 ‘Radical’ social reformism 264 ‘Moderate’ social reformism 270 Ameliorative social reformism 273 Marxist political economy 274 The behavioural approach 275 Social constructionism 277 Housing politics 279 Brexit 281 Let us be builders 283 Fixing our broken housing market 285

x

List of boxes, figures and tables Boxes 1.1 1.2 1.3 1.4 1.5 2.1

Tenure 3 Hayek on subsidised council housing 6 Why is housing ‘special’? 9 Eugenics and the ‘culture of poverty’ 17 The social construction of ‘homelessness’ 19 Extracts from Report on the sanitary condition of the labouring population of Great Britain 24 2.2 Homeownership ideology 29 2.3 Post war planning 33 2.4 Taxation and homeownership 36 2.5 The 1980 Housing Act 40 3.1 ‘Government’ and ‘governance’ 52 3.2 Housing associations (‘private registered providers of social housing’) 61 5.1 Politicians on quantity and quality 109 5.2 Barnet housing needs assessment 117 5.3 Green belts – for and against 123 6.1 State intervention in the housing market 128 6.2 Help to Buy 133 7.1 Foyers 169 8.1 Gentrification 184 8.2 A decent home 186 8.3 Housing Health and Safety Rating System 187 8.4 Overcrowding – 1935 Housing Act definition 191 9.1 Human and social capital 213 10.1 Supporting people 253

Figures 2.1 5.1 5.2 5.3 5.4 6.1

Housing tenure in the UK, 1919–2014 New housing construction, 1919–39 Housing construction, 1944–2014 Net additions to the housing stock, England, 2008/09–2014/15 Barnet London Borough Council’s approach to housing need assessment, 2015 The ‘poverty trap’ – gross weekly income at which HB stops according to weekly rent, 2015/16

46 108 110 111 118 130

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6.2 6.3 6.4 6.5 6.6 6.7 6.8 7.1 7.2 7.3 8.1 10.1 10.2 10.3 10.4

Right to Buy sales, England, selected years New ‘social’ housing lettings, England, selected years (thousands) Right to Buy sales, Scotland and Wales, selected years Rents, England, 1991–2015 House prices, real and cash terms, 1977–2016 Mortgage payments, first-time buyers, 1997–2016 Homeownership rates by age, 1991 to 2013/14 The homelessness process (family) The homelessness process (single person) Homelessness acceptances and households in temporary accommodation (England) 2000-16 Overcrowding – the bedroom standard, by tenure, 1995/6 to 2014/5 (three year moving average % of households) Yearly income by tenure 2014/5 per cent in each income band Median household net property wealth by household net equivalised income decile (£s) Great Britain, 2012– 14 Gini coefficient UK, before and after housing costs, 1978–2014 Child poverty 1998/9 to 2013/4, Absolute and Relative (before and after housing costs) (% below poverty line)

142 144 151 152 152 153 153 158 159 173 202 236 237 240 241

Tables 2.1 2.2 4.1 4.2 5.1 6.1 6.2 6.3 7.1

Tenure, England, Scotland, Wales and Northern Ireland, 1981 Tenure, England, Scotland, Wales and Northern Ireland, 2015 Housing statistics, selected countries Housing outcome statistics, selected EU countries, 2014 New house completions per 1,000 population, selected years Consumer and producer subsidies Land stamp duty tax rates, 2010 to September 2014 Land stamp duty tax rates from October 2014 Homeless acceptances and numbers in temporary accommodation, Scotland, selected years 8.1 1935 Housing Act overcrowding standard 8.2 Non-decent homes (%) 8.3 Energy efficiency, England, 1996–2014 (SAP rating) 8.4 Overcrowding – the bedroom standard, England, 1971–2014/15 (%, three year moving average) 202 8.5 Overcrowding – households with one or more rooms below the ‘occupancy’ standard, 2011 (%) 10.1 Households below each ‘Living Home’ standard, 2016 (%)

xii

47 47 80 98 119 128 140 140 175 192 200 201 202 203 233

List of boxes, figures and tables

10.2 10.3 10.4 10.5

Social class in the 21st century The P90/P10 ratio, 1979–2015 Lone-parent families tenure profile Ethnicity and housing outcomes

234 240 245 247

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List of acronyms ALMO BES BME CBL CERT CIL CRE CRESR DCLG DFG DICE DLO DoE DTLR DWP EA EEA EEO EHRC EU FHA FNMA FSA GHA GIA GVA HAA HAT HB HC HCA HHSRS HMO HMRF HRA HUD IDC ISA LCC

xiv

Arms Length Management Organisation Business Expansion Scheme Black and minority ethnic choice-based lettings Carbon Emissions Reduction Target Community Infrastructure Levy Commission for Racial Equality Centre for Regional Economic and Social Research at Sheffield Hallam Department for Communities and Local Government Disabled Facilities Grant Design Improvement Controlled Experiment Direct Labour Organisation Department of the Environment Department of Transport, Local Government and the Regions Department for Work and Pensions Estate Action European Economic Area Energy Efficiency Obligation Equality and Human Rights Commission European Union Federal Housing Administration Federal National Mortgage Association Financial Services Authority Glasgow Housing Association General Improvement Areas gross value added Housing Action Areas Housing Action Trusts housing benefit Housing Corporation Homes and Communities Agency Housing Health and Safety Rating System house in multiple occupation Housing Market Renewal Fund Housing Revenue Account Housing and Urban Development Industrial Development Certificates Individual Saving Accounts London County Council

List of acronyms

LCO LEP LHA LSDT LSP LVST MHLG NDC NFHA NIC NIHE NRF NSNR ODPM ONS PEP PRS PSNCR PWLB RDA RGF RSS RTB SAP SDLP SHMA SNP TMO TPC TSA UC WHQS

Legislative Competence Order Local Enterprise Partnerships Local Housing Allowance land stamp duty tax Local Strategic Partnerships Local Voluntary Stock Transfer Ministry of Housing and Local Government New Deal for Communities National Federation of Housing Associations National Infrastructure Commission Northern Ireland Housing Executive Neighbourhood Renewal Fund National Strategy for Neighbourhood Renewal Office of the Deputy Prime Minister Office for National Statistics Priority Estates Project private rented sector Public Sector Net Cash Requirement Public Works Loans Board Regional Development Agencies Regional Growth Fund Regional Spatial Strategies Right to Buy Standard Assessment Procedure Social Democratic and Labour Party (Northern Ireland) Strategic Housing Market Assessments Scottish National Party Tenant Management Organisations Tenant Participation Compacts Tenant Services Authority Universal Credit Welsh Housing Quality Standard

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Acknowledgements Thanks are due to a number of people who have contributed to the publication of this book. I am greatly indebted to the staff of Policy Press, especially Jess Mitchell and David Worth for their help. My more personal gratitude is to Charley, Phyllis, Sukey, Rachel, Daniel, Carly, Bethany and Max for their support, comfort and encouragement. Stanley and Olly, cats of character, must not be forgotten.

xvi

Preface When the first edition of this book was published in 2006, the housing market was buoyant, housing construction was accelerating, albeit from a very low base, and New Labour was making progress in upgrading the ‘social’ housing stock. As prime minister, Gordon Brown placed housing alongside health and education as government priorities and endorsed a target to increase new house construction in England to 240,000 a year by 2016. The second edition was written against the background of the ‘credit crunch’ and subsequent recession that shattered New Labour’s plans and helped to produce a Conservative/Liberal Democrat coalition government. This edition updates the story by analysing housing policy in a cold economic climate. All the chapters have been completely revised and a new chapter on housing need, demand and supply added. This replaces the chapter on the political/policy process in the second edition whose themes are more comprehensively examined in Housing politics in the United Kingdom: power, planning and protest (Lund, 2016). The conclusion is a personal and, at times, polemical refection on proposed answers to the ‘housing question’ set in the context of the theoretical approaches outlined in Chapter One. When asked what prime ministers fear most, Harold Macmillan reportedly said ‘Events, dear boy, events’. Housing policy changes quickly as governments respond to the rollercoaster housing market and shocks to the economic and political systems such as the ‘Brexit’ vote. This book was completed in October 2016 but, at the proof stages, I have been able to include some comments on policy developments up to early February 2017. The numerous websites and other references cited in the book should enable students to keep up to date. In common with most textbook authors, I have left out far more than I have put in. Nonetheless, responsibility for any errors and omissions remains mine. Brian Lund, February 2017.

xvii

one Understanding housing policy Summary

• •

•

Housing policy is concerned with the processes and outcomes involved in state intervention in the housing market. There are a number of approaches to studying housing policy each containing: −− a normative order against which housing problems are identified; −− explanations of housing problem causation; and −− accounts of why and how the state has intervened in the housing market. This chapter explores five approaches to understanding housing policy: −− laissez-faire economics; −− social reformism; −− Marxist political economy; −− behavioural approaches; and −− social constructionism.

What is housing policy? Housing has been described as ‘the wobbly pillar under the welfare state’ (Torgersen, 1987, p 116) because, unlike health and education, politicians have not used the state as the main service provider. Housing is a basic human need and was delivered by private mechanisms long before health and education – supplied by professional expertise – became established as human requirements. Hence, as Harloe (1995, p 3) points out:

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Understanding housing policy: third edition

... housing, like food production, has provided large-scale and profitable opportunities for capitalism in ways that have not been nearly so evident (or took longer to develop) in the other spheres of provision for human needs ... Nevertheless, although housing has not had ‘universal’ social service status and entrenched market forms of provision, underpinned by property rights, have been dominant, the state has intervened in the housing market in a number of ways. Thus, housing policy is best understood as government attempts to modify the housing market – perhaps more accurately housing markets given marked area variations in house prices – to achieve social objectives. Government objectives have varied over time and place with, for example, the coalition government (2010–15) stating it wanted to create ‘A thriving, active but stable housing market that offers choice, flexibility and affordable housing’ (HM Government, 2011a, p vii). The previous Labour government declared its aim as ‘to offer everyone the opportunity of a decent home and so promote social cohesion, well-being and self-dependence’ (DETR, 2000, p  1). The Scottish government stated its vision for 2020 ‘is for a housing system which provides an affordable home for all’ (Scottish Government, 2011, p 1). Under Conservative control, with Theresa May as prime minister, the Department for Communities and Local Government (DCLG, 2016a, p  1) claimed ‘Our department has a driving focus to increase housing supply and make it easier for the 86% of people who say they want to own their own home, to achieve that aspiration’, although the 2017 white paper Fixing our broken housing market (DCLG, 2017) modified this concentration on owner-occupation to allow more rented accommodation to be built. This book adopts a broad view of housing policy as involving: • financial policies designed to increase or reduce house purchase costs such as setting interest rates, now a Bank of England responsibility, and government mortgage underwriting; • taxation measures aimed at encouraging or discouraging housing investment and consumption such as land stamp duty tax (LSDT) – payable on purchasing a house or land – that can be changed according to housing market fluctuations; • the basis on which people have rights and obligations in a dwelling – sometimes called ‘tenure’ (see Box 1.1); • direct subsidies to producers and consumers; • infrastructure support such as the roads and schools necessary to make developments sustainable; • services to assist tenants and homeowners as part of a community care policy such as ‘supported’ housing, home improvement agencies and energy company obligations to help low-income households to insulate their homes;

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Understanding housing policy

• physical planning constraints and incentives relating to land release; • supply, allocation and management policies in the ‘social’ housing sector; • security for the ‘quiet enjoyment’ of a ‘home’ and the lifestyle choices that such sanctuary promotes; • ‘social capital’, that is, the value of the social networks people can draw on that may accrue from living in a neighbourhood; and • policies aimed at reducing ‘social exclusion’ on an area basis.

Box 1.1: Tenure In the past ‘tenure’ was related to privileges and duties involved in land possession but today it is usually used to refer to the rights and obligations involved in occupying a dwelling. In the UK it is conventional to identify four main tenure types although they do not conform to precise legal formats and there is considerable mixing in tenure forms, such as shared ownership.

•

•

• •

Owner-occupation: where the occupier owns the building and land freehold or, as a leaseholder, rents land for a specified period after which the land and the dwelling revert to the freeholder. In 2016 some new detached and semi-detached houses were being sold as leaseholds with ground rents doubling every ten years (Collinson, 2016). Renting from a local authority as a ‘secure’ tenant: where, in England the tenant has a right to buy the property and protection from eviction if the tenancy agreement terms are kept. However, in recent years, this protection has been eroded by introductory and fixed-term tenancies. Renting from a private landlord: usually as an ‘assured shorthold’ tenant with the presumption that the landlord has the right to possession at the end of the contract. Renting from a not-for-profit landlord: often called a ‘housing association’ or a ‘registered social landlord’ that, in return for government grants, is subject to state registration and enhanced regulation. Most tenants are ‘assured tenants’ with greater protection from eviction than tenants renting from a private landlord. Housing associations may be cooperatives where ownership is vested in a corporation with membership involving a share in the corporation’s assets. In recent years ‘for profit’ landlords have been allowed to register and the sector is now officially labelled ‘private registered providers of social housing’.

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Understanding housing policy: third edition

Understanding housing policy Any taxonomy of the perspectives applied to understanding housing policy is open to dissent and there are many classifications available. Each perspective contains a normative order against which housing problems are recognised, notions of housing problem causation and empirical explanations of why and how the state has intervened in the housing market. ‘Think tanks’ and pressure groups work within these perspectives. They convert underlying ideas into policies to offer political parties and promote ‘epistemic communities’ – networks of knowledgebased experts – claiming authority via policy-relevant knowledge and sharing causative notions and evaluative criteria.

Laissez-faire economics Being a revival of 18th century classical economic theories, this approach is sometimes called ‘neoclassical economics’ or ‘neoliberalism’. Since the 1980s the neoliberal paradigm has become dominant in housing policy with demand, not need, the motivating force for housing production and distribution. Following the basic premises set out by Adam Smith in his treatise An Inquiry into the Nature and Causes of the Wealth of Nations (1776), laissez-faire economists assert: • free exchange allows the division and specialisation of labour so that individuals can concentrate on producing the goods they are most suited to create; • the state should confine itself to doing what only the state can do: maintaining law and order; policing contracts and producing large infrastructure projects which it can never be in the interest of any individual to construct; and • individuals are rational, self-interest maximisers so, if the state obeys these rules, then the market’s ‘hidden hand’ will promote everyone’s welfare. Laissez-faire economics dominated housing policy for most of the 19th century. State involvement in the housing market embraced ‘nuisance’ removal to protect public health and promote social order, but not stimulating housing production by direct state provision or state subsidies. During the 20th century economic liberalism was on the defensive and the state assumed a larger role in shaping and partially replacing the housing market through subsidised local authority housing, improvement grants, rent control and creating favourable fiscal regimes to support homeownership. Friedrich Von Hayek was the most important figure in restoring free market ideology. He embraced Adam Smith’s laissez-faire ideas, added lessons drawn from the experience of state intervention and set out proposals for renewing the application of market principles to economic life. The Institute of Economic Affairs, a ‘think tank’ established in 1957, converted Hayek’s beliefs into concrete

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Understanding housing policy

policy proposals and, by the middle 1970s, a developed philosophical critique of ‘unjustified’ state activities in the housing market, plus a set of remedies, was available. Market efficiency Laissez-faire theorists believe that housing is a commodity with no intrinsic merit: a dwelling’s value is its exchange price as determined by the interaction between supply and demand. Consumers have different views about how much to spend on housing and different preferences about style, location and amenities. House prices reflect value according to consumer preferences and the alternative uses of the resources deployed in construction. Laissez-faire economics asserts that ‘asset prices are always and everywhere at the correct price’ (Cooper, 2008, p 9; emphasis original). There is no such thing as an irrational price ‘bubble’, a sudden price increase is simply the market responding to changing fundamentals. Markets benefit low-income groups via ‘filtering’. If higher income groups buy new homes this leaves vacancies to be filled by lower income households and so on down the chain until the least well-housed household improves its circumstances. Laissez-faire economics allows only two exceptions to the rule that the state should ‘leave to be’. First, the state can eliminate externalities. An externality is a side impact of an activity that affects other parties without being reflected in the price of the good or service involved. Slum dwellings, for example, generate externalities because they affect the welfare of people living outside the slum. Writing in 1841, Nassau Senior, a prominent free market advocate, put the matter plainly when he said: With all our reverence for the principle of non-interference, we cannot doubt that in this matter [slums] it has been pushed too far. We believe that both the ground landlord and the speculating builder ought to be compelled by law … to take measures which will prevent the towns which they create from being the centre of disease. (quoted in Holmans, 1987, p 25) Second, some neoliberals permit an income subsidy to the poor to enable them to afford a minimum housing standard supplied by the market. Hayek (1979, p 296) advocated a state minimum income ‘to assure to all protection against severe deprivation’ – an idea endorsed by Charles Murray (2006). Market distortions Neoliberals claim that state intervention in the housing market has caused more problems than it has solved. Rent control and subsidised council housing are the

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primary culprits. Rent control was introduced in the UK in 1915 but, after 1989, was gradually phased out. According to laissez-faire economists, rent control had the following undesirable consequences: • it prevented private savers investing in new houses to let; • it limited labour mobility because workers benefiting from rent control were reluctant to move and thereby lose their protected status; and • it produced underinvestment by landlords in their properties. Subsidised council housing is also regarded as part of the housing problem not part of its solution (see Box 1.2) and some laissez-faire economists condemn the physical planning system as restricting land supply thereby pushing up house prices (Evans, 1988; Cheshire, 2014).

Box 1.2: Hayek on subsidised council housing Hayek presents the most lucid exposition of the case against state provision of subsidised dwellings. He argues that: The old buildings which at most stages of the growth of a city will exist at the centre … will often provide for those of low productivity an opportunity to benefit from what the city offers at the price of very congested living. (Hayek, 1960, pp 346–7) So, says Hayek: If we want to abolish the slums we must choose between two alternatives. We must either prevent these people from taking advantage of what to them is part of their opportunity, by removing the cheap but squalid dwellings from where their earning opportunities lie, and effectively squeeze them out of the cities by insisting on certain minimum standards for all town dwellings; or we must provide them with better facilities at a price which does not cover costs and thus subsidise both their staying in the city and the movement of more people into the city of the same kind. (Hayek, 1960, p 348) According to Hayek, subsidised council housing promotes the movement of poor people into areas where they cannot afford to live without subsidy. Once subsidised council housing has been provided then more people move to an area to try to take advantage of the new, low cost, housing opportunities thereby generating pressure for yet more subsidised housing.

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Government failure Laissez-faire economists believe that state intervention in the housing market not only generates problems but that state housing provision is likely to be inefficient. Only competition can supply efficiency incentives and if the state becomes a monopoly accommodation supplier, as it did for family rented housing in the 1970s, then it must be inefficient. Empirical explanations of continuity and change Empirical explanations attempt to elucidate what happened and why but, although the ‘empirical’ and the ‘normative’ can be conceptually distinguished, they are often interwoven. Hayek (1949) explained the growth of state intervention in terms of neoclassical economics being vanquished in the ideas battle during the first part of the 20th century. However, the neoliberal perspective has adopted public choice theory as is principal explanatory paradigm. Public choice theorists divide the political process into three elements: the voting system; interest group activity; and how state officials behave when organised into bureaucracies. All process participants are considered in terms of neoclassical economics’ basic premise – they act rationally to promote their selfinterest. There is no quest for ‘the common good’ in political activity: politicians are interested in securing election to pursue power, prestige and material advantage. In order to attain such advantages, they must win more votes than their rivals and will adopt strategies to obtain these votes. In spending and taxation, they carry out ‘those acts of spending which gain the most votes by means of those acts of financing which lose the fewest votes’ (Downs, 1957, p 52). This maxim is often interpreted by public choice theorists as attracting the median voter – the additional voter necessary to secure a majority – by pursuing policies to redistribute income from the rich to middle income groups and the poor who form the majority of the electorate (Tullock, 1976). However, median voter attraction is also applicable to forming an alliance between rich and middle income groups against the stigmatised poor. Laws (2016, p 97) claims: George Osborne saw ‘welfare’ as a big political dividing line. He wanted Labour to be seen as the party of ‘welfare scroungers’, and he hoped that the Conservatives could position themselves as the party of the strivers. According to public choice theory, in their power hunt, politicians rely on public apathy, such indifference being rational because each voter has only a tiny impact on an election result. Moreover, in seeking to gain and retain power, politicians are susceptible to interest group influence. Such ‘pressure groups’ exist to take a

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‘free ride’ on their fellow citizens: they seek to persuade politicians to give special privileges to the domain in which they have a vested interest. Politicians often rely on interest groups to help secure a ‘winning coalition’ at elections and, when in power, they may respond to interest group demands to ensure cooperation in regulating a complex policy domain. Interest groups will engage in a variety of tactics to enhance their control over politicians and bureaucrats such as ‘log rolling’, where a variety of interest groups may act together against unorganised groups. Thus, for example, the construction industry, estate agents, landowners and the financial institutions may combine to demand government intervention to ‘kick start’ the housing market when prices are stagnant or declining. They will make their demands in ‘the public interest’ but there will be losers – new entrants to the housing market who would benefit from falling prices – if the government agrees to such demands. The more cynical public choice theorists might add that the political neglect of housing market inflation might be associated with the capital gains made by certain MPs via their tax supported second homes and their involvement in private landlordism. Bureaucratic self-interest is the third influence identified by public choice theorists. State officials are portrayed as maximising their personal utility via ‘salary, prerequisites of the office, public reputation, power, patronage and the ease of managing the bureau’ (Niskanen, 1973, pp 22–23). They are ‘knaves’ not ‘knights’ interested in upholding the ‘public good’ (Le Grand, 2003) and their welfare is served by maximising the agency’s budget (Niskanen, 1975). Niskanen claims that, in public services, there is a single buyer – the politician – and a single seller – the bureaucrat. The bureaucrat has a virtual monopoly on information about an organisation’s cost and will offer the politician only a single package to accept or reject so there will always be wastefulness – labelled ‘X-inefficiency’ by public choice theorists – in service delivery. Moreover, to public choice theorists, bureaucrats are in league with interest groups. Tullock (1976, p 199) asserts ‘most government demands are organised by special interest groups ... who are normally intimately connected with the bureaucracy which will carry out the policy’. The New Right The terms ‘neoliberal’ and ‘New Right’ are often used interchangeably but the New Right attempts to combine laissez-faire economics with neo-Conservatism, that is, support for traditional institutions such as the nuclear family, the established church, the monarchy and the ‘nation-state’, alleged have ‘stood the test of time’ and beneficial in producing social stability. Margaret Thatcher mingled neoConservatism and laissez-fare economics. Andrew Gamble (1988) described the politics of ‘Thatcherism’ as ‘the free economy and the strong state’ – with the ‘strong state’ deployed ‘as the creator of institutional conditions suited to promoting markets, logics of competitiveness, and individual responsibility at the service of

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commodification’ (Blessing, 2015, p 2). In the housing domain, Thatcher was a strong supporter of homeownership and threatened her Chancellors of the Exchequer that if they persisted in advocating abolishing tax relief on mortgage interest she would increase it (Howe, 1994; Lawson, 1992). In an interview with Sir Robin Day she said: ‘We have had an increase in home ownership, the heart of the family’ (Thatcher, 1987). The New Right also asserts that immigration has made a major contribution to the housing problem.

Social reformism Social reformism is a sweeping term but serves to connect strands of thinking that have combined, fragmented and coalesced at various times during the 19th, 20th and 21st centuries. There were two main elements in the development of social reformism. The ‘new’ liberalism – often called ‘social’ liberalism – and Fabian socialism emerged at the end of the 19th century both claiming that capitalist economies generate inefficiency and unjust outcomes. During the 20th century, Fabian socialism and ‘social’ liberalism fused into a broad social-democratic, reformist approach emphasising gradual improvement, achievable by tackling specific social problems through state action. Today social reformists maintain that housing has special characteristics that, taken together, mean that markets will operate inefficiently (Box 1.3).

Box 1.3: Why is housing ‘special’?

•

•

Housing is expensive relative to incomes and the requirement for independent accommodation comes at an inconvenient time in the lifespan before people have been able to accumulate wealth. Thus, purchasing a home usually involves borrowing from institutional lenders who may have the power to influence market operations. For example, in the 1970s some building societies ‘red-lined’ selected districts where they were unwilling to lend because they perceived such areas as bad risks. Borrowing also means that homeowners’ outgoings are strongly influenced by interest rates especially if variable rate loans are used. If unable to purchase, people must rent, with the capital for rented accommodation also mainly obtained by private landlords from institutional lenders. Houses are durable and have a value for future generations. Anticipating the future may involve building to high standards unaffordable to existing consumers. House durability also means that a house is both a ‘consumer’ good, with a flow of services involved in living in a house, and an ‘investment’ good with potential gains achievable from price increases. This has led to government and academic interest in housing as an important element in ‘asset-based’ welfare, incorporating savings that may reduce the need for other forms of welfare. Malpass (2008) claims that

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•

•

•

•

housing is not a ‘wobbly pillar’ in the new welfare state but its cornerstone – a prospect diminished by the rise of ‘generation rent’. Housing supply is inelastic. The best year for housebuilding in the UK (1968) added only about 2% to the housing stock. Hence, the housing market is ‘made’ by the existing supply of dwellings. Moreover, the housebuilding process takes a long time and, therefore, supply does not respond quickly to changes in demand. The housing stock is immobile. This means it offers solid security for lenders – you cannot run away with it – but there is limited opportunity to switch existing supply to areas of new demand reflected, in part, in the wide area variations in house prices in different parts of the country. Thus the term ‘housing crisis’ – often applied today to the UK – has different resonances in different places (Chakrabortty, 2014). Houses are built on land, an absolute scare resource, made scarcer by planning controls. Thus, land supply is not automatically responsive to demand. In the UK 1995–2007 housing boom, the real price of residential land rose by 260% but its supply fell by 19% (Aldred, 2010). Housing is a necessity. People cannot opt out of consumption. Moreover, unlike other goods, it is difficult to vary consumption on a day-by-day basis.

Social reformists also argue that the market is incapable of resolving certain housing issues. Glennerster (2009), for example, extends the ‘externalities’ idea to cover: • Clustering of poor accommodation makes it imprudent for individual owners to improve their property. Property values do not increase because shoddy property sends bad ‘signals’ about an area. Whole area improvement by collective action can spark a ‘virtuous circle’ of revival. • Unfettered building may produce urban sprawl, leaving city centres without population. Existing urban infrastructure assets are wasted and journeys to work are long. • The unregulated market can polarise communities. It excludes the poor from places where the middle class and the rich wish to live. This produces ghettos, possible breeding grounds for crime and disorder. Some social reformists go further and claim that housing, good enough to be called a ‘home’, is so fundamental to forming personal integrity that it should be regarded as a ‘merit’ good. Housing consumption should be encouraged by the state because income levels generated by market transactions will be insufficient for many to afford the ‘decent’ housing necessary for character development. Moreover, many consumers may be unwilling to purchase appropriate quantities of housing. In 1932, Raymond Unwin said:

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a portion of the dwellers in the slums who might possibly afford it [a decent home], having been brought up under slum conditions, do not realize the necessity of doing so … This … forces the community in its own interest to remove the evil.... (Unwin, 1932, p 46) Empirical explanations of continuity and change in housing policy Sometimes labelled ‘understanding paternalism’ (Lux, 2009), social reformism merges analysis of policy (from outside the system) with analysis for policy (from inside the system). Idealist/organic theory were at the heart of Fabian socialism and ‘new’ liberalism at the turn of the 19th century and beyond. Idealist theory was developed by Hegel (1770–1831) who traced human consciousness evolution from the ‘barbaric’ towards a condition in which all phenomena are assimilated into a conscious whole that is shared with others – the ‘absolute’ (Hegel, 2016 [1817]). Organic/idealist political philosophy used the body as a metaphor for society. It did not make a clear distinction between normative theory (what ought to be) and explanatory theory (what is) because it regarded society as undergoing a natural, organic, evolutionary process leading to a ‘higher’ social order. This ‘Whig interpretation of history’ (Butterfield, 1931) was reflected in the work of Leonard Trelawney Hobhouse (1864–1929). Hobhouse was Professor of Sociology at the London School of Economics – the first Sociology Professor in a British university – but he was also active in ‘new’ Liberal politics. He viewed society as a constantly evolving organism. For Hobhouse the natural evolutionary process involved the rational self-direction of society through mind. Cooperative activity, manifest, for example, in the growing number of working class mutual aid associations such as friendly societies, cooperatives and building societies would eventually produce ‘a feeling for the common good, a readiness to forego personal advantage for the general gain, a recognition of mutual independence’ (Hobhouse, 1893, pp 4–5). Hobhouse’s idea that citizens were ‘simply members of a large co-operative society’ (Dennis and Halsey, 1988, p 80), becoming aware of a ‘common good’ through voluntary interaction, led him to reject socialism as bureaucratic, elitist and autocratic. Hobhouse directed his distain towards the Fabian socialism, expressed most cogently by Sydney and Beatrice Webb. According to Lloyd (1901, p 577) ‘the organic theory of society is entertained by nearly every serious thinker at the present time’. The Webbs were no exception. They ‘saw society as an evolving organism, in which collectivist rationality was inexorably replacing individualistic chaos’ (Marquand, 2008, p 63). The evolution was inevitable but could be stimulated by experts with knowledge of the ‘facts’. Equipped with ‘facts’ and inductive reasoning, the ‘new samurai’ – as H.G. Wells described them – would lead society through an ‘irresistible glide’ (Webb and Webb, 1913, p 56) into a new social order dominated by an efficient state directed

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towards meeting individual needs, at one with society’s needs. The Webbs viewed the democratic process simply as a means to choose ‘brain workers’ (Webb and Webb, 1920), needed to run the state. Social reform must come from above. Sidney Webb declared that it would be unwise to suppose that a complicated industrial society could be organised ‘without strict subordination and discipline, without obedience to orders’, its affairs ‘more and more the business of elaborately trained experts, and less the immediate outcome of popular feeling’ (Webb, 1908, p 57, p 71). Beatrice confided to her diary: We have little faith in the ‘average sensual man’, we do not believe that he can do much more than describe his grievances, we do not think that he can prescribe the remedies … We wish to introduce into politics the professional expert and through him extend the sphere of government. (Webb, 1948, p 120) Organic theory developed a sociological arm, soon divorced from ‘new’ Liberal politics. Associated with Emile Durkheim (1858–1917) and Talcott Parsons (1902–79), functionalist sociological theory adopted the notion that society was a social system of interrelated parts, surviving because it evolved institutional structures to fulfil basic ‘system needs’ – its ‘functional prerequisites’. However, a dimension of this functionalism later stressed certain ‘dysfunctional’ elements in society (Merton, 1949) with, for example, the ‘slum’ viewed as disruptive to a harmonious order due to its disorganisation and its association with crime, immorality and disease. From this modified functionalist perspective the natural adjustment process would, in time, eradiate the slum but the process could be accelerated by the attentions of ‘rational’ planners gathering the ‘facts’ on an issue and acting ‘with the grain’ of functional adaptation. Association between the organic with the ‘rational’ permeated physical planning with Harvey (1997, p 24) stating: The proper design of things would solve all the problems in the social process. It was assumed that if you just built your urban village like Ebenezer Howard, or your Radiant City, like Le Corbusier, then the thing would have the power to keep the process in harmonious state.

Marxist political economy Marxist political economy maintains that relationships between individuals and social institutions are determined by the dominant production mode. Capitalism is a production form based on two classes: a capitalist class – the bourgeoisie – owning the means of production and a proletariat or working class that, because it does not own capital, is forced to work for capitalists in order to subsist. Whereas

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Fabian socialists and ‘social’ liberals believe that capitalist exploitation is partial, to Marxists it is total. This exploitative, economic relationship is the real foundation of all other legal, political and ideological ‘superstructures’, including the state. Applied to housing, this approach generates a number of propositions. • Real worker exploitation occurs at the production stage when workers are paid less for their labour than the market value of the houses they create. In addition, since housing has particular characteristics as a commodity – it is expensive to produce relative to worker earnings – then special institutions are necessary to realise house value. These institutions – banks, private landlords and so on – spread housing costs over the worker’s lifetime. By demanding a share of the surplus value created when houses are constructed, ‘exchange institutions’ add to working class, indeed middle class, exploitation. Engels (1872, part 3, p 3) quotes, with approval, Mulberger’s statement ‘The middle classes suffer just as much as, and perhaps even more than, the proletariat under the oppressive fetters of the rented dwelling’. • There are factions in housing capital with different short-term interests but the same long-term interest in ensuring that capitalism endures. Industrial capital wants to ensure its workers can be housed at minimal cost, land capital wants to maintain high land values and development capital wants to secure access to cheap land. • Housing has an ‘exchange’ value to capitalism – its efficiency in generating profits – but a ‘use’ value to the working class in meeting a human need. In a market capitalist economy, housing will be affected by its investment value not by its use value. Thus Madden and Marcuse (2016, p 26) claim ‘Under hypercommodification, all the material and legal structures of housing – building, land, labor, property rights – are turned into commodities’. • ‘Capitalist rule cannot allow itself the pleasure of creating epidemic diseases among the working class with importunity; the consequences fall back on it and the angel of death rages in its ranks as ruthlessly as in the ranks of the workers’ (Engels, 1872, p 11). Thus attempts will be made to eradicate ‘plague spots’ to protect the bourgeoisie but, given that working class housing conditions are determined by the wages paid by capital, such action merely displaces the problem elsewhere. Marx abandoned systematic thinking about the nature of society under communism at an early stage of his intellectual development arguing that ‘it is not the consciousness of men that determines their being, but on the contrary, their social being that determines their consciousness’ (Marx, 1859, p 5). New organisations would emerge only from the new economic relationships created by ending capitalism. He predicted that, after capitalism’s demise, there would be a transitional stage based on working class domination of the state but that

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eventually the state would ‘wither away’ and communism – the organisation of production and distribution by self-managing ‘communes’ – would emerge. Empirical explanations of continuity and change in housing policy Marxism runs the normative and the empirical together but interpretations of Marx’s writings have identified two major versions of the state’s role in capitalist development: the ‘instrumental’ model and the ‘arbiter’ model. In the 1970s, ‘instrumental Marxism’ claimed that the state is a straightforward instrument used by the ruling class to dominate society and ensure capitalism’s continuance. Taking their cue from the dictum ‘the state is but a committee for managing the common affairs of the whole bourgeoisie’ (Marx and Engels, 1848, p 10), instrumental Marxists explained continuity and change in housing policy as the state maintaining capitalist hegemony by stratagems such as: • attempting to minimise ‘externalities’; • taking the steam out of radical movements by temporary concessions at times of social unrest; • maintaining capitalist profits in times of surplus production; • promoting housing forms that underpin capitalist relationships with homeownership encouraged – aimed at convincing working people that they have an investment stake in capitalism, promoting an ethic of ‘possessive individualism’ and providing the ‘psychic’ benefits of security, independence and respectability. Engels (1872, p 36) was suspicious about homeownership, stating ‘give them their own houses, chain them once again to the soil and you break the power of the resistance to wage cutting by factory owners’. Marxists like to cite Conservative politicians who have argued that a degree of property ownership protects capital, a favourite being Lord Halsbury (1887), Tory Chancellor of the Exchequer, who declared: If there is to be an attack on property it will be resisted with much greater force if it is possible to say that it includes all property, not merely property which has any peculiar privilege, because then it can be said that an attack on property is an attack on property of all kinds. • ensuring that unrestricted competition between various capital factions does not undermine the overall system, so it has been the state’s business to ensure that the activities of factions in capital are complementary rather than contradictory with the development process assisted to ensure maximum profitability for all; and • maintaining a ‘reserve army of labour’ needed by capitalism to respond to its boom–bust production cycle by supplying standardised, cheap housing, linked to producing a physically efficient labour force.

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The ‘arbiter’ model is grounded on Marx’s earlier works in which – while disputing the notion that the capitalist state could act in accordance with the ‘common good’ as propagated by social reformists – he recognised that the state may obtain a degree of neutrality from capitalism and that it may act in proletariat interest at certain moments in history. This model allows the organised working class some influence in the historical construction of state housing policy via its involvement in social movements and offers a degree of optimism on the outcome of future struggles within and against the state via ceaseless pressure from the working class arising from its everyday experience as welfare producers and recipients. It also allows Marxists to provide a more convincing account of why and how housing policy evolved with real improvements being made in working class housing provision at times when the labour movement was strong, for example, 1914–21 and 1945–51. However, although ascribing ‘relative autonomy’ to the state and allowing ‘grassroots’, ‘rank and file’ social movements a potential role in social change makes the Marxist account more plausible, it reduces its distinctness when compared to the social reformist perspective.

Behavioural approaches So far the approaches to understanding housing policy examined have been ‘structural’ in that housing problem causation is located in the ways the economic and social systems operate. In contrast, there is long tradition in thinking about housing issues that places blame for housing problems on how some of its occupants behave. This approach can be traced to the theories of Malthus who, in his Essay on the Principle of Population (1803), argued that because population increases in geometrical ratio whereas agricultural production grows only arithmetically, unrestrained population growth would produce famine and disease. Malthus advocated ‘moral restraint’ – delayed marriage – as the check on population growth and, if the labouring classes did not practise such restraint, then they were to blame for famine, disease and destitution. Behavioural approaches to explaining housing problems became very influential towards the end of the 19th century and attempts to mitigate the housing conditions of the urban working class were linked to improving ‘character’. During the 20th century, behavioural approaches became subservient to structural approaches but, in the 1980s, they returned to prominence as ‘underclass’ theories. In Losing Ground (1984) Charles Murray asserted that an ‘underclass’ had developed in the United States characterised by young females reliant on state welfare to maintain their children and young males, separated from the necessity to support their offspring, adopting a lifestyle of crime and irresponsibility. He applied the ‘underclass’ idea to Britain claiming to have recognised similar trends – escalating illegitimacy, rising crime and a growing aversion to work (Murray, 1992). Other authors identified a tendency for the ‘underclass’ to become

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concentrated in certain areas thereby compounding the impact of their behaviour (Anderson, 1992; Hill, 2003). Although usually associated with the New Right, whose political wing has attempted to secure election success by detaching the ‘underclass’ from the working class, the behavioural approach has also featured in Marxism and has been a strong undercurrent in social reformism. Marx referred to the ‘lumpen-proletariat’ as ‘a passive putrefaction of the lowest strata of the old society’ (Marx and Engels, 1948, quoted in Bovenkirk, 1984) and Engels regarded the Irish as the Victorian ‘underclass’. Whenever a district is distinguished for especial filth and especial ruinousness, the explorer may safely count upon meeting chiefly those Celtic faces which one recognizes at the first glance as different from the Saxon physiognomy … The Irishman loves his pig as the Arab his horse, with the difference that he sells it when it is fat enough to kill. Otherwise, he eats and sleeps with it, his children play with it, ride upon it, roll in the dirt with it … The southern facile character of the Irishman, his crudity, which places him but little above the savage, his contempt for all humane enjoyments, in which his very crudeness makes him incapable of sharing, his filth and poverty, all favour drunkenness. (Engels, 1845, p 32) ‘New’ liberals and Fabian socialists also identified a ‘residuum’ requiring ‘overparenting’ to improve their conduct. Tony Blair adopted the behavioural approach. In 1997 he said: I have chosen this housing estate to deliver my first speech as Prime Minister … There is a case not just in moral terms but in enlightened self-interest to act, to tackle what we all know exists – an underclass of people cut off from society’s mainstream, without any sense of shared purpose. The basis of this modern civic society is an ethic of mutual responsibility or duty. It is something for something … You only take out if you put in. (Blair, 1997) New Labour quickly dropped the term ‘underclass’ from its lexicon but the notion that rights had to be accompanied by obligations – if necessary by enforced fulfilment – was a recurring theme in housing policy during New Labour’s term in office and David Cameron’s ‘broken society’ notion contained ‘underclass’ elements. Some commentators view the ‘underclass’ idea as ‘blaming the victim’ (Ryan, 1971) – individualising culpability for poverty – with, for example, Wacquant (2007) exploring the economic, social and public policy changes responsible for the economic marginalisation of the so-called underclass.

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Empirical explanations of continuity and change in housing policy Behavioural approaches incorporate two explanations of why ‘you always have the poor with you’ (Matthew 26:2). Eugenics, dominant at the end of the 19th century and still influential in the 1930s, claimed that low intelligence and its associated behavioural problems were transmitted genetically. By the 1960s, eugenic explanations had been superseded by ‘culture of poverty’ and ‘cycle of deprivation’ theories – albeit that some ‘cycle of deprivation’ ideas had eugenic undertones – asserting that undesirable place and family based ways of life were conveyed between generations. These theories were used to explain the need for continuous intervention in the housing system (see Box 1.4).

Box 1.4: Eugenics and the ‘culture of poverty’ Eugenics There is a long history of hunting for a ‘welfare trait’ (see Perkins, 2015: Lambert, 2016). The housing problem for eugenists centres in the question of obstacles put in the way of vigorous human beings … Up to the early part of this century people were continually either buying houses for themselves or expressing a demand for them which was readily satisfied by those likeminded investors. Then came the vogue of a totally different idea. The whole community was conceived of as a unit, whose duty it was to supply houses for the people who showed the least effective aptitude for acquiring them for themselves … Mr. Townroe emphasizes – though not, we think, unduly – the difficulties that arise from tenants who carry the slum mind and the slum habit wherever they go. (Pringle, 1929) Cycle of deprivation/culture of poverty The levels of dependency among social housing renters is quite staggering … This is not a situation that will resolve itself. How can we expect different from people who never see anything different? (Duncan Smith, 2008) There has followed a vicious cycle of degeneration, with social housing populated by ever more needy and dispirited individuals. It is no exaggeration to say that this situation presents one of the most critical social justice issues of the day. (Centre for Social Justice, 2008, p 54) The balance of our population, our human stock is threatened. A recent article in Poverty, published by the Child Poverty Action Group, showed that a high and rising proportion of children are being born to mothers least fitted to bring children into the world and to bring them up. (Joseph, 1974)

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Social constructionism The dominant approaches to understanding housing policy have tended to assume that the problems it addresses are objective and governments respond to these problems according to their ideological tendencies (Jacobs et al, 2003). In contrast, social constructionism – a dimension of the post-modernism thinking – focuses on ‘what’s the problem?’ They assert that housing problems are not obvious, and ‘out there’ waiting to be exposed. Rather they are constructed through a claimsmaking process via problem definition and attaching causal notions to a problem. Thus, when used as a noun, housing simply means ‘houses’ but, when used as a verb, ‘housing’ refers to a process or activity – to quote one dictionary definition, ‘to take or put into a house’ (Wordnet, 2004). This ‘taking and putting’ process involves a number of stages whereby housing conditions become housing problems and policy develops from the causative notions attributed to these problems. Social constructionism challenges ‘modern’ thinking by questioning global, all-encompassing, rational views that claim to capture objective knowledge of reality. In its most zealous form – sometimes called the ‘strong’ version – social constructionism rejects the notion of ‘essentialism’ – the idea that the external world exists independently of our representations of it. Its objective is to supply an account of the processes by which phenomena are socially constructed and thereby expose the ways in which certain understandings have become privileged and regarded as ‘the truth’. Social constructionism’s key concepts are ‘meaning’ and ‘power’. According to the approach, language, codified into ‘discourses’, is the key to meaning. These ‘discourses’ – systems of knowledge – classify and order events and persons and give some groups power over others because ‘dominant discourses’ frame the image and often the self-perception of the ‘subjects’ of the discourses (See Box 1.5). Frequently squealed, ‘Two legs good, four legs bad’ can become accepted by the majority. Social constructionism has associations with the word ‘post-truth’ — Oxford English Dictionaries’ 2016 word of the year — meaning ‘relating to or denoting circumstances in which objective facts are less influential in shaping public opinion than appeals to emotion and personal beliefs’ (Oxford English Dictionary, 2016).

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Box 1.5: The social construction of ‘homelessness’ In Citizen Hobo: How a Century of Homelessness Shaped America (2003), Todd Depastino explores how homelessness was identified as a social problem in the United States. Different labels were applied to homeless people at different times creating diverse ‘welfare subjects’ – ‘tramp’, ‘hobohemian’, ‘transient’, ‘skid row bum’ – according to the dominant concerns of American society. All the terms applied were ‘discourses’ on a lifestyle rather than descriptions of the condition of lacking shelter and were not always shared by their ‘subjects’. For many hobos an ‘unsettled way of living’ was an acceptable, even attractive, way of life – ‘a civilisation without a home’ – to quote a title chapter in Depastino’s book. It took a significant expansion of the American welfare state after the Second World War in the form of subsidised mortgages, unemployment compensation and grants for higher and vocational education to ensure that many of the returning GIs did not return to ‘Hobohemia’. Dominant discourses on homelessness as an unnatural, pathological way of life triumphed when the ‘hobohemians’ accepted this representation.

Social constructionism both liberates ‘agency’ – the capacity of people to formulate the ‘discourses’ that frame their identity – and points to the factors inhibiting such ‘agency’. It opens the door to examining different perceptions of what housing means to different household members, the ways these meanings change according to time and place and the roles of housing ‘consumers’ in negotiating and developing their own housing pathways. John Turner (1972) in Housing as a verb accuses ‘top down’ urban planners of controlling housing forms and called for greater user power in influencing housing outcomes. Empirical explanation of continuity and change Social constructionism is more of an epistemological position, a view on the nature of knowledge, than an explanatory theory. Social constructionists claim that all ‘discourses’ are situated historically and, because value and significance are culturally and historically specific, they are best understood when located in the detailed circumstances of their development. In explaining their passage to the social construction paradigm, Rose and Miller (2008, p 6) state: Theorists of the state addressed ‘why’- type questions … Why did a new institution appear, or why did an existing one change – a question often answered by gesturing to global processes such as modernization and individualization. We asked a different question, not ‘why’ but ‘how’, thereby lightening the weight of causality, or at least multiplying it and enabling us to abstain from the problems of ‘explaining’ such indigestible phenomena as state, class and so on … Instead, why not

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be content to trace small histories and their interesting trajectories? Why not study events and practices in terms of their singularity, the interrelations they define and the conditions that make them possible? When applied to the policy developing from housing problem identification, social constructionism adopts a systematically sceptical approach. It asks a series of questions about all claims that a given housing situation constitutes a housing problem. • Who says so? • What interests do they represent? • Why do they say this? (what assumptions are they making?) • How do they justify their views? • What are the implications of their assumptions? (Saraga, 1998, p 192) Answers to these questions can be found via a detailed examination of the specific contexts of a condition becoming a social problem and the responses made to the problem in accordance with the discourses of the times. Social constructionism has also embraced Foucault’s idea of ‘governmentality’ – whereby ‘conduct’ meaning ‘to guide’ meets ‘conduct’ as self-regulating behaviour. His insight has been developed within the social constructionist perspective by a focus on the ‘othering’ process. People are separated from the mainstream via their assignment to a category or grouping characterised by what they are not: the underclass/ mainstream society; hard working families/the unemployed; natives/immigrants; included/excluded; families/lone mothers; respectable/disreputable; owner/social tenant. ‘Othering’ has two benefits for the interests involved in the ‘othering’ process. Through a calculated dispensation of shame – stigmatising ‘the other’ – an enhanced feeling of self-worth and ‘belonging’ is given to those outside the stigmatised grouping. Moreover, those in the ‘other’ category may be encouraged to change their situation by the promise of inclusion in the ‘social body’. As Poovey (1995, p 8) has stated ‘The phrase social body promised full membership in a whole (and held out the image of that whole) to a part identified as needing both discipline and care’.

Overview

• •

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Housing policy is about the state attempting to make corrections to the housing market. Each approach to understanding housing policy is linked to a political agenda and contains, explicitly or implicitly, a normative theory used to establish the nature and causation of housing problems and an empirical theory aimed at understanding continuity and change in housing policy.

Understanding housing policy

Questions for discussion 1. According to the laissez-faire perspective, what is the legitimate role of the state in the housing market? 2. Why do social reformists insist that the supply and distribution of housing cannot be left to market forces? 3. Examine the websites of the ‘think tanks’ listed below. On which normative approach to housing policy are they based? 4. Should state help with housing costs be linked to the behaviour of the recipients?

Further reading Normative and explanatory welfare theories are linked to the development of the British state welfare in Understanding State Welfare (2002) by Brian Lund. Housing and Residential Structure: Alternative Approaches by Keith Bassett and John Short (1980) is a comprehensive account of the Marxist Political Economy approach and Noel Thompson’s article ‘Hollowing Out the State: Public Choice Theory and the Critique of Keynesian Social Democracy’ (2008) is an accessible exposition and critique of public choice theory. The excellent Regulating Social Housing: Governing Decline (2006) by David Cowan and Morag McDermont is underpinned by a social constructionist approach. A comprehensive account of behavioural approaches can be found in John Welshman’s Underclass: A History of the Excluded Since 1880 (2013).

Websites Various ‘think tanks’ reflect the diversity of approaches to understanding housing policy and the development of policy prescriptions. See, as examples, the websites of the following ‘think tank’ by entering their names in a search engine.

• • • • • •

The Policy Exchange Centre for Policy Studies Fabian Society Civitas Centre for Social Justice Resolution Foundation

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two Housing policy: continuity and change Summary

• • • •

•

• •

Poor housing conditions became recognised as a social problem when ‘the slum’ was seen as a threat to social order and the nation’s moral and physical health. Homeownership and council housing expanded between the wars as private landlordism declined. The 1945–51 Labour government attempted to tackle the housing problem by subsidised local authority housing for ‘general needs’ and new towns. Initially the Conservative government (1951–64) maintained a robust ‘general needs’ council housebuilding programme but then extended green belts and directed local government to meeting the requirements arising from slum clearance. Owner-occupation was promoted and an attempt was made to revive private landlordism by relaxing rent controls. In the 1950s and 1960s both the major political parties emphasised producing more houses but, in the late 1960s, older home improvement starting to have a higher profile. Supporting housing associations became a common party objective albeit for different reasons. The Conservative Party focused on tenure choice in the 1980s and 1990s, with the Right to Buy (RTB) its flagship policy. Rent control was abolished for new tenancies. At first, New Labour adopted the same policy orientation as the Conservatives but later it attempted to stimulate housing output, a project derailed by the 2008 ‘credit crunch’. RTB controls were imposed. After decades in decline, the private landlord sector started to revive.

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• •

The coalition government tried to boost homeownership by a re-invigorated RTB for council tenants, demand side subsidies, and planning reform. Cameron’s 2015 Conservative government made expanding homeownership its principal objective.

Housing becomes a social problem ‘Externality’ identification transformed housing into a social problem. Urban growth developed through short distance moves of less than 30 miles by young people in search of better-paid work, supplemented by the migration from Ireland and the Scottish Highlands. The migrants were of child-bearing age and those born in towns and cities soon provided the main population growth impetus. Dwelling supply and sewerage could not keep pace with the billowing population so many people crammed into low quality, insanitary accommodation. However, poor housing conditions are not necessarily problematic. Housing had to be constructed as a social problem, a mission pursued by a new group of ‘public good’ experts who thought it necessary to centralise administration to secure a more wholesome nation. Throughout the 19th century, ‘health and housing were considered to be one problem and treated accordingly’ (Lawrence, 1985, p 124).

Housing, health and the public good Edwin Chadwick was the most formidable sanitary reform advocate. His Report on the sanitary condition of the labouring population of Great Britain (1842) assembled a variety of statistics and opinions to demonstrate that existing sanitary arrangements generated ‘externalities’ (see Box 2.1).

Box 2.1: Extracts from Report on the sanitary condition of the labouring population of Great Britain (Chadwick, 1842, pp 369–72)

• • • •

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That of the 43,000 cases of widowhood, and 112,000 cases of destitute orphanage relieved from the poor rates in England and Wales alone, it appears that the greatest proportion of deaths of the heads of families occurred from unsanitary conditions. That the ravages of epidemics and other diseases do not diminish but tend to increase the pressure of population. That the younger population, bred up under noxious physical agencies, is inferior in physical organisation and general health. That the population so exposed is less susceptible of moral influences, and the effects of education are more transient than with a healthy population.

Housing policy

• • •

That these adverse circumstances tend to produce an adult population shortlived, improvident, reckless, and intemperate, and with habitual avidity for sensual gratifications. That these habits lead to the abandonment of all the conveniences and decencies of life, and especially lead to the overcrowding of their homes, which is destructive to the morality as well as the health of large classes of both sexes. The annual slaughter in England and Wales from preventable causes of typhus which attacks persons in the vigour of life appears to be double the amount of what was suffered by the Allied Armies in the battle of Waterloo.

Chadwick was so anxious to ensure his findings produced action he consulted Charles Dickens on how to present his report for maximum impact. He also ignored alternative analyses circulating at the time stressing ‘privation’ – gruelling work, low wages and poor food – as causing poor health in favour of the politically less controversial ‘miasma’ – polluted atmosphere – explanation (Hamlin, 1998). Nevertheless, his report did not produce immediate results and it required pressure group activity from the Health of Towns Association to promote the measures. Ever helpful, Charles Dickens included references to Chadwick’s thesis in Dombey and Son, first published in monthly parts between 1846 and 1848. But if the moral pestilence that rises with them [noxious particles] ... could be made discernable too, how terrible the revelation. Then should we see depravity, impiety, drunkenness, theft, murder and a long train of nameless sins against the natural affections and repulsions of mankind. (Dickens, 1953 [1846–48], p 625) The 1848 Public Health Act set up a Central Board of Health with powers to establish local boards to provide parks and public baths, remove nuisances and manage sewers wherever the death rate exceeded 23 per 1,000 population per annum. Public health and local governance Chadwick, Secretary to the Central Board of Health, tried to use its powers to cajole the localities into action but was firmly resisted on the argument he was interfering with property rights and local governance. In 1858 such opposition led to the abolition of the Board in a climate of opinion well captured by The Lancet (12 February 1858): … a few doctrinaires nursed in the narrow conceits of bureaucracy, scornful alike of popular knowledge and of popular government, seized

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upon the sanitary theory as a means of exercising central power of domiciliary inspection and irresponsible interference with the conduct and property of Englishmen … The truth is we do not like paternal governments. Despite Chadwick’s demise, there was sporadic progress towards improving public health through better understanding of illness causation, middle class panic during periodic cholera outbreaks and the endeavours of ‘ad hoc’ health authorities set up in some localities under private legislation. By the early 1870s, public health had become so well established as a political objective that Disraeli (1872, p 2) could declare that, to promote national efficiency, ‘Sanitas sanitatum, omnia sanitas’. The 1875 Public Health Act consolidated and enhanced earlier legislation, setting out the duty of sanitary authorities, to be established in every locality, as: securing an adequate sewage disposal system; a water supply; a drainage method; and supervising street widths in new developments. Using the Act’s authority, the Local Government Board, established in 1871, issued a new model bylaw code that, although not compulsory, was adopted by many local authorities. This had a significant impact on new home quality. The bylaws enlarged the court size in courtyard houses making it more profitable for developers to build terraced houses, even though such terraces had to be a specified minimum size and contain a backyard with a ‘privy’ and coalhouse. Outside passages had to be provided to facilitate sewage removal. Commenting on model bylaw application in Preston, Morgan (1993, p 59) asked ‘Was Preston’s housing revolutionised?’ concluding ‘the short answer is that most new housing was, and that it was good enough to have survived to the present day, still mostly in good condition’.

The slum The 1875 Public Health Act ensured that new dwellings were built to sanitary standards and gradual water and sewerage municipalisation, paid collectively through the rates, made basic hygiene standards more affordable to the working class. Nevertheless, the problem of the unwholesome dwellings, built before regulations for new dwellings were adopted, remained. These dwellings became known as slums, a term referring both to individual houses deemed ‘unfit for human habitation’ and entire districts – the slum – regarded as ‘the locale of vice, crime, delinquency and disease, a disorderly gathering of people beyond society and without community’ (Mellor, 1977, p 67). Local government’s role was not to build, except on clearance sites with special permission, but to control individual houses regarded as ‘unfit for human habitation’, flatten slum areas and assemble a site for redevelopment by private enterprise and philanthropic organisations. The failure to replace houses demolished by clearance and the railroad advance into the central cities, having been investigated by the 1885 Royal Commission

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on the Housing of the Working Classes, led to the 1890 Housing of the Working Classes Act, permitting local authorities in London – extended nationwide in 1900 – to erect houses outside clearance areas provided no scheme made a loss. The slum problem added to the national angst on ‘national efficiency’ that reached its zenith in 1904 following the publication the report by Interdepartmental Committee on Physical Deterioration (FitzRoy, 1904). Set up to investigate the reasons for the high rejection rate of potential recruits for the Boer War, the committee concluded that a major reason for physical deterioration was the habits of people living in the overcrowded slums and demanded that people from slum areas should be dispersed. A paradigm shift in housing policy occurred in the early 20th century. Pushed by Labour movement’s growing power – John Wheatley, a ‘Red Clydesider’ and later to become the minister responsible for housing, said ‘the prime aim of Labour’s housing policy is not to rescue people from the slums but to prevent them getting there’ (quoted in Hannan, 1988, p 45) – attention shifted from the slum to the nationwide housing ‘famine’. Numerous solutions, with contemporary resonances, were in circulation.

The housing issue circa 1906 In Progress and Poverty, according to Blaug (2000, p 270) ‘undoubtedly the most widely read book on economics in the nineteenth century’, Henry George elaborated John Stuart Mill’s idea that ‘landlords grow richer, as it were in their sleep, without working, risking, or economising’ (Mill, 1848, p 28). George (1979 [1879], p 66) defined ‘rent’ as ‘consideration for the use of land’. ‘Rent’ increased with expanding population and the consequent inflation in land values, to which the landowner made no contribution, reduced the social product accruing to capital and labour. The remedy was to take ‘rent’ by land taxation on value above unimproved ‘site’ value. Such a tax would represent ‘the taking by the community, for the use of the community, of the value that is the creation of the community’ and would be easy to collect ‘for land cannot be hidden or carried off’ (George, 1979 [1879], p 139). The mainstream Liberal Party adopted land taxation but was opposed to housing subsidies, regarded them as ‘doles’. Land tax receipts would be used as an adjunct to general revenues not hypothecated to housing although land taxation’s impact would be to bring land to the market and thereby reduce its cost. Lloyd George viewed land taxation as a way to undermine the power of the landed aristocracy. He attacked their ‘undeserved’ wealth asserting: ‘The Landlord is a gentleman ... who does not earn his wealth … His sole function, his chief pride, is the stately consumption of wealth produced by others’ (Lloyd George, 1909, p 7). The Labour movement was attracted by land taxation but it also endorsed land nationalisation. It was far more enthusiastic about municipal housing than

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mainstream liberalism with Councillor Edwin Scrymgeour, a Christian Socialist, encapsulating Labour’s general attitude in supporting state-built housing but ‘wanting the government to pay for it not Dundee’s workers’ (quoted in Young, 1991, p 418). Under the control of the ‘Progressives’ – founded in 1888 by a group of ‘new’ Liberals and labour movement leaders with Fabians having a prominent role – the London County Council (LCC) attempted to build houses with the surplus derived from municipal water supply. However, when the use of this financial surplus was blocked by the Conservative government, the LCC resorted to concealed ‘subsidy’ by writing down land acquisition costs (Shaw, 1908). John Wheatley (1914) advocated using the profit produced by Glasgow’s municipal trams to finance council housing. Land values formed an important element in Ebenezer Howard’s garden city advocacy. In Garden Cities of Tomorrow (1902), he argued that the ‘magnets’ of city and country living could be combined by residence in a planned garden city, organised through a not-for-profit trust, and surrounded by a rural ‘green belt’. Retained enhanced land value by the community was a vital element in Howard’s scheme. As the city grew, land values would increase and this ‘betterment gain’ could be used by the not-for-profit trust to provide community facilities and stimulate cooperative housing ventures. Unlike garden cities, garden suburbs were not intended to be self-contained. They were to be appendages to existing urban areas but developed at low density, marrying town and country by tree-lined roads, hedges not walls plus woods and public gardens. The first garden suburb – Hampstead Garden Suburb – designed by Raymond Unwin, was a private venture but contained a variety of housing types to promote a mixed community. It was the design prototype for Labour Party’s ‘suburban solution’ – low density municipal houses on urban fringes. The property slump in the early 20th century highlighted the salience of these new solutions but the legislation passed by the Liberal Party between 1906 and 1914 made little impact. In his 1909 ‘Peoples’ Budget’, Lloyd George introduced land taxation at 20% on the ‘unearned increments’ on land sales and an annual tax on the capital value of ‘undeveloped’ sites. Problems with land valuation and adverse court judgements meant that, by 1914, only £612,787 had been collected and, in 1922, the tax was abandoned (see Lund, 2016). Between 1893 and 1908 cheaper public transport had allowed half a million acres to be used for suburban development. The 1909 Housing and Planning Act was a diluted version of an attempt to allow local government to plan the shape of the emerging suburbs by permitting them to acquire land by compulsory purpose. Rather than grant such a power, the Act gave local authorities greater permissive authority to control new estate development, an extension of their bylaw powers under the 1875 Public Health Act.

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Housing policy: 1915 to 1939 Homeownership Estimates of the proportion of homeowner households before 1914 vary from 10% (Pawley, 1978) to 23% (Holmans, 2005) but homeownership increased rapidly between the wars and, in 1939, 34% of households were homeowners. Many factors underpinned this growth (see Chapter Five) but it was underpinned by a ‘homeownership ideology’ (Roland, 2008) (see Box 2.2).

Box 2.2: Homeownership ideology The Conservative MP, Noel Skelton, coined the term ‘property-owning democracy’ in a series of Spectator articles published in 1923 and later issued as a pamphlet (Skelton, 1924). He believed the idea would appeal to working class opinion leaders. It did and, as Scott (2013) has demonstrated, middle class suburban relocation was followed by a significant proportion of the ‘respectable’ working class moving into owner-occupied suburbia. A ‘suburban identity’ emerged, characterised by the idealised married women’s role as professional housewife, providing a happy, clean, homely environment for her family via labour saving devices and efficient household management practices plus the stable, respectable male citizen spending his leisure time in home-related activities. They had ‘Dunroamin’ – to use the name on a 1930s house – and settled down. The design of the new suburban houses, influenced by the architect Charles Voysey, avoided ‘modernism’ and reflected English vernacular architectural traditions (Hitchmough, 1995). In the early 1930s, the National Association of Building Societies published a collection of endorsements from 47 MPs. One contributor, Colonel R.V.K. Applin, expressed the virtues of homeownership as: The man who owns his home has rooted himself in the very soil of this country … He has staked out his claim, settled his future, and is an asset in the national life, a worthy citizen of no mean empire. (quoted in Scott, 2003, p 17)

Baldwin welcomed the working class into suburban owner-occupation and, immediately after the publication of Skelton’s Spectator articles, declared: Nothing can be more touching than to see how the working man and woman after generations in the towns will have their tiny bit of garden if they can … The love of these things is innate and inherent

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in our people. It makes for that love of home, one of the strongest features of our race. (Baldwin, 1923, quoted in Baldwin, 1926, p 56) The impact of the ‘homeownership ideology’ and the related council tenant ‘othering’ was revealed by the ‘Cutteslowe Wall’, first built in 1934 by owneroccupiers across a road to divide the homeowners from the adjoining council estate (Collison, 1963). Other barriers were erected up and down the country. Rent control In the 19th century working class distaste for private landlordism produced demands for rent regulation. Agitation on rents, sometimes in the form of rent strikes, increased (Lund, 2016). Rent control was endorsed by the Independent Labour Party but landlords were well represented on local councils and rent regulation had a low national political profile. Between 80% and 90% of households rented privately in 1914. Landlord/tenant relationships at the lower levels of the market were strained, it being a constant battle to extract rent from poor families prone to ‘moonlight flits’ and aggressive resistance to eviction. Housebuilding stopped at the outbreak of the First World War and worker movement into the munitions factories led to rent increases. Faced with working class unrest, notably the rent strikes in Glasgow led by Mary Barbour, the government introduced rent control and restricted interest rates on the associated mortgages. Rent control was buttressed by giving tenants tenure security to prevent landlords from evicting sitting tenants to extract a higher rent. Rent control was due to be revoked six months after hostilities ended but fear of social unrest and electoral unpopularity prevented such a move. The Conservatives – in power for most of the inter-war period – attempted to gradually back out of rent control. The general approach was to use ‘expert’ committees to classify dwellings according to their markets with ‘block’ decontrol in those sectors where supply and demand were viewed as in balance and decontrol on vacant possession – called ‘creeping’ decontrol – in other areas. This approach met strong working class resistance that produced a political retreat in 1933 when low-value houses were removed from ‘creeping’ decontrol. By 1939, dwellings with a high rateable value had been decontrolled and houses with middle range rateable values became decontrolled on vacant possession. Low-value houses, about 44% of the total privately rented stock, remained controlled. Whereas rent control has been blamed for the decline in private renting between the wars there was little difference between the selling rate of decontrolled and controlled properties, indicating homeownership was becoming a preferred tenure and carried a premium. New homes built for private renting experienced revival in the middle 1930s prompted by the favourable economic conditions for residential construction and the 1933 Housing (Financial Provisions) Act

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that allowed local authorities to guarantee loans made by building societies for building rented accommodation. Council housing for the working class Labour’s ‘suburban solution’ was reflected in the subsidised housing for munitions workers sponsored by the Ministry of Munitions that, by 1918, had supplied 10,284 homes on 38 estates. Gretna, with the largest concentration of munitions workers, became a ‘mini welfare state’ with state public houses, canteens and community halls. The Fabian Society, whose members occupied influential positions on the various wartime reconstruction committees, played a significant role in framing the 1919 Housing and Town Planning Act. This Act made it mandatory for each authority to assess housing need and compile a plan to meet this need. It granted ‘open-ended’ central subsidies to local authorities to meet housebuilding costs above a set rate contribution. The Fabians received valuable support from garden city advocates who, although maintaining that building 100 garden cities was the best way to create a ‘land fit for heroes to live in’, endorsed the view that community provision, not profit-motivated private enterprise, was the right path. Opposition to subsidised local authority provision came from the Treasury but was overcome by the need to provide work for demobilised troops and the spectre of social unrest, perhaps, revolution. Lloyd George, highlighting the Bolshevik scare, put the issue bluntly to the Cabinet; ‘Even at the cost of £100,000,000’, he said, ‘what was that compared with the stability of the State’ (quoted in Johnson, 1968, p 346). Although subsidised local authority housing was regarded as a temporary expedient, scheduled to end in 1927, the new homes were to be built to high standards. The Tudor Walters Committee Report (Tudor Walters, 1918) recommended the houses should have bathrooms, gardens and, in some cases, ‘parlours’. As Burnett (1986, p 255) has stated, ‘every Englishman was, or felt he was, a disinherited country gentleman and social stability would be created by mimicking the “manor” in suburban estates’. Central subsidies to local government to build houses acted as a ‘butterfly valve’ in the inter-war period serving to direct local authorities towards central government priorities. The open-ended subsidies of the 1919 Housing and Town Planning Act were ended in 1921 and Conservative governments – dominant between the wars – reduced ‘general’ needs subsidies and provided assistance to private enterprise to supply small houses. Short-lived minority Labour governments increased local authority subsidies. In 1924, Health Minister John Wheatley, responding to a Liberal call for subsidy dilution on the argument that Wheatley’s ‘doles’ would lead to ‘a privileged tenant living at a low rent because of the outpouring of Government money’ (quoted in Hannan, 1988, p 134), said ‘Over the 60-year loan period interest rates were double that of the combined cost of all other

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factors in production, his dilution would start with interest rates’ (quoted in Hannan, 1988, p 134). Replacing overcrowded slums In the early 1930s, leading Conservatives expressed anxiety about ‘the trend of recent events, which tend to turn our local authorities into owners and still more managers of small house properties’ (Austen Chamberlain, quoted in Estates Gazette, 1933, p 203). Conservative housing strategy was to confine the state to removing ‘pathological’ conditions in inner cities by building flats leaving private enterprise to build new dwellings for homeowners on suburban sites. The 1933 Housing (Financial Provisions) Act axed general subsidies for local authority housing, retaining only the slum clearance subsidy awarded under the 1930 Housing Act passed by a minority Labour government. The 1935 Housing Act granted extra subsidies to reduce overcrowding. In England and Wales, council housing, as a proportion of total building, declined from 44.4% (1919–24) to 21.5% in the late 1930s. However, in Scotland – where housing conditions were lower than in England and worker militancy higher – local authority housing construction dominated the private sector by a three to one ratio.

Labour 1945–51: a planned solution At the outbreak of the Second World War, the government did not wait for social unrest before putting rent controls in place. In 1939, rents were frozen except for very high value properties. Despite the progress made between the wars, a serious housing shortage remained. The war intensified the problem: 458,000 houses were destroyed and 250,000 badly damaged and, when hostilities ceased, household formation accelerated and the birth rate increased. Housing became the political issue and a squatting movement developed, led by the Communist Party, and involving ex-servicemen occupying former army camp and luxury flats (Watson, 2016). Despite these problems, there was no housing equivalent of the Beveridge report on social security, perhaps reflecting an obvious remedy: state directed production that had been so successful in meeting war economy requirements. In 1945, the Daily Mirror declared ‘Housing will have to be tackled like a problem of war. We make, as if by miracle, tanks, aircraft, battleships, pipelines, harbours! Are we then incapable of building houses?’ Aneurin Bevan, who became responsible for the housing programme in 1945, injected a socialist edge into the housing plans developed by the wartime coalition. He favoured local authorities – in his words, ‘plannable instruments’ – that could meet the need of poor people for homes to rent. Labour offered local authorities a new flat rate subsidy for ‘general needs’ houses that tripled the subsidies on

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offer in the late 1930s making them available for 60 rather than 40 years. Bevan imposed a mandatory requirement for local authorities to make a rate contribution to housebuilding, allowed them to borrow from the Public Works Loans Board (PWLB) at an interest rate below the market rate and introduced a strict building licence system to control materials use by the private sector. Local authority houses would form part of a planned physical environment (see Box 2.3).

Box 2.3: Post war planning The 1932 Town and Country Planning Act had allowed local authorities to prepare development plans to control new building and even levy a tax on development gain but very few local authorities used the Act because compensation had to be paid on a planning application refusal. The 1935 Restriction of Ribbon Development Act, aimed at preventing ‘sprawl’ along the routes radiating from cities was more successful. The 1947 Town and Country Planning Act:

• • • • •

imposed taxes of between 40% and 100% on the ‘betterment’ value of development land; made provision for grants to be paid to local government for land assembly; placed a duty on local authorities to prepare development plans; allowed local authorities to acquire land by compulsion; and required most developments to have planning permission which meant that housing supply, unlike any other privately supplied good, was controlled and regulated by the local democratic process.

The 1946 New Towns Act made provisions to establish new towns to relieve congestion in the major cities.

Mixed communities Bevan wanted to ensure that all new housing schemes promoted mixed communities. He declared ‘We don’t want a country of East Ends and West Ends, with all the petty snobberies this involves’ and that local authority housing should replicate the Welsh village with its ‘living tapestry of a mixed community’ (quoted in Foot, 1975, p 78). The 1949 Housing Act removed the requirement, present in all previous housing legislation, that local authority housing was to be supplied only to ‘the working class’ and, although opposed by other Cabinet members, Bevan insisted on far higher standards of space and amenity than provided between

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the wars. Such improvements increased the cost of a council house by 35% and higher subsidies were granted to local government. In 1948 Bevan ended the prefabricated bungalows programme, started in 1944, arguing that such homes were low quality ‘rabbit hutches’. Between 1945 and 1951, 80% of the houses built were local authority houses and Labour’s 1951 manifesto stated that, in future, ‘Most of these houses will as now be built for rent and not for sale, and for the benefit of those whose housing need is greatest’ (Labour Party, 1951, p 4).

The Conservatives and housing policy, 1951–61 The ‘people’s house’ Housing construction declined after its 1948 peak. The Conservatives blamed the slow progress on state bureaucracy, restrictions on private enterprise and land release being impeded by land taxation. At the 1950 Conservative Party Conference the delegates passed a resolution, against the leadership’s wishes, calling for a target of 300,000 houses per year and started a political numbers auction that lasted until the late 1970s (see Chapter Five). In its 1951 manifesto the Conservative Party declared ‘In a property-owning democracy, the more people who own their homes the better’ (Conservative Party, 1951, p 3). However, Harold Macmillan, responsible for meeting the 300,000 per annum target, recognised it could not be achieved through private enterprise as the private sector had built only 26,000 dwellings in 1950. The 1951 Census revealed the dire housing situation: 48% of households did not have access to all four basic amenities – a cooking stove, piped water, a water closet and a fixed bath. There were marked area differences in housing conditions with, as examples, 66% of households in the South Wales valleys without a fixed bath, 27% of households in South Yorkshire without exclusive use of a lavatory and 51% of Glasgow dwellings with only one or two rooms compared to 5.5% in Greater London. For a time, the Conservatives continued to rely on local government: 300,000 new dwellings were built in 1953, 245,000 by local authorities. Macmillan maximised the use of building materials – his ‘people’s house’ had a smaller living room, no store rooms and lacked a second lavatory in larger houses. Stimulating the private sector At first, Macmillan resisted party demands to promote homeownership and Treasury insistence on reducing subsidies. However, sensitive to Conservative concerns about state housing growth and fears that local authority housing was a devise to help Labour move its supporters into Tory heartlands (Seldon, 1981), he started to prepare to return to the 1930s policy.

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Middle 1950s initiatives marked Conservative steps towards applying free market principles to housing while protecting rural England. The policies were heralded in the white paper, Housing: the Next Step, acclaiming homeownership as ‘the most satisfying to the individual and most beneficial to the nation’ (MHLG, 1953, p 3). Local authorities were forced to borrow from the capital markets at higher interest rates than available from the PWLB, ‘general needs’ subsidies were withdrawn and resources concentrated on slum clearance. The statutory rate contribution to council housing was ended and an attempt was made to persuade local authorities to charge ‘realistic’ rents with local rent rebate schemes to cushion the impact on low-income households. New Town Corporations were encouraged to sell houses and allow private housing to be built. Private sector solutions to the unsatisfactory dwellings problem were encouraged by mandatory improvement grants for basic amenity installation. The Party’s deep distaste for Labour’s ‘suburban’ solution, revealed in internal party policy documents prepared during the war (Day, 1988), was augmented by worries that large urban authorities were intent on extending into the counties by land purchase for new estates. Conservative housing policy again became a matter of ‘fencing the cities’. In 1955, the extension of green belts was promoted through a circular to local planning authorities. Green belt designation increased rapidly. ‘Rachmanism’ In the early 1950s, the Conservatives attempted to revive the private landlord sector by abolishing rent control on new property and allowing rent increases for better maintenance. The strategy culminated in the 1957 Rent Act. Rents above a specified rateable value were decontrolled and ‘creeping’ decontrol was introduced by ending rent control when a house became vacant. This experiment in free market economics was a political disaster. It did not halt the decline in private landlordism: in 1957 there were 4.5 million privately rented homes but by 1965 the total had fallen to 3.5 million. Moreover, it generated a political storm as the vicious tactics of a few slum landlords to secure vacant possession added a new term to the English language – ‘Rachmanism’ – named after Perec Rachman, the most notorious abuse practitioner. Private landlordism’s already tarnished reputation was blemished again.

Housing policy 1961 to 1979: consensus years? In 1961 housing reignited as a political issue; Prime Minister Harold Macmillan had reservations about the policies pursued since 1955 declaring that he wanting to ‘recreate the spirit of 1951–54’. ‘Think big’, he told his housing minister, Sir Keith Joseph (quoted in Denham and Garnett, 2001, p 101). Joseph thought big, devising some radical policies, including a land tax, green belt relaxation and

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local authority development corporations to build up land banks. However, he found it difficult to secure Cabinet acceptance for his schemes, especially after Sir Alex Douglas Home replaced Macmillan as prime minister in October 1963. Nonetheless, there was a significant policy change post 1961. The Conservatives abandoned further private landlord deregulation, introduced new initiatives to boost housing associations, designated five new towns, restored ‘general needs’ subsidies to local authorities and stimulated homeownership by abolishing Schedule A tax (see Box 2.4).

Box 2.4: Taxation and homeownership Schedule A was a tax levied on the rental income that all owner-occupiers were assumed to have paid to themselves. It ensured that a homeowner was treated in the same way as a private landlord who had to pay tax on rental income. As part of the package involved in Schedule A payment homeowners and private landlords were allowed to deduct their mortgage interest payments from their income tax liability. When Schedule A tax was abolished for resident owners in 1963, mortgage interest tax relief continued thereby creating a subsidy to homeowners. The tax concession was important to people paying the standard rate of taxation and valuable to those people paying the higher rates of tax, especially when interest rates and taxation rates were high. Treasury ministers wanted to abolish the concession (Mount, 2009) but Margaret Thatcher resisted and it only started to be phased out when she left government. New Labour completed the process.

Despite the heated housing debate during the 1964 election campaign, the two principal parties adopted similar policies. The Conservatives, although lukewarm on local authority housing, had to give it a role. Private landlordism had been totally discredited by the publicity given to Rachman’s abuses and an attempt, started in 1962, to create a ‘third sector’ of non-profit landlords renting at cost through ‘cost-rent’ and ‘co-ownership’ societies’ – forms of housing association – needed time to make an impact. Labour thought it expedient to support homeownership by a pledge to reduce the mortgage interest rate to 4%. The 1964–70 Labour five-year housing programme promised to split new building 50/50 between homeownership and council housing. Labour’s growing taste for homeownership was reflected in the declaration that public sector expansion was a response to ‘exceptional needs’ whereas ‘the expansion of buildings for owner occupancy … is normal’ (MHLG, 1965, p 3). Owneroccupation was stimulated by an ‘option mortgage’ scheme allowing a low-income household that did not benefit from tax relief on mortgage interest to receive a low interest loan. Labour restored the balance between public and private sector building that had tipped in favour of owner-occupation in the late 1950s and

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early 1960s. The gap between the two sectors narrowed from 96,000 in 1964 to 23,000 in 1969 but, as Dunleavy (1981, p 24) has commented, ‘if Labour’s strategy was successful in terms of the number of public housing completions, it contained the seeds of its own demise in the type of housing being completed’. Some low-rise estates were badly designed but the most significant policy failure was the high-rise.

Cities in the sky Flats were never popular with the people they housed. Their form was alien to the ground level terraced property familiar to the English working class and flats ‘were the products of monolithic and large scale design which gave little scope for the users to modify through their ordinary domestic behaviour’ (Ravetz and Turkington, 1995, p 57). Yet, although survey after survey demonstrated people did not want flats (see Lund, 2016), flats were what they got. Until the mid-1950s, technological limitations restricted the block heights but advances in construction techniques allowed high-rise building. By 1966–67, 25% of the dwellings constructed were high-rise and in the major cities the proportion was far higher – up to 70% in Greater London. Over 60% of tower blocks were built by industrialised systems. High-rise was the product of a number of influences. Le Corbusier (1927) asserted that houses should be ‘machines for living in’. Well-spaced tower blocks, providing homes with equal access to daylight, should be linked by ‘streets in the air’ to encourage social interaction and allow the areas around the blocks to be used as parkland. By the early 1940s the architectural profession was in thrall to Le Corbusier’s ‘modernism’ with Peter and Alison Smithson, leading architects and fervent believers in ‘streets in the sky’ declaring ‘Folk-build is dead in England’ (quoted in Kynaston, 2009, p  280). In response to claims that people did not want to live in flats, the Architects Journal argued that public opinion surveys were ‘limited by inherent difficulties which are much more fundamental – by the ignorance and irrationality of the masses’ (quoted in Tsubaki, 1993, p 237). When things went wrong – and they did – architects censured the occupants, with Esher (1983, p 286) blaming ‘bad upbringing by parents in thrall to television of moonlighting’. Perhaps the penguins were at fault for not liking Berthold Lubetkin’s modernist penguin pool at London Zoo. They were moved out in 2004 because they suffered aching joints due to having to walk all day on concrete and were unable to burrow, a part of their courting ritual. Chinese alligators moved in but they did not like it either (Glancey, 2004). The major building firms, possessing the techniques for systems building, regarded high-rise as a source of profit and used their influence on the National Building Agency and with senior politicians to promote tower blocks. Building high cost more than building terraced houses. Lifts were expensive, accounting for up to

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Understanding housing policy: third edition

20% of the costs of a high-rise project. It was known in the 1960s that densities, equivalent to high-rise, could be achieved ‘by the theoretically elementary expedient of laying four tower blocks on their sides round a rectangle of open space’ (Esher, 1983, p 132). Many city authorities demanded more homes within their boundaries in order to retain rateable value and preserve civic status. When city authorities wanted to expand to build council suburbs they met resistance from county and district authorities. Nottingham City Council was frustrated in its attempts to expand into Nottinghamshire (Matthews, 2016) and Manchester was in constant conflict with Cheshire. Duncan Sandys’ green belt policy gave the county councils greater power to resist city expansion into their territories. High-rise flat construction started to decline post 1966 and, following the partial collapse of Ronan Point, a 22-storey tower block in Newham, East London in 1968, few new tower blocks were started. Private landlords and improving older dwellings The Labour Party’s attitude to private landlordism in the 1950s was aggressively negative and it developed proposals to allow local government to take over the sector. However, in office, and influenced by the 1965 Milner Holland Report on London Housing which demonstrated that, despite ‘rogue’ landlords, the majority of landlord/tenant relationships were satisfactory, Labour replaced municipalisation with regulation. New mechanisms were set up to regulate rents giving tenants and landlords the opportunity to ask rent assessment committees to determine a ‘fair’ rent – one that ignored scarcity value – for a property. Labour also promoted a switch away from clearance towards home improvement on an area basis justifying the change as a positive measure aimed at reducing the disruption of established communities via clearance. However, the policy was also a response to the financial crisis of 1967 – rehabilitation was cheaper than demolition and new build. Selectivity Edward Heath’s government moved towards greater selectivity in housing finance, applying ‘fair’ rents in the local authority as well as in the private landlord sector and cushioning the impact on low-income households by a national rent rebate scheme for council tenants and housing allowances for private tenants (see Chapter Six). ‘Fair’ rents met with considerable resistance from council tenants. In power, Labour retained the national rent rebates and allowance system but local authorities were instructed to charge only ‘reasonable’ rents. The 1975 Housing Rents and Subsidies Act introduced a new form of central government subsidy – more targeted on local authorities with the highest housing needs. The ideas contained in the Conservatives’ white paper Better homes – the next priorities

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Housing policy

(DoE, 1973) on stricter area selectivity were adopted by Labour and incorporated into the 1974 Housing Act. Housing associations were given a major role in the legislation. If registered with the Housing Corporation they became entitled to Housing Association Grant (HAG) designed to pay, as a capital sum, the difference between a project’s cost and the amount that could be raised by charging ‘fair’ rents. Between 1974 and 1976 local authorities and housing associations were provided with resources to purchase and refurbish properties owned by private landlords in ‘stress’ areas, partly meeting the longstanding demand from Labour Party activists to ‘socialise’ the private landlord sector. These measures, combined with the subsidies needed to boost council house construction because interest rates were high, meant that housing expenditure almost doubled between 1971/72 and 1975/76. The 1976 sterling crisis and the agreements made with the International Monetary Fund produced cuts in capital expenditure. Anthony Crosland, Secretary of State for the Environment, declared ‘the party’s over’ and a housing review concluded: We should no longer think about [housing] only in terms of national totals; we must try to secure a better balance between investment in new houses and the improvement and repair of older houses ... and we must make it easier for people to obtain the tenure they want. (DoE, 1977, p 7) Economic circumstances and growing homeownership popularity – described in Labour’s 1977 Housing Review (DoE, 1977, p 6) as a ‘basic and natural desire of all people’ – had combined to further modify the Labour leadership’s faith in public housing; indeed, Jackson (2005) quotes Anthony Crosland as declaring that a property-owning democracy is a ‘socialist rather than a conservative ideal’ as long as ‘property is well distributed’. The council building programme was curtailed. Environmental Secretary Peter Shore declared that Britain was ‘pensioning off the bulldozer’ (Shore, 1976, quoted in Harrison, 2010, p 80) but improvement grants were also scaled back and the policy of bringing private landlords operating in ‘stress’ areas into the ‘social’ sector was restricted.

‘Thatcherism’ and housing policy In 1975 the Conservative Party acquired a leader with firm anti-collectivist beliefs as was demonstrated in Ranelagh’s record of Margaret Thatcher’s visit to the Conservative Research Department. Another colleague had also prepared a paper arguing that the ‘middle way’ was the pragmatic path for the Conservative Party to take …

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Understanding housing policy: third edition

Before he had finished speaking to his paper, the new Party leader reached into her briefcase and took out a book. It was Friedrich von Hayek’s The Constitution of Liberty. Interrupting our pragmatist, she held the book up for all of us to see. ‘This,’ she said sternly, ‘is what we believe’ and banged Hayek down on the table. (Ranelagh, 1991, p ix) Thatcher absorbed all Hayek’s views on council housing and she that thought council tenants contributed to a ‘dependency culture’. The Right to Buy Selling council houses was not a new idea – it had started in the late 19th century – but although some Conservative-controlled councils were enthusiastic about sales (Jones, B., 2010) its national impact was limited despite the government granting local authorities a general consent to sell in 1952. During the 1974 election campaigns, the Conservatives promised to allow council tenants to buy their homes at 33% less than the market value. In 1975, Peter Walker, a Shadow Cabinet member, suggested that council tenants who had occupied their houses for 20 years should be given their homes. According to Gilmour (1992, p 142) ‘Mrs Thatcher feared that those on the Wates estates, the least well-off owneroccupiers, whom she regarded as ‘our people’ would have resented council house occupiers being given something for nothing…’ hence the outright gift proposal was changed to the discount system of 1974 but on more generous terms. Conservative ideas on the sale of council houses caused great concern among Harold Wilson’s advisors and a sales scheme for council homes was prepared in secret (Haines, 1977). However, when Labour’s housing review was published in 1977, there was no mention of council house sales. Instead, proposals were put forward to enhance the status of tenants by offering greater involvement in the council house management and more legal rights. The Conservative’s 1979 manifesto contained proposals to sell council houses at substantial discounts that were included in the 1980 Housing Act (see Box 2.5).

Box 2.5: The 1980 Housing Act ‘Secure tenants’ for three years were given an individual right to purchase their homes at a substantial discount on market value: 33% for three years’ tenancy rising by 1% per year to a maximum of 50%. Later, the qualifying period was two years and discounts up to 60% on houses and 70% on flats were on offer, subject to a ‘cost floor’ based on the capital expenditure on the house made by the local authority in the previous eight years. The 1980 Housing Act added the push of higher rents to the pull of discounts by introducing a new subsidy system that withdrew subsidy from local authorities on the

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Housing policy

assumption that they would increase their rents according to ministerial guidelines. Later, eligibility for housing benefit (HB) was restricted so that, by 1988, only households with less than 50% of average male gross earnings were able to claim, compared to 110% of average male gross earnings in 1983.

The private rented sector In the early 1980s some circumspect moves aimed at reviving private landlordism were introduced. The remaining controlled tenancies were brought into the regulated sector and landlords could let property as ‘shorthold’ tenancies subject to ‘fair’ rents but with the landlord able to repossess after a fixed term. New ‘assured’ tenancies allowed approved landlords to let property at market rents. Innovative but limited schemes to promote low-cost homeownership were set up and, in 1986, the Building Societies Act completed a process of allowing building societies and banks to compete in a deregulated mortgage market. Housing associations From the early 1960s both the major political parties showed an increasing interest in housing associations as housing’s ‘third arm’ but for different reasons. Mullins and Murie (2006, p 187) pose the question are housing associations ‘state, market or third sector?’ Their political appeal resided in this ambiguity: Labour regarding them as a means to ‘socialise’ private landlordism and the Conservatives as an alternative to local authority housing. Until the late 1980s housing associations obtained their capital finance from public funds and therefore their borrowing counted as public debt. The 1988 Housing Act transformed the nature of housing associations and paved the way for expansion as part of the ‘independent’ sector – alongside private landlordism – whose borrowing did not count as public debt. Under the Act, as McDermont (2010, p 2) has stated, a once ‘voluntary housing movement’ was able to transform itself ‘into a sector of entrepreneurial private businesses now seen as the (principal) solution to present day problems in social housing provision’. The Act placed all new housing association tenants under the formal legal regime governing tenant–landlord relationships in the private landlord sector but under Housing Corporation regulation. Housing associations had to rely on private finance for an increasing proportion of their investment and had compete to secure HAG – now named Social Housing Grant (SHG) – according to ability to meet the Housing Corporation’s objectives at the lowest cost. Rents were expected to move towards ‘market rents’ with HB mitigating the impact on low-income households.

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Ending council housing and reviving the private landlord Pushing housing associations towards greater reliance on borrowing from the private sector with the debt not counting as a public sector liability and forcing the rents they charged towards market levels formed part of a Conservative strategy to move all rents to market levels, end council housing and revive private landlordism. A 1987 white paper set out four aims: First to reverse the decline of private rented housing and improve its quality; second to give council tenants the right to transfer to other landlords if they choose to do so; third to target money more accurately on the most acute problems; and fourth to continue to promote the growth of owner occupation. (DoE, 1987, p 3) The Conservatives had mixed success in achieving the aims set out in the 1987 white paper. Private landlordism was promoted by: • removal of rent controls on new private sector lettings with HB ‘taking the strain’ from low-income households; • under the 1988 Housing Act all tenancies entered into after 15 January 1989 were ‘assured’ tenancies with ‘assured shorthold’ – lasting for a minimum of six months and ended by serving a two-month notice – as the norm; and • allowing investors in private landlordism to claim up to 40% of their investment against their tax liability for five years through the Business Expansion Scheme (BES). These measures helped to halt private landlordism’s decline and its housing stock share increased by 1% between 1987 and 1997. However, the cost was high in terms of HB expenditure and the tax income forgone under BES (estimated at £40,000 per property). Housing Investment Trusts, designed to encourage investment by financial institutions in private landlordism, had little impact. Council housing Conservative strategy to eclipse council housing involved gradually increasing local authority rents to market levels. In addition, a statutory procedure was established to enable local authority tenants to change landlords via individual action or a ‘tenant’s choice’ ballot and Housing Action Trusts (HATs) were to be set up to take over local authority estates, improve them and then sell the stock into a variety of tenures. Implementing this policy proved troublesome. Despite extensive publicity, tenants showed little interest in leaving their local

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authority via ‘tenant’s choice’ and few alternative landlords came forward to buy council estates. HATs encountered local opposition and Margaret Thatcher (1993, p 601) expressed her disappointment that council tenants rejected ‘huge sums of taxpayers’ money’. HATS gained modest momentum only when tenants were given assurances that they could return to their local authority when the improvements had been made. Between 1988 and 1995 moves towards ending local government’s provider role came more from local authorities using large scale voluntary transfer than from tenants. Selectivity Targeting money more accurately on the most acute problems was achieved by means testing improvement grants and limiting their application to the ‘fitness’ standard. The more selective incidence of HB and increases in rents continued the trend towards reliance on means tested consumer subsidies rather than producer subsidies. Between 1978/79 and 1996/97 government housing expenditure declined from 5.8% to 1.5% of total government expenditure, whereas spending on HB increased from 1.2% to 3.8%. Homeownership Promoting homeownership was derailed by a crisis in the late 1980s and early 1990s. The removal of restrictions on borrowing in the mid-1980s and the Chancellor’s announcement that tax relief on mortgage interest would be limited to one person per house promoted a steep house price increase. Feeling confident and affluent, many homeowners began to spend on consumer durables. In addition, a large equity slice, estimated at over £50 billion between 1985 and 1989, was taken out of housing by re-mortgaging. The subsequent rise in consumer spending followed by interest rate increases to dampen the boom – the mortgage interest rate reached 15.4% in February 1990 – led to slump in house prices. Repossessions escalated and ‘negative equity’ – homes worth less than the amount borrowed – emerged as a significant problem. In order to prevent a further downward spiral in house prices the government introduced a ‘housing market package’ providing finance to housing associations to purchase unsold homes built for owner-occupation. The decline in house prices dampened tenant enthusiasm for RTB and a ‘rent into mortgage’ scheme had few takers. John Major’s government started to phase out tax relief on mortgage interest so that, after reaching a peak at £800 per recipient in 1990/91, it declined to £230 in 1996/97.

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Retreat from laissez-faire? Limitations on capital finance to local authorities significantly reduced council housebuilding and by the late 1990s housing policy had ‘come to be seen increasingly as an arm of regeneration policy for low-income inner cities and marginal estates, rather than an end in itself ’ (Hills, 1998, p 124) – a familiar theme in Conservative housing policy. However, by 1995, Major’s government was backing away from the neoliberalism ideas promoted by Margaret Thatcher. A white paper (Department of the Environment and Welsh Office, 1995) stressed, without disapproval, the high consumer subsidies; endorsed strategic enabling with an emphasis on the strategic; promoted ‘mixed communities’ and abandoned the attempt to drive housing association and local authority rents to market levels.

New Labour As Kemp (1999, p  134) has noted, ‘Apart from a few specific manifesto commitments on housing, it was not clear what Labour’s housing policy objectives would be, nor what instruments it would use to pursue them’. Indeed, for two years, New Labour accepted the spending proposals set out by the Conservative government which had included substantial cuts in state support for ‘social’ housing. Consequently, housing policy marked time and Conservative policies on homeownership, private landlords and the ‘social’ housing sector were continued. New Labour extended the Conservative target for new building on brownfield sites – previously developed land including gardens – and set 30 dwellings per hectare as minimum density guideline. Innovation, such as it was, occurred in extending housing’s role in the social exclusion agenda; a commitment to ensuring all ‘social’ sector homes were ‘decent’ (see Chapter Eight) and extending choice. However, house prices accelerated, new house construction stagnated and New Labour placed restrictions on the RTB (see Chapter Six). Concern about the impact of high house prices on economic growth led to the Treasury appointing Kate Barker to examine ways to deliver stability in the housing market. Her final report (Barker, 2004) recommended a step change in housing supply to be achieved by setting national and regional affordability targets that, if unmet, would trigger land release. This new emphasis on supply culminated in Homes for the future: more affordable, more sustainable (DCLG, 2007). Housing supply would be ratcheted to 240,000 per year by 2016 and 70,000 affordable homes a year would be provided by 2010/11 with 45,000 in the social housing sector. Regionally set targets and a planning delivery grant would encourage local authorities to supply land for new homes. Unfortunately, within months of publication, the plans in Homes for the future: more affordable, more sustainable were derailed by the ‘credit crunch’. House prices started to decline as did new housing starts, mortgage foreclosures increased and

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the number of homeowners with ‘negative equity’ accelerated. The government’s response was to introduce new mortgage rescue schemes and to bring forward resources allocated ‘social’ housing to ‘kick start’ the market. Finance was injected into the banks, the Bank of England reduced its base rate from 5.75% in July 2007 to 0.5% in August 2009 and increased the money supply. An attempt was made to stabilise the financial institutions by nationalisation, bank mergers and state share acquisition. Under New Labour the private rented sector expanded rapidly, from 2.4 million in 1997 to 4.5 million in 2010. In part this was a consequence of Rent to Buy introduced in 1996 when mortgage lenders agreed to lend to private landlords on terms similar to owner-occupiers.

The coalition government (2010–15) Both the Conservatives and the Liberal Democrats were opposed to Labour’s ‘top down’ regional planning targets and, in government, abolished the system in favour of local planning authorities assessing ‘local’ housing and consequent land release, incentivised by a ‘New Homes Bonus’. However, a stagnant economy produced a Treasury led rethink with the National Planning Policy Framework (DCLG, 2012a) subjecting local plans to national scrutiny with a ‘presumption in favour of sustainable development’ should a local plan be absent or deficient. Owner-occupation was stimulated by printing money, government mortgage support and guarantees, demand side subsidies plus ‘revitalising’ the RTB (see Chapter Six). Despite these measures, homeownership continued to decline with private landlords acquired a rapidly increasing market share. There were different tenure patterns in England, Scotland, Wales and Northern Ireland (See Figure 2.1 and Tables 2.1 and 2.2).

The 2015 Conservative government The 2015 Conservative government announced a 1 million extra homes target for England by 2020 and placed expanding homeownership at the summit of its housing agenda, albeit that the homeownership hegemony was modified under Theresa May’s government. An agreement was reached with the National Housing Federation on a ‘voluntary’ RTB for housing association tenants and selling council houses was promoted by ‘pay to stay’, that is, market rents for tenants with household incomes over £40,000 in London and £31,000 elsewhere. ‘Pay to stay’ would have been compulsory but Theresa May’s government made it optional for ‘social’ housing suppliers. Under the 2016 Housing Act local authorities would have to make a contribution to the cost of the voluntary RTB by selling ‘higher value’ council houses. ‘Starter’ homes – built on brownfield sites and available to specified groups for purchase at 20% less than market value – were promoted

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by insisting that local authorities include such homes in any ‘affordable’ housing requirements imposed in planning agreements with developers and making provision for brownfield sites to receive automatic planning permission. The 2015 Summer Budget and the 2015 Spending Review and Autumn Statement (HM Treasury, 2015a; 2015b) contained measures to curb the growth in private landlordism by extra land tax stamp duty requirements and to switch housing association activity away from rented accommodation towards shared ownership schemes. The upper limit of the Help to Buy equity loan scheme for new house buyers in Greater London was raised from 20% to 40% and new Individual Saving Accounts (ISAs) to encourage saving for homeownership were announced. Various selective measures were taken to boost the construction industry such as the Builders Finance Fund – set up to help restart and speed up smaller housing developments that have slowed down or stalled – and the Large Sites Infrastructure Fund – packages of support to bring forward large scale housing development and the Build to Rent Fund. Theresa May’s government consolidated these funds, with extra resources, into the Home Builders Fund. Figure 2.1: Housing tenure in the UK, 1919–2014 % 100 90 80 70 60 50 40 30 20 10 0 1919

1939

1951

1961

1971

1981

1997

2004

Housing association Local authority

0

1

1

1

1

2.2

1991 3

4.6

7.8

2007 8.6

2010 2014 9.4

9.9

0

10

18

26

31

29.2

2.18

17.8

11.5

9.6

8.4

7.8

Private landlord

90

57

50

30

19

11

8.5

9.8

11.1

13.5

16.3

18

Owner occupation

10

32

31

43

49

57.6

66.6

67.7

69.2

67.2

65.6

64

Note: these figures refer to households not adults (see Chapter Five on ‘concealed’ households). According to calculations by Judge and Corlett (2016), in 2015, 52% of UK families (couples and singles) were homeowners. Source: Adapted from DCLG (2016b)

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Table 2.1: Tenure, England, Scotland, Wales and Northern Ireland, 1981 England

Scotland

Wales

Northern Ireland

Owner occupied

59.8

34.6

61.9

54.1

Local authority

26.6

52.1

22.3

37.91

Private rented

11.3

9.7

9.6

7.6

2.3

1.8

2.2

0.6

Housing association Note:

1Northern

Ireland Housing Executive stock.

Source: Wilcox (2006)

Table 2.2: Tenure, England, Scotland, Wales and Northern Ireland, 2015 England

Scotland

Wales

Northern Ireland

Owner occupied

62.5

60.0

69.0

66.9

Local authority

7.0

14.0

6.2

11.91

Private rented

19.8

14.0

14.0

16.9

Housing association

10.1

10.0

9.6

4.3

Note: 1Northern Ireland Housing Executive Sources: DCLG (2016b); Wilcox et al (2016a)

Devolution Although Scotland, Wales and Northern Ireland had degrees of ‘de jure’ autonomy in their housing policies and implementation politics produced different outcomes, the 1999 devolution settlements gave Scotland, Wales and Northern Ireland varying degrees of self-determination to pursue housing policies tailored to their specific politics and requirements. As Stephens and Stephenson (2016, p 64) note ‘the “British” housing system is beginning to fragment as different parts of the UK pursue their own priorities. This is seen most clearly in Scotland’. During the Scottish independence referendum campaign in 2014, the three main UK party leaders gave a commitment to grant Scotland increased powers over domestic taxes and parts of the social security system. This commitment was embodied in the 2016 Scotland Act that may produce new differences in housing policy between Scotland and England. Further transfer of powers to Wales is in the pipeline.

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Overview

• • • • • • • • • •

In the 19th century the ‘housing issue’ was constructed as a sanitary problem related to social order, health and morality ‘externalities’. The Labour Party adopted council housing as its principal means to deliver housing in planned environments. The Conservative Party, although prepared to support council housing to overcome extreme housing shortages manifest in overcrowding and slums, preferred homeownership and private landlordism. From the 1960s, both the major political parties showed an interest in housing associations: Labour to replace private landlordism and the Conservatives to eclipse council housing. From the 1960s the Labour Party leadership began to recognise the popularity of homeownership. Between 1979 and 1997 the Conservative Party applied market principles to the supply and distribution of housing but with a bias towards owner-occupation. New Labour initially followed the direction of Conservative policy but, post 2003, attempted to influence housing supply. This policy was disrupted by the 2008 ‘credit crunch’. The coalition government focused on bolstering homeownership but, by 2015, the homeownership market share continued to decline. Post 2010, important differences in the housing policies of England, Wales, Scotland and Northern Ireland started to emerge. The 2015 Cameron government re-affirmed Conservative commitment to homeownership and ‘green area’ protection.

Questions for discussion 1. What were the arguments for and against sanitary reform in the 19th century? 2. Labour was the party of council housing; the Conservatives were the homeownership party. Discuss this statement. 3. Why and how was council housing ‘eclipsed’? 4. Why did homeownership decline between 2005 and 2015?

Further reading Christopher Hamlin’s Public Health and Social Justice in the Age of Chadwick: Britain, 1800–54 (1998) is a perceptive account of sanitary reform. The Politics of Housing: Power, Consumers and Urban Culture (2007) by Peter Shapely explores local responses to national policy. Private Renting in Transition (2004) by Peter Kemp tells the story of private landlordism’s

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decline and its modest revival in the 1990s. Dunroamin: Suburban Semi and Its Enemies (1981) by Paul Oliver, Ian Davis and Ian Bentley is an appealing account of suburbia and its foes.

Websites The Thatcher Foundation website contains a comprehensive set of documents on Margaret Thatcher’s approach to housing policy: www.margaretthatcher.org The Victorian Times 1837–1901 website contains many original documents on housing in the 19th century: http://victoria.cdlr.strath.ac.uk Municipal Dreams is a very good information source on municipal housing: municipaldreams. wordpress.com The UK Housing Review is updated annually and features key housing statistics for England (and its regions), Wales, Scotland and Northern Ireland: www.ukhousingreview.org.uk

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three Governing housing Summary

• •

• • • •

•

In England, the Westminster ‘core executive’ works through a variety of semiautonomous and private agencies to meet its housing objectives. Since 1999, various degrees of autonomy have been devolved to the Scottish Parliament, the National Assembly for Wales and the Northern Ireland Assembly. Each ‘home nation’ now has its ‘core executive’ but many economic drivers of housing output remain under Westminster control. Direct responsibility for housing policy in England is located in a department with a remit also covering planning and local government. The Department for Work and Pensions (DWP) has a key role in housing policy throughout the UK because it is responsible for income-related housing payments. The local authority provider role in rented accommodation has been supplanted by housing associations. Initially the coalition government (2010–15) was committed to greater English local government autonomy in determining and meeting future housing requirements but its National Planning Policy Framework (DCLG, 2012a) contained provisions to drive land release. Under Cameron (2015–16), England’s ‘core executive’ promoted the ‘Northern powerhouse’ agenda and pushed local authorities towards greater reliance on resources generated by economic growth.

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The central state owns few dwellings and, to meet its objectives, has to operate through a range of housing supply and management agents. This chapter sets out the roles of the participants in the housing system. Its title reflects an ongoing debate on the state’s role in housing (see Box 3.1).

Box 3.1: ‘Government’ and ‘governance’ The term ‘government’ is closely associated with state power and embodies the notion that the state possesses the necessary authority and apparatus to secure its will. Thus, for example, when the Conservative government adopted a 300,000 per annum new house construction target in 1951, it was achieved by 1954 through central direction of local government and controlling building material use. In the 1990s the term ‘governance’ began to permeate policy analysis and there was talk of ‘steering not rowing’ (Osborne and Gaebler, 1992) and ‘the hollowing out of the state’ (Rhodes, 1994). This discourse was associated with ‘globalisation’. Rather than ‘governing’ to achieve a specified end via direct state power – ‘commanding and controlling’ – ‘governance’ was seen as guiding a course via conducting cooperative networks of external and internal agencies through turbulent, uncontrollable global forces. ‘Governance’ was linked to the ‘new public sector managerialism’ which claimed that, rather than being ‘top-down’, bureaucratic and rule bound, it was concerned with objectives and worked through policy networks.

Margaret Thatcher had little time for ‘governance’. According to Rifkind (2016, p 1) ‘Once, when asked whether she believed in consensus, she replied she did and then added ‘There should be a consensus around my convictions’. She governed, albeit to strengthen the market as a resource distributor. John Major edged towards a ‘governance’ agenda with his Citizen’s Charters placing emphasis on a mixed economy of welfare, value for money and state directed performance benchmarks. For New Labour, ‘governance’ was also a mantra under which market forces could be combined with modest state direction. Words and phrases such as ‘enabling’, ‘what works is what counts’, ‘targets’, performance indicators’, ‘partnerships’, ‘joined up government’ and ‘modernisation’ entered its lexicon. Under the ‘Big Society’ banner, the coalition government abandoned New Labour’s ‘target-setting’ approach, promoting ‘localism’ and voluntary sector involvement in service delivery. Nevertheless, despite ‘Big Society’ rhetoric, the nationally determined social objectives dearth was an act of government and the coalition promoted market provision and efficiency improvements via expenditure cuts. As the Conservative Party tightened its grip on coalition policies it governed to enforce its agenda being at ease in letting market outcomes rest where they fell. This mindset continued into the 2015 Conservative government although

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Theresa May’s speeches after she became prime minister (May, 2016a; 2016b) indicated a possible change in approach (see Chapter Eleven). Some commentators have identified a different policy attitude in the devolved governments. A ‘Scottish style’, ‘which refers to the ways in which the Scottish government makes policy following consultation and negotiation with pressure participants such as interest groups, local government organisations and unions’ (Cairney et al, 2016, p  337), has been detected with collaborative objectives formed thereby enlisted ‘pressure participants’ in implementation. A similar ‘Welsh style’ can be identified with the more restricted powers granted to the National Assembly for Wales, unfavourable Barnett formula outcomes, traditional ‘old’ Labour union connections and Labour unable to secure an overall assembly majority, producing greater promotional and economic interest group influence on policy formation and implementation. In Northern Ireland, it has been argued that the torpor built into the devolution settlement has produced ‘technocratic’ policies evolving through interest group/official interaction (Birrell and Gray, 2011). Muir (2016, p 31) emphasises policy networks in her analysis of social housing devolution in Northern Ireland stating: Social housing governance structures were only affected in a minor way by devolution .... devolution has created a new set of policy dynamics through revitalised local policy networks for social housing. These networks are now fully engaged in the current government and sector restructuring initiatives which are driven primarily by public expenditure reductions of the UK government.

The Westminster core executive The Cabinet In constitutional theory, the Cabinet is regarded as the ultimate executive decision making body in the UK government. Cabinet committees carry out most of the Cabinet’s work with the Housing Implementation Taskforce Committee responsible for managing housing policy in England. However, many decisions are made outside the Cabinet in the Prime Minister’s Office and through informal networks of ministers and advisors – so called ‘sofa government’ (see, for example, Haines, 1977; Rawnsley, 2010; Moore, 2013, 2015) – with the Cabinet acting as a ratification authority to promote collective responsibility. The ‘quad’ – David Cameron, George Osborne, Nick Clegg and Danny Alexander – had a role in decision making in the coalition government with Clegg and Alexander able to veto proposals. Cabinet membership is regarded as symbolic that the policy domain represented by a departmental minister has high priority in the government’s objectives. In

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Blair’s cabinets, housing was represented by a secretary of state with housing as only part of the minister’s responsibilities but, when Brown became prime minister, he invited the minister for housing to attend Cabinet whenever housing matters were considered – an indication that housing would join health and education as government priorities. Under the coalition government and the 2015 Conservative government the housing minister was not invited to Cabinet meetings. However, under Theresa May’s government, Sajid Javid, Secretary of State for Communities and Local Government, became the lead minister in representing government housing policies. HM Treasury The Cabinet Office (2015) has described its activities as ‘the corporate headquarters for government, in partnership with HM Treasury’. Treasury inclusion as a ‘partner’ in ‘the corporate headquarters for government’ reflects its importance. In England, it distributes the lion’s share of the public resources necessary to stimulate housing supply and maintain the existing housing stock through a spending review, usually published every three years. It also controls the economic and fiscal levers influencing housing supply and distribution throughout the UK.

Department for Communities and Local Government (DCLG) Post 1919 the Ministry of Health was in charge of housing policy but, in 1951, responsibility was transferred to the Ministry of Housing and Local Government (MHLG). Subsequently housing became the domain of departments such as the Department for the Environment (DoE), Department of Transport, Local Government and the Regions (DTLR) and the Office of the Deputy Prime Minister (ODPM). The DCLG was created in 2006.

Department for Work and Pensions (DWP) The DWP is responsible for a range of benefits and services aimed at income maintenance and encouraging work. From 1979 housing subsidies were switched from ‘producer’ subsidies towards means-tested ‘consumer’ subsidies in the form of housing benefit (HB), administered by local authorities under rules set by the DWP. HB is being absorbed into Universal Credit (UC) as it is slowly rolled out across the UK.

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Homes and Communities Agency (HCA) This quasi-autonomous government organisation (quango) was set up in 2008. The HCA joined up the housing and regeneration delivery in one organisation, bringing together the functions of English Partnerships – a national regeneration agency charged with identifying and assembling land – the Housing Corporation’s investment functions and key housing and regeneration programmes previously delivered by the DCLG. The Housing Corporation (HC) was a non-departmental public body established in 1964 to distribute resources to housing associations and monitor their activities. When it transferred the HC’s role in distributing investment resources to the HCA, New Labour placed the HC’s regulatory functions with a Tenant Services Authority (TSA). The coalition government abolished the TSA, transferring a diluted version of its responsibilities to the HCA but in November 2016 a DCLG review of the HCA recommended its regulatory role should be transferred to a new authority. The 2017 white paper Fixing our broken housing market stated that, in 2017, the Homes and Communities Agency would be re-launched as Homes England with ‘a clear, unifying purpose to make a home within reach for everyone’ (DCLG, 2017 para.3.36) with powers to promote land compulsory purchase.

National Infrastructure Commission (NIC) Another ‘quango’, the National Infrastructure Commission was established in 2016 to ‘set out a clear picture of the future infrastructure we need, producing an in-depth assessment of the UK’s major infrastructure needs on a 30-year time horizon’ (HM Treasury, 2016a, p 3). Its housing role is opaque with the Treasury announcing ‘The government has removed top-down housing targets, and will continue to ensure that homes are delivered through Local Plans, in consultation with local people’ (HM Treasury, 2016, p 60). However, in a letter to the Commission’s chair, the Chancellor said that, with regard to the Cambridge– Milton Keynes–Oxford corridor, the Commission should make recommendations to ‘develop sites (including public sector land) to meet existing and expected housing needs’ (Chancellor of the Exchequer, 2016), indicating a significant role for the Commission in housing development.

The English regional dimension In its earlier departmental forms, the DCLG maintained a regional structure of civil servants who played an important role in distributing housing resources to local government. They could adjust the distribution produced by the General Needs Index – a calculation of the housing needs in each authority – according to their perceptions of the quality of each local authority’s housing strategy. In 1994,

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these civil servants were merged with regional officials from other departments to form ‘Single Regional Government Offices’. Regional Development Agencies (RDAs), with substantial business representation, were established in 1999 to develop and coordinate regional economic development and Regional Assemblies, with nominated local councillors, were also set up. Regional Spatial Strategies (RSSs) were published with building targets that had to be incorporated into local authority Local Development Plans. One of the coalition government’s first acts was to scrap RSSs. Later, RDAs were abolished with Local Enterprise Partnerships, aimed at promoting the economic development of ‘natural economic areas’ below regional level, established to fill part of the vacuum. A Regional Growth Fund (RGF) was set up to sustain projects in England promoting economic growth, especially in areas heavily reliant on public sector employment, but the finance allocated to this fund was lower than available to RDAs and was distributed through a competitive bidding process.

Local government In England, the 36 metropolitan district councils in urban areas are responsible for all local authority functions although fire services, police and public transport responsibilities are exercised through Joint Boards. Until 1995, local government powers outside the urban areas were divided between county councils and district councils but an ongoing process led to the ‘unitary’ model being introduced in some areas but rejected in others. Where the county/district division continues, district councils are responsible for housing and preparing local plans. Parish and town councils cover areas up to 30,000 people – but usually far less – and have limited responsibilities for local services and environmental improvements although they can have a role in preparing neighbourhood plans under the 2011 Localism Act. In London, 33 boroughs have housing powers. The elected Mayor of London is responsible for developing a housing strategy and distributing investment in London’s housing, a HCA function in most of England but in the process of devolution in certain areas. The London Assembly monitors the mayor’s housing strategy. Elected mayors New Labour and the coalition government – perhaps influenced by the apparent success of ‘city mayors’ in other countries (Barber, 2013) – promoted directly elected mayors. The 2000 Local Government Act allowed elected mayors to be established following a referendum in favour but, post 2007, local authorities became able to create a directly elected mayor without a referendum should they choose to do so. Under the coalition government, referendums took place in the 12 largest cities. Most referendums rejected elected mayors. After a number of

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‘City Deals’ allowing local authorities more autonomy, by, for example, retaining a share of the business rates, the coalition government came to an agreement with authorities in Greater Manchester allowing funding steam devolvement – including housing – in return for a ‘conurbation’ or ‘metro’ mayor. George Osborne made similar offers to other areas after the 2015 general election and by October 2015 38 local authority combinations had expressed an intention to sign up to new ‘English devolution’ deals although some failed to reach agreements. Stock transfer In the late 1980s, noting government hostility to council housing but conscious of the need to retain some low-cost social housing in their areas, some local authorities – mainly small, based in the south and Conservative-controlled – started to transfer their stock to specially created housing associations. A tenant ballot was not legally necessary for transfer but approval from the central government was unlikely without a ballot. Blair was not an admirer of local government as a service supplier. Soon after becoming prime minister he declared: The days of the all-purpose local authority that planned and delivered everything are gone. They are finished. It is in partnership with others – public agencies, private companies, community groups and voluntary organizations – that local government’s future lies. (Blair, 1998, p 13) New Labour regarded council housing as ‘a “redundant project”, characterised by falling demand, poor quality stock, unresponsive services and poor management and requiring significant rebranding’ (Pawson et al, 2010, p 16). Local Authority Voluntary Stock Transfer (LVST) to housing associations was promoted by: • offering tenants a ‘decent home’ carrot and supplying extra resources to promote transfer in the form of debt write-off and capital grants; • creating the option to transfer management to an Arms Length Management Organisation (ALMO) set up to achieve the decent homes standard (see Chapter Eight); • announcing that, irrespective of ownership, all social sector rents would be determined by a common formula; • promoting the ‘community ownership’ model in Scotland and Wales. Despite sustained opposition, some from within the Labour Party organised by ‘Defend Council Housing’, stock transfer gained momentum. Between 1997 and 2009, a million dwellings were removed from local authority ownership via LVST. In New Labour’s last five years in office an average of 35,000 houses

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per year were transferred but only 15,200 per year from 2010/11 to 2014/15 (Wilcox et al, 2016b). New build Since the late 1970s local government’s role in new build has dramatically declined. In New Labour’s 13 years in office only 6,400 local authority houses were built. However, the sharp reduction in new private building during the 2008/09 recession prompted a rethink and a specific Local Authority New Build Programme was established. New Labour also started discussions with local government on ways to reform local authority Housing Revenue Accounts to allow local authorities to use any surplus arising from renting the existing stock and Right to Buy (RTB) receipts, claiming in its 2010 manifesto that the new system would enable councils ‘to build up to 10,000 council houses a year by the end of the next Parliament’ (Labour Party, 2010, para 2.5). The Liberal Democrat’s 2010 manifesto demonstrated interest in council building stating the party would: Investigate reforming public sector borrowing requirements to free councils to borrow money against their assets in order to build a new generation of council homes, and allow them to keep all the revenue from these new homes. (Liberal Democrats, 2010, p 78) However, the only commitment in the Coalition Agreement (HM Government 2010 p 12) was to ‘review the unfair Housing Revenue Account’. The Housing Revenue Account (HRA) rules were changed along the lines proposed by New Labour but restrictions were placed on resource use and, despite Liberal Democrat attempts to boost local authority housing investment, borrowing by local government was tightly constrained. The ‘enabling’ role Housing strategies were introduced in the late 1970s as ‘a means of controlling public expenditure while allowing resources to be allocated selectively with regard to variations in local requirements’ (DoE, 1977, p 12). Local authorities had to assess their requirements for housing investment, devise a strategy to meet these requirements and submit bids for resources to the central government. Local housing strategies assumed a new importance in the late 1980s when the Conservative government designated local authorities as ‘enablers’ rather than housing providers and the quality of each housing strategy in ‘enabling’ housing associations, private landlords and developers to supply housing became an important factor in central resource distribution. This ‘enabling’ role for local housing authorities was adopted by New Labour but with more emphasis on

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the ‘strategic’. Planning agreements under Section 106 of the 1990 Town and Country Planning Act, allowing local government to secure ‘affordable’ housing as a planning consent condition, have been a significant element in the local government’s ‘strategic enabling’ role (see Chapter Six). Performance indicators and targets Monitoring ‘delivery agent’ performance was an essential component of New Labour’s espousal of the ‘new public sector managerialism’, an approach emphasising ‘customer’ service and ‘results’. The 1999 Local Government Act substituted Conservative competitive tendering promotion with the requirement that every ‘best value authority must make arrangements to secure continuous improvement in the way in which its functions are exercised, having regard to a combination of economy, efficiency and effectiveness’ (Local Government Act, 1999, Section 3.1). Local authorities were required to publish ‘best value’ housing service reviews according to nationally determined performance indicators. The coalition government abolished New Labour’s performance evaluation framework but the National Planning Policy Framework (DCLG, 2012a) gave central government, via the National Planning Inspectorate, enhanced powers to frame local planning decisions. Austerity and economic growth As part of the ‘austerity’ agenda, the coalition government cut central government financial support to local authorities in England by 40% in real terms between 2009/10 and 2014/15. London boroughs, the north east and the north west experienced the largest cuts. These reductions were accompanied by incentives such as the New Homes Bonus and higher business rate retention targeted on encouraging local government to stimulate local economic growth. The 2015 Conservative government announced that, by 2020, local government will retain 100% of business rate revenue – described by then Chancellor George Osborne as a ‘devolution revolution’ (quoted in House of Commons Communities and Local Government Select Committee, 2016a, p 3) – and the Revenue Support Grant, the main central government grant for local authorities, was scheduled for reduction.

Housing associations Housing associations are not-for-profit organisations set up to supply accommodation. They are run by management boards made up of unelected volunteers who, since 2003, may be paid. When registered, associations can apply for government assistance and become ‘private registered providers of social

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housing’, a name reflecting that profit-making organisations are now eligible for government grants. Box 3.2 sets out some of the sector’s characteristics. There has been a gradual transformation in the nature of housing associations. Always ‘hybrids’ (Mullins et al, 2014) – neither ‘for profit’ or ‘non-profit’, neither state nor market – they have been characterised by Chevin (2013) as ‘social hearted and commercially minded’ with, in recent years, the ‘social heart’ becoming overshadowed by the ‘commercial mind’. Heywood (2015) noted that local authority officials thought that housing associations were more ‘commercial’ in attitudes to development, had a more risk averse approach to allocations and local authority nominations, and were less willing to assist local authorities in discharging their homelessness obligations. The ‘commercial mind’ is more prominent in the largest associations and there are tensions between the smaller more community-orientated associations – ‘traditionalist’ in wanting to supply low-cost rental accommodation – and the bigger, more pragmatic associations, becoming more akin to private landlords and keen to expand. The major housing associations have set up an organisation, known as g15, to represent their interests. The g15 group owns and manages 550,000 homes (21% of sector stock) and, in 2015, generated 47% of the housing association sector’s surplus (Morrison and Manzi, 2016). Before 1988 housing associations were classified as public sector with their debt counting as national debt, known as the Public Sector Net Cash Requirement (PSNCR). The 1988 Housing Act, heralding greater reliance on private finance by housing associations, led to reclassifying housing association debt as ‘private’ giving housing associations an advantage over local authorities in supplying new houses and improving the existing stock because they were not subject to Treasury borrowing restrictions. This change was a major factor in promoting stock transfer to housing associations from local government. However, housing association classification as ‘private’ has been contentious, with Malpass (2000, p 259) claiming that housing associations ‘are little more than agents of the state and the voluntary element has been reduced to marginal and largely symbolic importance, providing a fig-leaf for those who really hold the power’. In 2015, the Office for National Statistics (ONS) reclassified housing associations as public sector, a decision based on the Labour’s Housing and Regeneration Act 2008 requiring government consent on matters such as ‘social’ housing asset disposal and mergers. The reclassification added the £60 billion housing association debt to the PSNCR and, in 2016, was extended to Scotland, Wales and Northern Ireland adding a further £7 billion to public debt. Although housing associations have usually embraced state policies, there have been occasional rebellious acts. In 1980, with the help of the House of Lords, housing associations successfully blocked an attempt to extend the RTB to charitable associations. Such a RTB extension reappeared in the 2015 Conservative Party manifesto but, after the 2015 General Election the government and the

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housing associations reached an agreement with housing associations promising to implement a ‘Right to Buy’ on a voluntary basis. Whether this represented a display of housing association autonomy or abject surrender to Government power is a hotly debated issue (see Lund, 2016).

Box 3.2: Housing associations (‘private registered providers of social housing’) In 2015, there were 1,799 ‘private registered providers of social housing’ in England (DCLG, 2015d) owning, in 2016, 2,761,690 ‘units/bedspaces’ (Hall, 2016). Most stock is for ‘general needs’ but there were 125,302 supported housing units and 300,181 homes built for older people, some known as almshouses with history dating to the 10th century and run by locally recruited trustees. The housing association sector’s market value assets have been assessed at nearly £300 billion (Walker, 2014). There were 26 ‘for profit’ organisations in 2016 that owned only 557 dwellings. Most stock is held by associations with between 2,500 and 10,000 properties. Providers vary considerably in size with the largest – Sanctuary, the Guinness Partnership, Circle and London and Quadrant – each owning more than 50,000 dwellings but the smallest 30% holding fewer than 25 properties. Mergers, often related to financial regime change, have been a housing association feature since the 1970s, and the 2015/16 regime changes injected momentum into housing association agglomeration. Black and minority ethnic (BME) housing associations – usually defined ‘as letting to more than 80 per cent BME applicants with a similar proportion of board members’ (Gulliver, 2016, p 9) – were encouraged by the HC in the early 1980s in response to mounting evidence of discrimination in housing (see Chapter Ten) and urban riots. However, the need to raise private finance for development and New Labour’s community cohesion agenda meant ‘partnering with large associations, oftentimes white-run, making it difficult to maintain a distinctive role’ (Hawkey, 2001, p 27). ‘BME housing organisations had been associated with community action and the Black Hostel Movement’ (Gulliver, 2016, p 9) but this association became diluted. Part of the ‘social heart’ in the housing association sector is reflected in the term ‘housing plus’. Keohane (2016, p 8) notes: Four in ten housing associations already provide employment and skills support to their tenants, including by setting up social enterprises, providing training opportunities and using their role as employers and contractors to make apprenticeship and employment opportunities available.

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‘Housing plus’ is threatened by the future resource limitations resulting from reductions in social rents of 1% per annum over the four years 2016–2020. In 2016, the ‘social’ rent average rent with service charges for a property was £101.45 per week ranging from £132.92 in London to £82.41 in the North East. The coalition government switched grants away from ‘social’ housing to the ‘affordable’ rent programme, with ‘affordable’ meaning rents at up to 80% of local market value. Existing ‘social’ rented units could be converted to affordable rent properties on vacant possession. Between 2013 and 2016 about 20,000 per annum were converted to ‘affordable’ and, with new build, housing associations owned 161,193 ‘affordable’ units (Hall, 2016). ‘Affordable’ rents are less affordable than ‘social’ rents averaging £126.59 in 2014/15, ranging from £93.56 in the north east to £184.52 in London.

Tenant empowerment: exit and voice politics Exit politics Between 1979 and 1996 the Conservatives attempted to breakup local government’s rented accommodation monopoly for families through ‘tenant’s choice’ and Housing Action Trusts (HATs) to produce a system whereby, by developing a range of ‘independent’ landlords, it was claimed that tenants could take part in ‘exit’ politics (Hirschman, 1970), that is, choose a new landlord if dissatisfied with their current housing supplier. ‘Tenant’s choice’ was a failure, finally abandoned in 1996 and the HATs programme was modified to allow tenants to return to their local authority. New Labour also promoted stock transfer and encouraged choice via ‘choicebased lettings’ (CBL). After the Cullingworth Report (1969), the dominant method of allocating ‘social housing’ was for housing officers to match waiting list applicants to suitable homes based on a ‘needs’ assessment. In contrast, CBL allowed applicants for ‘social’ housing and existing tenants seeking a move to apply for available vacancies advertised in the local newspaper or on a website. The successful bidder was the one with the highest priority and authorities would provide feedback to help applicants assess their chances of success in subsequent applications. Most local authorities, often in joint schemes with housing associations, operate CBL. Voice politics ‘Voice’ politics involves giving tenants more influence in shaping the pattern of ‘social’ housing by enabling their opinions to be heard and acted on. To

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enhance ‘voice’ politics in the local authority domain New Labour introduced Tenant Participation Compacts (TPCs). Beginning in April 2000 local councils had to start a process of agreeing a framework for tenant involvement directed towards the attainment of ‘best value’ in housing services delivery. The declared objective of the compacts was to ‘help to bring the quality of participation across all councils up to the best and to ensure that all tenants have equal opportunity to participate’ (DETR, 1999a, p 6). However, after an initial flurry of interest, TPCs faded into the background. In the early 1980s, the Conservatives’ desire to fragment local authority housing management produced some fruitful initiatives in tenant involvement in the form of Tenant Management Organisations (TMOs), now regarded as the ‘gold standard’ in tenant participation because formal powers are delegated to tenant organisations. In 1994 TMOs were encouraged by the introduction of a ‘right to manage’ giving all local authority tenant groups representing 25 or more households the right to assume a variety of management and maintenance responsibilities subject to training and a ballot in favour. There are two broad types of TMO – tenant management cooperatives and estate management boards – although, in practice, the distinction is blurred. TMOs do not own the housing stock but tenant management cooperatives, usually all residents, directly control their own staff whereas estate management boards often have councillor representatives and frequently use local authority officials to administer the organisation. TMOs enter into agreements with their local authorities specifying the responsibilities delegated to them and the resources they will be allocated. In 2001 there were 202 TMOs covering about 84,000 properties. Research into TMO activities has produced favourable findings. Price Waterhouse (1995, p 120) concluded that tenant management cooperatives were ‘very effective mechanisms for securing improved housing services, higher levels of tenant satisfaction and more economical running costs’ and estate management boards had shown they could deliver ‘a tenant-oriented service … in the most difficult operational contexts’. Given this TMO success and their fit with Blair’s promotion of ‘social capital’ it is surprising that they were not encouraged by New Labour – in 2008 the number of TMOs remained broadly constant at the 2001 figure. The coalition government backed TMOs, publishing new guidance on setting up TMOs, aimed at simplifying the setting up process (DCLG, 2013a). However, the funding available was low – £2 million in 2014/15 and £1 million in 2015/16. Housing cooperatives In the early 1960s, the Conservatives tried to produce an alternative to private and local authority rented accommodation by promoting ‘cost rent’ societies funded by developers with ‘exchange professionals’ such as solicitors and estate

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agents managing the societies. Societies owned the stock and it would be let at cost price without making a profit other than fees charged by the ‘exchange professionals’. ‘Co-ownership societies’ involved a sponsoring ‘parent’ society developing and managing a housing scheme that would be collectively owned by the occupiers. If society members left the scheme after a minimum residence period, they were entitled to a premium reflecting any enhanced value. Few cost rent homes were built but co-ownership societies were more successful although, under the Thatcher government, most schemes were wound-up with the occupants of individual houses becoming full owners. Par value cooperatives involve members having only a nominal equity share in the co-op and hence members cannot benefit from increases in property values. The 1974 Labour government attempted to boost such par value co-ops but the initiative was short-lived (Hands, 2015). Cooperatives have been ‘largely forgotten by UK housing policy makers since the 1990s’ (Independent Commission for Co-operative and Mutual Housing, 2009, p 1). Gulliver and Morris (2009) identified 836 cooperative and mutual housing organisations in the UK, managing about 169,000 homes – 0.6% of all the UK housing stock – of which 54% were owned by cooperatives. National Tenant Voice With Gordon Brown as prime minister, New Labour started to take a new interest in tenant involvement, although not in TMOs. It set up National Tenant Voice to give tenants a stronger say in national ‘social’ housing politics but the coalition government ended its £1.5 million state funding placing emphasis on local level involvement via ‘tenant panels’. The 2015 Conservative government has shown little interest in tenant participation. Tenants had no influence in the agreement on the ‘voluntary’ Right to Buy and a ‘panel of experts’ set up to monitor the regeneration of 100 council estates did not include a tenant representative. Hirschman (1970, pp 43, 47) noted ‘The presence of the exit alternative can therefore tend to atrophy the development of the art of voice’ with ‘highly quality-conscious customers … [paralysing voice] by depriving it of its principal agents’. The Conservatives had considerable difficulties in increasing council house rents and imposing conditionality until the RTB exit route was introduced. The ‘voluntary’ RTB outlet allows greater opportunities for conditionality and rent increases in the housing association sector.

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The financial institutions Building societies and banks Building societies differed from commercial banks in being ‘mutual’ – there were no shareholders – and their aim was to meet reciprocal lender and borrower requirements. By the 1970s, building societies, working class self-help organisations in origin, had become major financial institutions. Governments worked with them, offering loans in times when saving levels were low to stabilise the housing market. However, their activities provoked criticism. It was alleged that their conservatism and the cartel they operated in fixing interest rates produced mortgage queues, their mutuality had become a myth and unaccountable directors, not savers and mortgage holders, controlled the movement (Boddy, 1980). They were also accused of proliferating branch offices and a reluctance to lend in certain geographical areas. In the 1980s, the Conservative government attempted to deal with these criticisms by exposing the societies to more competition from banks, specialist mortgage companies and other financial institutions. As competitors moved into the mortgage market the building societies lost business and, by 1986, supplied only 51% of net mortgage lending compared to 79% in 1980. The societies argued that, if the banks were allowed to compete in their business, then societies should be granted more scope to diversify. The 1986 Building Societies Act enabled such diversification: societies could raise more funds from wholesale markets, that is, borrow from institutions as well as individuals; purchase land; act as developers; set up estate agencies; and offer cheque clearing facilities. Many building societies became banks by abandoning their mutual status and offering dividends to shareholders. The societies converting to banks were more aggressive in their expansion plans. Northern Rock, for example: ... started its quest to increase its mortgage market share. It promoted its project, not by the traditional mutual method of raising retail deposits, but by borrowing on wholesale markets with ‘securitisation’ (selling on the loans) as collateral. Northern Rock also attracting new mortgage business through such deals as its ‘Together’ loan – up to 125% of house value and up to six times annual income. (Brummer, 2008, p 100) Smith et al (2010, p 2), referring to the sub-prime crisis in the USA, commented ‘Somehow, the failure of a niche market in a single jurisdiction ... generated a shock sufficient to tip the global economy from growth to decline’. In late 2007, suspicion in the wholesale market about ‘sub-prime’, ‘toxic’, ‘ninja’ (no income, no job, and no assets) loans, financed by ‘securitisation’ – selling bundled

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mortgages to third parties – led to a lending standstill. Inability to borrow as old loans became due produced a liquidity crisis for Northern Rock, a bank run and its nationalisation in February 2008. Other banks encountered similar problems. Now that ‘securitisation’ was drying up, where were the funding sources? As house prices declined had some of their UK loans turned toxic? Did UK banks hold ‘toxic’ loans from the United States? Subsequently it emerged that they did. The Royal Bank of Scotland, for example, had purchased a package of US sub-prime loans for $840 million put together by Goldman Sachs with the aid of a hedge fund. Concerns about bank losses produced a confidence crisis in the UK financial sector, triggering extensive additional state intervention: mortgage protection schemes; merger brokering; deposit guarantees; shares acquisition in vulnerable banks; capital injections and interest rate reductions. This action helped to stall the decline in house prices. The coalition government continued the process of nursing the financial institutions back to health. Its primary mechanism was ‘Funding for Lending’ introduced in 2012 and aimed at injecting £70 billion into banking by government guarantees provided that the banks lent the money onwards. Although publicity for the scheme emphasised lending to small businesses, a large proportion went into mortgage lending. ‘Help to Buy’ in its mortgage guarantee and equity loan forms, fully introduced in 2013, also enhanced mortgage providers’ lending capacity. The UK banks and the housing system are closely connected with UK domestic mortgage loans expanding from 40% of GDP in 1990 to over 60% in 2015 (New Economics Foundation, 2015). ‘The Bank of Mum and Dad’ Young people have increasingly relied on their parents to supply finance for house purchase. Legal and General (2016) calculated that, in 2016, 305,900 young people would be helped by the ‘Bank of Mum and Dad’ giving £17,500 to each child to assist in funding £77 billion of property acquisition. This was 25% of all mortgage transactions in 2016, putting the ‘Bank of Mum and Dad’ into the top ten mortgage lenders. The Bank of England Under New Labour, mortgage finance regulation was the responsibility of the Financial Services Authority (FSA) that adopted a ‘light touch’ approach to regulation. The Bank of England was made responsible for setting interest rates as a powerful symbol that New Labour was prudent in managing financial matters. The coalition government abolished the FSA, placing responsibility for regulating financial service organisations with the Financial Conduct Authority and the Prudential Regulation Authority, with the Bank of England having overall

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control. There were tensions between the Bank of England – interested in preventing boom and bust cycles – and the coalition government concerned about promoting economic growth through stimulating the housing market. In 2014, the Bank of England, fearful of a house price boom, curtailed the mortgage share in the Funding for Lending scheme and introduced tighter controls on mortgage lending. It limited the number of ‘high-risk’ mortgages – more than 4.5 times a borrower’s income – to no more than 15% of new mortgages. It also required lenders to apply ‘affordability’ tests to new mortgage applications but not buy to let landlords. This included an ‘interest rate stress test’ to help ensure that prospective mortgagees would be able to cope with future interest rate increases.

The construction industry Despite there being 18,000 housebuilders registered with the National House Building Council, a small number of major companies dominate residential construction: in 2006, about one-third of total output was produced by the three largest firms (Jones and Watkins, 2009, p 30). ‘Self-build’ – both the individual owner who builds the house and an individual plot owner who contracts with architects and builders to build a dwelling – accounts for about 10% of total production. The coalition government attempted to stimulate ‘self-build’ by releasing public land to the sector. It has been argued that, until the ‘credit crunch’, builders could ‘sell anything’ (Barker, 2004, p 106) once they had acquired land and therefore they concentrated on land acquisition being unconcerned about expanding production in case extra supply undermined the price they could obtain for their product. The recession had a major impact on the housebuilding industry. The Lyons Commission (2014, p 103) reported: ‘Aggregate figures for the biggest six house builders show that between 2006 and 2009 turnover halved and operating profit fell from £2.1 billion in 2006 to a loss of £2.2 billion in 2009’. Lyons claimed that, to restore financial viability, the housebuilding industry had concentrated on margins rather than volume, indicating that scarcity maintenance was at the heart of the industry’s strategy. New Labour tried to help the sector by injecting government money into ‘stalled sites’, a policy continued by the coalition government that also allowed developers to renegotiate Section 106 agreements to take account of changed market conditions. In late 2013 housebuilding started to recover but remains well below the output estimated as necessary to match new household formation (see Chapter Five). The Lyons Commission suggested that housebuilding concentration in the major volume building sector was a reason why so few houses are built. It recommended granting special concessions to small and medium sized companies to assist them to build on smaller sites. Lyons also identified a skill shortage in the housebuilding industry that needed rectification by increasing the number of apprentices. The 3% levy on firms to

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finance apprentices, announced in 2015, will help in the long term but shortage of building workers is a major impediment to new house construction and, given the contribution of EU workers, ‘Brexit’ may restrict new house construction (Knight Frank, 2016).

Private landlords In 1974, the Conservative Political Centre stated ‘the private landlord, as he exists now and has existed, will, within a generation, be as extinct as the dinosaur. There is nothing that can be done about this’ (quoted in Rugg and Rhodes, 2008, p 3). Only in the late 1980s did the Conservatives make a robust attempt to revive private landlordism via the abolition of rent control for new tenants. In its opposition years, Labour’s attitude towards private landlords gradually changed and, as New Labour, the party embraced landlords as an integral part of the housing system. A housing green paper (DETR, 2000, Sections 5:1 and 5:2) stated: A healthy private rented sector provides additional housing choices for people who do not want to, or are not ready to, buy their own homes … Through its flexibility and speed of access, it can also help to oil the wheels of the housing and labour markets … Landlords can be assured that we intend no change in the present structure of assured and assured shorthold tenancies, which is working well. Nor is there any question of our re-introducing rent controls in the deregulated market. New Labour promoted responsible private landlordism by encouraging ‘landlord forums’ and voluntary accreditation schemes whereby landlords were brought into ‘big tent’, mainstream provision in return for adopting acceptable standards. In England, the sector expanded from 10.3% of the housing stock in 1997 to 17.1% in 2010 but larger scale landlordism was in relative decline being replaced by landlords acquiring only one or two properties. ‘Buy to Let’, started in 1996 when some mortgage lenders agreed to offer loans to private landlords on terms close to those available to owner-occupiers stimulated private landlordism. Its growth was rapid although a growing proportion of purchases were financed without mortgages. The coalition government appointed a committee, chaired by Sir Adrian Montague (DCLG, 2012b), to review the barriers to institutional investment in private rented homes. In response to its recommendations, a £200 million build to rent fund was set up to finance the construction of homes until they are built, let out and managed, and create new ‘demonstration’ projects to showcase larger scale rental developments in action. The 2013 Budget announced that the fund

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would be increased to £1 billion. A £10 billion Private Rented Sector Guarantee to underwrite 20% of the finance needed for new rented homes was announced and a taskforce was established to boost awareness of new build private renting. A dimension of this build to rent initiative is the hope that long-term institutional investment in private renting will lead ‘place-shaping’ via longer term rentals and housing scheme design that emphasises stability rather than the search for short-term profit (Baker, 2016). Although reluctant to regulate the private rented sector, New Labour introduced legislation at the end of its term in office to register private landlords, with unacceptable behaviour leading to exclusion from letting. The coalition government did not take up New Labour’s plans preferring to rely on voluntary measures and firmer action to curb ‘rogue’ landlords. The private landlord sector continued to grow from 2010 reaching 19.8% of the English market in 2015. Aware that private landlordism was restricting homeownership, the 2015 Conservative government introduced measures to restrict its growth, limiting tax reliefs and imposing 3% extra stamp duty tax on the transfer of houses into the sector. Information on private landlordism is limited (see Chapter Ten) but it has been estimated that there are 2.1 million landlords in England (Ronald, 2015). Paragon Group (2015, p 8) states: ARLA [Association of Residential Letting Agents] data also shows that the average landlord is 56.3 years old, has been letting property for 15.6 years and has 8.6 properties in their portfolio. Landlords do fall into two distinct groups though – those for whom being a landlord is a full-time occupation, who typically own a larger portfolio, and those who hold a small number of properties, often just one, as a means of augmenting other savings and investments.

The European Union Housing is not a European Union (EU) mandate but the common elements of the Union’s financial system, requirements for competition in awarding national and local government contracts and the need to remove obstacles to the free movement of people have affected housing policy in the 28 member states as has the use of other EU mandates to pursue housing objectives. Doling (2006, p  338) has detected the EU developing ‘a sort of housing policy by stealth’. Thus, for example, the European Commission has allowed member states to redirect up to 4% of their European regional development fund allocation towards energy efficiency in existing ‘social’ housing stock, a proportion of the European Structural Fund has been allocated to co-financing ‘social’ housing in selected member states and regeneration schemes have benefited from European funding. The salience of the EU’s rules on national accounts was revealed in 2015, when,

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based on 2008 New Labour housing regulations and EU national accounting rules, the ONS reclassified housing association debt as public sector. The 2016 EU Referendum ‘Brexit’ vote demonstrated the impact of political and economic shocks on the housing market. Many banks had their credit ratings reduced and, for a time, the share value of the major building firms declined.

Devolution Although post-devolution New Labour dominance in England, Scotland and Wales led some authors to conclude ‘It seems unlikely that devolution will exert a sufficiently strong influence to overwhelm the nationalizing, unifying and converging forces of national economic management, global markets’ (Mullins and Murie, 2006, p 10), recent marked divergence in housing policies in England, Scotland, Wales and Northern Ireland produced the declaration that England is now an ‘outlier’ in housing policy (McKee et al, 2017, p 60). Policy differences will be examined in subsequent chapters. Here, devolution’s historical context is outlined and broad policy orientations are examined. Scotland In the past, there have been differences between the housing policies pursued in England and Scotland related to legal variations in landlord/tenant law, political affiliations reflected in working class agitation and the relative autonomy granted to the Scottish Office that, until 1999, held responsibility for Scotland’s housing programmes. Local authority housing was dominant in new housing supply in Scotland and, by 1979, 52.2% of households in Scotland were council tenants compared to 29.6% in England. Rents were about 30% lower in Scotland. By 2010, the Right to Buy, stock transfer and restrictions on new building by local authorities had reduced the council housing stock in Scotland to 13.2%. Housing associations held 10.9%. Housing was included in the areas of responsibility devolved to the Scottish Parliament in 1999. The Scottish Parliament gained primary legislation powers and a limited tax-raising capacity but HB was reserved for Westminster and the main fiscal and economic levers, so important to housing outcomes, resided in the UK Treasury. The Scottish Parliament’s executive arm, the Scottish Executive – renamed the Scottish Government in 2007 by the Scottish National Party – received finance from Westminster as ‘the Scottish Block’ based on the ‘Barnett formula’– also used to distribute finance to Wales and Northern Ireland. Within the ‘block’ finance allocated, the devolved administrations could switch across budget headings and were not tied to delivering UK-wide policy objectives. Given New Labour’s dominance in the Scottish Parliament until 2007, it is not surprising that housing policy in Scotland, with the exception of homelessness

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policy (see Chapter Seven) reflected policy in England. However, the terminology was different. Thus, as examples, the 2006 Housing (Scotland) Act introduced ‘Home Reports’, analogous to the English ‘home information packs’ plus a tenancy deposit scheme for the private landlord sector, similar to the system in England. Scotland’s Low-cost Initiative for First Time Buyers mirrored England’s low-cost homeownership schemes and the Scottish Executive promoted stock transfer but with different procedures using the Scottish Housing Quality Standard – a more demanding yardstick than the ‘decent’ homes used in England – to assess investment requirements. The Right to Buy was modified in Scotland with all new social tenants being subject to the same restrictions. However, existing tenants retained their established rights, more generous than in England because they were not subject to maximum limits. Despite the transfer of Glasgow’s 81,000 council houses to the Glasgow Housing Association Ltd (GHA), local authorities and tenants in Scotland were less enthusiastic about stock transfer than their counterparts in England partly because, in Scotland, local authorities retained Right to Buy receipts thereby producing more ‘in house’ resources for refurbishment. There was a tendency to emphasise ‘community ownership’ model, for example, the Glasgow transfer to the GHA was to be followed by delegation to smaller, community based housing organisations. Scotland had its own version of New Deal for Communities in the form of the Community Regeneration Fund established in 2004. As Clegg (2016, p 249) has remarked ‘The SNP [Scottish National Party] has skilfully positioned itself as the party that “belongs” to Scotland and that authentic Scottishness “belongs” to it’. The Scottish National Party’s mounting political support was reflecting is lead role in the post 2007 coalition and its control of the Scottish Assembly post 2011. The rightward trend of the Conservative-dominated coalition government produced marked divergences in housing policy reflected not only in Scottish policy initiatives (see later chapters) but in what the Scottish government has not done. As examples, the Right to Buy has been abolished in Scotland not extended. Although the Scottish Government has supported ‘mid-market’ rent housing, similar to the English ‘affordable’ rent programme, no more than one-third of Scottish Government subsidy has been allocated to this programme compared to over 90% of the resources distributed to associations in England under the coalition government. These differences are likely to widen as Scotland acquires more powers, and, in England, the 2015 Conservative government peruses its dominant policy of building for homeownership.

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Wales Before devolution, housing policy outcomes in Wales followed the English pattern more closely than policy outcomes in Scotland (see Lund, 2016). For example, in 1979, 29% of households in Wales rented from a local authority. The National Assembly for Wales, established in 1999, was granted neither the right to vary taxation nor primary legislative powers but it could change secondary legislation. The 2006 Government of Wales Act made provision for a Legislative Competence Order (LCO) to be initiated by the Welsh Assembly thereby reducing dependence on finding an appropriate Westminster bill to which a Welsh dimension could be attached (Birrell, 2009). In 2011, after a referendum, the National Assembly for Wales gained the power to make laws in all areas covered by the original devolution settlement including housing. The 2014 Wales Act devolved Stamp Duty Tax, Business Rates and Landfill Tax to Wales. As might be expected, when both Westminster and Wales were dominated by New Labour, the housing policies adopted in Wales were similar to England with ‘Welsh’ incorporated into each new initiative’s title. However, voluntary stock transfer had less appeal to local government, even after the policy was made more palatable by an emphasis on community control. Post 2010, cleavages in the housing policies pursued in England and Wales emerged. Wales, having adopted New Labour’s caps on RTB discounts, did not embrace the coalition government’s ‘reinvigourated’ RTB for council tenants. Indeed, the Welsh Government announced its intention to end the RTB. The Welsh version of Help to Buy Equity Loan was less generous than in England (the Mortgage Guarantee Scheme was UK-wide) and the Welsh Government showed more enthusiasm for ‘sustainable’ housing. The 2014 Housing (Wales) Act made private landlord and letting agency registration compulsory. It also placed greater emphasis on preventing homelessness (see Chapter Seven). The resources made available under the Barnett formula restrict housing policy in Wales. Fitzpatrick et.al (2013, p 4) claim: Wales also has a far less favourable financial devolution settlement, compared to Scotland, particularly in respect of council housing finances where it continues to make payments (£68 million in 2012/13) of rental ‘surpluses’ to HM Treasury … However, the 2015 ‘St David’s Day Agreement’ included a commitment from the Westminster government that there would be a ‘funding floor’ for Wales ensuring that relative levels of funding for Wales will not fall below 115% of comparable funding in England. In 2015 there were 227,000 social landlord ‘housing units’ in Wales with Registered Social Landlords owning 61% of all the ‘social’ rented housing stock.

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As in England under New Labour, investment in ‘social’ housing in Wales was reduced. This was reflected in output and the new ‘social’ housing dearth continued under the coalition government at Westminster despite ‘intermediate housing’ – at higher rents – forming an increased proportion of production. Statistics for Wales (2015, p 3) concluded, ‘Overall there has been a general fall in percentage of social sector dwellings which were estimated to account for 16 per cent of all dwellings at 31 March 2014 compared with 19 per cent in 2000–01’. Northern Ireland Before 1971, state housing supply in Northern Ireland was the responsibility of 66 local authorities, three new town corporations and the Northern Ireland Housing Trust, set up after the Second World War to supplement local government housing supply. The civil rights marches and the intensification of violence in 1968–69 prompted the Westminster government to set up the Cameron Commission to inquire into the disturbances. It concluded that a major cause of the troubles was: a rising sense of continuing injustice and grievance among large sections of the population centred around the unfair methods of allocation of houses built and let by such authorities, in particular refusals and omissions to adopt a points system. (Cameron, 1969, p 140) The Cameron Commission’s findings led to the establishment of an appointed Northern Ireland Housing Executive in 1971 that became Northern Ireland’s single comprehensive housing authority under the direct Westminster political control, imposed in 1972, until the establishment of the ‘modern’ Northern Ireland in 1998 as part of the Belfast Agreement. The Northern Ireland Assembly was allowed legislative competence in housing but the Assembly was suspended in October 2002 when its powers reverted to the Secretary of State for Northern Ireland. It remained suspended until May 2007 when the Northern Ireland Housing Executive became accountable to the Northern Ireland Assembly via a division of the Northern Ireland Executive – the Department for Social Development, incorporated into the Department for Communities in 2016. Northern Ireland, with its long periods of direct Westminster rule, has tended to reflect housing policy in England. Legislation similar to the 1977 Housing (Homeless Persons Act) was applied in Northern Ireland in 1988 and Northern Ireland imposed caps on the discounts available under its Housing Sales Scheme (similar to the Right to Buy in England). However, New Labour did not promote stock transfer from the Northern Ireland Housing Executive, in part because of ‘the potential problems of community ownership in the context of communal conflict’ (Birrell, 2009, p 67).

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Northern Ireland’s housing market is connected to the market in the Republic of Ireland. In the early 2000s house prices in Northern Ireland were lower than the Great Britain average but, from 2005 to 2007, they doubled becoming 2% higher than in Great Britain (Pawson and Wilcox, 2013). The subsequent bust, lasting until early 2013, generated a 57% decline from peak to trough. House prices increased in 2013 and 2014 but, by 2015, prices were still more than 40% below peak levels. As in the rest of the UK, the bust and subsequent recession produced a steep decline in new house construction. The Northern Ireland Housing Executive acquired a good reputation for housing delivery and impartiality in housing allocation but, until 2006, it did not attempt to engineer better balanced communities. In 2004, 92.5% of all 100,000 public homes were segregated (Byrne et al, 2006). The Northern Ireland Housing Executive (NIHE) announced its Shared Future Housing Programme in 2006. In established areas, advisors and grants would assist communities to celebrate diversity and bring together people and there would be a better balance of people from different religious backgrounds in new build schemes. After 1995, when its borrowing powers were curtailed, the NIHE withdrew from new ‘social’ housing construction in favour of housing associations. Following a fundamental review of the NIHE (Northern Ireland Assembly, 2012) plans were announced to split the NIHE into landlord and strategic functions, with strategic issues becoming an enhanced Department for Social Development – Department for Communities from 2016 – responsibility and the Executive’s landlord function moving to the housing association sector. It was hoped that transferring the Executive’s 90,000 homes to housing associations would attract private investment into the stock. However, by 2016 there had been little change in the role of the NIHE. Several commentators have drawn attention to the inertia built into the Northern Ireland devolution settlement with policy outputs likely to be ‘technocratic’ and to reflect the ‘lowest common denominator’ (McLaughlin, 2005; Birrell and Gray, 2011). Up to five political parties can be entitled to represented on the Executive with ‘departmentalism’ the result of a particular parties controlling different policy domains. Parties can block a policy via filing a ‘petition of concern’. Muir (2012) detected that, after the Northern Ireland Assembly was restored in 2007, policy became more sensitive to ‘civic dynamics’ when compared to the former ‘technocratic’ ascendancy in the system. Welfare reform, including the ‘bedroom’ tax, may be an example of this. By convention, Northern Ireland followed financial policies adopted across the UK but, in Northern Ireland, welfare reform had a major impact ‘costing an estimate £630 a year for every workingage adult – even without implementing the bedroom tax’ (Wilcox et al, 2014, p 17). Sinn Fein opposed welfare reform and a settlement with the Assembly, agreeing to implement the welfare reform package in return for Westminster financial concessions and control of Corporation Tax, was attempted. However,

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the stalemate continued with Sinn Fein, the Social Democratic and Labour Party (SDLP) and Green Party making a ‘petition of concern’, blocking welfare reform because it did not receive the required cross-community support. Following long negotiations, a settlement was reached in 2015. Corporation tax was devolved, extra resources were allocated to Northern Ireland and there was a £585 million commitment by the Northern Ireland government to mitigate the impact welfare reform, effectively ending the ‘bedroom’ tax (Northern Ireland Executive, 2015).

Overview

• • • •

HM Treasury has become more powerful in determining housing policy. The role of local government in the direct supply of housing has been supplanted by housing associations and housing associations have become more commercially minded. The regional dimension in promoting housing supply, endorsed by New Labour, was abandoned by the coalition government but has re-emerged, in the form of ‘super-city’ governance. Directly elected representatives now have more autonomy in determining housing policy in Scotland, Wales and Northern Ireland and, post 2010, greater ‘home nation’ differences have emerged.

Questions for discussion 1. What is meant by ‘the core executive’? 2. Examine the main differences between housing associations and: a private landlords; b local authorities. 3. In what ways has central government controlled the housing activities of local government and housing associations? 4. How can tenants become more involved in the policy and management decisions made by local authorities and housing associations? 5. What difference has devolution made?

Further reading Who Governs Britain? (2015) by Anthony King is good short guide to government institutions. A–Z of Housing (2015) by David Garnett is a valuable guide to housing terminology. The Lyons Housing Review: Mobilising across the nation to build the homes our children need (2014) contains information on the construction industry. A more detailed account of devolution and its impact on housing can be found in Housing Politics in the United Kingdom: Power, Planning and Protest (2016) by Brian Lund.

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Housing in Northern Ireland, Coventry: Chartered Institute of Housing (2016) edited by Peter Shanks and David Mullins contains comprehensive accounts of various dimensions of housing policy in Northern Ireland.

Websites House of Commons Research Briefings: http://researchbriefings.parliament.uk/ Reviews of government policy in England can be found on the website of the Select Committee for the Department for Communities and Local Government: www.parliament. uk /business/committees/committees-a-z/commons-select/communities-and-localgovernment-committee The websites of The National Housing Federation, the Chartered Institute of Housing and Shelter contain commentaries on housing policy and links to other sites. Inside Housing is a weekly commentary on housing policy: www.insidehousing.co.uk/ Statistics relating to the devolved governments can be found at the following sites. For Scotland: www.gov.scot/Topics/Statistics/Browse/Housing-Regeneration/HSfS For Wales: http://gov.wales/statistics-and-research/welsh-housing-statistics/?lang=en For Northern Ireland: www.communities-ni.gov.uk/topics/housing-statistics

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four Comparative housing policy Summary

•

• • •

Cross-national comparisons contribute to understanding the global, regional and national factors influencing housing policy and allow the array of national housing policies to be examined. However, there are obstacles to forming robust conclusions on policy inputs and outputs due to data limitations. Since the 1980s there has been a trend for housing policies to converge towards greater reliance on market forces underpinned by selective consumer subsidies and homeownership promotion. There were national variations in the housing impact of the ‘global credit crunch’. Some housing policies have been transmitted between countries.

Why compare? There are three principal reasons for engaging in comparative studies. First, cross-national comparison offers the opportunity to identify possible global factors in housing policy development and thereby highlight specific national housing policy determinants. This involves exploring broad structural trends and the contribution of relationships between the state, the market and civil society in particular countries. Nonetheless, identifying cross-national policy trends is bedevilled by complexity in national policy interventions. Policy inputs are diverse ranging across intricate and constantly changing direct subsidies, cheap loans and tax breaks to producers, often applied at regional and local level, to the state’s regulatory activities and complex consumer assistance systems in the forms of tax concessions and means-tested allowances. These policy interventions interact and

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are embedded in the pathways established in specific national historical contexts. Housing policy is not ‘path determined’ (Murie, 2016b) but it is ‘path dependent’, characterised by Bengtsson (2012, p 161) as: ... if, at a certain point in time, the historical development takes one direction instead of another, some, otherwise feasible, alternative paths will be closed, or at least difficult to reach at a later point. Second, examining housing policies in other countries can supply ideas to apply in the UK by identifying what policies are in operation elsewhere and, perhaps, assessing their effectiveness. Stephens (2013) regards this function as the most important comparative housing studies purpose, but insists that the comparisons must be embedded in particular housing systems and their interactions with wider social and economic structures. Thus, for example, it is unwise to advocate the transfer of the German rent control system to England (Labour Party, 2015) without appreciating its German policy context: long-term support for private landlords; a far higher proportion of direct institutional investment in the sector; and success in controlling house price inflation thereby reducing the investment dimension in renting/owning decisions. The embedded nature of policy, statistical inconsistencies and terminology differences ‘makes policy learning and policy transfer between countries at best problematic and at worst dangerous endeavours’ (Crook and Kemp, 2014, p 228). Housing policy national entrenchment is also reflected in the diverse national standards used to measure housing outcomes. Thus, for example, housing indicator standards in the USA such as ‘on at least three occasions during the past 3 months, all flush toilets broken at the same time for 6 hours or more’ and ‘having unvented gas, oil or kerosene heaters as primary heating equipment’ (Schwartz, 2014, p 29) are very different to the Housing Health and Safety Rating System (HHSRS) operating in England (see Chapter Eight). Indeed, each UK devolved government now has its own minimum housing standard benchmarks and, as Sir Bob Kerslake, when Chief Executive of the Homes and Communities Agency, pointed out: Bizarrely, Britain, unlike most of Europe and the US, uses a home’s bedroom count rather than overall footprint, to indicate the size – and therefore the desirability – of the property. (Kerslake, 2010) Thus, identifying comparative policy outcome indicators is problematic: as Bradshaw, Chzhen and Stephens (2008, p 9) comment, ‘There aren’t very many, or particularly good sources of comparative data on housing’. Tenure, often used in comparative studies, is difficult to interpret due the variations in housing conditions within tenures and the different meanings attributed to ‘tenure’. As Ronald (2008, p 6) states ‘tenure is a slippery concept and the meanings, rights

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and obligations of “owning” a home vary radically from society to society’. ‘Social’ housing is a particularly flexible notion with Haffner et al (2009, p 4) noting ‘it is something defined in terms of who owns it or how rents are set’ but claiming its essential characteristic ‘is how accommodated is allocated’ with ‘social housing ... allocated according to need rather than demand or price’. ‘Co-ownership’ is also a capricious idea with many organisations allowing members to sell their stake at the market price and others imposing sale restrictions. Eurostat has managed to compile useful housing outcome indicators for EU members but some depend on how national governments generate their statistics. For example, the UK ‘Housing Cost Overburden’ for those paying a market rent fell from 45.6% in 2011 to 23.8% in 2012 due to ‘a break in the time series’ (Eurostat, 2015). Third, comparative studies can undercut what we take for granted by demonstrating that a particular housing system is not ‘natural’ and hence inevitable. For instance, although homeownership in the UK sometimes viewed as a ‘natural’ tenure expanding with affluence (Saunders, 1990), there is no robust relationship between a country’s wealth and its homeowner proportion.

Housing policies: five national case studies In 1990 and 1999, Esping-Andersen recognised three ‘worlds of welfare capitalism’: liberal, conservative/corporate and social democratic. This classification was based on labour decommodification levels; market mechanism use; universal or selective social rights; and the linkages between different political institutions and actors, that is, the degree of corporate political structures. The analysis did not include housing and has been criticised as an over-simplification of more diverse welfare regimes varying over time and in need of updating (Matznetter and Mundt, 2012; Stephens, 2016). Other authors (Allen et al, 2004) have identified a fourth category – South European states. Spain, Portugal, Greece and Italy are characterised by polarisation between well-protected workers and those with minimal entitlements, a strong reliance on family networks to provide welfare and fragmented welfare delivery systems. These states have high homeownership and hence a large share of total personal wealth is held as housing equity. Lunde and Whitehead (2016) used five categories in their housing finance study (Anglo-Saxon; Scandinavian; Central European Corporatist; Ex-communist and Southern European) and the European Commission, in Study on Housing Exclusion: Welfare Policies Housing Provision and Labour Markets (2010), adopted a ‘social democratic’; ‘corporatist’; ‘liberal’; ‘Mediterranean/rudimentary’ and ‘transition’ classification. The European Commission taxonomy is used in this chapter. It is mainly concerned with housing in OECD countries, with specific countries taken as examples of particular housing regime types: US (liberal); Sweden (social democratic), Germany (corporatist), Spain (Mediterranean/

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rudimentary) and the Czech Republic (transition). Housing statistics for the UK and the selected countries are set out in Table 4.1. Table 4.1: Housing statistics, selected countries UK

Germany

Sweden Czech Republic

USA

Spain

Population (millions) (2016)

64.9

82.7

9.1

10.6

324.2

46

GDP per inhabitant (US dollars, 2015)

41159

46993

47922

31549

55850 34818

Average transaction price: per square metre (€, 2014/15)

5100

4078

6991

3384

N.A

1800

Gini coefficient1 (2012–13)

32.6

30.1

29.3

26.1

41.1

35.9

Owner occupied

64

42

40

64.5

65.1

85

Private renting

18

582

23

12

34

14

18

62

18

8

1

2

11.1

0

0

Tenure (%) (2008–14)

Social rented Cooperatives/co-ownership

0

4

163

Housing regime private landlord friendly4

+1

-1

-2

+1

0

-2

House price (2001) real5

156.4

90.3

144.7

NA

122.4

112.7

House price (2006)

real5

246.1

80.7

204.7

100

171.1

202

House price (2011)

real5

218.8

81.3

238.7

112

116.9

160.9

House price (2014) real5

250

95.2

261.4

114

127.1

129.9

Dwellings per 1,000 people (2012)

443

490

479

434

N.A

544

New dwellings per 1,000 population (2015)

2.2

3.2

2.2

2.7

2.4

1.4

New dwellings per 1,000 people (average per annum, 2004–07)

3.2

3.4

3.3

3.2

6.8

12.6

Notes: 1 The Gini coefficient is a measure of inequality: 0 = total equality, 100 = totally unequal; 2 The ‘private’ sector in Germany is owned by a diversity of agencies and some operate as ‘non-profit’ organisations and cooperatives: 6% of the total stock has been estimated as ‘social’, that is, subsidised and subject to allocation rules; 3 If the co-ownership sector is classified as home ownership, the owner-occupied sector increases to 55%; 4 Global Property classifies countries according to whether they are pro-landlord or pro-tenant. + 2 is strongly pro-landlord, -2 is strongly pro-tenant; 5 Index 1993=100. Sources: Adapted from: Eurostat (2016); Schwartz (2014); Statistics Bundesamt, Deutschland (2015); Worldometers (2015); Global Property Guide (2016); Joint Center for Housing Studies (2015); World Bank (2016)

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The five case studies set out below focus on how housing policies are institutionally embedded in historical pathways. Later, the impact of globalisation and the hegemony of neoliberal ideas on these pathways will be explored.

USA Federal intervention in the housing system started in the 1930s when the economic depression severely impeded housing market functioning. In 1931, 50% of all mortgages were in default and residential construction had declined by 95% since 1928. To deal with this situation the Federal Housing Administration (FHA) was set up to insure private mortgages and thereby stimulate finance availability for private construction. The Federal National Mortgage Association (FNMA) was also established to purchase mortgages from lenders thereby freeing funds for new mortgages. In 1968 FNMA was privatised and, quaintly known as ‘Fannie Mae’, it bought mortgages on the secondary market and pooled them to sell on to investors as mortgage-backed securities. Later the Federal Home Loan Mortgage Corporation (‘Freddy Mac’) and the Government National Mortgage Association (‘Ginnie Mae’) were set up to provide competition to ‘Fannie Mae’. Under the 1937 National Housing Act, part of President Roosevelt’s New Deal, federally funded public housing could be built and managed by local housing authorities. In response to objections from the private sector about unfair competition, public housing had to be linked to slum clearance schemes so that there was no addition to the housing stock and occupancy was restricted to lowincome households. The 1949 Housing Act extended the scope of the 1937 Act and set a target of 135,000 low-income units per year for six years. However, by the end of the 1950s only 250,000 public housing dwellings had been built. Public housing continued to be built as part of urban renewal programmes in the 1960s and early 1970s but, from the middle 1970s, new public housing projects were gradually replaced by producer subsidies aimed at stimulating private sector housebuilding for particular groups such as elderly people and low-income families. Many producer subsidies were consolidated in the 1986 Tax Reform Act authorising a Low Income Housing Tax Credit, distributed by the states to companies and investors in housing, and redeemable against federal tax liability. It was targeted at rented housing acquisition, rehabilitation or new construction for lower-income households. In the 1980s and 1990s federal government intervention in the housing market was significantly reduced but many states entered the housing domain by sponsoring Community Development Corporations and using Low Income Housing Tax Credit to stimulate housing production. These schemes, often in conjunction with programmes for revitalising ‘distressed’ public housing and sometimes involving ‘non-profit’ organisations – similar to UK housing associations – became part of the largest housing programme focused on poorer Americans and, by 2013, had produced 2.5 million ‘units’.

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Consumer subsidies Consumer subsidies in the US have taken two main forms. Homeowners have been able to offset their mortgage interest payments against their tax liability. Such ‘tax expenditure’ amounted to over $405 billion in 2015 (Bankrate, 2016) compared to $47.9 billion spent on direct housing subsidies in 2009 (Schwartz, 2014). Under Section 8 of the 1974 Housing and Community Development Act, housing allowances were made available to low-income households renting at ‘fair market rents’. In the 1980s these were replaced by ‘housing choice’ vouchers on a ‘payment standard’ set for each area and similar to the ‘reference’ rents adopted in the UK (see Chapter Six). Participants are free to choose any accommodation that meets programme requirements and is not limited to units located in subsidised housing projects. In restricted circumstances, the voucher can be used to purchase a modest home. In 2015, housing vouchers helped 2,111,360 households (Center on Budget and Policy Priorities, 2016). Prospective tenants are issued a voucher stating they are covered by the scheme’s income requirements – not exceeding 50% of the median income for area in which the family chooses to live. When accepted by a landlord offering accommodation, that, unlike the UK HB system, has to meet set quality standards, they pay 30% of their income in rent. The remainder, up to the ‘payment standard’, is met by the local housing authority, subsidised by the federal government. The 1998 Quality Housing and Work Responsibility Act stated that households with very low incomes – less than 30% of an area’s median family income – must receive at least 75% of all vouchers. Housing vouchers are not an ‘entitlement’ – there is limited funding and a long waiting list with only 25% of those eligible receiving the vouchers (Joint Center for Housing Studies, 2016). In August 2010, when Atlanta issued a new series of vouchers, 30,000 people queued for about 450 vouchers. The riot police had to be called in to control the crowd. Homeownership and the ‘credit crunch’ In 2004, 68.8% of households in the US were homeowners but the homeowner per cent declined to 63.7% in 2015 after the ‘credit crunch’ (Joint Center for Housing Studies, 2015). Alan Greenspan, head of the US central bank from 1987 to 2006, dealt with financial shocks such the economic impact of the 9/11 attacks by lowering interest rates. Low interest rates boosted the appeal of property ownership and the excess demand over supply led to rapid house price inflation. A new mortgage market, known as ‘sub-prime’, fuelled the house price boom. ‘Sub-prime’ mortgages were the outcome of two main influences. President Clinton wanted to increase homeownership among low-income households, especially those headed by

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black people who were under-represented in the tenure: in 1996 only 45% of black households were homeowners compared to 65% for all households. Banks were encouraged to lower their requirements for property-backed loans and, in 1996, the Department of Housing and Urban Development (HUD) set a goal for ‘Fannie Mae’ and ‘Freddie Mac’ that at least 42% of the mortgages they purchased should be targeted on borrowers with a household income below the area median. President George W. Bush shared Clinton’s housing goals and issued a challenge to mortgage lenders to extend credit to low-income households backed by the 2003 American Dream Downpayment Act, granting federal assistance to finance mortgage deposits to first-time buyers. Despite this federal intervention, the main ‘sub-prime’ driver was the profit anticipated by those involved in the mortgage chain. Mortgage suppliers identified profits to be obtained by selling mortgages to sub-prime borrowers. These ‘affordability products’ – ‘African American borrowers were almost four times more likely than Whites to take on subprime credit ...’ (Wyly, 2010, p 401) – typically offered a ‘teaser’ introductory interest rate, usually 2%, to be followed by a sharp increase of up to 10%. Interest only 100% mortgages – often more – were offered and some borrowers were allowed to estimate their incomes on the mortgage application form, so called ‘liar’ loans. The ‘initiate and distribute’ mantra resulted in mortgage brokers selling these mortgages to banks who then resold them in packages, often bundled with ‘prime’ mortgages, on the global financial market – a process known as ‘securitisation’. ‘Securitisation’ meant that mortgage brokers had little incentive to check borrower credit history. As Lanchester (2010, p 99) comments: If the borrower defaulted, so what? The lender no longer owned the risk anyway: it had been securitized and sold on. The initial lender was free to quote Bart Simpson: ‘Sayonara, sucker’. By 2007, the housing bubble had burst. The sustained house price inflation had increased supply and the federal interest rate, at a 1% low point in 2004, started to creep upwards. Many sub-prime mortgage holders could not afford to pay the higher interest rates charged when the ‘teaser’ rates ended. Mortgage foreclosures soared and abandoned houses added to supply. The average house price declining and the fall in sub-prime loan values caused an international financial crisis. ‘Securitised’ – now ‘toxic’ – mortgages had been sold throughout the world and several major banks still owned loans yet to be ‘sliced and diced’ as ‘securitised’ debts. As banks did not know who owned the bad debt, they refused to lend to each other producing the ‘credit crunch’. Gradually ‘toxic’ loans owners started to become known and the Federal Housing Finance Agency placed ‘Fannie Mae’ and ‘Freddie Mac’ under ‘conservatorship’, effectively making the federal government responsible for their debts. Bear Sterns was sold to J.P. Morgan for a

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fraction of its value a year earlier, Lehman Brothers went bankrupt, other banks merged and many required substantial federal assistance to stay in business. New housing output fell from 2.2 million in 2005 to 609,000 in 2009 and only started to recover in 2012. The Obama administration attempted to stall the mounting number of mortgage foreclosures – up from 1.2 million in 2007 to 3.2 million in 2008 (Squires, 2010) and with 25% of all homeowners in negative equity in 2009, ‘Fannie Mae’ and ‘Freddie Mac’ were authorised to refinance – on more favourable terms – mortgages that exceeded 125% of their value. Post 2010 house prices in the US started to increase and mortgage foreclosures declined from a peak of 2.8 million in 2010 to 1.1 million in 2014 (Statistics Portal, 2015). By 2016 house prices were back to within 6% of their former highpoint but down almost 20% in real terms (Joint Center for Housing Studies, 2016). In 2016 the homeownership rate for 30-34 year olds was 10% lower than in 2005 and the Joint Center for Housing Studies (2016) identified the increasing debt burden from student loans — up by 50% since 2003 — as a factor in impeding homeownership growth. Private renting Most Americans pay the market rent for their privately rented accommodation with means-tested choice vouchers helping those with the lowest incomes. Approximately 1.7 million households – half being elderly or handicapped people – occupy privately owned dwellings subsidised by the government. Since the ‘credit crunch’ private renting has expanded, supplying over 35% of the market in 2016. Public housing There were 1,119,864 public housing units in the US in 2015 (Office of Policy Development and Research, 2016). As Schwartz (2014, p 163) has said: public housing evokes many, mostly negative images in the popular imagination: extreme poverty, grim architecture, neglected grounds and, not least, crime. Though certainly true in places, these images do not portray the reality of most housing developments. Under the Hope V1 programme, introduced in 1992, ‘distressed’ public housing complexes were upgraded or demolished and replaced, in part, by new units of ‘mixed income housing’. Public housing tenants whose homes were to be upgraded or demolished were given four options:

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• pass a screening test for the restricted number of public housing units in the new development; • use a housing rental voucher to find a home in the private market; • move to an empty unit, if available, in another public housing development; or • find unsupported accommodation. After 1992 more than 165,000 public housing units were demolished but far less ‘mixed income’ units were built and only about 24% of the original residents moved into the new properties. The 1.1 million remaining public sector houses now represent just over 1% of the dwellings in the US. President Clinton’s 1998 Quality Housing and Work Responsibility Act devolved federal responsibility for public housing to 3,400 quasi-autonomous local public housing agencies and encouraged them to create ‘balanced communities’ with added social discipline. Such agencies were allowed to consider a prospective tenant’s employment history when making allocation decisions and were required to set standards prohibiting people involved in ‘anti-social behaviour’ from acquiring a tenancy. One offence makes a public housing tenant liable to eviction. Public housing residents have to contribute no less than 8 hours of work per month within the community in which the adult resides, or to participate on an ongoing basis in an economic self-sufficiency or job-training programme. Housing voucher recipients can lose the voucher if they do not fulfil work requirements. Under President Obama, an Urban Affairs Department was created, the 2009 American Recovery and Reinvestment Act contained substantial extra resources for public housing and HUD’s 2010 budget was increased by 10.8%. However, Republican dominance of Congress after 2010 produced programme cuts with extensions of the ‘conditionality’ measures in the 1998 Quality Housing and Work Responsibility Act. Although housing may benefit from President Trump’s commitment to investing in the USA infrastructure, Republican Party control of the Presidency and Congress does not auger well for housing programmes targeted on lowincome households. The Trump administration has called for a cut to nondefence spending, a cumulative 1% reduction each year, amounting to a 30% cut to Department for Housing and Urban Development’s budget by 2026 after allowing for inflation.

Germany East Germany German reunification in 1990 brought together two very different housing systems. East German housing policy, following communism’s basic tenets, was aimed at a sufficient home supply for those in need plus an equitable housing

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distribution. In East Germany, the state owned 41% of the housing stock. This stock was let at very low rents and allocated according to need, key worker requirements and as a reward for party loyalty. The cooperative and the private landlord sectors were subject to rent control. Homeownership, mainly a residue from former regimes, constituted about 25% of the housing stock. Prior to reunification, housing was a source of discontent with long waiting lists for a small flat, 18% of dwellings with no shower or bath, 24% of households not having sole use of a lavatory and 53% without a modern heating system. West Germany Constituted as the Federal Republic in 1949, West Germany implemented a ‘social market’ in housing. The state was to be involved in rectifying imbalances between supply and demand with the ultimate aim of applying market principles whenever the supply and demand balanced. Thus, in West Germany, state involvement in the housing market fluctuated according to supply/demand equilibrium assessments. Moreover, the political system’s federal structure gave considerable scope for variation between the Länder and between local authorities in housing policy specifics. The serious housing shortage at the end of the Second World War prompted the government to fund housing construction and impose rent controls. Subsidies for rented accommodation were made available, albeit in different forms, to all kinds of suppliers in return for compliance on the rent, size and dwelling quality and accepting nominations from local government. This subsidy form produced a range of ‘social’ rented housing suppliers and good quality houses. Non-profit organisations, some sponsored by trade unions, locally elected authorities and cooperatives offered accommodation at ‘cost’ or subsidised rents. Commercial organisations, anticipating long-term profits from ‘social’ letting with government subsidies, also entered the ‘social’ market but were allowed to operate as full commercial landlords when the low cost loans – paid in return for the acceptance of regulations akin to the non-profit sector – had been repaid. In West Germany the term ‘social’ housing came to describe a housing finance system accompanied by regulations on use rather than, as in the UK until the 1980s, housing owned by local government. Kemeny (2006) has categorised the rental system in Germany – alongside Sweden – as ‘integrated’ rather than ‘dualist’. He states: In the integrated rental market non-profit renting is accessible to the general public … In a dualist system, however, the non-profit sector is confined to the poor and cut off from the rental housing market through being socialised and controlled by a bureaucratic set of rules that limit public access to the non-profit rental housing stock. (Kemeny, 2006, pp 2–3)

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These arrangements plus the generous tax treatment of the ‘pure’ private landlord sector prompted a healthy new dwelling supply and, in accordance with ‘social market’ philosophy, moves towards cementing market principles were made whenever supply and demand seemed to be in balance. In the middle 1960s, rent controls were gradually phased out by allowing decontrol wherever the local housing shortage was estimated to be below 3%. In order to protect the poorest from the full impact of higher rents, a means-tested housing benefit (Wohngeld, now named Hausgeld) was introduced which applied to working households in the owner-occupied and the rented sectors. In the rented sector Wohngeld was aimed at reducing the rental burden to between 12% and 22 % of income. The role of Wohngeld expanded in the 1960s and 1970s with about 10% of households receiving the allowance (Stahl and Struyk, 2013). Rent control was reintroduced in the early 1980s but not on new dwellings and, over time, rents of existing properties were allowed to increase towards new property rental values. In 1986 subsidies were withdrawn from organisations involved in ‘social’ renting and, although these subsidies were reintroduced a few years later in response to pressure from the flow of immigrants and census evidence of a housing shortage, the new subsidies were more selective and at a lower rate. Before reunification the housing system in West Germany consisted of: • Owner-occupation: At 43% homeownership was low in comparison to the UK. Owner-occupation in West Germany came to be regarded as the tenure for the long-term ‘home’: expensive, built in the suburbs to high standards on land subject to tight planning restraints and occupied in later life after a long period of saving. • Non-profit housing enterprises: Cooperatives and companies owned by local authorities, the regional states, churches, trade unions or industrial companies owned about 22% of the stock. However, in accordance with the ‘social market’ philosophy as the low interest loans received from the state were repaid, there was a tendency for such non-profit organisations to opt out of taking nominations from local authorities and for the municipal companies to become private. • Private landlords: In 1990 about 36% of the housing stock belonged to the private landlord sector that supplied a diverse range of dwellings catering for a variety of mainstream housing requirements. Reunification Following German reunification in 1990, the East German housing system was subject to the ‘big bang’ of market forces. The state owned housing stock was transferred to local authorities who, in return for debt reduction, were supposed to sell them, via communal housing companies, to private investors and tenants. The cooperatives retained their properties but, as an incentive to sell, were allowed

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to write-off debt provided they sold a proportion of their stock. Rents were to be increased in steps to match West German levels with Hausgeld helping poorer families to afford the increase. Tenants were given incentives to buy in the form of discounts on market price and the federal government allocated resources to improve older dwellings and for new building. This attempt to rebuild the East German housing system on West German principles was hampered by ownership claims on property built before the German Democratic Republic was formed and by the movement of over 2 million East Germans to the West. By the early 2000s, the former East Germany had a large housing surplus with one in seven properties unoccupied. To cope with this surplus an extensive programme of demolition and improvement, with federal subsidies, was implemented but responsibility for mainstream bricks and mortar subsidies was transferred to the Länder with the federal government providing compensation until 2013. Population movement to the former West Germany prompted the government to stimulate housing supply by a combination of generous tax incentives and direct subsidies. Housing investment peaked at 8% of national income in the late 1990s before going into steep decline as state incentives were withdrawn in accordance with indicators that supply and demand were in balance. In 2014, about 42% of the housing stock in Germany was owner-occupied although the rate was 11% higher in the former West Germany than in the East. This low homeownership rate has been attributed to the cautious lending policies of the financial institutions, the good supply of rented accommodation accumulated post 1945 and limited subsidies to homeowners (Voigtländer, 2009). There was no house price boom that many countries experienced between 2000 and 2007 in part because deposits for homeownership were high at between 20% and 30% of house price. The tendency to price stability was a factor in restraining homeownership with renters not feeling they had lost out by not receiving capital gains. Renting, including the ‘non-profit’ sector, is about 58%. Rents are not controlled at the start of a tenancy but, when established, the Länder and municipalities regulate rents with the result that they have tended to lag behind inflation. In comparison to the UK, post 1989 private landlord tenants have good tenure security and landlords benefit more from depreciation allowances and reductions in capital gains tax if dwellings are owned for a long period. There is far more direct institutional finance investment in private renting in Germany compared to the UK. The share rented as ‘social’ has been in decline because the conditions attached to subsidies are time limited. As low cost loans have been paid off, landlords have become free from the lock-in of state restrictions on allocations – requiring a proportion of lets to be allocated to low-income house – and rents levels. Some stock has been sold to private investment trusts. In 2010 Hausgeld was received by 800,000 households, about 2.2% of all households and a much larger number – people long-term unemployed or claiming social assistance  –received so called ‘rent substitute’ payments (Droste

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and Knorr-Siedow, 2014). ‘Rent substitute’ payments are now separated from Hausgeld that is concentrated mainly on working single parents. New house construction and house prices Planning controls in Germany are tight but the planning law freezes land value when the local municipality specifies an area for residential development and German urban planning law enables rapid acquisition of unused land designated for development. Freezing land values means that the municipality can acquire land at existing use value with the value increase from selling housing sites paying for the infrastructure required for the development. Moreover, apart from a new green belt running along the old East/West border, green belts do not feature in Germany’s planning policy. Germany’s planning system seems to have had the effect of making its housing market less volatile than in the UK because sudden uplifts in land values are less important to volume builder profitability. Compared to the UK, house prices in Germany have been very stable. However, between 2010 and 2015, prices increased by 15%. This price increase sparked additional new house construction. Germany has consistently outperformed the UK in new construction per 1,000 population and, in 2015, 3.2 houses per 1,000 population were built compared to 2.2 per 1,000 in the UK. Germany needs these new homes. In 2014, before 1 million refugees arrived in Germany from Iraq, Syria and Afghanistan, the EU countries with the largest inflow of foreign nationals were Germany with 790,000 and the UK with 551,000 (Hawkins, 2016). To deal with the housing needs arising from population growth Germany is increasingly using prefabricated construction methods.

Sweden In its long period of social democratic government, Sweden developed a comprehensive housing policy aimed at promoting a general improvement in living conditions for all its citizens, not just for the poor. Between 1965 and 1974 the ‘Million Programme’ (Miljonprogrammet) was aimed at building 1 million homes to overcome a housing shortage. The target was achieved. To stimulate overall supply, the government offered long-term, low interest loans for the capital requirement portion most difficult to finance on the normal credit market. These state housing loans were an important dimension in the government’s control of housing production with preferred suppliers – ‘not-forprofit’ housing corporations often linked to municipal government – receiving higher loans than homeowners and private landlords. State loans to private landlords were accompanied by rent control which, while ensuring that the rent of a new property was sufficient to meet capital and maintenance costs, aimed at preventing the rents for older property, built at lower cost, rising to market

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levels. Between 1968 and 1978 specific rent control was gradually relaxed in the expectation that accommodation available from ‘cost-rent’ housing corporations would dampen rent levels in the private landlord sector. Rents in the housing corporation sector were subject to negotiation between the National Tenants’ Union and the National Federation of Cost-rental Housing Corporations, mediated by a Rental Market Committee. The rents for dwellings owned by the municipal non-profit housing companies were then used as a yardstick for setting rents in the privately owned sector that, unlike the UK, had a high proportion of large scale landlords supported by institutional investment. The centre-right government, elected to office in 1991, attempted to dismantle the social democrat housing policy. It phased out interest rate subsidies and ‘not-for-profit’ suppliers were subject to the same tax regime as for-profit rental suppliers. This raised housing costs and means-tested housing allowances were increased to mitigate the impact of higher rents on low-income households. In addition, access to mortgage finance was liberalised as stimulus to homeownership and municipalities were encouraged to sell their stock to tenantownership cooperatives. According to Christophers (2013), Swedish housing policy ‘neoliberalisation’ has continued under subsequent social democratic and centre-right coalition governments. As examples, under legislation passed in 2011 municipal housing companies must conduct their activities according to commercial principles, targeting ‘normal’ rates of return and there has been substantial cuts in the value of means-tested housing allowances. Today there are four principal elements in the Swedish housing system. • Homeownership: This accounts for about 40% of the housing stock. Owneroccupiers can deduct their mortgage interest costs from their tax liability at a rate of 30% but are subject to tax on the imputed rental income and a capital gains tax. • Tenant-ownership cooperatives: Members of tenant-ownership cooperatives own an individual share in the collective property value. Usually members are responsible for the maintenance of their individual dwellings and can sell the ‘right to occupy’ their property at the market price although some cooperatives reserve the right to determine the sale price. In essence, tenant-ownership is a form of homeownership with the cooperative element used to manage a blocks of flats. Individual members of a cooperative can claim the same tax relief as single-family owner-occupiers. • Cost-rental housing corporations: Many of these have strong connections with locally elected authorities. They own about 22% of the housing stock and charge rents that, in aggregate, cover historic costs. These costs are low because the stock was mainly built before the mid-1970s. Housing corporations do not let their properties only to low-income households. Indeed, there has been a long

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consensus between the political parties that ‘social’ housing for low-income households should not be a clearly identifiable housing sector (Lind, 2014). • Private renting: This accounts for 20% of the housing stock. The private rented sector in Sweden has been in decline as its profitability has been reduced because the general rent level in the private sector is set in relationship to the general rent level in the housing corporation sector. In many areas, rent levels in the private rented sector are well below the market-clearing rate. Housing consumption is also subsidised by a mean-tested housing allowance system that has grown in importance as universal ‘producer’ subsidies have been curtailed. House prices increased by 71% in real terms during Sweden’s 2000 to 2008 housing boom. After a short-lived dips in 2008 and 2011, increases have been sustained and has been attributed to the failure of new house construction to keep pace with population growth and movement due to the withdrawal of state assistance for new ‘social’ housing and planning restrictions (Emanuelsson, 2015). In 2015, only 2.2 dwellings per 1,000 population were constructed in Sweden. Mean-tested housing allowances are available. The amount received depends on income, housing costs, the size of the home and the number of children within the household. It is mostly single parents who receive the housing allowance.

Spain Housing in Spain is characterised by a high proportion of owner-occupiers (85%), a small private landlord sector (12%) and a very small ‘public’ sector (2%). Homeownership in Spain is one of the highest in the world and about 20% of Spain’s urban population own a second ‘holiday’ home. Allowing for the second homes owned by people residing outside Spain, around a third of the stock is not held as a main residence. The high proportion of Spanish homeowners has been attributed to a cultural tradition of ‘patrimony’ – a specific stock of housing and land conserved within the extended family (Allen et al, 2004) – that was reflected in significant producer subsidies under the Franco regime and consumer subsidies under subsequent governments. Between 1997 and 2007, despite high levels of construction, house prices in Spain more than doubled and, although interest rates declined, home affordability became problematic. A high percentage of people aged 18–34 – 55% in 2014 – live in the parental home. This indicates that access to independent accommodation is problematic but it also reflects the different social meaning attributed to young people leaving home. As Allen et al (2004, p 44) comment: Throughout a large part of Europe, the period between leaving the parental home and forming one’s own family has come to be considered as a normal stage in the life process … More than half of

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those who leave their parental home in Spain start with owning their own home. These young people skip the stage of living alone or in cohabiting couples in rented housing prior to marriage and having children. The state has encouraged homeownership via tax breaks and specific low cost homeownership initiatives with some newly built owner-occupied housing, known as ‘publicly protected housing’, given subsidies in the form of reduced interest loans with the houses allocated via means-tested schemes. Between 1998 and 2007 the housebuilding rate in Spain was very high with the housing stock growing by 5.7 million, nearly 30%. This housebuilding boom was a consequence of rising demand, especially from foreign buyers, the extensive use of mortgage ‘securitisation’ plus the considerable incentives to local government to release land, such as taxes on land sales and the requirements to give between 5% and 15% of development land to local government. The ‘credit crunch’ had an enduring impact with prices declining by 10% per annum from 2008 and 2013. The rate of decline reduced post 2013 but, in 2015, prices were 46% lower in real terms than in 2007. Housing prices plummeted after the ‘credit crunch’ In the past, the private rented sector was subject to rigid rent control. The Ley de Arrendamientos Urbanos (1964) – imposing rent regulation and allowing transfer of leases to family members – prevented investment in private renting. However, in the 1980s and 1990s rent control was relaxed by ending the forcible extension of leases, allowing landlords to raise the old controlled low rents gradually towards real market prices and allowing inflation increases on newer five-year contracts. After the collapse of the housing market, policy switched markedly from encouraging homeownership to renting in order to promote labour market flexibility and encourage the sale of vacant properties. Income tax deductions were introduced for renters with tax breaks for housing purchasers abolished in 2011, except for those with a gross annual gross salary less than €24,000. In 2009 Real Estate Investment Trusts were set up giving exception from corporation tax. Rental contracts became three-year rather than five-year and it was made easier to evict tenants. Gentile (2015, p 10) remarks: This was the first time in contemporary Spanish housing policy that the state had sought to break from the rigid path-dependency of homeownership ascribed to the traditional (familialistic) welfare system … ‘Social’ housing in Spain, in the sense of subsidised, not-for-profit accommodation for rent – known as vivienda de proteccion oficial (‘publicly protected housing’) – is very limited, being the product of autonomous municipal and charitable schemes.

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The Czech Republic Between 1948 and 1989, during the existence of Czechoslovakia, housing policy in the Czech Republic reflected communist thinking. Housing was provided and distributed, not by the market, but in response to ‘needs’, economic requirements and political affiliations. There were four main tenure types: state, ‘enterprise’, cooperative and private. • State: Housing directly controlled by the state – consisting of apartments nationalised in 1948–49 and dwellings constructed under the state-directed Complex Housing Construction Programme – accounted for 45% of dwellings in 1991. These estates were heavily subsidised and contained a large percentage of prefabricated (‘panelak’) flats. Management was provided by housing services companies acting on behalf of the state. • Enterprise: In this tenure form, particular state enterprises held the right to allocate dwellings built with finance from the state and bank loans. The tenure’s purpose was to attract labour to preferred regions and industries. • Cooperative: This tenure consisted of cooperatives set up under state supervision in the 1950s and pre-war cooperatives that were later merged into ‘giant’ associations (Lux, 2009, p 96). Most of the cost was financed by the state but, in return for individual contributions, prospective tenants could have quicker access to housing, and, in some cases, better quality homes. • Homeownership: Individually self-built houses were supported by state loans at low interest rates and were directed to workers in preferred industries. Following the demise of the communist regime and the formation of the Czech Republic as a separate state from Slovakia, housing was subject to a ‘transition’ process: the elimination of administrative allocation and the establishment of a more market-orientated system. Subsidies for both new and existing state rented dwellings were substantially reduced, cooperative members were allowed to purchase their properties and houses nationalised under the communist regime were returned to their original owners. State stock was transferred to the municipalities and some municipalities embarked on a selling programme to individual tenants, tenant cooperatives and real estate development companies. It has been estimated that, by the beginning of 2010, 80% of the stock transferred to municipalities in the ‘transition’ period had been sold on (Lux, 2014). However, there were no general ‘right to buy’ as occurred in some other ‘transition’ states. This was justified on the argument that a good supply of rented accommodation promoted labour mobility. Rents became deregulated on vacant possession but the law provided reasonable protection from eviction. Rents for sitting tenants remained regulated (based on size, not location) and, despite substantial increases after 1991, they remained at below market rents. Thus, two segments exist in

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the rental market – market and regulated – with rent levels depended on when the dwelling was let rather than income. In 2006 a rent deregulation law aimed at gradually deregulating all rented housing was passed. In 1993, to protect lower-income households from the impact of rent increases, the government introduced a system of housing allowances. Initially, the allowances were given to households in the rental sector for a maximum of two years with the household expected to move to cheaper accommodation within this period. In 1996 a new system of housing allowances was introduced for households with a total income of less than 1.4 times (later 1.6 times) the subsistence level. The support was available to households in all tenures but only about 7% of households receive the allowance and, because it is based on notional rather than actual rents, it covers only about 20% of costs. Subsidy removal resulted in a sharp decline in dwelling construction from 44,594 in 1990 to only 12,662 in 1995 (Lux, 2009). This failure of the market to boost housing supply produced a move towards greater state intervention. Subsidised savings schemes were introduced to support homeownership and the shortage of accommodation for low-income families was to be overcome by new subsidies for municipal housebuilding. These were targeted on people with special needs, on single-member households with an income below 80% of average monthly income and on multiple member households with an income of less than 150% of average monthly income. Renovation of older dwellings was stimulated by low interest loans to municipalities and, under the ‘panel programme’ started in 2001, bank guarantees and subsidies were made available to modernise the ‘panelak’ estates. There are now four sectors in the housing market. • Private rented: At about 12% of the housing stock this sector has been created mainly by the restitution of property nationalised in 1948 to the ‘rightful’ owners. • Municipal rented: This accounts for 8% of occupied dwellings and has decreasing due to sales to cooperatives and individual tenants. The ‘residualisation’ of municipal rented accommodation in the Czech Republic was reflected in a new ‘social’ housing legislative framework approved in 2014. This divided ‘social’ housing into three tiers. The first tier or ‘housing in crisis/asylum housing’ will be ‘social service’ provision for people in acute need of housing and they will be able to use for a maximum duration of six months. In the second tier, named the ‘social flat’, tenants will be under the supervision of a social worker. The third tier or ‘affordable flat’ will be a standard quality dwelling available for two years and subject to rent increases should the household income increase. • Cooperative sector: This sector, at about 11% of the stock, is decreasing as sales to individuals outstrip acquisitions from the municipal sector.

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• Homeownership: At 64.5%, this sector has expanding rapidly as a consequence of new build (encouraged by tax breaks and low interest loans for first-time buyers) plus transfers from the municipal and cooperative sectors. New housing construction has not reached 1990 levels and there are problems of dwelling size, maintenance, uneven distribution of dwellings relative to demand and a shortage of inexpensive housing for families. House prices increased from 2000 to 2003, then, after a period of decline, started to increase rapidly until 2008 when the rate of increase started to wane becoming negative in 2010/11. Since 2012, there has been a modest house price increase.

The ‘convergence’ thesis Comparative housing research has been strongly influenced by ‘structural’ approaches. Social reformism identified the ‘logic of industrialisation’ as the principal housing change driver and a strong element of organic functionalism has permeated the approach. Donnison (1967), for example, identified ‘developmental stages’ in housing policy from ‘haphazard’ to ‘comprehensive’ implying that housing systems evolve towards a ‘higher’ order. According to Marxist theory, capitalism’s requirements determine housing policy with the state intervening in the market to restore profitability when capitalism is in crisis. Both ‘structural’ approach variations predict ‘convergence’ in housing systems. Schmidt (1989) attempted to test the convergence thesis by examining housing markets and housing policy in advanced industrialising countries from the 1970s to the mid1980s. He concluded ‘contrary to convergence theory, and its associated thesis of a particular ‘logic of industrialism’, institutional factors loom large’ (Schmidt, 1989, p 83). However, an examination of the above five national case studies plus the UK experience indicates a convergence from the 1980s with ‘recommodification’ – a return to market principles in housing distribution – being a common factor and state housing support becoming more selective. Rolnik (2013, p 1059) claims that, since the 1980s, there has been a new ‘housing paradigm in almost every nation-state … primarily based on the implementation of policies designed to create stronger and larger housing-based financial markets, to include middle and low-income consumers’ and Garcia-Lamarca and Kaika (2016, p 315) have detected ‘embodied processes’ that ‘enrolled millions of lives in global realestate speculation and debt servicing practices and are, we argue, central in the macroeconomic process of “housing financialisation”’. Droste and Knorr-Siedow (2014, p  182) note that over the past 25 years ‘social’ housing in Germany, ‘originally conceived as a federally funded building programme “for a broad spectrum of society” (11nd WogbauG of 1956)’ is becoming a ‘much smaller and more needs orientated differentiated support for

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those “who are unable to provide for themselves on housing markets” (Section 1 of WoFG, 2001)’. The UK and the US have moved strongly in the direction of restricting access to ‘social’ housing and, in England, the not-for-profit housing association sector has been pushed towards market level rents. There has also been significant change in Sweden. Christophers (2013) quotes the American economist Robert Heilbroner, who observed that the vision of what he called a ‘slightly imaginary Sweden’ served as a ‘lodestar’ for many in the West by demonstrating ‘a much higher degree of economic equality and a more equitable distribution of income and wealth’ (Heilbroner, 1992, p 46). Swedish housing policy was an important element in this image. Christophers argues that, having received ‘powerful doses of neoliberalism’, housing is now a ‘complex hybrid of legacy regulated elements on the one hand and neoliberalised elements on the other’ (Christophers, 2013, pp 3, 13) but the regulated sectors are islands in the tide of neoliberalism. He concludes: From our current vantage point, therefore, a fully neoliberalised Swedish housing system, with its own distinctive dynamics and distortions, seems more and more likely. But we are not there yet. (Christophers, 2013, p 23) Kemeny (2006) pointed out how integrated rental systems depend on a thriving not-for-profit rental sector capable of dampening rents in the for-profit sector. Allowing the not-for-profit sector to decline gives free rein to the market. In discussing housing policy in post-socialist cities, Tsenkova and Polanska (2014, p 401) note that ‘the housing sector has been rapidly transformed in the early years of the transition to markets with most of the reform efforts emphasising deregulation of house prices, privatisation and private sector provision’. Between 1990 and 2000 privatisation of public housing in former communist countries ranged from 97.2% in Albania to 49.2% in Poland with 56.5% in the Czech Republic (Treanor, 2015). The state was ‘lost in transition’ (Tsenkova, 2009). A number of interacting factors has produced such ‘recommodification’. The abatement of mass housing shortages through the sustained housebuilding programmes in the 1960s and 1970s had an impact. Globalisation has had a role but a dominant influence has been the hegemony of neoliberal thinking within international financial organisations such as the World Bank and within national governments. According to Dewilde and De Decker (2016, p 159), who examined a number of European countries, the outcome has been ‘that between 1995 and 2012 with regard to housing affordability problems, in most countries the position of low-income respondents has deteriorated, both in absolute terms and relative to middle-income respondents’.

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Globalisation According to the ‘globalisation’ thesis ‘we are now entering a new phase in which cross-border flows in goods and services, investment, finance and technology are creating a seamless world market where the law of one price will prevail’ (Weiss, 1998, p 167). Although housing immobility limits the impact of globalisation, its influence on financial and labour markets magnifies regional and local variations in economic conditions within countries through internal and international migration. This may have prompted a more ‘selective’ response from national governments. Globalisation also magnifies ‘risk’ and prompts governments to deflect this ‘risk’ to homeowners in the context of greater volatility in the housing market. The ‘credit crunch’ illustrates the global context of housing policy but its differential impact also demonstrates the salience of historically established national pathways in influencing housing outcomes. Thus, as examples, in the boom housing market from 2000 to 2006, real prices fell in Germany and Japan compared to annual increases of 5.4% in the US, 8.8% in the UK and 11.2% in Spain and the credit crunch did not depress prices in Germany below trend. The US, UK and Spain and other countries made extensive use of ‘securitisation’ to finance mortgages (Dewilde and De Decker, 2016). Germany and Sweden and other countries did not (Springler and Wagner, 2010) although the Deutsche Bank bought and sold such financial products originating elsewhere. Commenting on the ‘credit crunch’ impact, Bardhan et al (2012, p 1) state: As the dust settles, it has become clear that some countries were more vulnerable than others. In particular, impacts on residential real estate ranged from unnoticeable in countries as far apart as Australia, Germany and Israel to sharp downturns in Ireland, Spain and the United Kingdom; the latter at a level that at a cursory glance appears to closely mirror the US experience.

Policy transfer It is possible to identify examples of how the experience of other countries has influenced UK policy and vice versa. • In the 1970s the Conservative Party was attracted to the German ‘social market’ economy that had produced an ‘economic miracle’ in West Germany. The means-tested rent rebate and rent allowances introduced under the 1972 Housing Finance Act had a marked similarity to West Germany’s 1965 rent allowances scheme. Both were designed to cushion a move towards market rents across all sectors of the rented sector.

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• The UK’s choice-based lettings scheme (see Chapter Seven) was based on the Delft lettings model developed in the Netherlands during the late 1980s. • Linking ‘social’ tenancies to behaviour conditions in England are similar to the conditionality clauses in President Clinton’s 1998 Quality Housing and Work Responsibility Act. • The Right to Buy scheme in the UK provided a model for the privatisation of state housing in some countries in their transition from state socialism although not in the Czech Republic. • The Labour Party’s manifesto proposals on tenure security and rent restriction in the private landlord sector were based on the German system.

Housing outcomes (EU) Cross-national housing outcome indicators are available but, as lamented earlier, they are sparse and often out of date. Governments hold divergent views about what constitutes a ‘successful’ housing policy and compile statistics, not for the convenience of comparative housing researchers, but for their own purposes. Eurostat has improved the quality of housing output indicators for EU members. Some of Eurostat’s indicators are presented in Table 4.2. Table 4.2: Housing outcome statistics, selected EU countries, 2014 United Kingdom

Germany

Sweden

Czech Republic

Spain

Housing cost ‘overburden’1 (% of total population)

12.1

15.9

8

10.5

10.9

Housing cost ‘overburden’ (% of owner-occupied with mortgage or loan)

6.3

11.3

2.9

8.3

9

Housing cost ‘overburden’ (% of owner-occupied, no mortgage)

4.3

4.8

5.6

6.2

2.8

Housing cost ‘overburden’ (% of those paying a market rent)

33.2

23.1

17.8

32.9

17.8

Overcrowded rate: total population2

7.2

6.6

10.7

19.9

5.3

Notes: 1 The housing cost overburden rate is the percentage of the population living in households where the total housing costs (‘net’ of housing allowances) represent more than 40 % of disposable income. Housing costs include maintenance, repairs and utilities, including water, electricity, gas and heating; 2 For Eurostat’s overcrowding definition, see http://ec.europa.eu/eurostat/statistics-explained/index.php/ Glossary:Overcrowding_rate Source: Eurostat (2016)

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The Fondation Abbé Pierre and FEANTSA (2016) published a European Housing Exclusion Index using 2014 data from Eurostat relating to: housing cost overburden; arrears; overcrowding; inability to keep home warm; and severe housing deprivation. Of the 28 countries, Sweden ranked 4th, Germany 9th, the Czech Republic 16th, Spain 17th and the UK 20th. The countries performing worse than the UK were the Southern Europe countries affected by the eurozone crisis and five Eastern European countries. The lack of an extended data time series prevents trend assessments and there are information inconsistencies but the Eurostat statistics indicate some tentative conclusions. The UK’s high ‘housing cost overburden’ for those in the market rent sector is a possible indication of its rent control parsimony but the UK’s lower overall ‘housing cost overburden’ compared to Germany reflects its high homeownership rate, demonstrating the impact of ‘lifetime’ housing costs. This raises questions on German reliance on private landlordism. In Germany 53.9% of people aged 30–59 and 45% of people aged over 60 were renting privately (Statistics Bundesamt, Deutschland, 2015) compared to 15.1% of households in England (aged 45–54) and 6.8% (aged 55–64) with only 5% of people aged over 65 in the private landlord sector ( DCLG, 2012). Most owner-occupiers over 65 in the UK own their home outright.

Housing outcomes (USA) In the USA, ‘Excessive Housing Cost Overburden’ is the most commonly used housing affordability measure. It refers to households spending more than 30% of their disposable income on housing with ‘Severe Housing Cost Overburden’ relating to more than 50% of disposable income being spent on housing. In 2014 about 33% of US households experienced an ‘Excessive Housing Cost Overburden’ including 16.5% with a ‘Severe Housing Cost Overburden’. Cost overburdens were concentrated in the private rented sector (Joint Center for Housing Studies, 2016). Property physical condition is assessed with regard to plumbing, heating, hallways, upkeep and electricity with, in 2011, 1.85% of households having ‘moderate’ problems and 3.7% ‘severe’ problems (Swartz, 2014). Crowding is gauged according to number of people per room with more than one person per room considered ‘crowded’ and more than 1.5 people per room ‘severely crowded’. The ‘crowded’ rate declined from 20% in 1940 to 4.5% in 1980 but had increased to 5.7% by 2000. By 2007 it had declined to 3%. The rented sector had the highest per cent of overcrowding: 5.5% of renting households lived in homes with more than two people per room (Joint Center for Housing Studies, 2016).

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Overview

• • •

Although comparative housing studies can contribute to an understanding of policy development and supply ideas for new housing policies, they are limited by the availability of data suitable for comparative analysis. Case studies of housing policy in different countries supply evidence on the relative contributions of structural economic and social factors and specific national politics in explaining housing policy. Since the mid-1980s, there has been evidence of convergence in housing policies and the ‘credit crunch’ impact illustrates both degree of interdependence between some national housing systems – influenced by globalisation – and the salience of embedded national pathways in housing policy.

Questions for discussion 1. What are the major differences between the countries included in Tables 4.1 and 4.2? 2. Examine the principal problems involved in comparative studies of housing policy. 3. Examine the impact of ‘the credit crunch’ on housing. 4. Can Sweden now be classified as an example of a ‘social democratic’ housing regime?

Further reading A comprehensive, albeit now out of date, account of Spanish housing policy is available in Allen et al (2004) Housing and welfare in Southern Europe. Martin Lux’s Housing Policy and housing finance in the Czech Republic during transition (2009) explores housing policy development in a former communist state. A good account of housing policy in the USA can be found in Alex Schwartz’s Housing policy in the United States (2014). Ashok Bardham, Robert H. Edelstein and Cynthia A. Kroll (eds) investigate the impact of the credit crunch in Global housing markets: crises, policies, and institutions (2012). ‘Social’ housing is examined in Social housing in Europe (2014) edited Kathleen Scanlon, Christine Whitehead and Melissa Fernández Arrigoitia and the private rented sector is explored in Private rental housing: comparative perspectives (2014), edited by Tony Crook and Peter A. Kemp. Milestones in European housing finance by Jens Lunde and Christine Whitehead (2016) examines mortgage finance.

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Websites The Joint Centre for Housing Studies, based at Harvard University, supplies comprehensive information on housing policy in the United States: www.jchs.harvard.edu The ‘Global property guide’ website provides statistics on house prices across the world: www.globalpropertyguide.com Eurostat is a valuable source of information about EU member states: http://ec.europa. eu/eurostat

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five Need, demand and supply Summary

• • • • • • • •

The rental market was dominant in housing supply throughout the 19th century, questioned only when ‘externalities’ were recognised. In the early 20th century the Labour movement identified a ‘housing famine’ and demanded state action to promote supply. Between the wars 1.1 million local authority houses were built. The 1930s was a ‘golden era’ in house construction for owner-occupation. From 1951 to 1979 the political parties competed in a housebuilding ‘numbers game’: 320,000 houses per annum were built from 1950 to 1979 with local government contributing an average of 155,000 per year. Housing supply declined from the early 1980s with planning control, a political fixation on choice and a distaste for ‘social’ housing being significant factors in this decline. The ‘credit crunch’ disrupted New Labour’s attempt to boost supply. The coalition government modified planning constraints to increase new house construction but, as the 2015 general election approached, development curbs were re-emphasised. The 2015 Cameron government declared its intention to concentrate new housebuilding for homeownership on brownfield sites, but Theresa May’s government appears to be more willing to promote affordable rented accommodation.

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Private landlordism The private rented sector housed the large growth and shift in population during the 19th century. Estimates of the proportion of houses owned by private landlords before 1914 are influenced by land tenure complexities and vary from 90% to 77% according to homeownership assessments. The typical residential market process was for freeholders to lease land for a perpetual annual ground rent (chief rent) or for a specified period at an annual ground rent. Sometimes the freehold was bought outright for cash. When in the right place, land value was high and Lloyd George constantly attacked landowners for making large profits from enhanced land values created by community investment. Builders/developers obtained finance from a variety of sources including short-term loans made by landowners and prospective purchasers plus longer-term mortgage advances from banks. Solicitors – important players in land and property transactions – also supplied a financial source via organising people interested in passive investment in urban growth into ‘building clubs’ (Offer, 1981). Building societies had a long history as ‘terminating’ societies. Working class people agreed to pay into a fund to build houses and, when sufficient funds had been accumulated buy a property, members drew lots to decide the first occupier. Payments continued until all subscribers owned a house when the society terminated. Some societies allowed people not requiring a house to join the society paying interest on the investment. The society then became ‘permanent’. In explaining ‘permanent’ building society expansion, Samy (2016, p 24) adopts Hansmann’s theory (Hansmann, 2000), stating: The theory is centred on the premise that small-scale investors and mortgage borrowers were vulnerable to opportunist behaviour on the part of holders of permanent capital and managers seeking to extract rent from them. The mutuals were a way of structuring property rights in such a way that allowed borrowers and investors to trust them. ‘Permanent’ building societies became an important financial source delivering about 38% of mortgage finance in the 1880s. Gauldie (1974) detects increasing middle class influence in their management, borrowing and lending. Sometimes developers acted as intermediates between landowner and builder but many builders acquired land directly. Because they were usually small firms, builders needed to sell the properties quickly to pay their loans and raise capital for new ventures. Residential landlords acquired the land and houses ‘realising’ their investment by renting to tenants over time. Most owned only a few properties and wanted an income-generating asset as a pension, there being few other opportunities for relatively safe investments: Pacione (1995, p 97) lists Glasgow landlords as ‘cowfeeder’, ‘carter’, ‘baker’ and ‘tinsmith’. Landlords put down

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part of the purchase cost, often borrowing the remainder from the same sources as builders but on longer terms. Tenants came from all social classes with rental agreement lengths varying according to class: one-year terms for the middle class and weekly lets for the working class, except in Scotland whose distinct legal system produced annual agreements for all. Some large scale landowners kept the entire building process in their hands, a few builders also rented and some landlords held sizeable portfolios. In Glasgow, for example, the average holding was 3.6 tenements, about 22 flats (Crook and Kemp, 2014). How well did the system perform? Gray (1968, pp 12,14) regards the 19th century as a time of ‘spontaneous improvement’ in housing conditions arguing ‘though population rose nearly fourfold between 1801 and 1901 the average number of people per house fell by almost a fifth …’ In contrast, Tames (1972, p 40) claims that the 19th century was ‘a great age of construction, but not of housing’. Building factories, warehouses, docks and public buildings was far more profitable than building working class houses. ‘The workers got what was left over’, because they could not afford the rents necessary to make housing more profitable than commercial development. Bentley (2016, p 9) quotes The Sanitary Record as observing in 1884 that ‘no practical plan has yet been devised by which dwellings can be built, which … can be let at these low rentals, and prove remunerative to builders’. Post 1903 there was a major decline in property values and an associated reduction in new house construction. Nationwide data is scarce, but, in London, new house construction was less than half its 1901 level (Samy, 2015), perhaps a reaction to rising prices in the 1890s and higher credit costs (Pigou and Rowntree, 1914). Property owners attributed the decline to the growing rate burden (Lund, 2016). State involvement in housing supply was very limited in the 19th century. Common lodging houses, regarded as a particular breeding grounds for crime and immorality (O’Neill, 2014), prompted action from philanthropic organisations such as The Society for Improving the Condition of the Labouring Classes, established in 1844 to build ‘model’ lodging houses. The dwellings – mainly aimed at single men and women – were spartan, hygienic and supervised by ‘fit and proper’ people. The Earl of Shaftesbury, Chair of The Society for Improving the Condition of the Labouring Classes, tried to encourage local authorities to build ‘model’ lodging houses via the 1851 Labouring Classes Lodging Houses Act. The capital required to build ‘model’ lodging houses came from public subscription or from loans acquired by local authorities but the rents charged – with no subsidy – when compared to the private ‘dosshouses’ were high. Gauldie (1974, p 240) comments, ‘House-building for the poor by the State was, nevertheless, unthinkable. The Act remained on the statute book, a dead letter’. When the 1890 Housing of the Working Classes Act allowed London authorities to build outside clearance areas, the London County Council (LCC) set up a

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Direct Labour Organisation (DLO). A few local authorities followed the LCC’s lead when they acquired housebuilding powers in 1900 (Ruddock, 1994). DLOs were regarded as a major threat to private enterprise. By 1914 only 20,000 local authority houses had been built. Birmingham’s attitude was typical. It set up a housing committee in 1901 but ‘… refused to recommend a large-sale programme of municipal building on the grounds that such a scheme would check private enterprise and require a means-test to make it work fairly’ (Briggs, 1952, p 85).

The 1919 Housing, Town Planning, etc. Act The 1919 Housing, Town Planning, etc Act – known as the Addison Act after the minister who introduced the legislation to parliament – marked a watershed in housing delivery. Working class unrest on rent increases during the First World War helped to produce a state commitment to local government as a housing supplier via state subsidies meeting costs above receipts from a penny on the rates. Unfortunately, the 1919 Act had a short life and, in 1921, the central government withdrew subsidies arguing that the housing market was overheated. In a letter to Winston Churchill who had protested about the Addison’s removal from the housing portfolio, Lloyd George claimed that Addison had ‘let contracts far in advance of the trade’s ability to assimilate’ so ‘… prices soared, higher and higher’ (Lloyd George, 1921, quoted in Hattersley, 2010, p 526). Nevertheless, with private housebuilding sluggish – in the middle 1920s ‘the shortfall of dwellings relative to potential households probably reached a peak of 1,500,000 …’ (Holmans, 1987, p 73) – house supply was a significant election issue. In power, the Conservatives found it politically expedient to restore assistance for local authority housing. Under the 1923 Housing, etc Act, known as the Chamberlain Act, subsidies were granted to local authorities and private enterprise to build homes but local government was allowed to build only when it had clearly demonstrated that private enterprise could not meet requirements. The 1924 Housing (Financial) Provisions Act (the Wheatley Act), passed by a minority Labour government, removed restrictions on local authority building and granted more generous subsidies to local government. Wheatley negotiated with the trade unions and building industry representatives promising certainty in housing construction via a planned building programme in return for ending restrictive practices and cooperation from the builders (Lund, 2016). Conservatives governments ran the Chamberlain and Wheatley Acts in parallel until 1933 when, as private building accelerated, all ‘general needs’ subsidies were axed with resources concentrated on inner-city slum clearance and overcrowding, subsidised under the 1930 Housing Act passed by a minority Labour government and the 1935 Housing Act. Over 1 million council houses were built between 1919 and 1939 (see Figure 5.1). The 1919 Housing, Town Planning, etc Act required local authorities to ‘consider the needs of their area with respect to the provision of houses for the

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Need, demand and supply

working classes, and submit to the Local Government Board [replaced by the Ministry of Health] a scheme for the exercise of their powers …’ stating ‘the approximate number and the nature of the houses to be provided by the local authority’. However, local authority enthusiasm for building new homes varied from place to place. The extent of private landlord representation on local councils was a significant factor but some local Conservatives strongly supporting council housing (Matthews, 2016). New-build quality deteriorated after 1921 and, when directed to building for clearance, housing quality was poor.

A golden housebuilding age? From 1929 to 1939, 3 million new houses were built for a population that increased by 2.1 million. Compare this to the 2 million new homes built between 2004 and 2014 for a population that increased by 4.8 million. The private sector was the main provider, making its most robust contribution between 1934 and 1939. There were many economic reasons for this private sector housebuilding boom. • In 1932, the Bank of England pushed down the interest rate to 2% where it remained until 1939. • State assistance in the form of: – direct subsidies for inexpensive, private sector houses; – tax relief on mortgage interest although the impact of such relief was modest because Schedule A tax had to be paid; and – local authority mortgage guarantees. • Local authority loans under the 1899 Small Dwellings Acquisitions Act and the 1925 Housing Act. • Suburban railway and road extension made it possible for more people to live at a distance from their place of work. This trend, together with the dearth of planning controls, enabled builders to erect dwellings on agricultural sites. In the inter-war period, building land was only 10% in real terms of its price in the 2000s (Aldred, 2010). Cheap land helped to keep prices stable at an average of £590, worth about £32,000 in 2015. • Finance for house purchase became more accessible because savings invested with building societies increased rapidly and some developers offered mortgage guarantees. The numerous building society offices offered a convenient and generally safe haven for middle class and skilled working class savings and their share of the mortgage market increased from 45% to 68% between 1925 and 1938. • Rent control made a traditional repository for petit bourgeoisie savings – direct investment in houses to let – less attractive. Many landlords sold their properties. Investment in private renting was very limited in the 1920s due to rent control

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and competition from homeownership and local authority housing but, from 1933, build to let increased. The political dominance of the Conservative Party seemed to make a return to rigid rent control unlikely and the 1933 Housing (Financial Provisions) Act allowed local authorities to guarantee loans made by building societies for rented accommodation. Between 1933 and 1939, over 350,000 homes were built for private renting. Figure 5.1: New housing construction, 1919–39 (thousands) 380

300

275

Local government Private enterprise 1230

198

725

790

1925/29

1930/34

202 1919/24

1935/39

Source: Adapted from Bowley (1945)

The sustained post-1935 private sector building boom reduced the UK deficit of houses to households by 810,000 (Holmans, 2000) but a 500,000 shortfall remained and many of the houses were in poor condition with 60% not having running hot water (Holmans, 1987).

The ‘numbers game’ Housing was the top issue for the public in the 1945 general election. The Labour Party argued that too many homes had been built for owner-occupation between the wars and not enough to rent. Local authority building was popular and Labour made council housing its primary housing objective. Given the problems involved in ramping up production after a war, Labour’s housing construction record was sound, reaching 190,000 in England in 1948, but production declined to 160,000 in 1950. The Conservatives condemned Labour’s record contrasting the number of houses built under Labour to the Conservative performance in the late 1930s. In meeting the Conservative’s 1951 manifesto promise to build 300,000 homes per year Harold Macmillan relied on local authorities and new towns that met with significant local resistance at their planning stage but, by the

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Need, demand and supply

early 1950s, were beginning to deliver homes. Public housebuilding from 1951 to 1954 was higher as a percentage of the new housing total than it had been under Labour (Boléat, 1982). Quantity, not quality, dominated the political housing debate from the 1950s to the early 1970s (see Box 5.1). In 1955, the Conservative Party manifesto highlighted the 350,000 homes scheduled to be built that year and indicated its housing programme would continue at this level. However, it added: Conservatives will see that good farm land is protected, that big towns are restrained from sprawling haphazardly into the countryside, and that development to relieve over crowded cities takes place where, and only where, there will be work and amenities available for the people who move. (Conservative Party, 1955) Green belts were designated and urban authorities were required to meet their housing needs within their boundaries by building flats. In the early 1960s, with land and house prices rising rapidly, the Conservatives were on the defensive on the housing issue and the 1964 Conservative Party manifesto matched Labour’s promise of 400,000 per year. In its 1966 manifesto Labour increased its target to 500,000 per year and this target was adopted by the Conservative Party but, in 1974, although total housing supply featured in the party manifestos, national targets disappeared to be gradually replaced by tenure ‘choice’ issues. This culminated in 1979 when the Conservative Party manifesto included a Right to Buy promise, at substantial discounts, for council and new town tenants plus, ‘as far as possible’, extending these rights to housing association tenants.

Box 5.1: Politicians on quantity and quality

• • • •

‘We must not only build quickly, we must build well. In the next year or so we will be judged by the number of houses we have put up. But in ten years we will be judged by the quality of those homes’ (Bevan, 1946) Hugh Dalton (1962, p 352), Bevan’s successor as housing minister in 1950, and sceptical on Bevan’s insistence on quality claimed ‘It was the total of new houses which counted with public opinion …’ ‘Macmillan kept his and his team’s eyes firmly fixed on the numbers … Totals were displayed in the department along the lines of a cricket scoreboard’ (Gimson, 2013, p 1) ‘“The people need more homes” Macmillan declared in a booklet, Houses 1952. … In practice this meant … reductions up to 100 square feet on minimum floor areas … the omissions of cupboards in bedrooms, smaller kitchens and entrance

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• •

halls reduced to a lobby in which there was space for neither coats nor prams gives a good idea of the consequences for what was officially dubbed “The People’s House”’ (Kynaston, 2007, p 54) ‘I did not have a philosophy. I was just a “more” man. I used to go to bed at night counting the number of houses I’d destroyed and the number of planning approvals that had been given … Just more’ (Joseph, 1972, quoted in Halcrow, 1989, p 31) ‘Labour has failed to honour its pledge to build 500,000 houses a year by 1970. It is scandalous that this year, as last year, fewer houses will be completed than in 1964 when Labour took over’ (Conservative Party, 1970)

Party competition on new house construction produced a high output level from 1951 to 1977 but this was mitigated by slum clearance with, for example, in 1971, 350,000 built but 95,000 houses lost through clearance. In the late 1940s, Direct Labour Organisations (DLOs) built most council houses (Langford, 1982) but their role declined from the 1950s when the Conservatives insisting that they paid the lowest union rates and must win every third contract in competition with the private sector. New housebuilding started to decline in the late 1970s, flat-lining at a much lower level due mainly to the decline in ‘social’ housing construction, until the 2008–09 ‘credit crunch’ when new construction plummeted (see Figure 5.2). Figure 5.2: Housing construction, 1944–2014 (thousands) 2,500

2,000

1,500

1,000

500

1940/44 1944/49 1950/54 1955/59 1960/64 1965/69 1970/74 1975/79 1980/84 1984/89 1990/94 1995/99 2000/04 2005/09 2010/14

0

Local authorities

Registered Social Landlords

Source: Adapted from DCLG (2016b), Wilcox et al (2016b)

110

Private Enterprise

Need, demand and supply

Of course, new housing construction is an incomplete additional housing supply measure – demolition and conversions also need to be taken into account. Most of the homes demolished in the ‘clearance drives’ were grossly ‘unfit for human habitation’ and could not be considered as part of the housing stock but others could have been reconditioned. In recent years, governments have published estimates of net additions to the housing stock (See Figure 5.3). Net additions has now become the official version of new home supply. Figure 5.3: Net additions to the housing stock, England, 2008/09–2014/15 200,000

150,000

100,000

50,000

Demolitions

Net change of use plus other gains

Net conversions

/1 20

14

4 20

13

/1

3 20

12

/1

2 20

11

/1

1 20

10

/1

0 /1 09 20

08 20

–50,000

/0

9

5

0

New Build

Source: DCLG (2016c)

Lean years The Conservatives Green belt policy – although influencing new home location – did not have a major impact on total housebuilding in the 1950s, 1960s and 1970s. The dominant ethos was that more houses were necessary and local authorities released sufficient land outside green belts to meet requirements. Until the early 1970s, public participation in planning was limited (Ravetz, 1986) but the Skeffington Committee (1969) suggested ways to extend involvement and some of its recommendations were included in the 1971 Town and Country Planning Act. The 1947 Housing and Town Planning Act had introduced structure

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plans compiled by county authorities and local plans produced by districts with unitary authorities producing a single plan. Plans took years to prepare and were in constant state of flux meaning that granting planning permission was often an ‘ad hoc’ process allowing ample opportunity to refuse an application if local opposition, made more potent by the 1971 Town and Country Planning Act, was sufficiently vociferous. There is strong evidence that local opposition to development curbed land availability in the 1980s (Cheshire and Shepperd, 1989). ‘Social’ housing decline contributed to the housing dearth. The Thatcher/ Major governments switched new housing construction from local government to housing associations and reduced production subsidies in favour of consumption subsidies in the forms of HB and tax relief on mortgage payments. The result was a substantial fall in the proportion of new ‘social’ houses built, down from 50% in 1978 to 19% in 1996. The 1980 Local Government, Planning and Land Act, requiring local authorities to make a set return on DLO activities marked the start of a process leading to a substantial reduction in the role of DLOs in new construction and maintenance (Ruddock, 1994). In the 1980s the Conservative stance on land release became increasingly restricted with William Waldegrave (2016, p 192), reflecting on his time as planning minister, declaring he resisted ‘unremitting pressure from the development lobby which argues that only the Town and Country Planning Act stands between Britain and growth akin to that of China’. This attitude continued into the 1990s. Revised household projections, predicting that 4.4 million extra households would require accommodation by 2016 – a 70% increase compared to previous projections (DoE, 1995) – met with the response that household formation should be checked. Stratagems such as encouraging students to apply to their nearest university, persuading elderly people to live with their children, reducing divorce and separation and restricting benefits were recommended (Secretary of State for the Environment, 1996, p 16). Of the remaining demand, 60% would be met on brownfield sites. New Labour It fell to New Labour to promote the housing supply deemed necessary to meet projected household growth. It failed. New Labour adopted the Conservatives’ ‘brownfield first’ policy and the proportion of houses built on brownfield sites increased from 53% in 1997 to 72% in 2004. However, inertia on total new house supply governed until the Treasury intervened. Structure plans were abolished in 2004 and replaced by a strengthened regional dimension with ‘regional spatial strategies’, put together by regional assemblies setting targets for inclusion in local plans. Regional spatial strategies met with strong objections and the approval process was protracted. Even when approved, the strategies were often ignored by local authorities (Morton, 2012). Following Kate Barker’s report on the planning system (Barker, 2006), New Labour attempted to strengthen the system by making

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price signals a factor in housing requirement forecasts and a new housing and planning delivery grant to local government for performance in delivering homes. It also insisted on at least a five-year land release rolling programme to meet projected requirements with a warning that if a local authority did not allocate sufficient land, obtaining planning permission would be easier (DCL, 2007). Examining the contention that the politics of the planning system inhibited new house construction, Coelho et al (2016, p 1) state: We test this theory by examining survey data on public attitudes to house building in local communities; and by investigating whether these attitudes are related to local planning decisions. We find that there is a tendency for owner-occupiers to express greater opposition to local house building and that, in the decade to 2011, the housing stock grew significantly less in local authorities with higher proportions of owner-occupiers among local households. The coalition government In opposition, the Conservatives attacked New Labour’s approach to land release that was unpopular in ‘middle England’. Matthews et al (2015, p 57) comment: During the period of expansionist planning policy, this manifested itself in strong opposition to “top-down” housing targets, particularly in the south-east of England and similar affluent, commuter-belt areas ... This provided the Conservative Party with an issue with strong political traction in key marginal constituencies. However, as Goodchild and Hammond (2013, p  10) have remarked, they were ‘caught between the demands of the market and local communities’. A Conservative Party green paper, published just before the 2010 election, promised developers ‘a presumption in favour of sustainable development’ and local communities a ‘basic national framework of planning priorities and policies, within which local people and their accountable local governments can produce their own distinctive local policies to create communities which are sustainable, attractive and good to live in’. It added ‘local people in each neighbourhood will be able to specify what kind of development and use of land they want to see in their area’ (Conservative Party, 2010a, pp 1, 3, 8). These proposals were included in the 2010 Conservative Party manifesto. The Liberal Democrats adopted a similar position declaring they would ‘return decision making, including housing targets, to local people’ (Liberal Democrats, 2010, p 81). The coalition government agreement announced the abolition of regional spatial strategies and

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the return of decision making powers on housing and planning to local councils (HM Government, 2010). In power, the coalition quickly abolished regional spatial strategies and the 2011 Localism Act supplied the legislative framework for neighbourhood planning and the determination of local need and supply by local government. However, a moribund economy and news that, following the abolition of regional spatial strategies, many local authorities had scaled back their housing targets, produced a Treasury-led rethink. The Draft National Planning Framework (DCLG, 2011) included many controversial proposals. It stated that local authorities should ‘grant permission where the plan is absent, silent, indeterminate or where relevant policies are out of date’ (p 4); ‘planning policies and decisions should take into account local circumstances and market signals such as land prices, commercial rents and housing affordability’ (p 5); and ‘plans should identify and maintain a rolling supply of specific deliverable sites sufficient to provide five years worth of housing against their housing requirements’ with ‘ an additional allowance of at least 20 per cent to ensure choice and competition in the market for land’ (p 30). There was no reference to brownfield development first and local authorities were warned against new green belt designation. Fierce opposition led by Campaign to Protect Rural England and the National Trust, backed by the Telegraph, led to a rethink. The final version of the National Planning Policy Framework included some limited concessions such as modifications to the timescales for site identification and that local authorities ‘should encourage the effective use of land by reusing land that has been previously developed brownfield land’ (DCLG, 2012a, p 6). Neighbourhood planning gained modest momentum with Wills (2016, p 35) stating ‘the latest figures indicate that more than 1500 plans are being developed’ but they were harnessed by having to conform to local plans when in place and being subject to independent scrutiny. Unsurprisingly far more neighbourhood plans were being prepared in affluent areas than in poor areas (Kaszynska et al, 2016) and most were anti-development (Turley Planning Consultants, 2014). The 2017 white paper Fixing our broken housing market (DCLG, 2017) suggested redirecting neighbourhood planning away from housing numbers towards design issues. The myth of ‘plan-led’ development was exposed when it was revealed that a large number of local authorities had no plan in place. Such authorities were given time to produce a plan before the ‘presumption in favour of sustainable development’ was applied in planning appeals and then the Secretary of State for Communities and Local Government managed the system, showing a tendency to refuse appeals from developers. The 2015 Conservative government The 2015 Conservative Party manifesto (p 54) stated:

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Our moors and meadows, wildlife and nature, air and water are a crucial part of our national identity and make our country what it is. So we care about them deeply, want to protect them for everyone and pass them onto future generations. It promised to protect the green belt and its principal proposal for new housing was the rapid release of brownfield sites, announcing: We will ensure that brownfield land is used as much as possible for new development. We will require local authorities to have a register of what is available, and ensure that 90 per cent of suitable brownfield sites have planning permission for housing by 2020. (Conservative Party, 2015, pp 51–2) Under Theresa May’s government, the Chancellor of the Exchequer, announced a change in the government’s national deficit policy. Additional resources were injected into new housing construction.

Housing requirements National It is conventional to make a distinction between housing need and housing demand. In 2010, the DCLG stated: These discussions also generally distinguish ‘need’ – shortfalls from certain normative standards of adequate accommodation – from ‘demand’ –the quantity and quality of housing which households will choose to occupy given their preferences and ability to pay (at given prices). (DCLG, 2010a, para 2.10) However, most estimates concentrate on need, dividing future requirements arising from demographic change from the ‘backlog’ of existing unmet need. Estimating future national housing requirements starts with population projections that are converted into the number of households expected to form. In 2015, the number of households in England was projected to increase from 22.3 million in 2012 to 23.4 million in 2017 and 24.5 million in 2022, reaching 27.5 million in 2037 (DCLG, 2015a). Assuming that each new household requires a separate house, then, to keep pace with new household formation, 220,000 houses per annum would be required between 2012 and 2037. However, reflecting on the 2015 projection, McDonald and Whitehead (2015, pp 2, 15) state:

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2012-based household projections suggest that England needs an extra 222,000 homes a year over the period 2011–31. That is 9% fewer than the 244,000 a year suggested by the 2008-based projections – the last full set of projections produced, which reflected conditions before the economic downturn … Finally, comparing the 2012-based projections with the DCLG house building statistics for the four years 2011–12 to 2014–15 suggests that over that period only just over 50% of the homes needed in England as a whole were built. In London the proportion was a third. The failure to build the homes required to house the additional households which the projections envisage will result in household formation rates lower than in the projections. In other words, a housing shortage reduces household formation thus producing a self-fulfilling prophesy – fewer houses, fewer households. A USA study found that headship rates (the number of separate households formed from the population) in the 25 least affordable metropolitan areas were 10% lower than those in the 25 most affordable metropolitan areas (Joint Center for Housing Studies, 2016). This pattern – fewer, more expensive houses equals lower household formation – was reflected in new UK projections published in 2016 (DCLG, 2016d) that lowered household formation projections to 210,000 per year between 2014 and 2039. A 1996 memorandum to the House of Commons Environment Committee by the Joseph Rowntree Foundation stated ‘to meet the demand for homes by private owners and the need for subsidised renting about 240,000 new homes will be required in the two decades 1991–2001 and 2011 in England’ (House of Commons Environment Committee, 1996, p 1). Between 1991 and 2011, 2.9 million new dwellings were built, a 1.9 million shortfall on projected requirements. Household projections tend to become regarded as estimates of future housing requirements. Politicians use them as progress yardsticks, with, for example, Raynsford (2016, p 63) declaring: net additions to the housing stock showed sustained improvements through the years up to 2007, in which year they totalled over 207,000, within touching distance of the level necessary to match new household formation. However, housing requirements ought to include an assessment of the ‘needs’ backlog including ‘concealed’ (single people, couples or lone parents with dependent children who involuntary live as part of someone else’s household) and overcrowded households. Bramley’s calculations indicated about 8.5% of households as having current unmet housing needs (Bramley, 2011) and Fitzpatrick et al (2015, p viii) draw attention to:

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a 2013 estimate of 2.23 million households containing concealed single persons in England, in addition to 265,000 concealed couples and lone parents. On the most recent (2012) figures 685,000 households (3.1%) were overcrowded in England, maintaining the higher levels seen over several years. The House of Lords Select Committee on Economic Affairs (2016, p 5) declared: The Government’s target of one million new homes by 2020 is not based on a robust analysis. To address the housing crisis at least 300,000 new homes are needed annually for the foreseeable future. One million homes by 2020 will not be enough. Local requirements Under its ‘localism’ agenda, the coalition government claimed that assessing housing need was a local government responsibility to be undertaken when local authorities prepared their local development plans. According to DCLG guidelines, plans had to be up to date and were likely to require updating in whole or in part at least every five years. Local plans had to be based on a ‘presumption in favour of sustainable development’ and ‘this should be done by identifying and providing for objectively assessed needs and by indicating how the presumption will be applied locally’ (DCLG, 2014, para 111). The local planning authority had a duty to cooperate with neighbouring authorities and the quality of a local authority’s housing needs assessment would be an important factor in the Planning Inspectorate’s judgement on the quality of a local authority’s development plan with rejection a possible outcome of an under par housing needs assessment. Central government guidelines on assessing local need have been limited and the methods used to assess need vary between authorities, a situation that the white paper Fixing our broken housing market (DCLG, 2017) claims will be corrected by a new standard methodology for assessing need. An example of a local need assessment is given in Box 5.2. Local housing requirement assessments could be brought together to give a national figure for housing requirements, but many local authorities still do not have an up to date, approved, local plan and, despite ‘a duty to cooperate’, the plans focus on local housing requirements.

Box 5.2: Barnet housing needs assessment Barnet London Borough Council (2015, p 1) states:

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The aim of the Housing Needs Assessment was to understand the potential growth in the number of households living in the borough over the next 10 years and the type of housing, in terms of tenure and size that might be required to meet the housing needs of these households. Figure 5.4 shows the overall approach taken by Barnet in developing its housing needs assessment.

Figure 5.4: Barnet London Borough Council’s approach to housing need assessment, 2015

INPUTS

Household growth data

Income data

Unit size requirements

Ownership and rental prices

CALCULATIONS Affordability tests

OUTPUTS

TRANSLATED TO

No of units required

Type of units required

Price of units required

Tenure of units required

The needs of the Barnet Personas

Source: Barnet London Borough Council, (2015, p 1)

Barnet calculated that 20,396 homes were required to meet household growth, 4,772 for concealed households, households lacking basic amenities and overcrowded private sector households plus 2,183 for other purposes such as households likely to be decanted from existing properties. This requirement was divided into houses required for homeownership, shared ownership and market and sub-market rents.

Devolution and development The planning systems in Scotland and Wales remain similar to those in England although in Scotland there are four Strategic Development Plan Areas that cover city-regions around Aberdeen, Dundee, Edinburgh and Glasgow. Plans for these

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strategic areas set the context for local development plans prepared by unitary authorities. In Wales, there is a Wales Spatial Plan, People, Places, Futures (Welsh Government, 2013), that sets a strategic framework to guide future development and policy interventions contained in local development plans. Planning Policy Wales (Welsh Government, 2014) is the equivalent of the National Planning Policy Framework in England and places great emphasis on sustainable development and ‘green’ issues with, for example, a statement that ‘previously developed (or brownfield) land should, wherever possible, be used in preference to greenfield sites’ (Welsh Government, 2014, p 57). Planning in Northern Ireland was centralised in the Department for the Environment with District Councils having no executive planning powers being only able to influence decisions through consultation. However, as part of local government reform the bulk of planning functions no longer rest with the Department. These powers were devolved to 11 new councils on 1 April 2015 and they, through their elected representatives, are responsible and accountable for most planning decisions. Table 5.1 sets out new housing construction per 1,000 population in England, Scotland, Wales and Northern Ireland. There are important variations in the proportion of ‘social housing’ built in each of the ‘home nations’. These are considered in Chapter Six. Table 5.1: New house completions per 1,000 population, selected years Year

England

Scotland

Wales

Northern Ireland

2001

2.6

4.4

2.9

8

2004

3

4.9

2.8

9.1

2006

3.2

5

2.9

10.3

2008

2.9

4.2

2.5

6

2010

2

3.1

1.9

4.4

2013

2

2.8

1.8

3

2014

2.1

3

1.9

3

Source: Adapted from Wilcox et al (2016b)

Promoting housing supply There are a number of levers available to stimulate housing supply. This chapter focuses on planning. Later chapters, especially Chapter Eleven, examine other mechanisms such tax changes, new sources of housing investment and direct subsidies.

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Brownfield development ‘Brownfield’ refers to land previously used for industrial purposes or some commercial uses. Some ‘brownfield’ land may have been polluted by hazardous waste. Cameron’s 2015 Conservative government prioritised the use of brownfield land for development claiming it would build 200,000 discounted ‘starter homes’ on brownfield sites. It announced a package of measures to support the goal of over 90% of suitable brownfield land to be used 2020. This package included creating a number of ‘housing zones’ inside and outside London where £200 million of government finance for infrastructure would be available; amendments to the Community Infrastructure Levy (see Chapter Six) to support brownfield development and requiring local authorities to use local development orders (giving a grant of planning permission to specific types of development within a defined area) to accelerate planning permission for brownfield sites. Research by the University of the West of England identified sufficient brownfield land for 960,000 homes in England. This is about a four-year supply at current housing requirement estimates and up to 40% of sites may unprofitable to develop (Hudson, 2015). Moreover, an impact assessment impact assessment for the National Planning Policy Framework (DCLG, 2012c, p 42) commented that brownfield site use ‘… had negative outcomes, resulting in imbalances in housing provision for example between blocks of flats and family homes with gardens’. In 2014/15 brownfield new-build dwelling density was 37 per hectare, compared to 27 for non-previously developed land (DCLG, 2016e). Some existing brownfield site developments have encountered problems. Burrows (2015) comments: Barking Riverside, the UK’s largest brownfield regeneration scheme, is estranged even from the traffic-clogged A13 by swaths of industrial land, which cut it off from Barking town centre and the other more lived-in bits of east London’s edgelands to the north and the Thames to the south. Despite there being 1,800 people already living in Barking Riverside (and an estimated 2,500 in the 90s-built Barking Reach and Great Fleete developments nearby) there’s nowhere to sit and have coffee, no pub, no police station, no youth club, no football pitch – unless you hire it from the school – and the doctor’s surgery will only open when there are 10,000 people living here. Reforming compulsory purchase by local government Land compulsory purchase by local government for regeneration is time consuming and expensive, although the 2016 Neighbourhood Planning Bill contained such proposals to simplify the system. Radcliffe (2016) states that local authorities

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can issue Compulsory Purchase Orders for new housing development, but only if planning consent is already granted and quick delivery can be guaranteed. Moreover, compensation is determined by the intended land use value, not existing use value. If sufficient land at reasonable cost for new housing is to be released, then all local authorities require the powers to develop land banks by the compulsory purchase of land at existing use value. Compulsory purchase may have a role in countering ‘land banking’ by developers. Developers purchase land well before they start on site therefore a significant part of their profit comes from land-price increases and they delay building to secure the maximum value for their land. In 2016, although planning approvals had increased by 60% since 2010, there had only been a 48% increase in the number of homes built (Wright, 2016). At the 2016 Conservative Party Conference, Sajid Javid, Secretary of State for Communities and Local Government, called on developers to ‘release their stranglehold’ over land and ‘stop building up land banks’ (quoted in Bury and Fraser, 2016, p 1). Greenfield sites Greenfield land is undeveloped land in a city or rural area used for agriculture or left to evolve naturally. A green belt is an area of land around a city, on which building is restricted. Green belts contain buildings, brownfield land and scrubland. The National Planning Policy Framework (DCLG, 2012a) has the capacity to enhance supply by promoting development on greenfield sites to meet housing requirements as identified in local development plans. The 2015 Liberal Democrat manifesto, perhaps using insider knowledge gained in the coalition government, suggested that local plans would have to meet housing requirements for 15 years and respond to ‘demand, including through price signals, rather than simply need’ (Liberal Democrats, 2015, p 97). Unfortunately, local plan preparation has been painfully slow. The House of Commons Communities and Local Government Select Committee (2016b, p 21) stated: ‘We are disappointed that four years after the NPPF [National Planning Policy Framework] was published, 17 per cent of local authorities have still not published Local Plans and 34 per cent have not yet adopted Plans’. The Local Plans Expert Group (2016), set up by the DCLG to consider how local plan-making can be made more efficient and effective, set out a list the problems involved in constructing plans. In approximate order these were: • agreeing housing needs; • difficulties with the duty to cooperate, including the distribution of unmet housing needs; • a lack of political will and commitment; • a lack of clarity on key issues, particularly Strategic Housing Market Assessments, strategic planning, green belt and environmental constraints;

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• too many changes – changes of policy, advice and factual changes in forecasts (‘moving the goalposts’); and • a lack of guidance, support and resources. Moreover, Alex Morton (2016, p 1), having left his position as housing advisor to the prime minister, stated: when I was in Number 10 and dug out the figures (which officials were not keen to share) fewer than ten councils (out of 326) turned out to have an up to date local plan and deliver their housing need. A similar number do so without an up to date local plan. Thus over 300 councils failed to oversee delivery of housing need. This is the housing crisis in a nutshell. The Conservative government announced that if a local authority had not delivered a plan by 2017 the government would write one for it and, to speed up housing delivery, it would review the New Homes Bonus (see Chapter Six), perhaps introducing a housing delivery test involving comparing the housing targets identified in a local authority’s local plan with net additions to housing supply. Community land auctions Community land auctions have been proposed as a way to encourage local authorities to release land. Leunig (2011) suggested that local authorities should invite offers of land from landowners for which they would be able to pay up to five times the value of existing agricultural land use. Planning permission would be granted on selected sites and local authorities would then put the sites up for auction to developers. The scheme would provide considerable incentives for local government to grant planning permission – well above the ‘New Homes Bonus’ enticement – and cut out protracted ‘community benefit’ negotiations between local government and developers. The coalition government showed a fleeting interest in the idea – a pilot scheme was announced in George Osborne’s 2011 budget – but the idea now has a very low profile. Green belt land release Significantly green belt protection was absent from the Labour and Liberal Democrat 2015 manifestos. Green belts are a contentious element in the planning system (see Box 5.3).

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Box 5.3: Green belts – for and against Green belts were a social reformist idea aimed at preventing conurbation sprawl, providing ‘green lung’ for recreation, preserving ‘valuable agricultural land’ and promoting new town development. Post 1955 green belts became a Conservative mechanism for protecting ‘middle England’ from urbanite settlements. In the 1980s, the new town idea, aimed at complementing the containment of conurbation growth via green belts, was abandoned. Even an attempt by a major developer consortium to build 15 ‘private enterprise’ new country towns around London was thwarted by virulent opposition from the ‘Conservative grassroots of England’s outer south-east’ (Ward, 2005, pp 352–3). Green belts are now close to the hearts of environmentalists and ‘middle England’. They have strong public support albeit based on some misconceptions. Although 54% of the public believe that around half of England is developed and 10% think that more than 75% is developed (Barker, 2006) less than 10% of all land in England is classified as ‘built up’ (including gardens): 72.3% is agricultural with over a third of agricultural land consisting of ‘grasses and rough grazing’ (Aldred, 2010, p 9). Designated green belt covers about 13% of England’s land area: 1,638,610 hectares (Smith, 2015). In favour • They prevent ‘urban sprawl’. • They force development into existing built-up areas and thereby assist urban regeneration. • Constructing homes at higher densities on brownfield sites has contributed to environmental sustainability by concentrating activity and thereby reducing residents’ overall ecological footprint. • They protect the setting and special character of historic towns. • They preserve valuable agricultural land. • The Ipsos/Mori poll carried out for the Barker Review of Land Use Planning (Barker, 2006) found that 60% of respondents thought that green belts protected wildlife and 46% believed that they preserved areas of natural beauty. Against • Not all green belt land is green – part is scrubland and even the Campaign to Protection of Rural England classifies 18% of green belt land as ‘neglected’ (CPRE, 2010). • Champion (2010, p viii) points out: more affluent households have ‘leapfrogged’ the green belt into the smaller towns and villages beyond. Not only has this had with implications for commuter journeys, congestion and pollution but the galloping ‘residential gentrification’ of much of Britain and a virtual embargo on new business enterprise … represents

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a double whammy as far as the continued presence of less well-off families in the countryside is concerned.

• • •

37% of green belt land is used for intensive agriculture (Papworth, 2015). Although justified as a ‘green lung’ for urban dwellers, most land in green belts is privately owned with very restricted public access. Green belts force up land and house prices and thereby contribute to building expensive, small houses. New homes built in England are much smaller than the European norm.

The 2015 Conservative government recognised that not all green belt land is green and promoted brownfield site release within green belts. The Campaign to Protect Rural England (CPRE, 2016) noted that, due to lower rural wages and higher house prices, only 8% of rural housing is ‘affordable’ compared to 20% of the urban housing stock. It recommended that landowners in rural areas – some owning green belt land – should be granted tax concessions to release land for ‘affordable’ houses and that landowners should have nomination rights to ensure that the houses were occupied by local people. New towns/garden cities Established new towns have had mixed fortunes but Harold Macmillan said they were a ‘profitable venture’ (Macmillan, 1969, p 418) with the new towns surrounding London compensating for the less successful ventures elsewhere. Margaret Thatcher quietly dismantled the new town corporations and, even when proposed by private enterprise, rejected additional new towns. Gordon Brown attempted to revive the new town idea in the form of eco-towns but his initiative foundered in the credit crunch and opposition from areas where ecotowns where to be located. Although initially enthusiastic, David Cameron, on meeting ‘middle England’ resistance, almost abandoned the idea, endorsing only two existing commitments in Ebbsfleet and Bicester. Theresa May’s government has shown more commitment to garden towns announcing support for additional garden towns bringing the total commitment to seven. New towns have considerable merits. Created by Development Corporations with planning powers, after the initial designation brouhaha, they can expand housing production rapidly and land value enhancement can be used for community purposes. Moreover, energy efficiency and healthy living can form part of their rationale – NHS England is now involved in attempts to create ten new ‘healthy towns (NHS England, 2016). Labour’s 2015 general election manifesto (2015, p 46) stated ‘to boost the housing we need, we will start to build a new generation of garden cities’. The Liberal Democrats promised ‘at least

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ten new Garden Cities in England, in areas where there is local support’ (Liberal Democrats, 2015, p 96) and that rural local authorities would be encouraged to develop new garden villages or suburbs. Garden villages have been cautiously supported by the 2015 Conservative government with the DCLG (2016f, p 5) stating ‘Our intention at this stage is to support up to 12 new garden village proposals’ and inviting expressions of interest for new free-standing garden villages of between 1,500 to 10,000 homes. The housebuilding record of New Labour and the coalition government was poor. Tony Blair showed no interest in housing policy. His autobiography makes only two references to housing – one to his first speech as prime minister made at the Aylesbury Estate and the other to his personal housing situation. Just before resigning as prime minister, Blair remarked ‘Cherie and I had been out of the London housing market since 1997, during which time prices had rocketed’ (Blair, 2010, p 504). When New Labour began to appreciate that action was necessary to boost supply, the ‘credit crunch’ soon stalled housing production, The coalition government’s record was worse than New Labour’s with only 579,850 houses built in England during its term in office compared to 749,660 in the last five years of New Labour governance. Time was lost in promoting the ‘localism’ agenda and, having accepted new house construction as an economic growth lever in 2012, Conservative enthusiasm waned as the depth of ‘middle England’ opposition became manifest.

Overview

• • • • • •

Private landlords dominated housing supply in the 19th century. At the Labour movement’s insistence, local authorities started to have a significant role in new house construction. After 1951, quantity, not quality, dominated the housing issue. Planning control, aversion to ‘social’ housing and a focus on choice rather than supply influenced the post-1970s decline in new house construction. The 2008–09 ‘credit crunch’ disrupted New Labour’s attempt to boost supply. Planning control was adjusted by the coalition government to stimulate supply but political factors swayed the Conservative Party towards building on brownfield sites.

Questions for discussion 1. Why did the role of private landlords in new housing supply decline in the 20th century? 2. Compare policy on new housing construction in the 1930s with policy in the 2000s. 3. Green belts protect privilege. Discuss. 4. Examine the merits and limitations of a ‘brownfield first’ policy.

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Further reading Peter Kemp’s, ‘Housing Landlordism in late nineteenth-century Britain’, Environment and Planning, vol 14, no.11, pp 1437–47 (1982) explores the operations of private landlordism in the 19th century. ‘Turning houses into gold: the failure of British planning’ by Paul Cheshire of CentrePiece (2014) is a robust polemic on the planning system’s impact. Housing and the State 1919–1944 by Marion Bowley (1945) is a good account of housing supply policy between the wars. The new town story is well told in Anthony Alexander’s Britain’s New Towns: Garden Cities to Sustainable Communities (2009).

Websites Campaign to Protect Rural England: www.cpre.org.uk Town and Country Planning Association: www.tcpa.org.uk The House of Commons Research Briefings site contains many informative accounts of the ways the planning system operates in England: http://researchbriefings.parliament.uk

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six ‘Affordable’ housing Summary

• • • • • •

‘Affordability’ is a nebulous term, interpreted in different ways. Producer subsidies, ‘rent pooling’, rent control and means-tested housing allowances have helped to make rented accommodation less expensive. Tax concessions and improvement grants have supported homeowners but, in recent years, state assistance has become more concentrated on first-time buyers. Since the early 1990s, the physical planning system has been used to secure more ‘affordable’ housing. In 1988 rent control was abolished for new lettings and the private landlord sector receives state assistance via tax breaks and grants. The coalition government labelled accommodation let by housing associations at below 80% of the local market price as ‘affordable’ and the 2015 Conservative government applied the term ‘affordable’ to ‘starter homes’, available to buy at 20% below market price.

In establishing what housing costs should be, market price has been the dominant norm. Indeed, commentators working within the neoliberal perspective maintain that, if a tenant does not pay a market rent, they are subsidised even if the tenant has paid the historic cost (and more) for his/her accommodation. As examples, Davis and Field (2012, p 9) state:

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The subsidy for social housing rent varies by region but is substantial. Social rents are well below market rents, ranging from around 60 per cent of private rents in the North to less than 40 per cent in London. While Chancellor of the Exchequer, George Osborne asserted ‘social housing is subsidised because the price of private rental stock is the real price, reached by logic of the market’ (Osborne, 2015a). Thus, when assessing ‘affordability’, market price has become the dominant benchmark with the state intervening – via consumer subsidies, debt extension measures, deposit raising support and other means – to make housing more ‘affordable’. An alternative approach would be focus on reducing housing production costs. Box 6.1 sets out the historical forms of state housing market intervention aimed at reducing housing costs.

Box 6.1: State intervention in the housing market Direct subsidies can be given to housing producers or consumers and can be meanstested or not means-tested (universal). When not subject to a direct income test, state assistance is usually linked to other selective criteria.

Table 6.1: Consumer and producer subsidies Means-tested

Universal

Consumer

Housing benefit Improvement grants after 1989 Disabled facilities grant (households without children under 19) Energy efficiency grants Mortgage benefit (income support)

Improvement grants before 1989 (subject to dwelling value) Low cost homeownership schemes supplied by housing associations (subject to area and job criteria plus a maximum income condition) Right to Buy discounts Tax allowances such as on mortgage interest tax relief (until 2000) and exemption from capital gains tax for homeowners Disabled facilities grant (households with children under 19) Rent control often subject to rateable value limits Help to Buy (subject to restrictions) ‘Starter homes’

Producer

Improvement grants for private landlords at certain times in the past.

‘Social’ and ‘affordable’ housing grants Private landlord tax concessions and grants. Section 106 agreements aimed at supplying housing at lower than market costs New homes bonus

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‘Affordable’ housing

What is ‘affordable’ housing? According to Fears, Wilson and Barton (2016, p 3): Currently, the most commonly referred to definition of affordable housing is set out in Annex 2 to the National Planning Policy Framework (NPPF). This is the definition that local planning authorities apply when making provision within their areas to meet local demand/need for affordable housing. The National Planning Policy Framework (DCLG, 2012a, p 50) defines affordable housing as ‘Social rented, affordable rented and intermediate housing, provided to eligible households whose needs are not met by the market. Eligibility is determined with regard to local incomes and local house prices’. Rented accommodation Affordability in the rented sector has been assessed in a number of ways. The ‘safety net’ approach is linked to the perception of housing as a necessity and a concern that, if a high income proportion has to be devoted to housing costs, then insufficient resources will be available for other essentials. Sometimes called ‘the residual income approach’, this understanding formed the rationale for housing benefit (HB). In recent years, HB has become more selective and directed towards preventing post-rent incomes falling below the basic social assistance level. Given that HB – now being absorbed into Universal Credit (UC) – pays all rent up to a prescribed maximum if income is very low, then any rent ‘unaffordable’ on the ‘safety net’ definition is due to inefficiency in HB operation. Indeed, on this interpretation, if HB functions efficiently, there is no ‘safety net’ reason why all rents should be not be at market levels (DCLG, 2009a). Pushing all rents to market level was the strategy incorporated into the 1988 Housing Act. Nicholas Ridley, the Minister then responsible for housing said: I saw the solution as being to provide housing benefit on a sufficiently generous scale to enable all tenants to be in a position to pay their rents, and at the same time to bring rents up towards market levels. (Ridley, 1991, p 88) The coalition government’s introduction of ‘affordable’ rents reflected Ridley’s approach. A distinction was made between ‘social’ housing for which ‘guideline target rents’ were determined through a national rent regime and ‘affordable’ rented housing requiring rent to be no more than 80% of the local market rent. Concentrating new build on ‘affordable rented housing’ and transferring part

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of the existing ‘social’ housing’ stock to the ‘affordable’ category would stretch available resources with HB protecting those on low incomes from the full rent impact. However, various conditions on HB entitlements have restricted its effectiveness as a ‘safety net’. Confining state help to low-income renters requires rapid assistance withdrawal as income rises. This raises concern that reliance on the ‘safety net’ objective discourages entry into the paid workforce or, if in employment, working harder and longer – the ‘poverty trap’ (see Figure 6.1). Of course, those out of work can be encouraged into work by benefit sanctions but a different way to interpret ‘affordability’ is to maintain that the rent paid should leave sufficient resources available for other requirements without the need to claim a housing cost related and means-tested benefit if a household member is in work. In 1989, following the Conservative government’s declaration that all rent should gradually move to market levels, the Housing Corporation, adopting a different approach, stated: ‘Associations are … expected to set and maintain their rent at levels that are within the reach of those in low paid employment’ (Housing Corporation, 1989, p 1). The National Federation of Housing Associations (NFHA) – now the National Housing Federation (NFA) – set an ‘affordability test’ claiming ‘rents are affordable if the majority of working households taking up new tenancies are not caught in the poverty trap (because of dependency on HB) or paying more than 25% of Figure 6.1: The ‘poverty trap’ – gross weekly income at which HB stops according to weekly rent, 2015/16 £900.00 £800.00 £700.00 £600.00 £500.00 £400.00 £300.00 £200.00 £100.00 £0.00 Single person over 25

Lone Parent plus 1 child under 19

Source: Adapted from Wilcox et al (2016b)

130

Couple plus 2 children under 19

Couple plus 4 children under 19

‘Affordable’ housing

their income in rent’ (NFHA, 1995, p 4). This benchmark reflected a convention, widely applied in housing studies, to measure ‘affordability’ in terms of rent to income ratio. Although the 25% yardstick has a long history – ‘one week’s pay for one month’s rent’ was a common rule of thumb in the 19th century – it is arbitrary and other countries use different benchmarks with 30%, 35% or 40% often applied. ‘Living rent’ is a variation on the NFHA’s proposal with rents set in the ‘social’ housing sector in relationship to low-income household earnings (Lupton and Collins, 2015), an idea that could be extended, via rent control, into the private rented sector. Eurostat (2016) assesses ‘affordability’ according to a ‘housing cost overburden’ (see Chapter Four). Shelter enlisted public perceptions to define affordability. To be affordable a home had to meet the essentials of ‘can meet the rent or mortgage payments on the home without regularly having to cut spending on household essentials like food or heating’ and not cause worry ‘that rent or mortgage payments could rise to a level that would be difficult to pay’, plus one of two ‘tradables’: ‘features many people believed were important, but they were not universally applicable to or equally desired by everyone’ (Shelter, 2016b, p 8). These were ‘can meet rent or mortgage payments on the home without regularly preventing participation in social activities’ or ‘can meet the rent or mortgage payments on the home without regularly being prevented from putting enough money aside to cover unexpected costs’ (Shelter, 2016a, pp 15–16). On this definition, 27% of all UK homes were not affordable: 4% owned without a mortgage; 28% owned with a mortgage; 47% private rented; 48% local authority rented and 47% rented from a housing association (Shelter, 2016b). Local authorities vary in the criteria they use to assess ‘affordability’ in the rented sector. As examples, Barnet London Borough Council (2015, p 2) stated: Department of Work and Pensions (DWP) income thresholds net of housing were used to assess affordability for rented accommodation. The measure used was that after housing costs had been taken into account, a household would have to have 10% more than the DWP income threshold left for all other expenses. Canterbury City Council (2015, pp 30–1) states: In respect of renting, there is no official, or definitive, threshold for how much a household can spend on rent before it is unaffordable, but examination of a range of sources suggested ‘broad rules of thumb between 25% and 35% gross income as being the appropriate threshold’

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… These were applied in Canterbury to identify the proportion of such households that can afford to access lower quartile market housing. ‘Affordable’ homeownership Examining the decline in homeownership since the early 2000s the Redfern Review (Redfern, 2016, p 10) noted: The decline has been steepest amongst young people. Whilst the rate of home ownership fell from 70.9% in 2003 to 63.6% today overall (-7.3 percentage points), for those ages 25-34 it fell from 58.6% to 36.7% (-21.9 percentage points). Since 1996 real house prices have increased by 151% while real earnings have risen by only 39%. Moreover, the incomes of younger people aged 28 to 40, relative to those aged 40-65, have fallen by 10% since the onset of the recession in 2008. When applied to owner-occupation, house price relative to income or earnings is often used as an affordability indicator. Other measures incorporate interest rates and some such as the Nationwide First-time Buyer Index – measuring the ratio of first-time buyer prices to mean ‘take-home pay’ – focus on first-time buyers. The relationship between lower quartile house prices and lower quartile earnings is also used. These standards allow relative affordability to be tracked over time but lack a normative benchmark. Eurostat (2016) applies 40% or more of equivalised disposable household income after benefits to homeowners as well as renters as its ‘housing cost overburden’ threshold. The 2016 Housing and Planning Act inserted a new ‘affordable’ housing definition into the Town and Country Planning Act 1990 defining ‘affordable’ housing as ‘being for people whose needs are not adequately served by the commercial housing market’ and included ‘starter homes’, at 80% of market value. A variety of criteria are used by local authorities to assess homeownership affordability. Barnet (2015, p 2), for example, states: For outright ownership of a home, the test of affordability used was that after having paid a 10% deposit, a household would need to be able to service a mortgage of four times their income. To afford shared ownership, a household must be able to place a 10% deposit and have sufficient household income to service a 40% tranche of the purchase price. This test was applied to median house prices in the area.

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Carlisle City Council (2015) used access to a lower quartile house price in assessing homeownership affordability applying 3.5 times income to indicate if households could buy a lower quartile price house. Deposits Access to homeownership depends not only on the ability to afford repayments but on access to a deposit; indeed the Redfern Review (2016) placed deposit access above house prices in accounting for the decline in homeownership and, as has happened in the United States, saving for a deposit will become more difficult as the debt from student loans increases. Post 2016 it has been estimated that student debt will average £44,000 and there has been a significant decline in the per cent of final-year students expecting to become homeowners (Redfern, 2016, p 40). Opening the mortgage market to competition in the late 1980s, which led to lower deposits, contributed to a price boom. The subsequent bust made lenders more circumspect in awarding loans and, between 2007 and 2016, the average first-time buyer deposit more than doubled from £16,400 to £33,960 (Halifax, 2016). The ‘Bank of Mum and Dad’ helped with deposits as did the government’s ‘Help to Buy’ schemes (see Box 6.2). Wilcox et al (2015, p 10) commented: … with government … having acted to underpin house prices, preventing a full price re-adjustment and continuing to support at least a third of the 311,000 first-time buyers … getting onto the ‘ladder’ in 2014. With parents supporting another third, we have only around 100,000 buyers making it on their own – a real indication of how far we have to go.

Box 6.2: Help to Buy The coalition government set up a number of demand side schemes to try to boost homeownership. Introduced in 2013 to replace Labour’s FirstBuy scheme, aimed at firsttime buyers, Help to Buy Equity Loan offered those with a 5% deposit a government loan of 20% of the price of a newly built house up to the value of £600,000. The government took a 20% equity share and loan fees were not payable on the 20% loan for the first five years. From February 2016, the government increased the upper limit for the equity loan within Greater London from 20% to 40%. This scheme was supplemented by the Help to Buy Mortgage Guarantee designed to ‘increase the appetite of mortgage lenders for high loan-to-value lending to creditworthy customers’ (HM Treasury, 2013, p  3). According to Saunders (2016, p 86), the government believed ‘its ultimate guarantee

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is enough to insure up to £130 billion worth of mortgages (some 10 per cent of the nation’s total housing debt)’. It allowed lenders to buy a mortgage guarantee from the government allowing them to offer home buyers more high loan-to-value mortgages. The scheme, not restricted to new build, helped 86,000 households by mid-2016 but was ended on 31 December 2016.

Affordability in the 19th century Market rents dominated housing costs in the 19th century but slum ‘externalities’ gradually pushed ‘affordability’ towards social problem status. In replacing slums, the government relied on voluntary organisations whose investors limited their return on capital investment to 5%. Unfortunately, the rents necessary to supply a 5% return – or less in the case of some charitable associations – were beyond the means of many working class households. For example, the Peabody Trust’s austere but sanitary accommodation absorbed about 50% of low paid workers’ wages. Moreover, Gauldie (1974, p 235) maintains: The poor were, in any case, not attracted by the prospect of living in model dwellings. The rules, which forbade noise and demanded temperance … were too numerous and too repressive for the large majority of the noisy London poor. Certain trades, like costermongers were excluded by the rules and the lack of accommodation for their donkeys and casts. Direct local authority provision encountered the same problems – new homes were well beyond unskilled labourers’ means (Fisher, 1902). Conservatives and Liberals deplored state housing subsidies. As Harloe (1991, p 98) comments: objections to subsidies took many forms – they would privilege a few unfairly, breed dependence, inhibit thrift and self-reliance and be open to political abuse and encourage bureaucratic inefficient state provision (all arguments still familiar today). The ‘new’ Liberalism was especially vehement in its subsidy condemnation, arguing that such ‘doles’ undermined character and depressed the wages available to the ‘independent’ worker. This unwillingness to allow state subsidies, despite limited concealed assistance by writing down land acquisition costs, meant labourers did not move into the properties – an outcome defended by ‘filtering theory’ with James Hole declaring in 1866 that ‘by increasing the number of first class houses for mechanics the

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vacated tenements increase the supply for the second and third classes and thus all classes are befitted’ (quoted in Boddy and Gray, 1979, p 43). Octavia Hill adopted a different approach. She recognised that ‘trickle down’ did not work because new demand was created by migration into cities and the national population increase so she bought dilapidated properties, carried out urgent repairs and then rented the dwellings to tenants able to pay on a regular basis for a reconditioned dwelling. Although her tenants were poor – not the better-paid artisans housed by the model dwellings companies – ‘her flats could not be easily afforded by those earning less than a regular 16s to 18s’ (Wohl, 1977, p 182). Hence, the ‘very poor’, about 16.5% of London’s population, could not afford to live in her properties and, if they fell into arrears, Hill evicted them.

Standards and affordability The Tudor Walters Committee (1918), established to make recommendations on the standard of working class dwellings to be constructed, highlighted the affordability issue. It specifically rejected the use of the Glasgow tenement and recommended far higher future housing standards (see Chapter Two). It accepted ‘upfront’ state subsidies as necessary to achieve these standards but argued that the ultimate level of subsidy would depend on the relationship between the initial cost of the dwelling and rental income over 60 years indicating that, in time, the dwellings would require no subsidy because rents would meet historic costs. The houses built under the 1919 Housing and Town Planning Act were high quality but, despite the subsidy, expensive to rent. They were occupied mainly by skilled workers or by the middle class; indeed, some local authorities used a means test to select only high income tenants. Speaking about one of the first council estates built in Liverpool, a former tenant remarked: It was posh, our next-door neighbour used to have tea on the grass, the lawn she used to call it. Some of them even had cars, even in them days, and yes, a number used to have cleaning ladies to do for them. (quoted in McKenna, 1991, p 182) Attempts were made to overcome the cost problem in the 1920s by reducing council housing quality but, even with lower standards, many tenants still found it difficult to pay the rent and resorted to ‘strategies that had served them in the old areas: the pawnshop, hire purchase, reducing expenditure on food, or taking in lodgers …’ (Olecnowicz, 1997, p 7). The problem was compounded in the 1930s when local authorities, directed towards meeting the housing needs arising from slum clearance, were confronted by the slum dwellers’ very low incomes. Further reductions in quality were made with the average council house cost declining from 77% of an owner-occupied house in 1934 to 50% in 1939. Dwellings built

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for former slum inhabitants were mainly blocks of flats. Branson and Heinemann (1973, p 211) state: For the most part the blocks built at this time were severely utilitarian in character. Often five storeys high, they were usually served by concrete staircases with outside balcony access making one side dark and noisy. The rooms were small – hot water had to be pumped to the bath from a copper boiler installed in the kitchen. Some of these blocks seemed to emphasise that they were rough places for rough people. White (1950, p 16) notes that on these ‘slum clearance estates’ there was ‘no land to spare for gardens, or adequate playing space for the children and no money for such facilities as communal laundries, nurseries, workshops or clubrooms’. Yet, even with lower standards, the affordability question remained. The 1930 Housing Act contained a provision to allow local authorities to operate ‘differential’ rents but few authorities adopted such schemes either in the form of individual rent rebates or variable rents for ‘compulsory’ (re-housed from clearance areas) compared to ‘voluntary’ (re-housed from the waiting list) tenants. Council tenants with reasonable incomes strongly opposed such schemes and used their ballot box power to penalise politicians who introduced them (Lund, 2016). Moreover, many local authorities believed that means-tested subsidies were step towards housing support becoming a major ratepayer responsibility because ‘poor relief ’ could be interpreted as a public assistance matter, a traditional local government responsibility.

From producer to consumer subsidies Between 1945 and 1972 rented housing was made more affordable by rent control in the private landlord sector and continued central subsidies to local government. Rent control was perhaps the most effective low-cost homeownership scheme ever devised. Landlords either sold their properties to existing tenants or on vacant possession to owner-occupiers, with 4.5 million dwellings transferring from private landlords to homeowners between the 1920s and the 1980s. Central and local subsidies plus rent pooling – local authorities using the low build and loan costs of older houses to reduce the rents charged on new properties – helped to keep rents down. In 1971, gross local authority rents were 7.6% of average earnings. The white paper heralding the 1972 Housing Finance Act stating that the government’s policy was ‘subsidising people, not bricks and mortar’ (DoE, 1971, p 42). All tenants would pay ‘fair rents’ with a national rent rebate scheme for low-income council tenants and a rent allowance scheme targeted on the tenants of other landlords. The Act met resistance from council house tenants with

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decent incomes who objected to paying ‘fair rents’ – above the historic costs of providing their dwellings – and giving any surplus to the Treasury. Labour, on return to government in 1974, did not implement ‘fair rents’ and, by 1979, local authority rents were about 6% of national average earnings. Ridley’s reforms The idea underlying the 1988 Housing Act and the 1989 Local Government and Housing Act was to allow all rents to increase to market level with HB protecting households with very low incomes. All new private landlord lettings made after January 1989 were decontrolled. In the housing association sector, a reduction in central government grants was the mechanism used to push rents towards market levels. Central government took control of local authority rents by making council tenants pay the cost of HB and only paying a ‘subsidy’ when, after including HB cost and making assumptions about local authority rent levels, the local authority Housing Revenue Account (HRA) was in deficit. The HRA was ‘ring-fenced’; it could not subsidise or be subsidised by the rates. Private landlord rents were decontrolled on vacant possession. New Labour and rents Towards the end of John Major’s government the move to market rents in the ‘social’ housing sector was restrained. New Labour retained decontrol on vacant possession in the private landlord sector but continued Major’s restraint in pushing ‘social’ rents to market levels. In 2002, as part of an attempt to blur the distinction between council and housing association homes, New Labour took more control over ‘social’ sector rents. Rents were to be set by a formula taking into account average earnings in an area plus the size and location of the dwelling and its capital value. This formula determined a target rent and, over time, all ‘social’ sector rents would converge on the target.

Housing benefit The rent rebate and rent allowance system ran in parallel with rent payments made through Supplementary Benefit (Income Support) producing a complicated system but in the 1980s they were united in a HB scheme administered by local government and directed by the Department of Social Security (now the Department of Work and Pensions). Since its introduction, HB has been in continual flux. The basic principle underlying HB and the Local Housing Allowance (LHA) – paid, post 2008, to private landlord tenants – is that housing costs should not reduce income below Income Support levels. Thus ‘requirements’ are calculated

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according to Income Support norms and, if ‘requirements’ match income, HB pays all the rent. Any income above ‘requirements’ brings a reduction in HB of 65 pence for every pound that income exceeds ‘requirements’ until it is extinguished when the full ‘eligible rent’ is reached. However, the Chancellor’s 2016 Autumn Statement announced that the taper would be reduced to 63%. Savings over £6,000 are taken into account. That said, the scheme is complicated. Local Housing Allowance LHA applies to people who rent from private landlords and, unlike HB, is normally paid to the tenant. It is based on: • the number of bedrooms for which the claimant is eligible; and • local reference rents set according to local rental markets. The coalition government introduced a number of cuts to HB and LHA. • Increases in HB and LHA were linked to the consumer prices index (excluding many housing costs) rather than the retail prices index. • LHA was restricted to a maximum of four bedrooms. • LHA rates were calculated on the 30th rent percentile in a locality rather than the 50th percentile as under New Labour. • Reductions in HB and LHA for non-dependants were increased. • A national £26,000 per annum cap on welfare benefits was applied via HB. • The ‘single room restriction’ was extended to those aged under 35. • Working age ‘social’ tenants were subject to removal of the ‘spare room subsidy’, a measure soon to become known as the ‘bedroom tax’. The 2015 Conservative government announced further reductions in HB entitlements and, as UC is gradually rolled out, its housing element will be paid directly to the tenant living in ‘social’ housing, although there are certain safeguards such as budgeting help in the transition period and the direct payment of UC’s housing element to ‘social’ landlords in specified circumstances. Early experience indicates a higher rent arrears level among ‘social’ tenants claiming UC in England: 79% compared to 31% of ‘social’ tenants not yet receiving UC (Barnes, 2016a).

Private landlord subsidies The coalition government wanted to attract institutional investment into Build to Let and introduced incentives including a £1 billion Build to Rent Fund to provide equity finance for purpose-built private rented housing and a £10 billion

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debt guarantee scheme to support Build to Let homes. Following the abolition of Schedule A tax for homeowners in 2000 it was argued that private landlords were operating on a level-playing field with owner-occupation, subject to the proviso that homeowners did not pay capital gains tax. However, private landlords had significant tax concessions. The following ‘business expenses’ were tax deductable: • broker and arrangement fees; • all the interest paid on the mortgage each year; • letting agent fees; • advertising for tenants, purchasing a tenancy agreement, credit checking, referencing, deposit protection and professional inventory costs; • buildings and contents insurance premiums; • maintenance and repairs; • ‘wear and tear’ on furniture if the property is furnished; • ground rent and service services; and • other direct costs of letting the property such as phone calls, stationery and the costs of travelling between different properties for the purposes of the rental business. Generation Rent, a pressure group representing tenants, claimed that in 2013/14 landlord tax concessions cost the Exchequer £8.3 billion (Guardian, 2015). Moreover, in 2015 HM Revenue and Customs said that only 500,000 regularly filed self-assessment tax returns that would reveal property sales (Guild of Residential Landlords, 2015), resulting in a £9.06 billion loss to the Exchequer (Guardian, 2015). Concerned about the impact of private renting on homeownership, the 2015 Conservative government announced that offsetting mortgage payments against rental income for tax purposes would be reduced in phases to the standard income tax rate by 2020 and, rather than receive an automatic ‘wear and tear allowance’, landlords would have to demonstrate they had replaced furniture and fixtures. Reductions in capital gains tax, announced in the 2015 budget, would not apply to private landlords. Land stamp duty tax Land stamp duty tax (LSDT) makes house purchase more expensive and also produces substantial revenues for the state. For most of its term in office the coalition government levied LSDT at the rates in Table 6.2.

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Table 6.2: Land stamp duty tax rates, 2010 to September 2014 Value

Rate (paid on total value)

up to £125,000

0%

from £125,001 to £250,000

1%

from £250,001 to £500,000

3%

from £500,001 to £1,000,000

4%

from £1,000,001 to £2,000,000

5%

over £2,000,000

7% (bought by individuals)15% (bought by corporations)

In 2014 the Chancellor, arguing that modifying LSDT was a more effective way to tax high-value property than the mansion tax advocated by Labour and the Liberal Democrats, raised LSDT for higher value properties. Table 6.3 shows LSDT rates with effect from October 2014. Table 6.3: Land stamp duty tax rates from October 2014 Rate (paid on portion in band) up to £125,000

0%

from £125,001 to £250,000

2%

from £250,001 to £925,000

5%

from £925,001 to £1,500,000

10%

over £1,500,000

12%

The Conservative Party has had a long association with the ‘property-owning democracy’ idea and Cameron’s government was concerned that the growth in private renting might be eroding the Conservative vote. In the 2015 General Election 48% of homeowners had voted Conservative but only 28% of private renters. In his 2015 Autumn Statement and Spending Review, Osborne said: Frankly, people buying a home to let should not be squeezing out families who can’t afford a home to buy. So I am introducing new rates of Stamp Duty that will be 3 per cent higher on the purchase of additional properties like buy-to-lets and second homes. (Osborne, 2015b)

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The Right to Buy Although council houses had been sold to tenants before the 1980 Housing Act, sales had been restricted by local authority reluctance to sell, sale barriers imposed by central government especially when controlled by Labour and low discount levels. The 1980 Housing Act gave council tenants a statutory right to buy their homes at substantial discounts (see Chapter Two). Sale price was governed by a cost floor rule specifying that the sale price should not be less than the capital cost of the house to the local authority. Tenants had a ‘preserved’ right to buy when council houses were sold to other landlords. Right to Buy (RTB) made homeownership more affordable to council tenants in the right place at the right time and increased the future supply of lower-cost houses when they were eventually sold on the open market. The number of dwellings sold under the RTB fluctuated over time in response to such factors as the pent up desire to buy unleashed by the 1980 Housing Act; variations in house prices; rent levels and discount changes (see Figure 6.2). In 1999, New Labour modified the RTB via regional variations in maximum discounts ranging from £22,000 to £38,000. Later, evidence was uncovered revealing that, in some areas, private companies were using cash incentives to encourage tenants to buy their homes (ODPM, 2003a). In return for a payment, residents were agreeing to move out of their homes so that the company could let them at market rents. Tenants then sold the homes to the company after three years so they could keep their discounts. To maintain the affordable housing pool and curtail detected abuse, the maximum discount on sales was reduced from £38,000 to £16,000 in specific local authority areas where affordable housing was scarce. Thus, whereas average RTB discounts were 50% in England (London 53%) in 1998/99 they had been reduced to 24% (London 13%) in 2007/08. The 2004 Housing Act contained clauses restricting RTB, including extending both the initial qualification period and the time after sale when local authorities could require owners to repay some of the initial discount, to five years. The coalition government ‘revitalised’ RTB by increasing maximum discounts to £103,900 in London and £77,900 in the rest of England to be adjusted by inflation and relaxing resale conditions, promising to replace the homes on a one to one basis. This prompted a sharp increase in sales unmatched by replacements. Even if the one to one replacement promise is taken to mean the replacement of the additional sales prompted by the ‘revitalised’ RTB – the government version – by 2016 there had been only 2,055 replacements for the 12,246 extra homes sold (Local Government Association, 2016 quoted in Politics Home, 2016). According to Nick Clegg: It would have been in a Quad meeting, so either Cameron or Osborne. One of them – I honestly can’t remember whom – looked genuinely

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nonplussed and said, ‘I don’t understand why you keep going on about the need for more social housing – it just creates Labour voters’. (Clegg, 2016 quoted in Stone, 2016) Figure 6.2: Right to Buy sales, England, selected years 180,000 160,000 140,000 120,000 100,000 80,000 60,000 40,000 20,000

-1 5

0

14

-1 20

09

-0

7 20

4

06 20

-0

1

03 20

00

-0

9 20

19

98

-9

0 -9

6

89

-8 19

85

-8

3 19

82 19

19

80

-8

1

0

Source: Adapted from Wilcox et al (2016b)

Right to Buy: impact • There has been a significant increase in the assets of the overwhelming majority of households who have bought their homes. In the main, these households had low wealth. • On purchase many owners invested in their properties. • Over 2.8 million social rented houses have been sold in UK since 1980 under the RTB (Murie, 2016b) but the number of new council and housing association homes built has been well below RTB sales. Of course, when sitting tenants buy their houses, the housing stock available to new tenants is not restricted immediately but, over time, the number of rented properties available to let diminishes (see Figure 6.3). This reduces housing opportunities for people in housing need and, because there has been a tendency for the more desirable properties to be sold (Murie, 2016b), the chances of a council tenant moving to better accommodation in a more attractive locality have diminished. The

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impact has varied between areas and has been particularly severe in rural districts (Rural Coalition, 2010). • The state has received £58 billion from RTB receipts. • On resale, council houses contribute to the pool of lower-cost properties available to potential homeowners but the better quality homes may be beyond the reach lower-income households (Murie, 2016b). • An unanticipated RTB outcome has been the interest shown by private landlords, especially in London. As Colin Jones (2010, p 66) explains: RTB re-sales are attractive to private landlords because they are relatively cheap often selling at a discount relative to comparable properties. In some cases former RTB properties are unattractive or difficult to sell for owner occupation because of weak resale markets in areas where such markets have not been established or sustained … This is partly brought about by the lending criteria of major mortgage-providers, who will not fund, for example, the purchase of flats higher than five storeys above ground level. As a consequence many of these dwellings are sold at knock-down prices at auctions. The Daily Mirror (2013), using the Freedom of Information Act, found that 32% of former local authority flats were rented and an investigation by Inside Housing (Apps, 2015) discovered that private landlords now owned 40% of all council flats sold under the RTB in England. Unfortunately, this information relates only to leasehold property (mainly flats) and available information does not permit an assessment of the percentage of all council houses sold under the RTB acquired by private landlords. Mapping of the LHA in parts of Scotland indicates that around 40% of LHA payments to private renting tenants derive from ex-RTB stock (Sprigings, 2013). • In the first waves of RTB sales there was a tendency for purchasers to be better-off and with grown-up children, with 76% of purchasers in employment compared to 35% of council tenants overall. More recently, RTB purchasers have become more diverse, including more families with school-age children, including single parents, and more retired people (Jones, 2010). • The percentage of flats sold has increased, from 19 in 2000/01 to 34 in 2014/15, reflecting higher discounts for flat and the emergence of a resale market to private landlords. • Tunstall (2012, p 37) concluded ‘At neighbourhood level, take-up of RTB has reflected rather than transformed the relative popularity of different areas and the relative advantage of their residents’. • Council house transfer from needs-based central allocation to the market has allowed more choice in where people live for those who can afford to buy and perhaps assisted relatives to reside in closer proximity (Barker, 2009).

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Figure 6.3: New ‘social’ housing lettings, England, selected years (thousands) 400

Local Authority

Housing Association 350 300 250 200 150 100 50

-1 5

4

14 20

20

13

-1

0 20

09

-1

7 20

06

-0

1 20

00

-0

7 19

96

-9

1 -9 90 19

19

80

-8

1

0

Source: Adapted from Wilcox et al (2016b)

If the RTB for council tenants is a guide, then the agreement between the government and the National Housing Federation, with housing associations selling their stock to tenants on a voluntary basis, will produce eventual sales to private landlords and private landlords are likely to purchase the ‘higher value’ council houses local authorities have to sell to finance housing association sale discounts.

Low-cost homeownership Alongside RTB Michael Heseltine introduced a number of low-cost homeownership initiatives operated through housing associations including the innovative ‘Homesteading’, allowing first-time buyers to acquire a rundown property and renovate it with government support. Low-cost homeownership continued to feature in housing policy via shared ownership schemes. For example, New Labour concentrated on ‘key workers’ such as teachers, social tenants and others in housing ‘need’. They were able to purchase a 25% or more equity share in a house – with responsibility for repairs and maintenance – renting the rest from a housing association. Shared owners could ‘staircase’ by gradually buying more equity in the property. In 2008 the policy was extended to all first-time buyers but with income limits on eligibility. The 2015 the Conservative government widened entitlement criteria to include all potential buyers with an income below £80,000 (£90,000 in London). This was accompanied by a shift in the grant

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distribution away from rented properties to homeownership with £4 billion in grants available to stimulate the construction of 135,000 new shared ownership properties by 2020 although Theresa May’s government indicated it would allow associations flexibility to build more homes for rent. Private builders, councils and housing associations, were eligible to bid for grants. Another scheme – Rent to Buy – gave grants for building homes to let at less than market rents for up to seven years to tenants saving to buy a home. In 2016 about 200,000 UK households were shared owners with the average incomes of first-time buyer shared owners between £24,000 to £34,000 outside London and £45,000 in London. As Cowan, Wallace and Carr (2015, p 10) state ‘Shared ownership is a hybrid tenure which challenges existing binary characterisations between social and private housing …’ Its hybrid nature results in complexity. The shared ownership lease is the key document structuring the relationship between the parties. It is a lengthy, complex document which is not necessarily easy to translate because there are many implicit elements of it as a result of case law interpretations of words and statutory overlays. (Cowan et al, 2015, p 9) The Council of Mortgage lenders (2016, p 9) stated ‘If shared ownership is in any way to become a “fourth tenure” lenders require uniformity and consistency in the lease’ and a survey of housing associations by Inside Housing found that while 59% said that ‘shared ownership works either “very” or “quite well”, 41% said it could work better, pointing to simplifying the product – especially the leases’ (Duxbury, 2016, p 2). Many shared owners felt that did not have same control as full home owners with, for example, the housing association having the right to nominate a new owner when the house was sold if the shared owner did not own 100% of the equity. Moreover, in some areas, house prices were too high for the eligible groups to access low-cost homeownership schemes, perhaps a reason why the 2015 Conservative government extended income eligibility criteria. Only 20% of shared owners between 2001 and 2013 had ‘staircased’ to full ownership (Saunders, 2016). Protecting homeowners when income is reduced Workless households are able to obtain help in meeting mortgage repayments. Following a 39 week waiting period, help paying the interest on up to £200,000 a loan is available. Capital repayments are not eligible for assistance.

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Planning gain and affordable housing/Community Infrastructure Levy The 1971 Town and Country Planning Act enabled local planning authorities to enter into legally enforceable agreements with developers whereby, in return for planning permission, the developer provided benefits to the local authority. They are hypothecated payments, and, as Crook et al (2016, p 11), point out: Part of the appeal of infrastructure charges and of locally negotiated contributions lies in the ability of the local jurisdictions receiving them to devote the finances accrued to the funding of specific local investments. In the early 1990s some local authorities started to promote affordable housing through the planning process using Section 106 of the 1990 Town and Country Planning Act. Under Section 106, developers could be asked to supply lowcost accommodation in return for planning permission and, if this low-cost accommodation was built on the same site as the market price housing, then more balanced communities might be created (see Chapter Nine). The rapid increase in land prices in the 2000s created a favourable climate for acquiring ‘betterment gain’ for community purposes and the number of ‘affordable’ homes obtained through the planning process reached 48,000 in 2007/08 albeit that many also had to rely on Social Housing Grant. The decline in land prices following the 2008 credit crunch hampered opportunities to acquire ‘betterment gain’ and in 2011/12 the affordable housing acquired was back to its 2003/04 level of 31,000 (Crook et al, 2016). Some commentators prefer a transparent development levy to the capture of development gain by specific ‘in kind’ deals. The Barker Review (2004) recommended that the government should introduce a planning gain supplement tied to granting planning permission. In April 2010 a version of a planning gain supplement was introduced as the Community Infrastructure Levy (CIL) – a charge that local authorities could impose in return for planning permission. Section 106 agreements were not abolished but the CIL provided an alternative way for local authorities to capture development gain. Under the coalition government’s ‘localism’ agenda a significant proportion of CIL would be ear-marked for neighbourhood projects. Information on CIL receipts is sparse, but by mid-2014, only £57 million had been raised, 94% of that by the London Mayoral CIL (Savills, 2014a). Under the 2013 Growth and Infrastructure Act, the coalition government allowed developers to ask councils to renegotiate Section 106 obligations agreed prior to April 2010. Under the earlier system Section 106 agreements could not be renegotiated for five years once a council had refused a request for voluntary renegotiation by a developer. In 2014 developments of ten units or fewer were exempted from the requirement to contribute towards ‘affordable’ housing but this

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was overturned by a judicial review. Developers dislike Section 106 obligations and have been accused of massaging the predicted profits from a site to reduce payments. The 2016 Housing and Planning Act made provision for a dispute resolution process designed to accelerate Section 106 negotiations and included ‘starter homes’ in the affordable housing definition. Access to private renting Ability to pay the rent is the main barrier to private renting and there has been a growing tendency for private landlords not to let to tenants claiming LHA — down from 46% in 2010 to 22% in 2013 (National Landlords Association, 2013). Moreover, the private letting process involves letting costs. In addition to a deposit these may include inventory, agreement, reservation and administrative fees plus moving in and out charges that can amount to over £800 in areas of high demand. Letting agent fees, banned in Scotland since 2012, were scheduled to end in England according to the Treasury Autumn Statement made on 23 November 2016.

Allocating social housing One approach to ‘social’ housing is to define it according to allocation criteria. Historically, council housing has not been allocated primarily according to need – length of local residence, councillor recommendations and notions of ‘deserving’ were often used in determining access. However, following the Cullingworth Report (1969), need became the dominant norm. High demand and limited supply has focused attention on the rationing process involved in social housing allocation. New Labour and the coalition government issued guidelines giving local government greater ‘flexibility’ in their allocation processes including taking into account factors other than ‘need’ in prioritising applicants, including waiting time and local connections. Additional guidance was issued in 2013 (DCLG, 2013b) stating: ... in deciding who qualifies or does not qualify for social housing, local authorities should ensure that they prioritise applicants who can demonstrate a close association with their local area … The Secretary of State believes that a reasonable period of residency would be at least two years. (DCLG, 2013b, p 5) The coalition government’s guidance changes produced a significant reduction in housing waiting lists, down in England from 1,825,000 in 2011 to 1,241,000 in 2015 with residence qualifications having a significant role in this decline. The longest residence qualification appears to be Basildon that, with certain exceptions,

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requires a continuous seven years residency requirement in the borough (Wilson and Barton, 2016a). Allocating housing association houses Nominations by local authorities to housing associations are allocated within the same legal framework as applied to local authorities although there has been controversy surrounding association willingness to accept nominations (Cowan et al, 2007: Heywood, 2015). When an association has retained arrangements to allocate some or all of its properties directly, they are governed by the Regulatory Framework for Social Housing in England (Homes and Communities Agency, 2015), which states that providers shall let their homes in a fair, transparent and efficient way, contribute to local authorities’ strategic housing function, and develop sustainable communities. Many housing associations are part of joint registration and allocation schemes with local government and allocate their homes via ‘choice-based’ lettings.

Immigration and ‘social’ housing New Labour’s amendments to housing allocation guidelines reflected concern about a British National Party allegation that migrants obtained a disproportionate ‘social’ housing stock share. Coalition amendments were motivated by anxiety at UKIP’s growing popularity. Asylum seekers The 1999 Immigration and Asylum Act completed a process, started in 1993, of excluding asylum seekers from receiving help via the homelessness legislation. Asylum seekers do not qualify for the housing register and cannot be allocated secure tenancies, or nominated for assured tenancies. Using private sector companies, the Home Office has pursued a dispersal policy, arranging to secure properties through arrangements mainly with private sector landlords. As Hynes and Sales (2010, pp 45–6) comment: Dispersal to places where such accommodation was available ensured that asylum seekers were concentrated in areas with high levels of social exclusion. Nearly 80 per cent of the initial dispersal locations in England were in the 88 most deprived districts identified by the Social Exclusion Unit in 2000. Asylum seekers granted permission to stay in the UK become eligible to work and access mainstream welfare benefits. Refused asylum seekers are expected to leave

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the UK and their asylum cash support – reduced to £36.95 per person per week in August 2015 – is ended although they may be able to receive ‘cashless’ support if the Home Office accepts that there are temporary impediments to their exit. In 2016 the number of asylum seekers accommodated under the special arrangements made by the Home Office was 35,000. The House of Commons Home Affairs Committee (2017, p 48) stated ‘The evidence we have received suggests that some of the premises used by providers as temporary accommodation are substandard and unfit to house anyone, let alone people who are vulnerable’. The distribution of ‘dispersal accommodation’ remained very uneven across England with deprived areas accommodating a large proportion of asylum seekers. European Economic Area (EEA) nationals and other migrants As Wilson (2015, p 3) states ‘the rules on eligibility for housing assistance in relation to persons from abroad are extremely complex’. Given this complexity and that eligibility does not necessarily determine housing opportunities, examining outcomes is the most productive way to explore the process. The House of Lords Select Committee on Economic Affairs (2016, p 17) presented statistics from the 2011 Census revealing that about 8% of recent arrivals (2007–11) lived in ‘social’ housing with about 72% renting privately and, of those resident in the UK for 5–10 years, about 16% occupied ‘social’ housing and 55% rented privately. The Equality and Human Rights Commission commissioned research examining allocation procedures, outcome statistics and public perceptions of the allocation processes as revealed in focus groups. The research concluded that ‘Analysis of social housing allocation policies showed no evidence that social housing allocation favours foreign migrants over UK citizens’ (Rutter and Latorre, 2009, p ix). The researchers found that ‘new migrants to the UK over the last five years make up less than two per cent of the total in social housing’. Moreover, ‘of the foreign born people who have arrived in the UK in the past five years about 17% are owner-occupiers, 11% live in social housing and 64% are private tenants’ (Rutter and Latorre, 2009, p viii). Rutter and Latorre attributed public perceptions that a high proportion of migrants were living in ‘social’ housing to council house transfer to the private rented sector via RTB. Battiston et al (2015, p 3), after a detailed data examination, state: We show that immigrants as a whole are slightly more likely to be in social housing but there is considerable heterogeneity among immigrants – those with EEA citizenship are less likely to be in social housing than natives while those immigrants who either have UK citizenship (most likely acquired after immigration) or are non-EEA citizens are more likely to be in social housing than natives. However, once one controls for factors like the demographic structure of the

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household, the area of residence and economic circumstances (all factors that one would expect to affect the probability of being in social housing) these differences disappear and immigrant households are significantly less likely to be in social housing than equivalent native households.

Scotland, Wales and Northern Ireland All the ‘home nations’ have schemes to capture planning gain but, perhaps because development gain has been highest in southern England, Wales and Scotland have not secured an equivalent proportion of affordable housing when compared to England (Crook et al, 2016). Despite a number of attempts to secure developer contributions in Northern Ireland these were met with considerable developer opposition and, by 2015, had not been implemented (Birrell et al, 2016). The devolved governments also promote schemes to improve access to homeownership via variations on the English Help to Buy scheme. However, marked differences between Scotland, Wales and Northern Ireland on ‘social’ housing, compared to England, have emerged. Scotland, Wales and Northern Ireland have been less enthusiastic on stock transfer, have not gone down the ‘affordable rent equals 80% of market rent’ route, have resisted the ‘bedroom tax’ and have been more eager to promote ‘social’ housing. Income Support/HB is reserved for Westminster although the evolving devolution agenda, with Scotland having more control of the housing element of UC, may bring change. The Right to Buy The 1980 Tenants’ Rights, etc (Scotland) Act incorporated a RTB for Scottish tenants on similar terms to England but local authorities did not become subject to the same constraints on the use of capital receipts. The 2001 Housing (Scotland) Act created a uniform RTB for all social sector tenants with a qualifying period of five years and a maximum discount of £15,000. This scheme did not apply to tenants occupying local authority houses prior to 2002 who retained their existing rights. In 2010 the RTB on all new ‘social’ housing was abolished and, in August 2016, it was ended for all tenants. In Wales, the RTB maximum discount is £8,000 and local authorities can request RTB suspension in ‘stress’ areas. In the 2016 Welsh Assembly election Labour promised to abolish the RTB. As in Scotland, there has been no endorsement of extending the RTB to housing association tenants. Figure 6.4 sets out RTB trends in Scotland and Wales. Although the 1980 Housing Act did not apply to Northern Ireland, the Northern Ireland Housing Executive (NIHE) extended its House Sales Scheme, established in 1973, to incorporate terms similar to those applied in England and was able to benefit, until 2000, from capital receipt retention. The switch

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Figure 6.4: Right to Buy sales, Scotland and Wales, selected years 45,000

Wales

Scotland 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000

-1 5 14 20

-1 0 09

20

-0 7 06 20

-0 4 03 20

-0 2 01 20

-9 9 98 19

-9 9

-8 6

89 19

-8 3

85 19

82 19

19

80

-8 1

0

Sources: Scottish Government (2016a): Welsh Government (2016a)

of new development from the NIHE to housing associations led to the larger housing associations introducing a Voluntary Purchase Grant scheme. Tenants of the NIHE and smaller housing associations could purchase their homes with a £24,000 maximum discount.

Monitoring housing affordability Rents The absence of a robust normative ‘affordable housing’ definition makes it difficult to track ‘affordability’ over time. Figure 6.5 gives an indication of trends. Eurostat (2016) gave a 33.1% figure for private tenants in the UK as experiencing a ‘housing cost overburden’ in 2014 – up from 23.8% in 2012 – compared to 15.7% in 2014 of households living in ‘reduced rent’ accommodation with a ‘housing cost overburden’. The New Policy Institute (2016, p 3) comments ‘More than 70% of private renters in the poorest fifth spend at least a third of their income on housing, compared with under 50% in the social rented sector and 28% for those who own their own homes’.

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Homeownership Figure 6.6 records changes in house prices in real and cash terms since 1977. Figure 6.7 sets out mortgage payments as a percentage of mean take-home pay for first-time buyers over 1997–2016. Figure 6.8 depicts falls in homeownership rates for different age groups. Reductions in mortgage interest rates and easing in house prices since 2007 (outside London and the South East) have moderated the homeownership affordability problem, Wilcox et al (2016a, p 9) comment: Figure 6.5: Rents, England, 1991–2015 (% of average earnings) 35 30 25

Local Authority

20

Housing Association

15

Private landlords 'fair rent'

10

Private landlords (market rent)

5 0

1980

1985

1990

1995

1997 2001

2005

2010

2013

2014

2015

Sources: Adapted from Wilcox et al (2016b): DCLG (2016g): ONS (2016a)

Figure 6.6: House prices, real and cash terms, 1977–2016 500,000 450,000 400,000 350,000 300,000 250,000 200,000 150,000 100,000 50,000 0 1977 1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013 2016 UK (Real)

UK (cash)

West Midlands (cash)

Scotland (cash)

Source: Adapted from Nationwide (2016)

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London (cash)

‘Affordable’ housing

Indeed, London aside, it remains the case that despite Help to Buy and some minor easing in the market, it is the ability to raise a deposit by households unable to draw on the ‘bank of mum and dad’ that is now a far greater barrier for first-time buyers than the ability to securely meet the costs of mortgage repayments. And in turn those ‘frustrated’ potential buyers add to the pressures on the rental market. Figure 6.7: Mortgage payments, first-time buyers, 1997–2016 (% of mean take-home pay) 80 London

70

North West

West Midlands

Scotland

60 50 40 30 20 10 0 1998

2004

2001

2007

2013

2010

2016

Source: Adapted from Nationwide (2016)

Figure 6.8: Homeownership rates by age, 1991 to 2013/14 (% of population) 1991

2001/02

2011/12 78.0

66.5

2013/14 75.7

73.9

79.7 73.7

71.6

63.6

59.6

58.8

42.8 36.1

35.8 23.4 10.0

16-24

8.9

25-34

35-44

45-64

Source: Adapted from ONS (2016b)

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Overview

• • • • •

Until the introduction of a national system of income-related housing payments in 1972, many households found it difficult to pay for rented accommodation. In the 1980s and 1990s there was a marked shift away from ‘bricks and mortar’ subsidies to means-tested consumer subsidies. Access to ‘social’ housing has become increasingly restricted. In the past, various forms of subsidies have sustained homeownership but, in recent years, help has become more concentrated on first-time buyers. Private landlords now receive significant government subsidies in the form of loan guarantees and via the Build to Rent Fund.

Questions for discussion 1. What is meant by ‘affordable’ housing? 2. Assess the merits and limitations of HB as a method of subsidising housing costs. 3. How can the planning system promote affordable housing? 4. What has been the impact of the RTB on access to ‘affordable’ housing? 5. In what ways are private landlords subsidised?

Further reading There is a dearth of research and analysis on the long-term RTB impact but The Right to Buy: Analysis and evaluation of a housing policy (2002) by Colin Jones and Alan Murie is a valuable source, as is Alan Murie’s The Right to Buy?: Selling off public and social housing (2016). Peter Kemp sets HB in the UK in a comparative context in Housing allowances in comparative perspective (2007). The future of private renting: Shaping a fairer market for tenants and taxpayers (2015) by Daniel Bentley is a good analysis of private landlordism and Restoring a nation of home owners: What went wrong with home ownership in Britain, and how to start putting it right (2016) by Peter Saunders contains an insightful account of the impact of ‘demand side’ subsidies.

Websites The DCLG’s website provides statistics on housing prices and supply: www.communities. gov.uk/housing Statistics on HB can be found at the DWP website: www.dwp.gov.uk Eurostat supplies European Union statistics on ‘affordable’ housing: http://ec.europa.eu/ eurostat/statistics-explained/index.php/Housing_statistics

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• • • •

Homelessness is a contested concept with definitions linked to different causal notions and forms of action. Several factors interact in a process of becoming homeless. New Labour took steps to reduce the incidence of recorded statutory homelessness in England by prevention stratagems. Initially a different approach was adopted in Scotland but all the ‘home nations’ now embrace prevention. Recorded homelessness in England increased under the coalition and 2015 Conservative governments.

What is homelessness? Meanings attached to the term ‘homelessness’ influence estimates of the problem’s extent and the causal notions ascribed to it. Three main definitions are current in the UK. Homelessness can be equated with rooflessness, and can only be legitimately applied – to quote the definition suggested by the government in 1994 – to ‘those who have no accommodation of any sort available for occupation’ (DoE, 1994, p 4). On this meaning, homelessness is often interpreted as ‘rough sleeping’, the ‘homeless’ count will be relatively low and homelessness may be construed as a personal matter, located in an individual’s lifestyle, rather than a ‘social problem’ caused by structural factors. The 1996 Housing Act definition is somewhat broader. It defines homelessness in terms of whether a person has

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a legal right to occupy a dwelling, qualified by clauses such the accommodation must be ‘reasonable’ to occupy and the person can secure access to it. On this definition, despite the obstacles homeless applicants have to overcome before being accepted as homeless and an accommodation offer made, there were 73,120 homeless households living in temporary accommodation in England in 2016. Such a high number makes it difficult to link homelessness to personal, lifestyle problems although this has not deterred such attempts. Including ‘home’ in the term ‘homelessness’ indicates a third definition. As Waldron (1993) suggests, humans, as social beings, require a private and secure base in which to carry out functions such as washing, sleeping, reproduction, socialising, and so on. especially if using public space for performing such functions is forbidden. In discussing the idea of ‘home’, Atkinson and Jacobs (2016 p 1) state: In a rather primal sense, our home is the means by which we are able to stay safe, sheltered and well; it plays a central role binding various aspects of our lives together by offering a place of sanctuary and a primary place to which we can retreat and literally find a home. Thus, minimal ‘home’ requirements might include privacy, personal space, sufficient room to store possessions, adequate heating and the security necessary for quiet enjoyment of one’s personal life. In the late 1960s, Shelter claimed that to be homeless ‘in the true sense of the word’ means ‘living in conditions so bad that a civilised family life is impossible’ (Shelter, 1969, p 4). Shelter’s definition was aimed at converting homelessness from a ‘personal’ to a ‘structural’ problem and had some success, with the 1970 Conservative Party manifesto declaring ‘the problem of the homeless is concealed by unrealistic official statistics’ (Conservative Party, 1970, p 8). If Shelter’s 1969 definition is adopted, then the homeless count soars. Crisis (2015, p 1) claims: The Government’s headline homelessness statistics are focused on those owed the main homelessness duty and entitled to accommodation. However, the vast majority of homeless people exist out of sight in bed and breakfasts, squats, on the floors or sofas of friends and families or sleeping rough. This means that they are all too often invisible to the public … ‘Concealed’ households – people living involuntarily with friends and relatives but perhaps not on floors or sofas – might also be included in the homelessness definition. Fitzpatrick et al (2016a, viii) state: ‘The number of adults in these concealed household units is estimated at 3.52 million. These numbers represent a rise of 40 per cent since 2008.’ However, too broad a definition of homelessness may direct attention away from a more serious problem. Shelter has suggested a

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compromise definition. It has added together statistics on rough sleepers, those in temporary accommodation, the number of people in hostels and the number of people waiting to be housed by social services departments to reach a 254, 514 homelessness count (Richardson, 2016).

The causes of homelessness Becoming homeless is a process involving interaction between several variables. ‘Structural’ determinants – the housing market, poverty, unemployment, and so on combining in a process of marginalisation – influence the number of people at risk of becoming homeless as do changes in the benefit system such as increased use of benefit sanctions and benefit cuts. However, other factors – labelled ‘individual’, ‘pathological’ or ‘agency’ can trigger homelessness. Separating causes is problematic because variables interact over time in a process of becoming homeless. Figures 7.1 and 7.2 illustrate the processes involved.

Homelessness: constructing a social problem In England, homelessness is officially divided into two categories – ‘rough sleeping’ and ‘statutory homelessness’ – a partition reflecting a long tradition in attitudes towards homeless people. In the past, persons now called ‘rough sleepers’, mainly men, were regarded as a threat to social order: deemed as being a problem they were subject to harsh social control. People now referred to as ‘the statutory homeless’, including a high proportion with children, have more often been represented as having a problem and needing assistance. Nevertheless, concerns that such aid would lead to ‘jumping the housing queue’ and hinder self-help produced low standard, stigmatised forms of provision. The ‘old’ poor law Mercantilist theory regarded the sovereign’s duty to be the preservation of the state’s human capital – its ‘loyal subjects’. The 1601 Act for the Relief of the Poor placed a duty on parish churchwardens to appoint ‘overseers of the poor’. Their obligations included acquiring ‘weekly or otherwise (by taxation of every inhabitant...) convenient stocks of flax, hemp, wool, thread, iron, and other ware and stuff, to set the poor on work …’ (1601 Act for the Relief of the Poor, quoted in Bruce, 1973, p 39). By placing this obligation on each parish to provide work, the Act provided an income allowing the sovereign’s ‘loyal subjects’ to pay their rents. It was aimed at preventing ‘destitution’, now subsumed under the term ‘homelessness’. Those deemed incapable of work, mainly elderly people, were to be placed in a ‘poorhouse’, paid for by the parish rate, or in an ‘almshouse’ funded by charitable donations.

157

158

Father loses job in recession but finds low-paid work

2011

2009

2010

Spiralling debts related to husband’s drink problem. Family forced to sell house and move in with mother’s parents

Family of two adults with three children buy a house

Figure 7.1: The homelessness process (family)

Marital problems related to debt and overcrowding lead to father leaving

2012 Under ‘prevention’ strategy, local authority mediates with mother’s parents who agree that family can stay

2013

Mother’s parents cannot cope with children. Mother approaches local authority for help.

Nominated to Housing Association but application rejected

2014

Relationship with mother breaks down. Family placed in B and B accommodation. Mother becomes depressed due to conditions and long wait for offer of better accommodation

Family move to private landlord accommodation leased by local authority

2015

Local authority helps in family’s move into private landlord accommodation. Family is evicted because the landlord wants to sell the property. Family allocated a local authority house.

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2011 Relatives unwilling to provide accommodation. Applies as homeless to local authority but deemed not in ‘priority need’ Sleeps rough

2000

Often excluded from school. Spends a lot of time with ‘street-mates’

1998

Aged 18 No work since leaving school without qualifications. Develops an alcohol problem

Aged 7 Mother dies Spends next 11 years with a variety of relatives

Aged 5 Mother alcoholic Placed on local authority ‘at risk’ register

Figure 7.2: The homelessness process (single person)

Allocated one bedroom flat in a housing association property with support. Convictions for petty crime

2012

Aged 19 Outreach worker helps in finding accommodation in hostel

Sleeps rough or, using income from criminal activities, in B&Bs

2014

Aged 21 Alcohol related behaviour leads to eviction

Sleeps rough on leaving prison but then offered accommodation in hostel. Reestablishes contacts with former ‘streetmates’

2015

Aged 22 Prison sentence HB stops after 13 weeks

Finds work and is able to afford a room rented from a private landlordIs helped by the ‘Supporting People’ programme

2016

Aged 23 Alcohol problems intensify Joins alcohol treatment programme

Homelessness

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Settlement and removal laws Poor relief costs, met by levying a rate on property in a parish, raised the question of payment responsibility. By the late 17th century, the basic principles governing parish support obligations had been established. A person acquired a ‘settlement’ in a particular parish by occupying a property worth more than £10 per year, by serving an apprenticeship in the parish, by marriage or by being hired for more than a year. A ‘stranger’ could be removed from a parish, without legal procedures, if discovered within 40 days of arrival. ‘Rogues, vagabondes and sturdy beggars’ Imposing parish obligations to supply a means of subsistence, provided recipients abided in their parish of origin, promoted social stability. Those who strayed from their ‘rightful place’ were regarded as a social problem: labelled ‘vagrants’, they were subject to repressive legislation. In the 16th century, vagrancy laws were directed at the growing number of ‘masterless men’ who had taken to leaving their parishes of birth to find work and freedom from feudal ties. These migrants were regarded as a serious threat with the settled population living, according to pamphleteers of the time, ‘in terror of the tramp’ (Sharpe, 1984). The 1597 Vagrancy Act, deemed ‘all wandering persons and common labourers refusing to work for such reasonable wages commonly given in such partes where such persons do or shall happen to dwell or abide to be rogues, vagabondes and sturdy beggars’. They were to be whipped, incarcerated in a ‘house of correction’ and then returned to their parish of origin. Homelessness and ‘laissez-faire’ economics Adam Smith condemned the settlement laws as a hindrance to labour mobility and the growing influence of market theory led to modest changes to the harshness of the vagrancy laws. The 1824 Vagrancy Act redefined vagrancy as ‘failure to maintain oneself ’ and vagrants were divided into three groups according to their perceived character: ‘idle and disorderly’; ‘rogues and vagabonds’ and ‘incorrigible rogues’. People ‘sleeping out’ were classified as ‘idle and disorderly’ but, following second offence, they became ‘incorrigible rogues’ punishable by imprisonment or a public flogging. The 1834 Poor Law Amendment Act (the ‘new’ poor law) Under the 1834 Poor Law Amendment Act parish unions were required to build workhouses where inmate conditions were to not to be ‘really or apparently so eligible as the situation of the independent labourer of the lowest class’

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(Poor Law Commissioners’, 1834, p 228) – a condition intended to deter use. Workhouses accommodated destitute people with a ‘settlement’ in the area but also contained, ‘vagrant’ or ‘casual’ wards, popularly known as ‘spikes’. Here, shortterm accommodation was available to ‘tramps’ in return for a work task – usually breaking stones for use on local roads – hence the term ‘spike’ named after the stone-breaking tool. At the beginning of the 20th century it was estimated that between 30,000 and 80,000 people used the workhouse casual wards from time to time (Royal Commission on the Poor Laws and Relief of Poverty, 1909) but many people ‘on the tramp’ preferred to use common lodging houses. These ‘dosshouses’ provided accommodation on a nightly basis, the cheapest being the ‘two-penny hang’ – sleeping hanging over a rope strung across a room. Booth (1902, p 21) estimated there were 165,000 ‘homeless’ people in the UK, describing them as ‘loafers, casuals and some criminals’. Between the wars, the workhouse casual wards – renamed Public Assistance Institutions in 1929 – commercial common lodging houses and provision made by charities such as the Salvation Army were the major sources of accommodation for ‘tramps’. People using such accommodation were described as being ‘without a settled way of living’, a phrase illustrating how single homeless people were regarded as ‘rootless’ as well as ‘homeless’– they lacked connections to mainstream society.

The 1948 National Assistance Act This Act consolidated the distinction between ‘single’ and ‘family’ homelessness. Single homelessness was regarded as an employment matter involving ‘resettlement’ from an ‘unsettled way of living’, whereas family homelessness was a ‘welfare’ issue. Under the Act, a National Assistance Board assumed overall responsibility for the workhouse casual wards and hence homeless single people. It had an obligation to ‘make provision whereby persons without a settled living may be influenced to lead a more settled life’ and a duty ‘to provide and maintain centres for the provision of temporary board and lodgings for such persons’. Local authority public assistance committees, renamed welfare committees, became responsible for various forms of care, including residential provision for homeless people. The National Assistance Act imposed an obligation on local authorities to provide ‘temporary accommodation for persons in urgent need thereof, being need arising in circumstances that could not reasonably have been foreseen’. This duty was designed for emergencies and was not seen as replacing local authority waiting lists in allocating houses. Homeless people with children could be offered assistance but the help was temporary and provided by a ‘social work’ authority that, in county areas, was located at a different administrative tier to the housing authority.

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The 1977 Housing (Homeless Persons) Act Local authorities interpreted their duties under the National Assistance Act in a restrictive, some would say mean-spirited, manner. To them, ‘circumstances that could not reasonably have been foreseen’ meant fire, flood or other natural disaster. Other reasons signalled the applicant wanted to jump the housing queue or had a ‘feckless’ lifestyle. Thus, for example, in Greater London, 75% of all homelessness applications were rejected (Holman et al, 1970) and some local authorities set up rehabilitation units for homeless ‘problem families’. People without children had little chance of assistance and homeless people with children might be denied help because, echoing the ‘settlement’ laws, their ‘habitual place of residence’ was in another local authority. When local authorities offered a homeless family somewhere to live it was often a caravan or communal accommodation of a very low standard. The system had all the ‘less eligibility’ characteristics of the Poor Law from which it had descended; indeed, some of the accommodation was in former workhouses and many authorities did not allow a man to live with his wife and children. If, after spending time in temporary accommodation, the family could not obtain permanent housing, then the children might be taken into local authority care. ‘Cathy Come Home’, a television drama/documentary first broadcast in 1966, told the story of how a young couple, Cathy and Reg, became homeless. Having been passed between authorities due to disputes about responsibility for them, Cathy and her children had to live in a squalid dormitory to which Reg was not admitted. Eventually their relationship broke down and the local authority took the children into care. ‘Cathy Come Home’ dramatised the experiences of thousands of homeless people in the early 1960s and its broadcast converted the family homelessness condition into a social problem: parliamentary questions were asked, a special Cabinet meeting was held and Shelter, the housing charity, sprang to prominence. The government’s immediate response to ‘Cathy Come Home’ was to accelerate the housing programme and it was not until the mid-1970s that specific reform of the housing allocation system to assist homeless families was undertaken. Following a series of circulars urging local authorities to shift responsibility for homelessness from social services departments – the successors of welfare departments – to housing authorities, the government promoted a private member’s bill. The private member, Stephen Ross, declared that his bill’s aim was to introduce ‘a new legislative framework to change the outdated concept that homelessness was a social work problem and to place it clearly in the sphere of housing’ (Stephen Ross, 1977, quoted in Wilson, 2001, p 9). The 1977 Housing (Homeless Persons) Act still forms the basis of current homelessness legislation. It defined homelessness in terms similar to the definition used in the 1996 Housing Act, having no legal right to accommodation reasonable to occupy.

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Had this definition not been qualified by later sections in the Act, local authorities would have had a duty to assist all homeless people. However, despite sustained civil service support for the original bill (Raynsford, 2016), restrictions were placed on local authority obligations as it passed through Parliament. Under the priority need clauses, local authorities would only have a duty to ‘secure that accommodation becomes available for his occupation’ (Housing (Homeless Persons) Act 1977 Section 4, incorporated into the 1996 Housing Act) if:

1 (a) he has dependent children who are residing with him or who might reasonably be expected to reside with him; (b) he is homeless or threatened with homelessness as a result of any emergency such as flood, fire or any other disaster; (c) he or any person who resides or might reasonably be expected to reside with him is vulnerable as a result of old age, mental illness or handicap or physical disability or other special reason. 2 For the purposes of this Act a homeless person or a person threatened with homelessness who is a pregnant woman or resides or might reasonably be expected to reside with a pregnant woman has a priority need for accommodation. (Housing (Homeless Persons) Act 1977 Section 2)

Moreover, if a person was in priority need but deemed intentionally homeless, then the local authority only had obligations to supply accommodation for a limited period and offer ‘advice and assistance’. Intentionality was defined as ‘if he deliberately does or fails to do anything in consequence of which he ceases to occupy accommodation which is available for his occupation and which it would have been reasonable for him to continue to occupy’ (Housing (Homeless Persons) Act 1977 Section 17). The third obstacle to homeless people securing accommodation was the ‘local connection’ clauses that meant a local authority might decide that a homeless applicant did not have a local connection with their area but did have a link elsewhere. However, in contrast the settlement laws, local authority obligations in the place where the person made the application remained until the ‘receiving authority’ agreed to the transfer. The 1977 Housing (Homeless Persons) Act created two ‘headline’ statistics on homelessness: the number of households accepted as homeless and the number of households in temporary accommodation.

‘Perverse incentives’ and the 1996 Housing Act The number of households in temporary accommodation increased from 24,790 in 1986 to 73,490 in 1991 and the Conservative government attributed this growth to the ‘perverse incentives’ created by the 1977 Act. Access to Local Authority and Housing Association Tenancies claimed:

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By giving the local authority a greater responsibility towards those who can demonstrate ‘homelessness’ than towards anyone else in housing need, the current legislation creates a perverse incentive for people to have themselves accepted by a local authority as homeless. (DoE, 1994, p 4) Nicholas Ridley, Secretary of State for the Environment in the late 1980s, commented: A young lady with a child is in ‘priority housing need’ – one without is not. It became a way of life for some to have one or more children by unknown men, in order to qualify for a council house. (Ridley, 1991, p 91) In an attempt to eliminate these ‘perverse incentives’, the 1996 Housing Act obliged local authorities to provide temporary accommodation for up to two years but only when satisfied that other suitable accommodation was not available. The aim of this provision was to make clear that local authorities did not have to arrange to supply ‘settled’ or ‘permanent’ accommodation to end their obligations under the homelessness legislation. The terms ‘settled’ and ‘permanent’ occurred in the Code of Guidance issued under the Act, to which all local authorities had to ‘have regard to’ in implementing the legislation. Accordingly, most local authorities interpreted their obligations as involving providing a local authority or housing association property until, in the case of R v London Borough of Brent ex parte Awua (1995) the House of Lords established that this was unnecessary. The 1996 Housing Act reaffirmed this legal interpretation by stating that local authority obligations were discharged when it was satisfied that other suitable accommodation, including a private landlord assured shorthold tenancy, was available in the area. In addition, the duty to provide temporary accommodation for homeless people was separated from allocating local authority dwellings. In allocating tenancies local authorities had to offer ‘reasonable preference’ only in accordance with guidance incorporated in the Act. Homelessness was not included in the guidance as a ‘need’ category for which ‘reasonable preference’ was to be given although homeless people might receive priority under other categories. The Act also stated that a person could not qualify as homeless if they had a legal right to occupy accommodation outside the UK.

The 2002 Homelessness Act New Labour’s 1997 manifesto promised to ‘place a new duty on local authorities to protect those who are homeless through no fault of their own and are in priority need’ (Labour Party, 1997, p 23). This pledge was partially redeemed in

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1997 when ‘households who are being accommodated by the main homelessness duty’ was added to the need categories list that local authorities were required to give reasonable preference in allocating dwellings. Significant change to the 1996 Housing Act had to wait until New Labour’s second term. The 2002 Homelessness Act imposed a duty on local authorities to develop a homelessness strategy, abolished the two-year limit on the provision of temporary housing and disallowed an offer of an assured shorthold tenancy unless acceptable to the homeless person. The Priority Need Order 2002 extended the groups designated as ‘in priority need’ to cover: • all 16 and 17 year olds; • 18–20 year old care leavers; • vulnerable care leavers, former members of the armed forces and former prisoners; and • people who are vulnerable because they are fleeing violence.

Preventing statutory homelessness The homelessness legislation generates statistics on homelessness that become media ‘headline’ figures. Two statistics dominate: ‘households accepted as homeless’, measuring the ‘flow’ of people into homelessness, and ‘households in temporary accommodation’, a snapshot of the number of households homeless at a particular time point. Temporary accommodation includes B&B hotels, hostels and leased private landlord accommodation. In the countdown to the 1997 general election, New Labour was critical of the Conservative Party’s homelessness record. Its manifesto declared ‘Homelessness has more than doubled under the Conservatives. Today, more than 40,000 families in England are in expensive temporary accommodation’ (Labour Party, 1997, p 10). Embarrassing, then, that under New Labour, 101,000 households were in temporary accommodation in 2004/05. Part of this increase is attributable to the eligibility liberalisation under the 2002 Act but the trend had been upward since 1997 and reflected a growing housing shortage. The extension of the ‘priority need’ category in 2002 helped to blur the distinction between ‘statutory homelessness’ (mainly households with children) and single homelessness. When the DCLG’s Rough Sleeping Unit was merged with its Statutory Homeless Division, attention turned to the possible ‘personal’ causes of family homelessness. The DCLG started to take an interest in ‘repeat’ statutory homelessness – perhaps under the assumption that ‘repeat’ homelessness pointed to ‘personal’ causes – and asked local authorities to record its incidence. It also commissioned research on the aetiology of family homelessness. If the DCLG had expected this research to support its new approach related to the personal family problems, it was to be disappointed. The research report commented:

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Adult respondents (usually the mothers) in these families seemed to be a relatively disadvantaged group with respect to their health and access to social support, and many had experienced domestic violence. However, only a minority appeared extremely vulnerable and very few self-reported current drug or alcohol problems. Children in these families were generally happy at home and at school and were reportedly in good health. (Pleace et al, 2008, p 24) Sustainable communities: settled homes; changing lives, a strategy for tackling homelessness (ODPM, 2005a, p  13) affirmed the government’s ‘new approach to tackling homelessness which focused on people’s personal problems rather than just structural bricks and mortar causes’. It continued: We recognised that the provision of housing alone cannot solve homelessness. Underlying problems which led to homelessness in the first place have to be addressed in order to provide long-term solutions. Failure to address these root causes can lead to repeated episodes of homelessness. The Office of the Deputy Prime Minister (ODPM) defined homelessness prevention as ‘providing people with the ways and means to address their housing and other needs in order to avoid homelessness’ and set out its homelessness prevention strategy that included: Encouraging and rewarding the modernisation of services provided by local authorities which offer a wider range of preventative help, support and housing options – so that they reach more people, earlier on. (ODPM, 2005a, p 14) New Labour promoted the policy by a set of ‘administrative stratagems’ (Pawson, 2009), including setting a target to reduce temporary accommodation use by 50% by 2010; offering grants to local authorities for prevention measures; and introducing new performance indicators, such as indicator BV225 relating to whether a local authority had recently reduced the proportion of homelessness acceptances resulting from domestic violence and whether the local authority made available ‘sanctuary’ provision to prevent homelessness. In response to these exhortations, local authorities developed a number of preventative measures including: • interviews, often called ‘housing options’, prior to a formal homelessness assessment, from which ways of dealing with an accommodation problem, other than designation as homeless, may emerge;

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• rent deposit/bond schemes; • mediation with landlords/friends and relatives; • tenancy support; and • sanctuary schemes, that is, providing ‘safe’ or ‘panic’ rooms in the homes of domestic violence victims to enable them to remain in their home unharmed. Preventing homelessness or preventing politically damaging homelessness statistics? New Labour’s strategy of applying a ‘prevention’ strategy to statutory homelessness in England was very successful in reducing the ‘headline’ homelessness statistics especially when historically there has been a link between house prices and homelessness (Barker, 2003) and house prices increased rapidly between 2003 and 2007. The DCLG (2010b) estimated that in 2009/10, 165,200 cases ‘of homelessness prevention or relief ’ had taken place outside the statutory homeless framework in England (‘relief ’ relating to helping people who were not eligible for direct assistance under the homelessness legislation, such as single ‘nonvulnerable’ adults) with 140,900 related to ‘prevention’. However, the policy provoked controversy with critics claiming that the objective of the 1977 Housing (Homeless Persons Act) was to stop homelessness by supplying accommodation to households that met the qualifying criteria so the ‘prevention’ strategy’s objective seemed to be aimed at inhibiting the use of the homelessness legislation and hence preventing politically damaging homelessness statistics (see Pawson, 2009). Indeed, in Sustainable communities (ODPM, 2005a, para 3.15) it was stated that new legislation may be necessary to promote the prevention agenda although no legislation was introduced. The nature of this potential new legislation was not made public but it was indicated that it would include powers to make the ‘housing options’ interview and the acceptance of any help to prevent homelessness a condition of being formally accepted as homeless (Housing Quality Network, 2005, p 2).

Rough sleeping The 1977 Housing (Homeless Persons) Act did not include the majority of the people experiencing the most visible form of homelessness – sleeping rough. Nevertheless, the developing tendency in the 1970s to treat homeless single people as victims of circumstance rather than ‘feckless’ threats to a society (Brennan, 1976) was reflected in changes in the vagrancy laws. Sleeping outdoors was no longer an offence unless it caused a nuisance and begging had to be ‘persistent’ to be unlawful. In the early 1980s, the number of people on the streets was increasing and they seemed younger than in the past. The Conservative response was to stop

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the payment of HB to people under 18 and reduce the amount paid to 18 to 25 year olds. Margaret Thatcher believed that HB availability was encouraging young people to leave home (Thatcher, 1993). These HB restrictions did not have the anticipated impact and, by the late 1980s, considerable media attention had focused on the growth of ‘cardboard cities’ and begging, especially in central London. Margaret Thatcher commented that ‘Crowds of drunken, dirty, often abusive and sometimes violent men must not be allowed to turn central areas of the capital into no-go zones for ordinary citizens’ (Thatcher, 1995, p 603). A new expression entered the homelessness discourse – ‘rough sleepers’ – a term indicating the sleepers were as coarse as their sleeping conditions. The voluntary sector responded to the young ‘rough sleeper’ problem by establishing ‘foyers’ (see Box 7.1) and, in 1990, a Rough Sleepers Initiative was started. This consisted of a programme, costing £196 million over seven years, to contact rough sleepers in central London, allocate them to emergency hostel places and then offer more permanent, ‘move on’ accommodation. In addition the Police increased their activity with the number of people arrested under the vagrancy legislation increasing from 192 in 1991 to 1,445 in 1992 (May et al, 2004). In 1995 the government claimed that the initiative was working and ‘the number of people sleeping rough in central London has dropped from over 1000 in 1989 to under 290 in November 1994’ (DoE, 1995, p 37). New Labour and rough sleeping New Labour’s 1997 manifesto declared that ‘there is no more powerful symbol of Tory neglect in our society today than young people without homes living rough on the streets’ (Labour Party, 1997). In office, New Labour gathered ‘intelligence’ on the issue via the Social Exclusion Unit, set up in the Prime Minister’s Office. Having examined the available evidence (Social Exclusion Unit, 1998a), the government concluded that sleeping rough was not primarily a housing shortage issue but a matter of the rough sleepers’ disturbed personal biographies and their ‘lifestyle culture’. Thus the response to rough sleeping should be to persuade rough sleepers to come in ‘out of the cold’ to places where they would receive help. A ‘Rough Sleeping Unit’, under a ‘Czar’, was established to coordinate a new rough sleeping ‘initiative’ (DETR, 1999b) and a target for reducing rough sleeping was announced to be monitored through an annual rough sleeper count. The initiative was subject to periodic reviews with policy ‘tweaked’ according to their conclusions. The 2008 review No one left out: Communities ending rough sleeping (DCLG, 2008) proclaimed policy success – the target to reduce rough sleeping by two thirds had been met and sustained with rough sleeping down from 1,850 in 1998 to 483 in 2008. It was now time to announce a new goal:

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We want to see real and sustainable reductions in rough sleeping year on year, so that no one in England has to sleep rough by 2012. Our vision is to end rough sleeping once and for all. (DCLG, 2008, p 7) According to the official count, the number of people sleeping rough in England on a given night had declined to 440 in 2010 when New Labour lost office. However, counting rough sleepers is difficult not least because experienced rough sleepers will conceal their whereabouts. New Labour’s official counts were questioned because, as examples, a person had to be ‘bedded down’ to be recorded as a rough sleeper (not sitting or standing near a bed), the counts started at midnight before many rough sleepers had ‘bedded down’, and not all local authorities compiled figures on rough sleeping. The problems involved in counting rough sleepers continue and were included as examples in the list compiled by the UK Statistics Authority (2015, Para 2.17) as ‘a number of potential sources of error and bias that DCLG does not explain or quantify the impact’ and a reason the rough sleeper statistics could not be regarded as fit for purpose as national statistics. CHAIN, a multi-agency database, records information about rough sleepers in London based on a record of contacts made by outreach teams, every day of the year. In 2015/16 it recorded 8,096 people seen sleeping rough in London – compared to the 940 reported in the DCLG’s November 2015 rough sleeper count. There were 5,276 new rough sleepers in 2015/16. As people are taken off the streets, others become rough sleepers.

Box 7.1: Foyers A programme to link hostel provision for young homeless people to employment and training opportunities was started in 1991. The aim of these ‘foyers’ was to break the ‘no home, no job, no home’ cycle for people aged 16 to 25. The idea was imported from France where 500 foyers offered an integrated system enabling young people to move around the country for employment or training with guaranteed accommodation. The foyer idea of linking accommodation, training and employment placement fitted well with New Labour’s ‘jointed up’ mantra and foyers multiplied from the late 1990s. By 2010 there were over 130 foyers helping about 5,000 residents in units ranging from converted houses to large purpose-built accommodation. There has been a dearth of up to date independent research on the impact of the expanded foyer provision from the user perspective and its success in enabling young people to find work. Lovatt and Whitehead (2006) discuss the problems involved in assessing the foyer impact, notably, the absence of formal indicators or measures of foyer outputs. Their research, focused on the 111 designated foyers which were in

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existence in 2003, providing 4,630 bed spaces for young people between the ages of 16 and 21, concluded: Across the range foyers appear fit for their purpose of providing safe and secure accommodation; basic life-skills training; and, to a far lesser extent, progress into employment, education and independent living for their residents. In general, foyers do provide reasonable value for money, particularly given the level of client need with which they now deal. However outcomes probably range as widely as costs. (Lovatt and Whitehead, 2006, p 70)

Housing First New Labour’s rough sleeping strategy placed great emphasis on preparing rough sleepers for permanent housing through a staged, ‘staircase’ approach. This could involve: contact with outreach workers; provision of day centres; progression into a direct access hostel; perhaps another move into a hostel with specialist support; a move to semi-independent or shared accommodation and, when ‘housing ready’, an independent tenancy sometimes with floating support. ‘Housing First’, a model developed in the United States, has challenged this strategy. As its name suggests, Housing First brings support to people in secure accommodation. It claims that:

1. housing is a basic human right, not a reward for clinical success; and 2. once the chaos of homelessness is eliminated from a person’s life, clinical and social stabilisation occur faster and are more enduring. (Shelter, 2008, p 5)

Some research has demonstrated ‘Housing First’ is more effective than the ‘staircase’ model when it has been applied to people with multiple, complex problems. It produces reduced use of drugs and alcohol (Padgett et al, 2011), higher rates of housing stability (Tsemberis et al, 2004) and a greater sense of choice (Greenwood et al, 2005). A few ‘Housing First’ schemes have been established in England. Bretherton and Pleace (2015) reviewed nine English schemes. Based on interviews with service users, but with no comparator ‘staircase’ schemes, they found overall gains on a number of indicators but: Gains in health, mental health, social integration, drug and alcohol use and levels of anti-social behaviour were not uniform. There was also the possibility of deterioration in mental and physical health. However, there was no evidence of increases in drug or alcohol use, or

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anti-social behaviour, since engaging with Housing First. (Bretherton and Pleace, 2015, p 5) Housing First’s effectiveness has led to endorsements from the Canadian government and the EU. In evidence to the House of Commons Communities and Local Government Select Committee, Sarah Johnsen, Professorial Fellow in the Institute for Social Policy, Housing, Environment and Real Estate at HeriotWatt University, told the Committee: There is really now consistent compelling evidence internationally from a number of countries that have implemented it using very robust randomised control trial studies and so on to show that it is an extremely effective intervention with people with long-term experiences of homelessness and complex needs, particularly substance misuse issues and/or mental health problems. (House of Commons Communities and Local Government Select Committee, 2016c, p 29) However, the Committee was cautious in its approach to ‘Housing First’: … because of the severity of England’s homelessness challenge and the scarcity of funding and of social housing. Many people have been on social housing registers for over ten years and are therefore likely to be concerned by what might be seen as a means of jumping the queue. We acknowledge and commend the work delivered through existing Housing First pilots but we believe that resources should be focussed on supporting more mainstream efforts to tackle homelessness and prevent instances of entrenched homelessness.

Homelessness: the coalition government In the countdown to the 2010 general election the Conservative Party, perhaps in an attempt to modify its perceived ‘nasty’ image, focused on homelessness. In 2008, it set up the Conservative Homelessness Foundation advised by a panel made up of the leading voluntary organisations involved in the issue. Claiming that ‘Homelessness is a complex issue and contrary to popular belief, it is rarely simply about whether someone has a roof over their head’ (Conservative Party, 2009, p  1), a policy group, consisting of shadow ministers across a range of departments, was established to coordinate policy. The 2010 Conservative Party manifesto (Conservative Party, 2010b, p 76) stated: We will implement a range of measures to address the problems of the homeless, including introducing more accurate street counts and

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ensuring a Minister in each relevant department has homelessness in their brief. The coalition government adopted these measures and, on a revised counting method, estimated that there were 1,247 rough sleepers in England in 2010. A Ministerial Working Group on Homelessness was set up. Its first report Vision to end rough sleeping: No second night out nationwide (HM Government, 2011b, p 9) promised to ‘work with partners to roll out the principles of No Second Night Out nationally, drawing on the lessons learned in London and from other effective approaches’. Its second report Making every contact count: A joint approach to preventing homelessness (HM Government, 2012, p 5) focused on ‘how services can be managed in a way that prevents all households, regardless of whether they are families, couples, or single people, from reaching a crisis point where they are faced with homelessness’. The 2011 Localism Act allowed local authorities to discharge their duties to statutory homeless households by an offer of accommodation in the private landlord sector without the agreement of the household concerned. Local authorities have considerable discretion in interpreting their obligations. Such discretion was augmented by the 2011 Localism Act, although the exercise of discretion is tempered by court decisions. Thus, for example, the vulnerability clauses in the legislation allowed some single people with complex needs to be eligible for housing arranged by the local authority but, until 2015, councils were only obliged to treat as ‘vulnerable’ those single homeless applicants who were more vulnerable than an ‘ordinary street homeless person’ but a Supreme Court judgement in May 2015 stated that the ‘vulnerability’ test applied to whether an applicant is more likely to be harmed by the experience of homelessness than an ‘ordinary person’, thereby significantly enhancing the chances of a single homeless person receiving assistance. After 2013, coalition government interest in homelessness, outside its immigration dimension, started to wane and the Ministerial Working Group did not add to its reports made in 2011 and 2012. Although the coalition government abandoned New Labour’s ‘targets’, the application of the ‘prevention and relief ’ strategy became more intensive with the DCLG (2016h) recording 212,600 cases of ‘prevention and relief ’ outside the statutory homelessness framework in 2015/16. The House of Commons Communities and Local Government Select Committee (2016c, pp 17, 22) noted: local authorities have a duty to make the necessary inquiries to ascertain what level of duty they owe an applicant. We have received much evidence however that suggests that this does not always happen. In the face of increasing demand on services and decreasing funding, some councils have been ‘gatekeeping’ ... Homeless people can be made

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to feel that they were part of the problem rather than the victims of circumstance ‘Housing options’ interviews, preceding the formal acceptance of a household as homeless, are an element in gatekeeping. A housing officer in a London borough featuring in a BBC documentary (BBC, 2016) said ‘We are a housing options service with no options’. Fifty-two per cent of homeless prevention consisted of being ‘supported to remain at home’ (Wilson and Barton, 2016b). Stephenson (2016) found considerable variability in the practices of the London boroughs in relationship to their use of preventative strategies with Camden adopting the most rigorous prevention strategy, stating ‘For those families choosing to follow a statutory route, the Council will identify suitable short term housing and then make a single offer of suitable private rented property to them, to discharge its duty’ (quoted in Stephenson, 2016, p 8) There is a dearth of information on the longer term outcomes of prevention and relief and there has been no survey of consumer perceptions of the process. There is a danger that homelessness may become displaced into overcrowding with its limited statutory definition and measurement problems (see Chapter Eight). The UK Statistics Authority (2015, para 1.6) declared ‘the statistics published in Prevention and Relief and Rough Sleeping cannot be designated as national statistics because they were not integrated with other statistics to produce a full picture of trends in homelessness’. Despite greater ‘prevention and relief ’ use and the post 2012 economic recovery, statutory homelessness has escalated (see Figure 7.3). The rough sleeper count increased from 1,768 in 2010 to 4,134 in Figure 7.3: Homelessness acceptances and households in temporary accommodation (England) 2000-16 160,000

Homelessness acceptances: not to be held intentional Households in temporary accommodation

140,000 120,000 100,000 80,000 60,000 40,000 20,000

16 20

14 20

12 20

10 20

08 20

06 20

04 20

02 20

20

00

0

Sources: Aapted from: Wilcox et al (2016b), DCLG (2016h)

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2016, with benefit sanctions and cuts being principal causes (CRESR, 2016). The rise in the number of households in temporary accommodation exceeded the increase in the number of homelessness acceptances indicating the difficulties involved in securing accommodation for homeless people. In 2016, the House of Commons Communities and Local Government Select Committee endorsed a private member’s bill (the Homeless Reduction Bill) that would place a duty on councils to prevent homelessness for all eligible applicants – not just those in priority need – threatened with homelessness within 56 days, with specific standards set for the quality of the prevention service. The bill, akin to legislation passed in Wales, was supported by Theresa May’s government, which introduced a £60 million Homelessness Prevention Trailblazer Fund aimed at encouraging local authorities to develop better prevention services. Scotland Post devolution, the Scottish Government developed a distinctive approach to homelessness. Labelled ‘a rights based approach’ (Anderson, 2009, p 107), it has come to symbolise a particular Scottish attitude to social policy and has been referred to as ‘the most progressive homelessness legislation in Europe’ (Scottish Executive, 2005, p 5). The Housing (Scotland) Act 2001 required local authorities to house homeless people, whether considered to be in priority need or not, while a homelessness claim was investigated. Moreover, if assessed as non-priority homeless, local authorities had to supply accommodation for a reasonable period. Under the 2003 Homelessness (Scotland) Act the distinction between priority and non-priority need was to be gradually phased out in accordance with local circumstances. By 2012, all unintentionally homeless people would be entitled to a permanent home defined as a ‘Scottish secure tenancy’ (local authority) or an assured tenancy (usually used by housing associations) not an assured shorthold characteristic of the private landlord sector). The policy was reaffirmed in November 2012 when the Scottish Parliament approved the Homelessness (Abolition of Priority Need Test) (Scotland) Order. By ensuring that, from 31 December 2012 onwards, local authorities could no longer apply the priority need test to homeless households, all unintentionally homeless households in Scotland became entitled to settled accommodation. Given these changes, it is not surprising that the number of applications for assistance assessed as entitled to settled accommodation increased as did the number of households in temporary accommodation (see Table 7.1). Some local authorities expressed concern about the consequences of the rights based approach with one respondent in a Scottish local authority survey stating: The homelessness legislation, when fully in place, will see the end of people in the area being housed from waiting lists. We are already

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receiving twice the number of homelessness presentations as we get in empty homes each year. As the priority groups extend; we will not be able to cope. (quoted in Anderson, 2009, p 113) Table 7.1: Homeless acceptances and numbers in temporary accommodation, Scotland, selected years Year

Homeless acceptances: not held to be intentional

Households in temporary accommodation

2002/03

27,527

5,403

2005/0

31,679

7,985

2009/10

36,466

7,985

2015/16

26,334

10,488

Source: Adapted from Scottish Government (2016b)

As the ‘headline’ homelessness figure increased and the proportion of new local authority lets allocated to homeless people soared from 24.2% in 2001/02 to 53.3% in 2009/10 (Wilcox et al, 2016b), the English ‘prevention’ strategy was pursued in Scotland but not with the same robust central ‘administrative stratagems’. In 2009, new guidance was issued to local authorities on homelessness prevention endorsing the ‘housing options’ approach (Scottish Government, 2009). Since 2010 homelessness acceptances have been in decline and the proportion of new local authority lets to homeless people fell to 48.3% in 2014/15 (Wilcox et al, 2016b) but, as Shelter Scotland (2015, p 4), stated: This decrease can be linked to the introduction of the housing options model and a renewed preventative approach adopted by local authorities, rather than any significant change in the underlying causes of homelessness. Moreover, the increase in the number of households in temporary accommodation indicates that the settled accommodation allocated to relieving homelessness has been insufficient. The prevention strategy has been more controversial in Scotland than in England and the Scottish Government started to publish experimental statistics on prevention outcomes to provide a more robust evidence base for the impact of the ‘housing options’ process (Scottish Government, 2015a). In Scotland there is no annual rough sleeper count but the lack of restrictions on single people applying for and receiving assistance – almost a ‘Housing First’ approach – gives

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some insight into the ‘rough sleeper’ problem: 1,409 people applying as homeless in 2014/15 (4% of all applicants) said they had slept rough the night before their application. The Scottish Household Survey indicated that about 5,000 adults sleep rough during the year, with an average of 660 sleeping rough on a typical night (Scottish Government, 2015b). Wales and Northern Ireland Given the Welsh Assembly’s restricted legislative powers up to 2010 it is not surprising that homelessness policy in Wales took the same path as that in England. However, with increased legislative autonomy, the National Assembly for Wales developed a distinct approach to homelessness. The 2014 Housing (Wales) Act obliged local authorities to provide housing advice and assistance to everyone within their local area, regardless of whether or not they are homeless or threatened with homelessness. The Act’s homelessness provisions focused on getting local authorities, in partnership with other bodies, to prevent homelessness wherever possible. It imposed an interim duty on local authorities to secure accommodation if an authority has reason to believe that an applicant is eligible, homeless and in priority need pending a full assessment of their circumstances. Local authorities also have a duty to help to secure accommodation for all applicants assessed as homeless for a period of 56 days (or fewer if they consider that reasonable steps to secure accommodation have been taken). These duties allow time to prevent a potential applicant from becoming homeless. After the 56 days (or less), the local authority only has a continuing duty to secure accommodation for those in priority need – broadly defined in similar terms to the English legislation, but with ex-prisoners not included in the priority need category – who have not become homeless intentionally, although local authorities have the discretion not to apply an intentionality test. As Welsh local authorities prepared for the introduction of the 2014 Act by developing prevention stratagems there was a downward trend in homelessness ‘acceptances. Nevertheless, homelessness acceptances in Wales were 70% higher than in England, relative to population. Following the full application of the 2014 legislation, in 2015/16 7,128 households were assessed as threatened with homelessness within 66 days and 4,599 households (65%) were successfully prevented from becoming officially homeless for at least six months (Welsh Government, 2016b). Northern Ireland has also followed the English direction but with a time lag. Legislation similar to the 1977 Housing (Homeless Persons Act) was not applied to Northern Ireland until 1988 and, despite much debate, extension of the priority need categories has not occurred (Gray and Long, 2009). The Homelessness Monitor: Northern Ireland 2013 (Fitzpatrick et al, 2014) found that there were 13.4 statutory acceptances per 1,000 households in Northern Ireland

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compared to 2.3 in England and that official homelessness figures have remained at historically high levels since 2005/06. The high proportion of homelessness acceptances is reflected in the proportion of social lettings awarded to homeless people — 70% compared to 20% in England (Shanks et al, 2016).

Overview

• • • •

Homelessness has been identified as a social problem because it has been seen as a threat to the social order and as unacceptable in an affluent ‘civilised’ society. Definitions of homelessness are related to notions of causation. After an initial rapid increase under New Labour, the ‘prevention’ strategy reduced the recorded incidence of statutory homelessness in England. Despite more intensive ‘prevention’ measures, recorded homelessness increased under the coalition government. Scotland’s ‘rights’ approach to homelessness has been modified by the increased use of ‘prevention’ strategies.

Questions for discussion 1. You have been asked to count the number of rough sleepers in a part of a large city. What problems might you encounter in making the count? 2. Look at Figures 7.1 and 7.2. Identify ‘structural’, ‘personal’ and ‘inter-personal’ factors in the process of becoming homeless. 3. Is defining homelessness a political act rather than a semantic exercise? 4. How do the English, Welsh and Scottish approaches to homelessness differ?

Further reading The various Homelessness Monitors, written by Suzanne Fitzpatrick, Hal Pawson, Glen Bramley, Steve Wilcox and Beth Watts, covering England, Scotland, Wales and Northern Ireland, supply comprehensive information on homelessness in the four ‘home nations’.

Websites Local authorities publish homelessness strategies. Many of these are available online. The European Federation of National Organisations Working with the Homeless (FEANTSA) maintains a website that contains statistics and information on homelessness in Europe: www.feantsa.org Homeless Link is a useful information source: www.homeless.org.uk

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Wendy Wilson supplies informative, up to date examinations of homelessness: http:// researchbriefings.parliament.uk CHAIN – the Combined Homelessness and Information Network – contains helpful information: www.mungos.org/chain

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eight Decent and sustainable homes Summary

• •

• • • • •

The state has regulated new housing construction through building regulations and planning controls. Minimum standards have been imposed on the condition and use of the existing housing stock. Demolition was the dominant method used from the 19th century to deal with accommodation ‘unfit for human habitation’ but, from the late 1950s, improvement grants – often distributed on an area basis – offered an alternative to clearance. From the late 1980s, state aid to the private sector for repair and improvement became increasingly selective. There has been a change in the official benchmarks used to measure housing quality, from 19th century ‘sanitary’ standards to contemporary ‘decent’ and ‘sustainable’ benchmarks with an energy efficiency emphasis. Private rented sector regulation has become ‘light touch’. In controlling multi-occupied properties governments have attempted to balance enforcing minimum standards with maintaining a stock of cheap, accessible accommodation. Policy makers in Scotland, Wales and Northern Ireland have developed their own housing standard measures.

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The slum Most local authorities adopted the model bylaws for building new homes set out in the 1875 Public Health Act and subsequent local authority building regulations meant that new houses were ‘decent’ according to the norms of the time. However, because dwellings deteriorate and standards change, governments have established minimum housing benchmarks and attempted to ensure the existing dwelling stock meets these requirements. Cuming (2016, p  24) states that ‘the first citation of the word slum “in a dictionary of slang” was in ‘James Hardy Vaux’s Vocabulary of the Flash Language (1812) –where it refers to a room as well as a criminal racket or “rig”’. ‘Slum’ was also applied to an entire area and its surrogates were ‘plague spot’, ‘rookery’, ‘mean streets’, ‘Abyss’ and ‘Labyrinth’ with the term retaining its association with criminality. Manchester’s Angel Meadow – ‘Victorian Britain’s Most Savage Slum’ (Kirby, 2016) – contained all the slum’s ‘externalities’. Its slaughter houses, gasworks, boneyards and catgut factories created a stench than ‘even in a hard frost was sickening’. Its men were ‘malnourished and short, squat and sallow’ and its women ‘stunted and pale’. Cholera attacked the area with ‘extraordinary venom’ (Kirby, 2016, pp 8, 9, 32). ‘Putty shops’ where criminals fenced their stolen goods and drinking dens were common, ‘scuttle’ gangs were at war and Angel Meadow inhabitants were well represented in the frequent riots. From the 1830s, attempts were made to deal with the ‘nuisance’ caused by individual unfit dwellings and legislation sponsored by authorities in Liverpool and Manchester made it possible to close cellar dwellings. The 1868 Artisans’ and Labourers’ Dwellings Act allowed local authorities to require owners to demolish unfit houses but imposed no landlord obligation to rehouse the displaced tenants. The Act was concerned with ‘cleansing’ areas from their health and social order ‘externalities’ – widening alleys and courts – rather than the slum dwellers’ welfare. Nevertheless, there was intense hostility to the implementing the legislation from parish vestries, often composed of local property owners. The 1875 Artisans’ and Labourers’ Dwellings Improvement Act This Act made provision for eradicating slum areas in a planned manner. Its aim was to facilitate, but not compel, the use of public funds to eliminate the ‘slum’ threat to public welfare. State expenditure would be minimised by selling the cleared site to philanthropic, ‘model dwelling’ housing associations with local government having only very restricted powers to build homes in clearance areas. Unfortunately, the Act did little to improve the slum dwellers’ welfare because demolition costs, with landlord compensation at market value, were far greater than housing associations could pay for the cleared sites and provide adequate accommodation.

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The 1875 Artisans’ and Labourers’ Dwellings Improvement Act placed a duty on local authorities to arrange for new dwellings to be built on or near the cleared site, sufficient to rehouse all the displaced persons. However, this provision, even when reduced to 50% in 1882, was usually ignored as were the obligations placed on railway companies to replace homes lost in railway construction. In 1874 Joseph Chamberlain, then a Liberal, declared that misery of the poor was not due to intemperance but to ‘the horrible, shameful homes in which many ... are forced to live’ (quoted in Judd, 1993, p 64). His famous central Birmingham ‘grand improvement’ scheme to clear the slums and rehouse their inhabitants started under the Cross Act, led to the building of Corporation Street and a decline in the death rate from 53.2 to 21.3 per 1,000. By 1888, not one new house had been built on site to replace the slums, prompting a newspaper to comment ‘Tis an excellent plan and I’ll tell you for why. Where there’s no person living, no person can die’ (quoted in Watts, 1992, p 53). High rents and the numerous regulations applied in the new ‘model dwelling blocks’ meant that few slum inhabitants moved in: only 11 of the 5,719 slum inhabitants occupied new accommodation in a London scheme (Wise, 2008). Thus, although slum removal helped to achieve the ‘sanitary’ objective – the last cholera epidemic was in 1867 and the incidence of typhus was reduced – the poor were displaced into overcrowded adjacent areas and deaths from some contagious diseases increased. Deaths from measles, for example, increased from 78,211 in 1851–60 to 105,680 in 1901–10 (Anderson, 1993).

The 1930s clearance drive The slum issue was put into abeyance after 1919 while efforts were made to rectify the housing shortage caused by the house construction dearth during the First World War. The 1919 Housing and Town Planning Act established that compensation for an unfit house should be at site value only but, by 1930, only 11,000 slum houses had been demolished. Local authorities had to meet half the cost and there was strong opposition from tenants ‘terrified of having to pay too high rents’ (Simon, 1933, p 36). The 1929–31 minority Labour government started the 1930s slum clearance drive. The 1930 Housing Act offered additional subsidies to local authorities for demolition and construction and, post 1933, when the Conservatives abolished the ‘general needs’ subsidy, almost all local authority building was directed towards clearance. The minister responsible, Hilton Young, declared slum clearance to be ‘a public health problem ... not a first line problem of housing; it is a problem of ridding our social organism of radiating centres of depravity’ and subsidies were ‘appropriate in this region as a measure for the protection and preservation of the public health’ (Hilton Young, 1932).

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During the 1930s, when 250,000 houses were demolished or closed and over a million people were rehoused, attention focused on the difficulties in rehousing the people affected by clearance. Most concern focused on the slum inhabitants’ inability to pay for their improved living standards. A study of council tenants in Stockton, rehoused from the slums, demonstrated a rise in mortality connected with malnutrition (Ineichen, 1993) and a Manchester clearance area survey revealed only 31% of the people rehoused remained in their new estate three years later. Travel to work costs from outlying estates were a problem but ‘the principal cause of this [exodus] was undoubtedly rent’ (Yelling, 1992, p 74). Older property improvement was not totally ignored between the wars. The 1926 Housing (Rural Workers) Act gave local authorities the discretionary power to give improvement grants to private landlords and the 1930 Housing Act allowed improvement areas to be declared in urban districts with grants available to encourage repair. Moore (1980) estimates that 123,000 dwellings were made fit through statutory proceedings between 1930 and 1936 and 332,000 made fit by other forms of local government action.

The bulldozer returns Clearance returned to the political agenda in 1954 having been abandoned in the years immediately after the Second World War as the government concentrated on making good the overall housing shortage. Between 1954 and 1975, local authorities demolished 1 million dwellings as part of a large scale urban renewal exercise. Initially this clearance drive provoked little controversy – the most significant objection being its limited scale in relationship to the problem’s true magnitude – but in the early 1970s the clearance rationale began to be questioned. The vast majority of the dwellings demolished in the 1950s and early 1960s were grossly unfit and the people living in them, as tenants rather than owners, were excluded from formal appeal mechanisms against a clearance decision. However, by the late 1960s, local authorities were beginning to deal with a different area types where not all the dwellings were seriously unfit and where there were more owner-occupiers. Objections to compulsory purchase orders became more frequent and community activists started to assist local people in devising rehabilitation schemes as alternatives to clearance. Social research began to reveal insensitive, ‘top down’ approaches to demolition with the ‘clearance drive’ taking homes capable of improvement (Dennis, 1972; Gower Davies, 1974), a loss of community spirit when people were rehoused into different areas and increased living costs in the new estates, both in terms of rent – rent rebate schemes were uncommon– and increased travel to work costs from the new periphery estates.

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Clearance or improvement? The 1949 Housing Act allowed local authorities to offer improvement grants at 50% of rehabilitation costs up to a specified limit but only 7,000 grants were issued between 1949 and 1953, mainly because local authorities did not inform the public of their availability. The 1954 Housing Repairs and Rents Act increased the value of improvement grants and the 1959 House Purchase and Housing Act made it mandatory for local authorities to pay ‘standard’ grants for installing basic amenities such as a bath and an internal water closet – a measure that had a major impact in improving older homes. Additional discretionary grants were available to assist owners to improve their dwellings to a 30-year life standard. A dual strategy, unfit property clearance and improvement for ‘sub-standard’ dwellings, was promoted in the 1960s. However, Labour’s enthusiasm for flattening slums was beginning to ebb. Against a financial constraint background, the Labour government announced ‘within a total of public investment at about the level it has now reached, a greater share should go to the improvement of older houses’ (MHLG, 1968, p 4). The 1969 Housing Act increased grant payments, introduced a special contribution for basic amenity provision in multi-occupied dwellings, and made grants available for environmental measures in ‘General Improvement Areas’ (GIAs). Great reliance was placed on the ‘halo’ impact of area selectivity: The effort and resources devoted to improvement provides a much better return when directed to the up grading of whole areas – the houses and the environment. People are more likely to find it worth their while to co-operate and to maintain their houses after improvement. (MHLG, 1969, p 3) In the early 1970s, higher grant rates were offered in certain regions and the grant approvals soared as Edward Heath’s government attempted to inject demand into the economy and use home improvement to limit the requirement for new council housing. Improvement grants helped to upgrade the private sector housing stock but many people with low incomes left their homes as landlords encouraged tenants to move to facilitate sales to owner-occupiers – a process to become known as ‘gentrification’ (see Box 8.1) The Conservative government’s white paper Better homes: the next priorities (MHLG, 1973) heralded rationing by more specific area selectivity. Labour adopted this approach and the 1974 Housing Act introduced Housing Action Areas (HAAs) to complement existing GIAs. HAAs were areas exhibiting problem combinations such as a high proportion of unfit houses, furnished tenancies and shared accommodation. In HAAs, local authorities had extra powers to pay more generous grants and to acquire rented properties by compulsory purchase. In the 1950s the Labour Party committed

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itself to ‘socialising’ the private landlord sector and compulsory purchase of private landlord accommodation, perhaps to pass on to a housing association, marked a step in this direction. However, funding restraints limited the initiative’s impact.

Box 8.1: Gentrification Lees et al (2007, p xv) define gentrification as ‘the transformation of a working-class or vacant area of the central city to a middle class residential and/or commercial use’. Some accounts of the gentrification process identify early ‘gentrifiers’ as low-income, creative people who increase the chic and appeal of a district (Pritchard, 2016). Middle class residents are attracted to the area and property price hikes displace the ‘hipsters and artists’ and the original working class inhabitants. Many local authorities have encouraged gentrification as a way of creating ‘mixed’ communities but, at a point in the process, the area can become dominated by the middle class. Ruth Glass (1964, p xvii), who coined the term ‘gentrification’, describes the process as: One by one, many of the working class quarters of London have been invaded by the middle-classes – upper and lower. Shabby, modest mews and cottages – two rooms up and two down – have been taken over, when their leases have expired, and have become elegant, expensive residences … Once this process of ‘gentrification’ starts in a district it goes on rapidly until all or most of the original working-class occupiers are displaced … Some cities, notably Berlin, are trying to contain gentrification by acquiring properties at risk of gentrification and imposing restrictions on luxury renovations.

Income selectivity and home improvement In the 1970s clearance was automatically associated with council housing. Margaret Thatcher’s first government (1979–83) displayed a strong commitment to private sector housing rehabilitation as a mechanism to prevent future local authority building and an outlet for Right to Buy (RTB) receipts (Lund, 2016). This rehabilitation commitment was accompanied by a policy shift towards extending improvement grant availability regardless of location. However, following the 1983 general election, improvement grants were badly affected by public spending cuts and the Treasury appropriating RTB receipts for non-housing purposes. Home Improvement: A New Approach stated ‘home ownership offers opportunities for individuals to alter and improve their homes as they wish; they must carry the primary responsibility for keeping their property in good repair’ (DoE, 1985,

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p 7). In future, improvement grant eligibility would be determined by property fitness and the occupiers’ income. Neoliberal distaste for relativity in defining minimum yardsticks was revealed when, in relationship to the fitness standard, the green paper declared ‘a policy of raising the minimum standard to match rising social expectations would be inappropriate’ (DoE, 1985, p 10). The owneroccupier of a dwelling deemed unfit according to an unchanging standard would be eligible for an improvement grant but subject to a means test. The new grant would cover only the cost of making a dwelling fit with additional expenditure to give a house a 30-year life covered by an equity-sharing local authority loan. No action was taken on the principles outlined in the 1985 green paper until the 1989 Local Government and Housing Act, and, in the interim, equity-sharing loans were abandoned. Under the Act a new benchmark for assessing unfitness was introduced that became the basis for awarding means-tested renovation grants. Although HAAs and GIAs declarations were abolished, local authorities were allowed to undertake group repair schemes such as ‘enveloping’, involving making sure an entire terrace street was sound, and to designate renewal areas. Clearance area declaration was permitted only when a local authority had carried out a detailed cost/benefit option appraisal. The new urban renewal regime produced disappointing results. Again, selectivity was accompanied by resource constraints. Central government failed to make the finance available to meet the demand especially in neighbourhoods where low income and a major unfitness problem coincided. Local authorities responsible for such areas had to remain silent on the mandatory grant entitlement and delay payments to those who had applied, thus creating uncertainty and frustration among applicants. The 1996 Housing Grants, Construction and Regeneration Act made all grants discretionary, except for the disabled facilities grant.

‘Decent’ homes The private sector The 1996 English House Condition Survey (DETR, 1996) exposed a disconcerting level of unfitness and disrepair in property let by private landlords: 19.3% was unfit and 28.9% was deemed ‘poor’. In the homeownership sector, 10.9% lived in ‘poor’ housing with 6% of the stock unfit. However, New Labour retained the discretionary nature of private sector improvement grants established by the Conservatives and state expenditure on private sector improvement declined. Indeed, Turkington and Watson (2014, pp 2–3) note that, both in political and academic circles, ‘housing renewal tends to be less prominent than other aspects of policy such as new housing and affordability’. The 2001 English House Condition Survey contained a new benchmark for accessing housing stock condition, the decent homes standard (see Box 8.2). This

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was a target threshold, to be achieved in the future. The fitness standard became a minimum yardstick that could trigger specific local government action to rectify the unfitness. In 2006, under the 2004 Housing Act, the fitness standard was replaced by the Housing Health and Safety Rating System (HHSRS) involving a risk assessment related to the most vulnerable occupant in the defective housing (see Box 8.3). Prior to the introduction of HHSRS a mechanism was available enabling local authorities to compel a private landlord to upgrade his/her property to a statutory standard. As Bate (2016, p 3) points out ‘Since the introduction of the HHSRS in 2006, replacing the old Housing Fitness Standard, there have effectively been no minimum property standards for rented housing in England’. He continues: The risk-assessment approach to property standards under the HHSRS means that issues are judged on the risk they pose, not simply whether or not a property has a particular maintenance issue. It should assess for the most vulnerable member of the household, and therefore would give a different judgement depending whether or not, for example, a baby lived at the property. (Bate, 2016, p 6) In 2015 Karen Buck introduced the Homes (Fitness for Human Habitation) Bill into Parliament that would not only have enhanced the fitness standard in the HHSRS system but would have introduced a new set of minimum property standards which tenants could enforce through the civil courts. It was defeated, its opponents claiming it would add to the ‘regulatory burden’ on private landlords.

Box 8.2: A decent home To be classified as decent a home must meet each of the following criteria.

• •

•

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It is above the current statutory minimum housing standard, that is it does not meet one or more of the hazards assessed as serious (category 1) under HHSRS. It is in a reasonable state of repair: dwellings failing on this point will be those where either: −− one or more key building components are old and need replacing or major repair; or −− two or more of the other building components are old and need replacing or major repair. It has reasonably modern facilities and services: dwellings failing on this point are those that lack three or more of the following: −− a reasonably modern kitchen (20 years old or less); −− a kitchen with adequate space and layout;

Decent and sustainable homes

•

−− a reasonably modern bathroom (30 years old or less); −− an appropriately located bathroom and WC; −− adequate insulation against external noise (where external noise is a problem); −− adequate size and layout of common areas for blocks of flats. It provides a reasonable degree of thermal comfort. (DCLG, 2006a)

Box 8.3: Housing Health and Safety Rating System Property ‘hazards’ are given a score by a local authority environmental health officer based on the likelihood of an occurrence and the probable harm to the most vulnerable potential occupant. If the assessment produces a high score, labelled category 1, then the local authority has a duty to take action. Action can take the form of hazard awareness advice, improvement notices requiring repair and/or improvement, making a demolition order, declaring a clearance area or issuing a prohibition notice prohibiting the use of all or part of the dwelling. A lower assessment score, category 2, gives local authorities the power but not the duty to take action. HHSRS can be regarded as a minimum standard – contravention can involve legal action.

Initially the target for decent homes applied only to ‘social’ housing and it seemed that New Labour had stepped away from private sector involvement. A consultation document stated: ... it is only right that the responsibility for maintaining privately owned homes, which for many people is their most valuable asset, should rest first and foremost with the owner … (DETR, 2001, paras 3.1, 3.2) The detailed provisions governing the way local authorities facilitated private sector improvement were removed and replaced with a broad power to provide assistance for home repair and improvement, leaving more discretion to local authorities in their spending decisions. Targeting vulnerable households In response to criticisms that private sector improvement was being neglected, the decent homes target was extended in 2003 to cover privately owned homes occupied by ‘vulnerable’ families. The target was for 70% of vulnerable households living in the private housing sector to have a decent home by 2010 but this objective was quickly downgraded to ‘dormant’ status. Government sponsored

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home improvement agencies, often called ‘staying put’ or ‘care and repair’, assisted vulnerable people to access financial sources such as local authority grants and equity loans and provided support in finding a reliable builder. The social sector In 1997, New Labour inherited a local authority repairs backlog with a cost estimated at £19 billion. A target to ensure that all ‘social’ housing met the decent homes standard by 2010 was set. Central government injected more resources into local government to achieve the target, mainly by an additional allowance for major repairs supplemented by ‘prudential borrowing’. However, stock transfer to registered social landlords, able to borrow outside public sector constraints, assisted by debt write-off and ‘gap funding’ when the local authority stock value was negative, was the principal mechanism. Extra state resources were available if an Arms Length Management Organisation (ALMO) was set up. An ALMO is a not-for-profit organisation run by an unpaid board of directors including councillors and tenant representatives but no group having a controlling majority. The council continues to own the homes and determines allocation policy but the ALMO is responsible for stock management. In 2008 there were 70 ALMOs managing more than 1 million council homes but in 2014 this number had been reduced to 43 via stock transfer to housing associations and local authorities taking management back into their mainstream activities.

New Labour and sustainable homes When applied to housing the term ‘sustainable’ includes an ecological aspect related to a built environment ‘which meets the needs of the present without compromising the ability of future generations to meet their own needs’ (World Commission on the Environment and Development, 1988). Carbon dioxide emissions from the domestic housing sector supply around 25% of all UK greenhouse gas emissions. The Code for Sustainable Homes (DCLG, 2006b) set six levels of sustainability ranging from one (above existing building regulations) to six – a zero carbon home. Under New Labour, compliance with the Code at level three became mandatory for housing built with Social Housing Grant but voluntary for the private sector. The green paper Homes for the Future: more affordable, more sustainable proposed a phased building regulation enhancement so that, by 2016, all new homes would be ‘zero carbon’, defined as ‘over a year, the net carbon emissions from all energy use in the home would be zero’ (DCLG, 2007, p 4). To promote this objective, it was announced that new zero carbon homes valued at up to £500,000 would be exempt from land stamp duty tax and five eco-towns would be created. Eco-

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towns – reminiscent of ‘old’ Labour’s new towns – were to be small towns of 5,000–20,000 homes and a mixed community consisting of a variety of tenures and house sizes. They would be ‘places with a separate identity but with good links to surrounding towns’ and ‘the development as a whole will achieve zero carbon’ and provide ‘an exemplar in at least one area of environmental technology’ (DCLG, 2007, p 4). Eco-towns met with resistance in many areas and the initial list of places where eco-towns might be established produced only four firm proposals. In 2009, New Labour announced a second-wave of eco-towns and new planning guidance was issued including measures such as power points in all new developments to charge electric vehicles. Retrofit At current building levels, new home construction adds less than 1% to the housing stock each year. Thus, if the housing sector is to make a significant contribution to the government’s legally binding target, set out in the 2008 Climate Change Act, to cut greenhouse gas emissions by 80% by 2050, existing homes will need ‘retrofitting’. The decent home standard, applied to the social sector includes a thermal comfort criterion that contributes to energy efficiency and, in the private sector, energy efficiency reports help to raise awareness about energy consumption. Under New Labour, such reports were phased in after 2007 as part of Home Information Packs and were retained by the coalition government when Home Information Packs were scrapped. Grants to owners for micro-energy generation such as wind turbines and solar energy plus assistance to low-income households via the Warm Front programmes also encouraged efficient energy consumption. In 2008, the Carbon Emissions Reduction Target (CERT) came into effect, obliging electricity and gas suppliers in Great Britain to help reduce CO2 emissions from homes, especially in deprived areas, under the Community Energy Savings Programme.

Overcrowding Whereas homelessness is a visible housing shortage symptom, overcrowding is a more concealed response. Overcrowding externalities Overcrowding was recognised as a social problem in the mid-19th century because of its association with disease, depravity and anarchy. Edwin Chadwick, a firm believer that disease spreads by breathing foul air – the ‘miasmic’ theory – regarded densely populated areas and crammed buildings as major causes of illness because they produced potent concentrations of putrefying waste. However, he

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was more concerned about how ‘the want of separate apartments’ influenced the ‘morals of the population’ (Chadwick, 1842, p 190). This concern about the immorality linked to overcrowding was an enduring anxiety in the 19th century. Lord Shaftesbury, in his evidence to the 1885 Royal Commission on Housing, claimed that a family sharing a room often meant a family sharing a bed. He commented: … a friend of mine … going down one of the back courts, saw on the pavement two children of tender years, of 10 or 11 years old, endeavouring to have sexual connection on the pathway. He ran and seized the lad, and pulled him off, and the only remark of the lad was, ‘Why do you take hold of me? There are a dozen of them at it down there’. You must perceive that that could not arise from sexual tendencies, and that it must have been bred by imitation of what they saw. (Lord Shaftesbury, 1885, quoted in Stedman Jones, 1976, p 224) Local authority powers to control overcrowding did not apply to dwellings occupied by a single family until the 1875 Public Health Act. Intervention was applied sparingly except to common lodging houses and, in Scotland, to tenements where ‘block living’ was seen as an extra threat to public order. The model bylaws issued by the Local Government Board specifying thresholds at which local authorities might take action were expressed in terms of cubic feet of air per person. Adults were allowed 300 cubic feet in a sleeping room and children 150 cubic feet, compared to the 600 cubic feet allowed in army barracks. In some areas the bylaws were enforced by night visits from police officers and sanitary inspectors to check that the number of people living in a dwelling conformed to statutory number as set out on a plaque fixed on the building. The 1935 Housing Act The 1891 Census contained questions about the number of rooms in a dwelling and the number of inhabitants. On an overcrowding definition as more than two people per room, but excluding people living in houses with more than four rooms and with a somewhat vague room definition, 11.2% of the population was overcrowded. This declined to 8.2% in 1911 but the English national average concealed a range from 36% in Jarrow to 0.5% in Bedford. Lower birth rates in the 1920s helped to alleviate the problem but, in the 1930s, serious overcrowding remained. The 1931 Census recorded 7 million people living at more than 1.5 persons per room and 397,000 households at more than two persons per room. The Moyne Report’s findings (1933) convinced officials that overcrowding was a more serious menace to health than unfitness but overcrowding presented a troublesome issue to the Conservatives because the problem’s magnitude indicated

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that mass housing would be required in the suburbs. Hilton Young, the responsible minister, argued that overcrowding could be dealt with by ‘rehousing ... on or near the central sites by means of blocks of flats’ (quoted in Yelling, 1992, p 103) thereby representing overcrowding as an inner-city redevelopment issue divorced from a national housing shortage. The 1935 Housing Act set out a framework for tackling overcrowding. A duty was imposed on local authorities to survey the houses in their districts to ascertain overcrowding levels according to a statutory definition (see Box 8.4) and assess how many new dwellings were necessary to overcome the problem. When satisfied new dwellings would be constructed, the minister could trigger legislation permitting local authorities to make overcrowding illegal and allowing any landlord to regain possession if a property became overcrowded – thus portraying overcrowding as created by tenants rather than landlords. Subsidies to assist new building were limited to flats in central areas. The major attack on overcrowding was scheduled to follow completing the slum clearance task and a national survey of overcrowding in buildings thought to be overcrowded by the working class was undertaken. However, the outbreak of the Second World War prevented significant action.

Box 8.4: Overcrowding – 1935 Housing Act definition The 1935 Housing Act overcrowding definition was designed to ensure that any overcrowding identified by local authorities could be dealt with in a reasonable timescale and only in central areas. Two standards were specified. The first standard related to ‘sexual overcrowding’ and was contravened when: the number of persons sleeping in a dwelling and the number of rooms available as sleeping accommodation is such that two persons of opposite sexes who are not living together as husband and wife must sleep in the same room. For this purpose: (a) children under the age of ten shall be left out of account; and (b) a room is available as sleeping accommodation if it is of a type normally used in the locality either as a bedroom or as a living room. This meant that kitchens could be included as living and sleeping rooms. The second standard compared the number of rooms and the floor area of these rooms with the number of persons permitted to live in the accommodation (Table 8.1).

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Table 8.1: 1935 Housing Act overcrowding standard Number of rooms

Maximum number of persons

1

2

2

3

3

5

4

7.5

5

10

An additional two persons were permitted for every room in excess of five and the numbers allowed were scaled down if any room was less than 110 square feet. No account was taken of children under one and a child under 10 was reckoned as half a person. On this definition only 3.8% of families were found to be officially overcrowded by the government survey but, by raising the standard to exclude living rooms, the figure rises to about 8.2% (White, 1977).

After the Second World War there was no specific initiative directed towards reducing overcrowding; the problem was regarded as an overall housing shortage dimension to be overcome by building more homes. The 1957 Housing Act, in establishing the duties of local authorities when allocating council houses, stated that they should give reasonable preference to ‘persons who are occupying insanitary or overcrowded houses, have large families or are living under unsatisfactory housing conditions’ (1957 Housing Act, Section 113). The overcrowding definition in the 1957 Act was identical to that in the 1935 Housing Act.

Measuring overcrowding Overcrowding estimates are related to the criteria used to measure its incidence. A number of measures are available. The statutory standard This standard is identical to the one in the 1935 Housing Act. Many local authorities use it to assess rehousing priorities and to gauge whether the housing conditions of a family applying for accommodation under the homelessness legislation are bad enough for the household to be designated as homeless. Few local authorities use the 1935 Act to reduce overcrowding directly because

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evicting overcrowded families creates rehousing obligations in areas where ‘social’ housing is scarce. The statutory standard is very low. As Ormandy (1991, p 9) observes: the average two storeyed, terraced house (with three bedrooms, two living rooms and a kitchen) could be occupied by the equivalent of 10 persons without being overcrowded – and that could mean six adults and eight children aged between one year and 10 years. Governments have consistently rebuffed attempts change the statutory stating that any change would lead ‘to increased demand for housing, to the detriment of other people whose living conditions may be worse; and would make it more difficult for authorities to juggle their priorities’ (ODPM, 2003b). However, in 2007, New Labour produced an action plan involving piloting a new statutory standard based on the bedroom definition in 38 local authorities. This was accompanied by extra resources for the authorities with the most acute problems to extend and convert stock and use cash incentives to make large houses available. The bedroom standard This occupation density indicator was developed by the Government Social Survey in the 1960s for use in social surveys. A standard number of bedrooms required is calculated for each household in accordance with its age/sex/marital status composition and the relationship of household members to one another. A separate bedroom is required for each married or cohabiting couple, for any other person aged 21 or over, for each pair of adolescents aged 10 to 20 of the same sex, and for each pair of children under 10. Any unpaired person aged 10 to 20 is paired, if possible, with a child under 10 of the same sex, or, if that is not possible, he or she is counted as requiring a separate bedroom as is any unpaired child under 10. This standard is then compared with the actual number of bedrooms (including bedsits) available for the sole use of the household. If a household has fewer bedrooms than implied by the standard then it is deemed to be overcrowded and a shortfall of more than two rooms is described as ‘severe’ overcrowding. Census standards The 2011 Census used the ‘occupancy rating’ to measure the extent of overcrowding and under occupation. There are two occupancy rating measures, one based on the total number of rooms in a household’s accommodation and one based only on the number of bedrooms. The standard is more generous than

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the bedroom standard mainly in relationship to the ages at which persons are deemed to require separate bedrooms (ONS, 2015a).

Overcrowding: its impact It is difficult to draw robust conclusions from the research evidence on the impact of overcrowding because the benchmark used varies between studies. There are also forms of ‘selection effects’ that should be taken into account in examining the relationship between overcrowding and health: people with poor health, for example, may be forced to live in overcrowded houses, so overcrowding may not be the cause of their poor health. Moreover, disentangling the effects of overcrowding from other housing conditions such as dampness and lack of basic amenities is complex. A 2004 literature review on the impact of overcrowding concluded: • Overall there was a weak relationship between overcrowding and aspects of health of both children and adults but a robust relationship between meningitis, tuberculosis and overcrowding. • Overcrowding in childhood affects adult health. • There is limited evidence on overcrowding, childhood development, growth and education. (ODPM, 2004a) Shelter’s survey of 505 overcrowded households with children (Shelter, 2005) found: • At least one child shared a bedroom with their parent(s) in 74% of overcrowded families. • Children slept in rooms other than designated bedrooms in 27% of overcrowded families. • Nine out of ten families reported: – overcrowding made it more difficult for their children to study; – overcrowding harmed the health of their children; – being overcrowded caused depression, anxiety or stress in the home.

Bed and breakfast hotels Local authority powers to regulate bed and breakfast hotels (B&Bs) have evolved from the 1851 Act for the Regulation and Inspection of Common Lodging Houses. In the early part of the 19th century common lodging houses provided cheap accommodation, usually in the form of straw mattresses, rented on a nightly basis, in a communal room. These ‘dosshouses’ were regarded as breeding grounds for crime and immorality. Overcrowding occurred on a massive scale. In 1851

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the Police Commissioner for Leeds found ‘in one small area 222 lodging houses in which lived 2,500 people, averaging two and a half persons per bed’ (quoted in Hodgkinson, 1980, p  10). Many believed that the poor used ‘dosshouses’ because they preferred to spend their incomes on drink rather than on more spacious accommodation. Thus action taken to overcome the problem consisted of regulations issued under the 1851 Act allowing the police and sanitary authorities to set standards and control the number of people occupying a dwelling by posting notices on a lodging house specifying the permitted number of inhabitants and midnight raids to ensure compliance. Although largely ignored in the growing northern industrial towns, the Act was enforced in London where, to discourage prostitution, women were not allowed to use common lodging houses. Over time, common lodging houses have evolved into the lower end of B&B hotel market. Local authorities use these hotels to discharge their homelessness obligations mainly by giving lists to single homeless people to whom they had a responsibility to provide ‘advice and assistance’. However, in 2016 2,660 households with children were placed by local authorities in B&B hotels with 830 living in such accommodation for more than the statutory six week period. An additional 3,000 households without children were placed by local authorities in B&B hotels (DCLG, 2016h). Many homeless people access B&B hotels by ‘selfplacement’. Carter (1997) studied the extent and nature of this ‘self-placement’, finding that people with drug, alcohol or mental health problems, ex-prisoners, care leavers, young people and refugees were over-represented in B&B hotels with 76,500 individuals, ‘self-placed’ in B&B hotels in England and Wales. There has been no national study since Carter’s but local investigations cast some light on the issue. Spencer and Corkhill (2013) examined the 114 B&B hotels used by local authorities to house homeless people in the North East. They noted that most occupants were self-referred and Environmental Health Officers were unlikely to inspect B&B hostels unless a specific complaint had been received. At the ‘bottom end’ of the market there was disturbing abuse allegations reported to the researchers including: • people having cash cards or benefits books ‘confiscated’ by proprietors, sometimes presented as a way of helping residents to control problem drinking; • people being required to carry out unpaid work for proprietors, under threat of eviction, should they refuse; • sexual abuse; • people being required to share rooms with strangers, without any prior notice; • bed linen and towels not being laundered at least weekly, when this service is being charged for; and • repeated incidents of drug dealing and drug-related violence on the premises, some involving premise managers. (Spencer and Corkhill, 2013, p 29)

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Houses in multiple occupation Before the 2004 Housing Act became law, local authorities had acquired permissive powers to introduce registration schemes and to require the person managing a house in multiple occupation (HMO) to observe specified management standards. The 1997 Housing (Fire Safety in Houses in Multiple Occupation) Order placed a duty on local authorities to ensure that fire safety measures were adequate in all HMOs of three storeys or above.

The 2004 Housing Act New Labour’s 1997 manifesto promised to introduce a compulsory licensing scheme for HMOs. This pledge was redeemed in Scotland in 2000 and the 2004 Housing Act placed a duty on local authorities in England and Wales – to be implemented through regulations – to ensure that prescribed HMOs in their areas were licensed. As Kemp (2004) has observed, the 2004 Housing Act represented a trade-off between property condition, affordability and homelessness: if local authorities enforced higher standards then rents might increase, making accommodation less affordable and more people vulnerable to homelessness. HMOs prescribed for compulsory licensing under the 2004 Housing Act were those of three storeys and above in which at least five people lived. In granting a licence, local authorities had to consider if: • the property is reasonably suitable for occupation by the number of persons or households specified in the application; • the proposed licence holder or manager is a ‘fit and proper’ person; • the proposed management arrangements are satisfactory. Landlords letting property breaching the licensing provisions would commit an offence punishable by a fine of up to £20,000 and were liable to the recovery of housing benefit payments. Local authorities could also introduce an additional licensing scheme for multi-occupied houses not covered by the mandatory scheme provided that they supplied evidence on the need for such a scheme. In addition to licensing, the 2006 Management of Houses in Multiple Occupation Regulations applied to almost all HMOs. These regulations imposed a series of obligations on the person managing a HMO including the duty to take safety measures and to maintain living accommodation in good repair. Duties were also imposed on tenants such as the prohibition of conduct likely to hinder or frustrate the manager in the performance of his/her duties. The penalty for breaching these regulations was a fine (maximum £5000). The private landlordism review by Rugg and Rhodes (2008, p 104) stated ‘The Audit Commission inspection regime has recently found that local authorities do

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not score well with regard to their responsibilities relating to the sector compared with its other housing services’. A freedom of information request forced the Ministry of Justice to reveal that only 2,006 individuals and companies were convicted for housing offences between 2006 and 2014 under the 2004 Housing Act (Williams, 2015). Today bedsits form a large percentage of HMOs and their concentration in ‘student areas’ caused concern due to the alleged problems that accompany such densities. In early 2010 New Labour made planning permission mandatory for houses to be converted to multi-occupation. HMOs provide affordable housing options for some of the most vulnerable groups including social security claimants, those on low earned incomes, students, asylum seekers and migrant workers. However, despite HMO’s high yields to private landlords (Lowe, 2007, p 10) standards are often poor. The ODPM (2006, p 1) claimed: it is possible to find the very worst housing standards in HMOs and these tenants are most at risk from poor management … [In] all houses converted into bedsits, the annual risk of death per person is 1 in 50,000 (six times higher than in comparable single occupancy houses). In the case of bedsit houses comprising three or more storeys the risk is 1 in 18,600 (sixteen times higher).

Regulating the private landlord sector New Labour’s 2001 manifesto declared ‘we value a reviving private landlord sector’ and a housing green paper (DETR, 2000, sections 5: 1 and 5:2) stated ‘Landlords can be assured that we intend no change in the present structure of assured and assured shorthold tenancies, which is working well’. It regarded private renting as a ‘flexible’ tenure, indeed, its flexibility helped to secure accommodation for migrants. New Labour’s private landlord regulation was ‘light touch’ but, towards the end of its term in office, it introduced legislation to introduce compulsory private landlord regulation across England. This legislation was not taken up by the coalition government.

The coalition government Decent homes The decent homes programme in the local authority sector continued under the coalition government. Its ‘achievements’ declaration, issued before the 2015 general election stated:

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To help local councils with the worst housing, the government provided £1.6 billion to the Decent Homes programme for the period 2011 to 2015. A further £160 million has been allocated for 2015 to 2016. (DCLG/HCA, 2015) The coalition government showed little interest in applying the decent homes standard to the private sector. The discretionary grants available for improvement were affected by cutbacks to local authority budgets and support via improvement agencies became even more erratic than under New Labour. Help was targeted on energy efficiency. Energy efficiency The coalition government abolished Home Information Packs but retained energy efficiency reports. The ‘Green Deal’ was the coalition’s retrofit flagship scheme. Loans of £6,500 per home for energy saving, to be paid back via reduced energy bills would be available. The 2010 Spending Review (HM Treasury, 2010) announced that, in addition to the ‘Green Deal’, extra support to reduce energy bills would be provided by energy companies under the Energy Efficiency Obligation (EEO) allowing New Labour’s ‘Warm Front’ to be phased out. The Green Deal had a very low take-up rate – hardly surprising given interest rates were set at 7.9% to 10.3% – and was supplemented by a special, resource limited, scheme, the Green Deal Improvement Fund, offering grants for energy efficiency measures. According to a ResPublica report the EEO was not well targeted on low-income households and: Even if the EEO programme is successful, it would only equate to topping up 4% of the lofts that could benefit from further insulation, filling 16% of the empty cavity walls and tackling an insignificant 1% of solid walls that are without insulation. (Respublica, 2015, p 3) New homes Despite Liberal Democrat enthusiasm for new towns (Clegg, 2016), with Conservative ministers dominating in the DCLG, only one eco-town, North West Bicester in Oxfordshire, was started. However, Labour’s commitment to all new homes being ‘zero carbon’ by 2016 was endorsed. The ‘zero carbon’ definition proved troublesome to the Conservative and Liberal Democrat coalition partners and a compromise definition allowed developers to balance elements of ‘zero carbon’ homes by offsite ‘allowable solutions’. Small sites were exempted from ‘zero carbon’ requirements. The Code for Sustainable Homes remained voluntary except where residential developments were legally contracted to apply a code

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policy such as affordable housing funded through the Homes and Communities Agency. In response to political controversy on energy prices the obligations of energy suppliers were modified to produce a general reduction in heating costs. Overcrowding Other than claiming that the removal of the spare room subsidy would encourage ‘over-occupying’ ‘social’ tenants to move thereby freeing accommodation for larger families, specific measures to tackle overcrowding were absent from the coalition government agenda. Regulating the private landlord sector The coalition government was private landlord friendly. Planning permission for converting houses to multi-occupation was no longer required except in particular areas. New Labour’s legislation to extend compulsory private landlord regulation nationwide was abandoned and, responding to growing local authority interest in borough-wide licensing schemes and lobbying from the National Landlords Association, the DCLG announced there would be a threshold limiting licensing to only 20% of a local authority’s area or stock of rented properties (DCLG, 2015b). The coalition concentrated on voluntary private landlord regulation accompanied by limited statutory intervention such as amending the 2013 Enterprise and Regulatory Reform Act to enable the government to require agents to sign up to a redress scheme, compelling letting agents to publish their fee tariffs and requiring future new private landlord lettings to be at or above the lowest energy efficiency rating by 2018. The 2015 Derogation Act gave tenants some protection against ‘revenge evictions’, that is, evictions following complaints about repairs but, as with other measures aimed at rogue landlords, its impact has been limited due, in part, to the shortage of local authority officials to enforce the legislation (Whitworth, 2017).

The 2015 Conservative government Conservative disinterest in state regulation to improve the existing housing stock’s condition, apparent in the coalition, continued into the new Conservative government and the theme of isolating the ‘rogue’ landlord from the wider private landlord sector continued. The 2016 Housing and Planning Act allowed a local authority to apply for a banning order when a landlord or letting agent had committed certain offences, made provision for creating a database of rogue landlords maintained by local authorities and allowed a local authority to apply for a Rent Repayment Order if a landlord had committed a housing violation. Theresa May’s Conservative government declared its intention to remove the

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storey rule so all multi- occupied houses – regardless of how many floors – with five or more people from two or more households are covered by statutory licensing and a minimum room size of 6.52 square metres was set. Free from Liberal Democrat influence, the Conservative government announced there would be no higher energy efficiency standards for new homes. It also axed the Green Deal retrofit programme.

England: progress and stability Decent homes In England there has been a sustained reduction in non-decent homes (see Table 8.2) although the recent increase in the proportion of non-decent homes in the local authority sector is disappointing. The 2000s boom in house prices stimulated private sector improvement as housing ‘entrepreneurs’ – encouraged by TV programmes such as ‘Location, Location, Location’ and ‘Homes Under the Hammer’ – bought older properties and refurbished them for sale or rent. However, although the proportion of the private rented sector failing the decent homes test has declined private renting has increased substantially hence the number of homes rented by private landlords below the decent homes standard has remained constant since 2006. In 2014, 1.3 million homes in the private rented sector were non-decent (DCLG, 2016g). Table 8.2: Non-decent homes (%) 2014

2013

2010

2006

1996

Owner-occupied

18.5

19.4

25.6

34.6 (24)

42.0

Private rented

29.0

29.8

37.3

46.8 (40.2)

63.2

Local authority

16.0

15.7

21.7

32.4 (33.3)

55.4

Housing association

13.0

14.0

18.3

25.4 (23.9)

37.5

Note: The decent home definition was updated in 2006 and thus the figures are not comparable with 1996. 2006 figures based on the old definition (comparable with 1996) are given in brackets. Sources: Wilcox et al (2016b) and DCLG (2016g)

Energy efficiency Home energy efficiency can be monitored via the Government’s Standard Assessment Procedure (SAP), an index based on calculating annual space and water/heating costs for a standard heating regime and expressed on a scale of 1 (highly inefficient) to 100 (zero energy cost). Table 8.3 records changes in energy efficiency since 1996. Part of the differences between tenures in SAPs is related to house type, with flats being more energy efficient than houses.

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Table 8.3: Energy efficiency, England, 1996–2014 (SAP rating1) Year

Owner-occupied Private rented Local authority Housing association

1996

43.8

40.4

47.6

52.6

2001

45.0

42.8

49.6

55.2

2004

47.5

46.0

53.5

56.9

2007

51.5

49.1

56.7

59.5

2010

54.3

53.9

60.8

63.4

2013

58.5

58.4

64.9

66.2

2014

58.5

58.5

65.1

67.0

Note:

1 SAP

ratings are on a scale of 1 (highly inefficient) to 100 (zero energy cost).

Source: Adapted from Wilcox et al (2016b)

Overcrowding The English Housing Survey supplies information on overcrowding. It has a target response rate of 60% and when this rate is not reached remedial action is taken. The sample is too small to produce reliable annual figures on overcrowding so a three year moving average is used. Measuring overcrowding is difficult and the 40% of households not responding in the English Housing Survey, being difficult to contact, may be more prone to overcrowding. Illegal migrants are more likely to live in overcrowded dwellings and, because statutory overcrowding may lead to eviction, many people living in overcrowded conditions will not want to draw attention to their circumstances. The paucity of evidence on overcrowding among migrant workers was revealed in the report on private landlordism commissioned by the DCLG. It was only possible to state that ‘there is anecdotal evidence on bed sharing amongst shift workers’ (Rugg and Rhodes, 2008, p 102). The available statistics on overcrowding are set out below. Statutory standard No attempt has been made to make a robust assessment of the number of statutory overcrowded households despite local authorities having powers under the 1985 Housing Act to prepare and submit a report on the extent of overcrowding in their areas. A 2005 estimate put the number at 20,000 households in England (ODPM, 2005b).

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Table 8.4: Overcrowding – the bedroom standard, England, 1971–2014/15 (%, three year moving average) Below bedroom standard

1971

1981

1991

2001

2014/15

7

5

3

2.4

3

Source: DCLG (2016g)

Figure 8.1: Overcrowding – the bedroom standard, by tenure, 1995/6 to 2014/5: three year moving average (% of households) Private renters

Social renters

Owner occupiers

7 6 5 4 3 2 1 0 1995/06

2001/02

2006/07

2011/12

2013/14

2014/15

Source: DCLG (2016g)

Bedroom standard Between 1995–96 and 2014–15, the number of overcrowded households increased in the private landlord sector from 63,000 to 216,000. Overcrowding is long term for families and the overcrowding rate in London, as measured by the English Housing Survey, is much higher than in the rest of England – 8% in 2012/13 compared to the next worst, the West Midlands at 3.2% (Fitzpatrick et al, 2016a) Occupancy standard Table 8.5 sets out the per cent of households below the Census ‘occupancy standard’.

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Table 8.5: Overcrowding – households with one or more rooms below the ‘occupancy’ standard, 2011 (%) % England and Wales

4.5

London

11.3

Newham

25.2

North Kesteven (Midlands)

1.1

Owner occupied

2.3

Private landlord

8.6

Socially rented

8.7

Source: Nomis (2016)

Shelter has developed a ‘Living Home’ space standard using public perceptions of ‘essentials’ and ‘tradables’ (see Chapter Six). The ‘essentials’ were: • The number of bedrooms in the home is adequate for all members of the household. • There is enough space to allow all members of the household to have privacy, for example when they wish to be alone. • There is enough space for all members of the household to comfortably spend time together in the same room. • There is adequate space to prepare and cook food. • There is adequate space to store essential items, such as a reasonable amount of clothes, towels and bedding. The ‘tradables’ covered: • There are enough bathroom facilities for everyone living in the household to be able to use them at a time suitable for their needs. • The home has access to outdoor space, for example a private or shared garden, or balcony. • There is enough space to have visitors during the day or evening. • There is enough space for members of the household to study or do work or homework if they need to. • There is enough space for a guest to stay overnight, for instance on a sofa or sofa bed. • There is enough space to store domestic items, like vacuum cleaners and ironing boards, to keep them out of the way. • There is enough space to store some personal belongings, such as books or children’s toys.

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To fall below the Living Home Space Standard a house had to lack the all the ‘essentials’ and three ‘tradables’. At 23% the housing association sector contained the highest proportion of households falling below the standard, followed by local authority tenants (22%), households renting from private landlords (16%) and owner-occupiers with a mortgage (9%). London (26%) had the highest percentage of households below the standard, followed by Wales (18%) with the lowest at 5% in Yorkshire and Humberside (Shelter, 2016b).

Scotland, Wales and Northern Ireland Diverse official housing standards are applied in England, Scotland, Wales and Northern Ireland and the reports on the housing surveys in the four ‘home nations’ focus on different issues with, for example, religion being important in Northern Ireland. This makes comparisons problematic. The desire of each ‘home nation’ to have its specific standards has prevailed over the idea of common benchmarks that would permit a UK housing conditions survey and facilitate comparisons. Progress within the ‘home nations’, according to their different norms, can be tracked over time but the benchmarks have changed and the latest published house conditions survey in Wales relates to 2008 and the latest in Northern Ireland to 2011. Scotland, Wales and Northern Ireland have adopted private landlord compulsory registration resulting in emerging new standards being applied. Scotland has used the ‘tolerable’ standard – similar to the unfitness standard previously used in England but with additional criteria – as its minimum benchmark with failure to reach the standard a trigger for statutory action. It also has a ‘repairing standard’ that, under the compulsory registration of private landlords, must be adhered to. The HHSRS applies to Wales as well as England and forms the basis for statutory action. However, the Renting Homes (Wales) Act 2016 will require all landlords to ensure properties are ‘fit for human habitation’ at the commencement of, and throughout, the tenancy agreement. Ministers will be able to pass regulations defining ‘fit for human habitation’. The Scottish Housing Quality Standard, introduced in 2004, is used as a target to encourage social housing providers to upgrade their stock. It is higher than the English ‘decent homes’ standard as is the Welsh Housing Quality Standard (WHQS), also used to stimulate social sector improvement, that stipulates requirements for the outside of homes as well as kitchens and bathrooms. The Welsh government is in the process of establishing a new standard to be applied across all tenures. The English statutory overcrowding standard applies in Scotland, Wales and Northern Ireland. Northern Ireland has a decent homes standard used to track changes in housing quality over time and a fitness standard – similar to the one used in England before HHSRS was introduced. It applies to the private rented sector and, if not met, a property can be subject to rent control.

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Housing conditions in Wales, Scotland and Northern Ireland Wales When the Welsh Assembly adopted the WHQS, a target that all social housing in Wales should meet this standard by 2012 was set. However, in March 2015, 28% of social housing – 13% of housing association and 52% of local authority dwellings – failed to meet the standard (Welsh Government, 2016c). In 2008, the date of the last housing conditions survey, according to the fitness standard adopted in Wales, 4.1% of dwellings were unfit – down from 8.5% in 1998. In 2011, on the Census occupancy standard, 2.9% of Welsh households were overcrowded (ONS, 2014) and, in 2008, the average SAP rating was 50 compared to 55.6 in England at the same date. Scotland In 2014, 47% of all Scotland’s houses were below the Scottish Housing Quality Standard: 48% of private houses and 45% of ‘social’ houses. Only 2% were below the tolerable standard, down from 3.6% in 2010. At 64.1m the overall SAP rate was better than in England (owner-occupied 62.4, private rented 62.4, local authority 66.6 and housing associations 69.2). In 2011, 9% (214,000) of Scottish households were overcrowded on the Census standard. This proportion was 5% (67,000) for households who owned their property, 16% (93,000) for households in ‘social’ rented accommodation and 17% (54,000) for households in private rented accommodation (Scottish Government, 2014). As measured by the bedroom standard, overall overcrowding was 3% (74,000) but twice as high in the rented sector compared to the owner-occupied sector (Scottish Government, 2014). Northern Ireland The 2011 Census recorded an overall overcrowding rate of 6.9% in Northern Ireland with households renting from housing associations most likely to be living in overcrowded accommodation while those living in owner-occupied dwellings least likely (Northern Ireland Statistics and Research Agency, 2013). In 2011, 11% of dwellings in Northern Ireland were below the decent homes standard and the average SAP rating in Northern Ireland was 59.6, an improvement from 48.8 in 2001 with, in 2011, the private landlord sector close to the average at 59.2 (Wilcox et al, 2016b).

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Overview

• • • • • • •

In the past, slum clearance was directed towards the removal of ‘rookeries’ and ‘plague spots’, regarded as a threat to the nation’s moral and physical health. Slum clearance declined in the 1970s with the improvement of older homes given greater prominence in government policies. From the 1980s both the Conservatives and Labour regarded private sector maintenance and improvement as the owner’s responsibility and state assistance for improvement was reduced. New Labour concentrated on delivering the decent home standard in the ‘social’ housing sector. Overcrowding is a neglected problem. Multi-occupied dwellings are an important source of accommodation for low-income households and government regulation has been aimed at balancing enforcing minimum standards while retaining a supply of low-priced accommodation. Energy efficiency produced disagreements between the coalition partners and the Conservative government has retreated from the ‘green agenda’.

Questions for discussion 1. What problems did slum clearance create for the people who lived in the slums? 2. What is meant by ‘sustainable’ housing? 3. Is the definition of overcrowding in the 1935 Housing Act an adequate basis for tackling the overcrowding problem today? 4. Why do England, Scotland, Wales and Northern Ireland have different measures of housing quality?

Further reading Gareth Stedman Jones (1976) provides an absorbing account of slum clearance in London in the 19th century. Slums and redevelopment: policy and practice in England, 1918–45, with particular reference to London (1992) by J.A.Yelling is a comprehensive examination of urban renewal between the wars and Michael S. Gibson and Michael J. Longstaff take the story up to the early 1980s in Introduction to Urban Renewal (1982). Renewing Europe’s Housing (2014) edited by Richard Turkington and Christopher Watson sets housing renewal in the UK in a European context.

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Websites Sustainable Homes provides information on green housing issues: www.sustainablehomes. co.uk The website of the British Research Establishment has a useful section on sustainable housing: www.bre.co.uk/page.jsp?id=847 The Chartered Institute of Environmental Health covers a wide variety of environmental and public health issues: www.cieh.org House of Commons research briefing papers contain detailed information on issues such as overcrowding, housing unfitness, zero carbon homes: http://researchbriefings.parliament.uk

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nine Neighbourhood deprivation Summary

• • • • • • •

In the late 1960s a series of initiatives were launched to alleviate area deprivation. Post 1977, area programmes started to concentrate on the economic drivers of district disadvantage with Conservative governments emphasising property-led regeneration. New Labour linked ‘unpopular housing’ to deprivation and, via New Deal for Communities and other programmes, concentrated on improving ‘human’ and ‘social’ capital. The Housing Market Renewal Fund (HMRF), set up in 2002, marked an acknowledgement that ‘low demand’ was related to housing market drivers as well as to ‘human’ and ‘social’ capital deficits. Creating ‘balanced communities’ came to be recognised as a potential solution to the ‘unpopular places’ problem but the research evidence on the impact of balanced communities is inconclusive. The coalition government ended the specific schemes aimed at tackling neighbourhood disadvantage. The 2015 Cameron government relied on ‘incentivising’ people into work and the ‘trickle down’ to deprived neighbourhoods from ‘Northern powerhouses’.

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Area-based programmes in the 1960s and 1970s In 1968, following Enoch Powell’s ‘rivers of blood’ speech (Powell, 1968), Labour introduced Urban Aid, directed by the Home Office and aimed at steering resources to areas where racial tensions were high. It was accompanied by other initiatives such as Educational Priority Areas, Community Development Projects and Section 11 payments under the 1966 Local Government Act, made available to local authorities with a significant number of immigrants and mainly directed to employing additional teachers. Local authorities had considerable discretion on how they used the extra resources available under Urban Aid. Most spent the money on coordinating services, self-help schemes, nursery education and youth projects. Urban Aid continued throughout Edward Health’s 1970–74 government and beyond. The 1978 Inner Urban Areas Act switched urban policy emphasis towards economic regeneration with central government resources directed towards creating partnerships between local government, central government and local residents and assisting local industries. The Department of the Environment became responsible for the Urban Programme although Section 11 payments remained with the Home Office. Conservative commitment to reducing public expenditure from 1979 meant diminishing state resources for urban renewal and, rather than central/local partnerships with local residents, Michael Heseltine, then Secretary of State for the Environment, concentrated on private sector, property-led renewal via Enterprise Zones and Development Corporations primed by tax breaks and grants such as Derelict Land Grant. This property-led approach was revived in the 1990s, with more local government involvement via City Challenge and the Single Regeneration Budget, both accessed by competitive bidding.

Priority estates Diminishing demand for council housing first received central attention in 1974 when a national survey identified 62,000 council properties in low demand, a consequence, in part, of the decline of Britain’s industrial heartlands, which accelerated in the 1980s and 1990s. The Secretary of State for the Environment introduced ‘management priority estates’, on which capital expenditure and management resources would be targeted and, in so doing, rectified the potential imbalance of state special resource concentration between ‘inner areas’ and periphery council estates, mainly occupied by the white working class. In 1981, when a ‘difficult to let’ estates investigation was published (DoE, 1981), Glennerster and Turner (1993, p 3) commented:

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… the team concluded that the ‘hard to let’ label was a misnomer. What they were really observing was merely the most unattractive end of the public housing market. They were the tip of a much larger problem of poor housing management. Allocating extra resources to priority estates survived throughout the Thatcher and Major governments. Priority estate rationale was located in the notion that incompetent local bureaucracies and ‘socialist’ planning had created the problem, an idea well fitted to neoliberalism. The Priority Estates Project (PEP) focused on centralised, fragmented administration as the most important cause of ‘problem estates’ with local estate management promoted as the solution. Existing housing administrative structures meant that ‘estates deteriorated rapidly as a consequence of the remote, townhall-based administrative system and the low level of direct services’ (Power, 1993, p 202). Later, PEP coupled management decentralisation to tenant participation by promoting Estate Management Boards to engage tenants. PEP evaluations demonstrated limited achievement. Decentralised management systems were more expensive but the opportunities for tenant involvement offered by such arrangements plus ‘on-the-spot’ housing managers produced improvements in some outcome indicators (Glennerster and Turner, 1993). Nevertheless, despite associated investment in physical improvements, the projects were ‘swimming against the tide’, their impact thwarted by the ‘growing social disadvantages’ that created ‘intense management pressures’ (Power and Tunstall, 1995, p 6).

Architectural determinism In contrast to Anne Power’s management/participatory approach, Alice Coleman emphasised deficient design. Adopting Oscar Newman’s ‘defensible space’ idea – characterised by a dearth of surveillance and numerous escape routes (Newman, 1973) – Coleman claimed that many unpopular estates’ problems could be eradicated by design improvements. Her argument was grounded on a study of 4,099 blocks of flats and 4,172 houses. Five social malaise indicators – litter, graffiti, urine and faeces, vandalism and children in care – were correlated with 15 design features and significant relationships identified. Dwellings per entrance, dwellings per block, storeys per block, overhead walkways and spatial organisation registered the highest relationships to social malaise. Coleman linked design faults to ‘utopian planners’ who had failed to recognise the ‘territorial imperative’, inbuilt through human evolution, that ‘has led us to produce a shelter with its adjoining piece of territory and to impress it with distinctive marks of identity’ (Coleman, 1985, p 18). Unsurprisingly given that she placed the blame for ‘social malaise’ on ‘utopian planners’, Alice Coleman’s work had impressed Margaret Thatcher. She declared:

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I went further than the DoE in believing that the design of estates was crucial to their success and to reducing the amount of crime. I was a great admirer of the work of Professor Alice Coleman and I had made her an adviser to the DoE, to their dismay. (Thatcher, 1993, p 605) Estate Action and the design improvement controlled experiment Introduced in 1986, the Estate Action Initiative (EA) provided funds according to a central assessment of a local authority action plan. Management decentralisation and stock transfer to homeownership were important elements in a successful bid. Compliance with central demands produced substantial central capital resources for estate refurbishment. An evaluation of six early EA schemes concluded that ‘all the EAs were effective in achieving regeneration’ but ‘there was little evidence of estate-based financial management …, little success in involving residents in estate management with residents often expressing only limited interest’ and ‘only minimal reductions in crime and incivilities’ (DoE, 1996, p 1). In addition to EA, £50 million was set aside for the Design Improvement Controlled Experiment (DICE) – based on Alice Coleman’s ideas – through which the number of flats with a common entrance was reduced, walkways demolished and cul-de-sacs converted into roads. A DICE evaluation (DoE, 1997 p 1) noted that all the individual schemes achieved some benefits but ‘compared to the early EA schemes (the most relevant policy alternative) the evaluation suggests that DICE was not a more successful regeneration initiative (nor, at best, does it appear to be less successful)’. During the late 1980s central guidance on EA bids started to emphasise job creation measures and, via City Challenge and the Single Regeneration Budget, the specific measures targeted at council estates had to form part of a comprehensive and integrated package aimed at an area’s economic and social revitalisation.

New Labour and unpopular housing New Labour adopted the notion that ‘unpopular’ housing was not just a local authority estate issue. Bringing Britain Together: a national strategy for neighbourhood renewal stated: Poor neighbourhoods are not a pure housing problem. They are not all the same kind of design, they don’t all consist of rented or council housing, and they are not all in towns and cities. (Social Exclusion Unit, 1998b, para 1.2)

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The Social Exclusion Unit identified 1,370 deprived neighbourhoods ranged from 50 to 5,000 households with 44 local authorities having the highest deprivation intensities. In the absence of robust neighbourhood statistics, the characteristics of these 44 local authorities were compared to the rest of England, the limitations of previous policies identified and principles for future policy were set out as: • investing in people, not just buildings; • involving communities, not parachuting in solutions; • developing integrated approaches with clear leadership; • ensuring mainstream policies really work for the poorest neighbourhoods; and • making a long-term commitment with sustained political priority. (Social Exclusion Unit, 1998b, para 5.1) New Labour declared ‘… no-one should be seriously disadvantaged by where they live’ (Social Exclusion Unit, 2001, p 1) and its aims were to improve absolute conditions, measured by ‘floor targets’, and to ‘narrow the gap between the most deprived areas and the rest of the country’ (HM Treasury, 2000, p 1). Its diagnosis placed emphasis on deficits in ‘human’ and ‘social’ capital (see Box 9.1). Deficiencies in ‘human’ capital would be rectified by area-based initiatives such as Sure Start – started in 1998 and aimed at pre-school children and their parents living in deprived areas – plus other ‘action zones’ covering health, education and employment. A new initiative, New Deal for Communities, would augment both ‘social’ and ‘human’ capital.

Box 9.1: Human and social capital Human capital refers to the education, skills, health status and social competence an individual possesses. In Bowling alone: the collapse and revival of American community (2001) Putman defined social capital in terms of the collective value of all social networks and the inclinations that arise from these networks to do things for each other. The World Bank (2000) identified different types of social capital. ‘Bonding’ social capital relates to the ties connecting family members, neighbours, close friends and business associates. ‘Bridging’ social capital concerns the weaker horizontal bonds between people with different ethnic and occupational backgrounds whereas ‘linking’ social capital consists of vertical ties between people and organisations such as banks, local government and employers. The different forms of social capital may be contradictory; enhancing ‘bonding’ capital, for example, may limit ‘bridging’ capital.

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New Deal for Communities New Deal for Communities (NDC) was launched in 1998 with 39 ‘pathfinder partnerships’ identified, each to benefit from £50 million invested over ten years. The programme placed emphasis on community involvement in diagnosing problems and promoting local solutions in the expectation that such involvement would enhance community cohesion. The Centre for Regional Economic and Social Research (CRESR) at Sheffield Hallam University attempted to evaluate NDC. The appraisal was a sophisticated analysis, with comparator areas, and produced many reports recording complex outcomes. A distinction was made between ‘people-based’ (educational underachievement, worklessness and poor health) and ‘place-based’ (high levels of crime, inadequate housing and a poor physical environment) initiatives. With regard to ‘people-based’ schemes, the evaluation concluded: For only three people-related indicators is change in NDC between 2002 and 2008 greater than that which has also been observed in similarly deprived comparator areas: having a high score on the SF36 mental health index; having taken part in education or training in the past year; and thinking that health is worse than one year ago. (CRESR, 2010a, p 92) On place-based initiatives the conclusion was: NDC areas have also improved relative to similarly deprived areas, particularly in relation to indicators for crime, dereliction and area satisfaction. And there has been a greater proportional change in the numbers of NDC residents thinking that their area has improved and expressing satisfaction with their area as a place to live, than has been the case nationally. But there has been less absolute and relative change in some outcomes, particularly those relating to community and social capital indicators, and there has been no change overall in the numbers of NDC residents who wish to move. (CRESR, 2010b, pp 83–4). On ‘social’ capital the verdict was: While there has been a significant increase in the numbers of NDC residents feeling that they are part of the local community, other social capital indicators have improved only marginally. (CRESR, 2010b, pp 83–4)

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Wales had a version of NDC launched as Communities First in 2001. It was evaluated by Hincks and Robson (2010) by comparing the extent to which first generation Communities First neighbourhoods had improved between 2001 and 2008 relative to other deprived neighbourhoods. The evaluation mainly used economic indicators and found that, although house prices differences in Communities First neighbourhoods and comparator areas had converged, the number of Job Seeker Allowance claimants was significantly higher for Communities First neighbourhoods and, in terms of general economic inactivity, both Communities First neighbourhoods and comparator areas had improved to the same degree. In Scotland, NDC took the form of Social Inclusion Partnerships funded from a £345 million Community Regeneration Fund that continued when the English area-based initiatives had been ended. Robertson (2014) has attempted to evaluate the impact of Social Inclusion Partnerships in the context of earlier initiatives, the complexity of special initiatives in Scotland and the coalition government’s austerity agenda. The Neighbourhood Renewal Fund In 2002 NDC was augmented by a Neighbourhood Renewal Fund (NRF) focused on the 88 most deprived local authorities rather than the 44 targeted by NDC and available for use by local ‘pathfinders’ in promoting ‘jointed-up’ action by mainstream services whose earlier attempts to improve deprived neighbourhoods had been perceived as a ‘fragmented effort’ (ODPM, 2005c, para. 4.97). Various local interventions would be synchronised by Local Strategic Partnerships and day-to-day service provision would be coordinated by neighbourhood managers, an extension of the local housing management idea. The aim was to ‘bend’ mainstream provision to achieve ‘floor’ (absolute) and ‘convergence’ (relative) targets by ‘joined-up’ thinking from mainstream services. Targets included increases in employment rates, reductions in burglaries and reducing the gap in life expectancy between the national average and the fifth of areas with the lowest life expectancy. NRF was the largest neighbourhood regeneration programme. By 2007/08 the NRF had spent £2.9 billion on crime and community safety projects, education, health, housing and work promotion schemes. An evaluation by York Consultancy made frequent references to the lack of evidence accompanying stakeholder claims to success. It stated: Hard, attributable evidence of outcomes and impact of NRF on service delivery, mainstreaming or contribution to floor targets at an area level is very limited, and will remain so until further work relating to evidence collection and impact evaluation is embedded within LSPs [Local Strategic Partnerships]. (Cowen et al, 2008, p 6)

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It criticised the programme because ‘it could, and has in some places, become a process in “spending the cash” resulting in disparate and incoherent interventions, with poor strategic fit, that does not maximise the effectiveness or value of the Fund’ (Cowen et al, 2008, p 73). Given the limited robust evidence of neighbourhood change attributable to the £2.9 billion spend, it was not surprising that, in 2008, as part of Gordon Brown’s emphasis of ‘economics first’ (Houghton, 2010), the Neighbourhood Renewal Fund’s name was changed to Working Neighbourhood Fund. Resources were targeted on improving employment in the 88 local authorities with the highest deprivation scores. Later, a NRF evaluation, paid for by the Department for Communities and Local Government and published just before the 2010 general election, was far more positive than the York Consultancy evaluation. Remarkably, it found ample evidence of success stating, for example: According to most indicators, the long-term trend of a widening gap between the most deprived neighbourhoods and the rest of England has been stemmed … Overall, the National Strategy for Neighbourhood Renewal (NSNR) appears to have delivered reasonable value for money. (Amion Consulting, 2010, pp 4, 9)

Low demand Just as the Conservatives had shifted focus from specific ‘problem estate’ pathologies to broader economic and spatial perspectives, New Labour’s initial concentration on ‘joined-up’ managerial thinking and boosting ‘social’ and ‘human’ capital was also modified. The Report by the Unpopular Housing Action Team (DETR, 1999c) identified 928,000 dwellings as ‘unpopular’ due to relative economic decline, out-migration from certain regions and that first-time buyers were bypassing particular areas. Although specific local drivers could influence demand, low demand risk was significantly higher in the northern industrial conurbations. Nevin et al’s influential study (2001) located a particular demand deficit along the ‘M62 corridor’. The Housing Market Renewal Fund The HMRF marked a ‘rescaling’ in perceptions of what drives low demand: a shift in state concern: ... from housing as an inherently local problem to housing as a subregional asset within the wider economy ... linked to place – towns

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and neighbourhoods – which could determine access to wider social opportunities. (Ferrari and Lee, 2010, p 5) By 2005, 12 ‘pathfinders’ existed, covered about 60% of the identified low demand stock. They were set the task of closing by a third the gap between the level of vacancies and house values in ‘pathfinder’ areas compared to regional averages. The areas selected were large relative to other area-based initiatives, with populations between 150,000 and 300,000 and cut across local authority boundaries. The ‘pathfinders’ were expected to establish partnerships involving ‘stakeholders’ and develop strategic plans for whole housing markets based on detailed local studies that would reconnect ‘pathfinder’ areas with nearby functioning housing markets. At first the emphasis was on demolition and subsequent new build with a prediction that 400,000 dwellings might need to be flattened (Mathiason, 2004). The idea was to replace rundown terraced properties and flats with new houses, thereby uplifting the neighbourhood and reconnecting it to the mainstream market. This clearance emphasis provoked opposition on the grounds that communities were being uprooted, improvement was far cheaper and that part of England’s heritage would be lost with Ringo Starr’s childhood house scheduled for demolition. Moreover, almost at the time the ‘pathfinders’ started their work, house prices in low demand areas started to increase – an outcome of accelerating national house prices linked to credit expansion and buy to let investors moving into the market. Rising house prices fuelled resistance from some communities affected by demolition: ‘Why was demolition necessary?’ they asked, and ‘how would we find a better house with our compensation when prices are rising fast?’ Some academics believed the initiative exemplified what David Harvey (2005) has called ‘accumulation by dispossession’ and Naomi Klein (2007) ‘disaster capitalism’ – the use of a crisis to promote profit – with, in the case of ‘low demand’, the crisis manufactured (Glynn, 2009). Others regarded the ‘pathfinders’ as an assault on working class values – appreciation of community and family and a house as an end in itself – by middle class housing ‘experts’ concerned with housing as a status statement and an investment good (Allen, 2008). Using a quotation from Nevin (2001, p 3) that, in contrast to the 1950s and 1960s, market restructuring in the 2000s was being led by ‘changes in consumer demand’, Couch et al (2015 p 464) maintain ‘as indicated in the above quotation, the problem of low housing demand and abandonment was framed within a discourse surrounding the view of housing as a consumer product’. Lees and Leys (2008, p 2381) claimed housing market renewal was ‘state-led gentrification ... promoted in the name of community regeneration’. In response to this antagonism and increasing acquisition costs at a time when house prices were rapidly increasing, the ‘pathfinders’ backed away from demolition and ‘by the end of 2008, the housing market renewal programme had refurbished and improved around 40,000 homes, built 1,100 new properties

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and demolished just under 10,000 properties’ (Homes and Communities Agency, 2009, p 1). Up to 2006, house prices growth was faster in the ‘pathfinders’ than in the northern regions. In 2002, 28% of properties in all ‘pathfinder’ areas were classified as in low demand but this had dropped to 6.3% by 2008 (DCLG, 2009b, p 19). However, because the evaluations did not use comparator areas, it is not possible to access the improvement share generated by the ‘pathfinders’ in relationship to wider housing market influences.

Balanced communities Over the past 50 years, local authority housing has increasingly become the tenure of younger and older people, single people, single parent families, working low-income households and households without paid work, in part the outcome of an increasing emphasis on need in allocating ‘social’ housing but also reflecting changes in the labour market with its increasing tendency to create a ‘precariat’ (Standing, 2011) – people moving between low-paid, unstable jobs and unemployment. Discussing Bevan’s mission to create mixed communities in council estates, Kynaston (2007, p 598) comments: This was not quite such a fanciful aspiration as it would come to seem, given that it has been estimated that in 1953 the average income of council tenants was virtually the same as the overall average income … In 1964 the highest income groups were rapidly leaving the council house sector but the proportion of other income groups in the owner-occupied and council house sectors was roughly equal (Hamnett, 1976). By 1972 the average income of household heads living in council housing was 56.4% of those buying with a mortgage; in 2014 it had declined to 32% (Wilcox et al, 2016b). In 1962 only 11% of households living in local authority housing had no one in work (Holmans, 1988) but, by 2014, this had increased to 64% (Wilcox et al, 2016). The change – often called ‘residualisation’ – was also reflected, but to a lesser extent, in the housing association sector. If ‘social’ housing had been dispersed throughout the community, then ‘residualisation’ may not have been problematical. However, ‘social’ housing concentration in particular localities produced difficulties. Hills (2007, p 5) points out: Two-thirds of social housing is still located within areas originally built as council estates. These originally housed those with a range of incomes, but now the income polarisation between tenures also shows up as polarisation between areas. Nearly half of all social housing is

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now located in the most deprived fifth of neighbourhoods, and this concentration appears to have increased since 1971. In part this was the outcome of high density inner cities and low density suburbs. As Dunleavy (1981, p 71) observed in relationship to building high-rise flats: … those living at low levels of amenity would be rehoused in a sanitized environment at reduced but still comparatively high densities, while those living at higher levels of amenity in suburban areas would continue to do so. Moreover, local authority housing is not a uniformly desirable commodity. Numerous studies have documented how the formal and informal procedures for allocating council housing have led to the people with the most pressing housing needs and the lowest incomes receiving the least desirable properties. Jones (1988, p 96) summarises the process: The result of this process of complex bargaining is to establish a clear hierarchy wherein offers of good quality property are most often made to those most able to ‘operate’ the system whether by political influence, by possessing a bargaining counter, or by articulacy and social acceptability. ‘Ability to wait’ was an additional factor with the most desperate having to accept the first offer whereas those in better accommodation able to wait for a more acceptable offer. The Right to Buy has also contributed to concentrations of people with low-incomes in some ‘social’ housing areas. Many former council houses have been sold to private landlords who have let the property to tenants claiming Housing Benefit. In Hinterland, Chris Mullin (2016, p 213) claims that, in Sunderland, there were high concentrations of public housing, acquired by private landlords, ‘that went into a spiral of decline’ because Housing Benefit went directly from the public purse into private landlords’ pockets, so that landlords had little interest in managing their properties. Mullin campaigned for Housing Benefit to be paid directly to tenants so landlords would become more concerned about what was happening in their houses. In 2008 New Labour introduced this change. The mechanism by which low-income households have become spatially concentrated within the owner-occupied sector is straightforward. In the virtual absence of specific state assistance to working low-income homeowners then the market – strongly influenced by ‘location, location and location’ – dictates that people with the lowest incomes occupy the least desirable homes. Market rents in the private landlord sector also produce spatial outcomes although, because

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homes in this sector are not allocated according to ‘need’, LHA availability (see Chapter Five) may mitigate spatial concentration albeit that ‘local reference rents’ restricts access to more affluent areas.

New Labour and mixed communities Under New Labour there were five initiatives linked to producing balanced communities. Stock transfer Although not its primary purpose, the transfer of local authority stock to housing associations can be perceived as helpful in reducing the stigma associated with ‘council estates’. ‘Choice-based’ lettings Creating balanced communities is a potential by-product of this scheme that was mainly directed at changing the image of local authority housing by rebranding ‘social’ housing applicants as ‘consumers’. Possible gains from choice-based lettings include higher satisfaction and lower tenant turnover and the prospect that new ‘consumer’ groups’, who might not have considered ‘social’ housing as an option due to its association with ‘need’, will be identified. Whereas an early evaluation of ‘choice-based’ lettings discovered an increase in demand in almost all the pilot areas (ODPM, 2004b), there is limited evidence of a positive impact in creating more balanced communities. Indeed, Barnard and Pettigrew (2004, p 6) noted that ‘the introduction of choice-based letting systems has not led applicants to be more willing to move to areas they considered “rough” or unsafe’. Housing Market Renewal Fund An aim of this fund was to create more balanced communities. However, despite extensive research into the fund’s effect, no robust evidence is available on its impact in creating more mixed communities or on the displacement of established residents into other areas. The Mixed Communities Demonstration Initiative (MCDI) In 2005, Gordon Brown, then Chancellor of the Exchequer, announced a new scheme specifically aimed at creating balanced communities in existing council estates. He declared that ‘overcoming … “area” effects will require the transformation of neighbourhoods from mono-tenure social housing estates into

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communities containing a much broader socio-economic mix of households’ (HM Treasury, 2005 p 147). Twelve demonstration projects were established in different locations with different types of housing market. No specific public funding was allocated to the initiative and, in 2009, ‘the demonstration projects were at different stages, but mostly at the master-planning stage’ (DCLG, 2009c, p 12). Under the coalition government, the initiative disappeared. New balanced communities Section 106 of the 1990 Town and Country Planning Act allowed local authorities to insist that a proportion of affordable homes is supplied in any new development thereby, as a planning approval condition, pushing developers into partnerships with housing associations to create ‘balanced communities’. If implemented with enthusiasm then, over time, areas would become more balanced in their social composition and possible reductions in social housing availability to lowincome households, caused by creating mixed communities in existing deprived neighbourhoods, would be mitigated. Crook et al (2016, p 3402), having examined the impact of Section 106, conclude: A national policy such as S106, together with greater emphasis on providing partial ownership as well as traditional social rented housing in new developments, can provide a scale of intervention which enables communities with a mix of income groups and household types. However, under New Labour, the impact of Section 106 on ‘balanced communities’ was modified by permission to provide the affordable housing ‘off site’ and, as Gregory (2009, p  59) states, the ‘social’ housing component in a development is ‘often in the darker recesses, overlooking the bins, in the least desirable part of the estate’, rather than intermingled with ‘market price’ housing. Indeed, on some developments the ‘affordable’ and market price houses are divided by gates (Beauman, 2014).

Mixed communities: do they work? Tunstall and Lupton (2010, p 8) stated that, as an overall policy goal, the term ‘mixed communities’ encapsulates three main meanings: 1. ‘Mixed communities’ as a general social good, reflecting an integrated and egalitarian society in which people of all social classes and incomes share the same space, services and facilities, creating conditions in which mutual understanding and/or shared norms can potentially develop.

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2. ‘Mixed communities’ as spaces to encourage racial, ethnic or religious cohesion, or which prevent increasing segregation. 3. ‘Mixed communities’ as ‘workable’ or ‘sustainable’ communities, following a notion that a combination of different land uses, building types and people is: a. more sustainable (less affected by changes that affect only one type of resident, such as youth unemployment or becoming unable to support oneself in old age); b. more mutually supportive (with intergenerational links); c. easier to manage because hard-to-manage groups are diluted; and d. more capable of supporting a varied range of activities, facilities and services, because of a range of incomes, ages and interests. There is extensive but inconclusive research on impact of ‘balanced’ or ‘mixed’ communities carried out in the USA and the UK. In part, the uncertain and, at times, contradictory inferences from the research output reflect the problems in defining what ‘mixed community’ means. As Monk et al (2011, p 1) ask, ‘Is it income mix, ethnic mix, social mix or tenure mix? How mixed should the mix be? And at what spatial scale?’ On the extent of the mix issue, Tunstall (2012, p 37) notes ‘schemes described as “mixed tenure” vary from those with 95% private housing and 5% low-cost home ownership … and 45% private housing and 55% social housing’. Having examined a number of studies, Monk et al (2011, p i) conclude: Overall, the evidence in the UK seems to support the mixed tenure (as a proxy for mixed communities) approach to new developments, but the evidence for increasing tenure mix in existing estates dominated by social housing or regeneration areas is less clear cut. In Mixed communities: evidence review, Tunstall and Lupton (2010, p 27) state: In summary, it is hard to argue that evidence of the benefits of creating more mixed communities in existing areas and advantages over traditional neighbourhood renewal is strong enough to justify substantial economic and social costs of demolition and rebuilding. Concentrated poverty Concentrated poverty and mixed communities are somewhat different issues. Mixed community initiatives tend to focus on tenure diversification and often do not include people previously living in deprived neighbourhoods in the mix. The strongest evidence on the impact of dispersing concentrating poverty comes from the Gautreaux programme, established in Chicago in 1976 following

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lawsuits filed against the USA Department of Housing and Urban Development, alleging deliberate segregation of African-American families via selection policies. Under this programme, families were allowed to move to a home in the suburbs or remain in situ. Rubinowitz and Rosenbaum (2001) examined the fortunes of the suburban movers compared to those who stayed in the city. Of the suburban movers 75% were working compared to 41% of those who stayed in the city and 40% of the movers’ children past the age of 17 were enrolled in college compared to 24% of the city children. However, more recent studies, covering longer time spans, have cast doubts on the long-term gains achieved by ‘diluting poverty’ initiatives in the US (Cheshire, 2007). The UK evidence on the long-term impact of concentrated poverty is inconclusive partly because there are problems involved in isolating neighbourhood effects from ‘selection bias resulting from the non-random selection of people into neighbourhoods’ (Manley et al, 2015, p 1). Lupton et al (2009) found a relationship between living in council housing and worse health, wellbeing, education and employment outcomes for children that they attributed not to a specific ‘council housing effect’, but to a clustering of children who are likely to have poor life outcomes in council housing. Bolster et al (2007), using a British Household Panel Survey-derived cohort data set following individuals over ten years, found that original place of residence had no statistically significant influence on subsequent household incomes or individual earnings. Overall, Clapham (2015, p 91), citing Van Kempen and Bolt (2012), concludes that the evidence indicates that ‘living together with other poor people has a small but measurable impact on life chances all other things being equal’.

New Labour and neighbourhood deprivation: evaluation Neighbourhood deprivation has many causes and, under New Labour, a remedy was made available for almost every potential cause. Surestart, Health Action Zones and Excellence in Cities etc. were aimed at developing ‘human’ capital; NDC would foster ‘human’ and ‘social’ capital and improve ‘place’; the Market Renewal Fund would build up physical capital; anti-social behaviour initiatives would promote social order; and the NRF was aimed at coordinating these initiatives, and others, at local level. It is difficult to disentangle the impact of New Labour’s specific area initiatives from the effects of its other policies. The decent homes initiative, for example, was not specifically area-based but, being concentrated on council estates where deprivation is high, it made an impact and is included in some evaluations (Lupton et al, 2013). Social security policy also had an influence. Between 1998/99 and 2009/10 the percentage of individuals in relative poverty (after housing costs) declined from 24% to 22% and the percentage of those in absolute poverty (after housing costs) from 31% to 21% (DWP, 2015).

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When comparator areas have been included in specific initiative evaluations, the results were disappointing with crime reduction being the major success in the NDC programme. Overall, little impact was made on worklessness, with Palmer claiming: … in terms of both numbers of claimants and its geographic concentration, the situation in February 2009 was similar to the situation in February 2001. In this sense at least, the policies of the last decade have not in general succeeded in reducing the gap between the most deprived areas of the country and the rest. (Palmer, 2009) However, the compounding impact of different area initiatives plus other policies, produced some positive outcomes. Lupton et al (2013) have produced the most upbeat evaluation stating: Physical environments and services got better. 90 per cent of social housing was brought to a ‘decent’ standard. Rates of crime, litter and vandalism fell and differences between deprived and other areas (“gaps”) narrowed. New childcare and health centres, schools and community buildings were built in the most deprived areas; neighbourhood policing and community warden schemes were introduced. Gaps also improved in many individual outcomes between poorer and richer areas including death rates from cancer and heart disease, school attainment, and worklessness. But some gaps did not close, including life expectancy and neighbourhood satisfaction, and all gaps remained large. (Lupton et al, 2013, p 4) Northern Ireland has had its own area-based programmes, often supported by substantial EU funds. Having examined the impact evidence over time, Nolan (2014, p 82) comments: From decade to decade the pack is reshuffled so that the pecking order alters slightly but when arranged alphabetically the same names recur … and is a sobering testament to the persistence of poverty.

The coalition government NDC came to its scheduled end in 2010 and the coalition government axed all New Labour’s specific funding schemes aimed at deprived areas although, initially, hints of Blair’s ‘community development’ agenda, such as the Community

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Organisers Programme with government funding available to recruit and train 500 community workers, remained in Cameron’s ‘Big Society/Localism’ agenda. Local authorities were left to manage their deprived areas. Indeed, in response to a House of Commons Communities and Local Government Select Committee (2011, p 3) declaration that it had ‘little confidence that the Government has a clear strategy for addressing the country’s regeneration needs’, the Secretary of State for Communities and Local Government (2012, p  1) stated ‘If local regeneration, development and growth are deemed local priorities, then it is for local partners to determine the appropriate plans and strategies to deliver this’. Limited central assistance came from specific schemes such as Enterprise Zones and funds for Local Enterprise Partnerships (LEPs), the most important being the Regional Growth Fund (RGF). This was set up in 2010 and worth over £3.2 billion over the five years from 2011–12 to 2016–17, far less than the resources previously allocated to New Labour’s Regional Development Agencies (RDAs). A Liberal Democrat initiative, its purpose was described as being ‘to help areas and communities at risk of being particularly affected by public spending cuts’ (Secretary of State for Business, Enterprise and Skills, 2010). It was targeted on private sector investment and would work alongside LEPs. The RGF formed part of policy shift that emphasised private sector economic growth underpinned by local government support. ‘City Deals’ were negotiated involving mechanisms to promote growth such as pooling funding streams and business rate income into a single investment pot and local business hubs. The ‘Northern powerhouse’ (see Chapter Three) was a highpoint of this policy. Presumably, residents in deprived areas were assumed to benefit by ‘trickle down’ from larger area growth. However, mainstream resources available to local government declined substantially under the coalition government’s austerity agenda. In England between 2010/11 and 2014/15, local government experienced a 27% reduction in spending power and: The most deprived areas have borne the brunt of the cuts. On one key measure, the most deprived English authorities have had a level of cut nearly six times higher than the cut experienced in the least deprived areas. (Hastings et al, 2015) Rather than tackle deprivation on an area basis, the coalition government concentrated on ‘incentivising’ individuals and households into work via social security cuts. Signs of things to come could be found in the various policy documents published by the Centre for Social Justice. In his foreword to Housing policy: from social breakdown to social mobility (Centre for Social Justice, 2008, p 5), Iain Duncan Smith said:

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The levels of dependency among social housing renters is quite staggering … Fathers are routinely absent from their children’s lives … Escape from this situation is rare: more than 80% of people living in social housing in 2006 were within the rented sector ten years earlier. The report stated that ‘social’ housing should be used for shorter time periods, ‘as a dynamic resource, playing a part in helping people to get back on their feet and on with their lives’ and: There should be a new requirement that new working age tenants – in particular the half of new tenants who are under 35 – and their landlords sign commitment contracts under which the tenant agrees actively to seek work and the landlord agrees to provide or access support such as training or childcare to help them do so. (Housing and Dependency Working Group, 2008, pp 8, 99) The proposals in Housing policy: from social breakdown to social mobility (Centre for Social Justice, 2008) were not included in the Conservative Party’s 2010 manifesto but the coalition government’s policy followed their grain. ‘Flexible’ tenancies – a new form of tenancy introduced by the 2011 Localism Act 2011 – could be used by local authorities to offer a time-limited form of secure tenancy; local authorities were allowed to charge a market rent for household with an income of £60,000 plus and the ‘bedroom tax’ was an incentive to leave social housing.

The 2015 Conservative government The 2015 Conservative government stepped up the coalition’s ‘incentivisation’ agenda by measures including: • a four year freeze on working age benefits; • ending automatic entitlement to housing support for 18 to 21 year olds for new claims to Universal Credit; • aligning housing benefit entitlements for those in ‘social’ housing with those in the private rented sector, meaning that ‘social’ sector tenants under 35 would be entitled only to the single room rate in a shared house; and • the 2015 Summer Budget proposed substantial reductions to Working Families Tax Credits that would be offset by increases in the minimum wage (now called the ‘Living Wage’). However, the House of Lords rejected the plan and, faced by this revolt, Conservative backbench concern and the accusation he was penalising the ‘strivers’ not the ‘skivers’, Osborne (2015b) said: And because I’ve been able to announce today an improvement in the public finances, the simplest thing to do is not to phase these changes in,

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but to avoid them altogether. Tax credits are being phased out anyway as we introduce universal credit. In effect, Osborne was relying on changes in Universal Credit, as it was rolled out nationwide, to deliver cuts in welfare expenditure, changes that, if implemented by Theresa May’s government, will reduce spending power in deprived neighbourhoods. ‘Trickle down’ from Northern powerhouses and the ‘Midlands engine’, added by Theresa May, appears to be the future hope for deprived neighbourhoods. Attempts at creating ‘mixed’ communities have been diluted with Section 106 agreements jettisoned on the brownfield sites in favour of ‘Starter Homes’ priced up to £420,000 (see Chapter Five). From 2017–18 ‘social’ landlords will be required to charge a market or near market rent to ‘social’ tenants with a £40,000 plus household income in London; £30,000 plus in the rest of England, although Theresa May’s government is modifying this requirement. This market or near market rent would incentivise higher income tenants to leave the sector or, if eligible, use the Right to Buy. The long-term implications for balanced communities of selling housing association stock to tenants and marketing the most expensive council houses – perhaps to private landlords – remain obscure. However, the idea expressed in Laying the foundations: a housing strategy for England (HM Government, 2011a, p ix) that ‘Social housing must … be a springboard for social mobility, rather than trapping people into patterns of worklessness and benefit dependency’ is the touchstone of Conservative policy. The policy has the added attraction that the people ‘trapped into patterns of worklessness and benefit dependency’ can be subject to behaviour modification procedures and stigmatised to give ‘hard working families’ a greater sense of inclusion. The new poverty definition in the 2015 Life Chances Act, making behaviour rather than income the poverty touchstone, will mask the impact of cuts in welfare and inwork payments to those on low incomes. Under the coalition government some local authorities, mainly in London, had been ‘renewing’ council estates and their activities had produced accusations of ‘social cleansing’ and gentrification (Lees, 2014). In Create streets Boys Smith and Morton (2013) suggested that unsuccessful high-rise council estates should be demolished and replaced by street level developments that could accommodate more people. In early 2016 Cameron’s Conservative government announced that £140 million would be made available to lever private investment into demolishing and rebuilding 100 estates. In announcing the initiative Cameron said he wanted to ‘really get to grips with the deep social problems – the blocked opportunity, poor parenting, addiction and mental health problem s...’ He added:

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There’s one issue that brings together many of these social problems – and for me, epitomises both the scale of the challenge we face and the nature of state failure over decades. It’s our housing estates. Some of them, especially those built just after the war, are actually entrenching poverty in Britain – isolating and entrapping many of our families and communities. (Cameron, 2016, p 1) This indicated that dispersal to dilute concentrated poverty was at the heart of the initiative but an Advisory Panel was set up to ‘establish a set of binding guarantees for tenants and homeowners so that they are protected’ (Cameron, 2016). There was no tenant representative on the panel.

Overview

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The labels attached to the ‘deprived neighbourhood’ problem have changed since the 1970s as the causal explanation focus has shifted from poor management, poor design and lack of tenant involvement in council estates towards a shortage of ‘human’ and ‘social’ capital, to housing market ‘drivers’ and ‘unbalanced’ communities. New Labour’s initiatives, aimed at enhancing ‘human’ and ‘social’ capital, produced mixed outcomes. Under the coalition and Conservative governments, the underlying causal explanations of neighbourhood deprivation have been attributed to sluggish ‘Northern’ growth and the lack of work incentives in the social security system.

Questions for discussion 1. How have different social constructions of the ‘deprived neighbourhood’ problem influenced policy initiatives? 2. What evidence is there to support the idea that is it worse to be poor in a poor area than in one that is socially mixed? 3. What was the coalition government’s response to ‘deprived neighbourhoods’?

Further reading Evaluation of the mixed communities demonstration projects: baseline and early process issues (2009) published by the Department for Communities and Local Government includes a good discussion of the possible impact of mixed communities. Ruth Lupton, Alex Fenton and Amanda Fitzgerald (2013) offer an assessment of New Labour’s record on deprived neighbourhoods in Labour’s record on neighbourhood renewal in England.

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Ruth Lupton and Amanda Fitzgerald (2015) examine the coalition government’s performance in The coalition’s record on area regeneration and neighbourhood renewal 2010–2015. Sarah Monk, Anna Clarke and Connie P.Y. Tang (2011) provide an accessible account of the research evidence on mixed communities in Mixed communities literature review as do Rebecca Tunstall and Ruth Lupton (2010) in Mixed communities: evidence review.

Websites The Joseph Rowntree website contains the findings from research projects on unpopular housing: www.jrf.org.uk/housing The Centre for Cities website is useful for tracking the impact of government policy on cities: www.centreforcities.org The Centre for Social Exclusion at the London School of Economics hosts a website with informative papers: http://sticerd.lse.ac.uk/case/_new/publications/default.asp

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ten Housing and social justice Summary

• • • • •

Social exclusion and social justice differ in that social exclusion refers to deficits in the human and social capital necessary to compete within a given society’s framework, whereas social justice focuses on structured unfairness. There are entrenched class relationships built into current housing pathways through the housing system. In the past, various forms of discrimination, with contemporary reverberations, influenced minority ethnic group access to good quality housing. Gender differences in housing consumption have reflected a dominant patriarchal family model. People with disabilities encounter barriers to independent living in integrated communities.

What is social justice? There being no agreement on its meaning, philosophers have labelled social justice a ‘contested’ concept. At a basic level, distributive justice is concerned with fair processes in disseminating goods and services. There are two broad approaches to assessing process outcomes. Current time-slice theorists view the existing social product as a collectively created cake to be allocated according to impartial principles. In A Theory of Justice, John Rawls maintains that rational people, behind a ‘veil of ignorance’ about their future life chances, will agree to join a particular

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society so arranged that social and economic inequalities are permitted only if they are ‘to the greatest benefit of the least advantaged’ (Rawls, 1971, p 102). Thus, for Rawls, inequalities are just if they lead to an improvement in the position of the ‘least advantaged’ to a situation better than they would have obtained from an equal resource division. Equality is Rawls’ starting point; inequalities require robust justifications. In contrast, entitlement theorists examine the procedures through which a particular social distribution has occurred. Robert Nozick, for example, argues that a social distribution is just if it has been fashioned through fair procedures, that is, by creating an object, barter between free agents or as a gift. If people attain resources by these legitimate means they are entitled to keep them (Nozick, 1974). Nozick, alongside Hayek, was instrumental in the 1970s renaissance of laissez-faire thinking but, unlike Hayek, he argued that justice was historical. If resources have been acquired by past unfair procedures, then current rectification is necessary.

Social justice and social exclusion The Commission on Social Justice conceptualised social justice in terms of a four-idea hierarchy: First, the belief that the foundation of a free society is the equal worth of all citizens, expressed most basically in political and civil liberties, equal rights before the law, and so on. Second, the argument that everyone is entitled, as a right of citizenship, to be able to meet their basic needs for income, shelter and other necessities … Third, self-respect and equal citizenship demand more than the meeting of basic needs: they demand opportunities and life chances … Finally, to achieve the first three conditions of justice, we must recognise that although not all inequalities are unjust (a qualified doctor should be paid more than a medical student), unjust inequalities should be reduced and where possible eliminated. (Commission on Social Justice, 1994, pp 17–18) The second and third social justice dimensions identified by the Commission relate to social exclusion. They are concerned with the human and social capital necessary to meet basic needs and facilitate equal opportunities to become unequal. The resources needed to advance social inclusion can be supplied through collective assets without necessarily requiring the specific unequal society causal agents to make reparations for their contributions to the exclusionary process. In contrast, distributive justice is about unfairly structured inequalities.

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Why is social justice in housing important? When social justice is used to identify what is problematic then disparity in housing conditions and housing wealth, if unfairly structured, become matters of concern. Moreover, through the ways that poor housing conditions impact on health and education, social injustice impairs the capacity to compete in a market economy thereby inhibiting equality of opportunity. Friedman (2010, p 1) reviewed the evidence on the interactions between health, education and life chances and, by connecting established relationships between poor housing and educational achievement with lifetime earnings, calculated that ‘the bill amounts to £14.8 billion in lost earnings forecast for this generation in poor housing’.

Social class The relationship between social class and housing is complicated by different interpretations of what class means. Marx adopted a two-class model, a bourgeoisie owning the means of production and a proletariat without capital. In contrast, Max Weber (1864–1920) claimed that class refers to a market situation with a class existing when a number of people share a specific causal component of their life chances represented by economic interests in the possession of goods and opportunities for income (Weber, 1924). In not designating capital ownership as the decisive factor in social stratification, Weber opened the way to identifying a more differentiated stratification system. His class notion became the basis for compiling official statistics with the population usually divided into seven classes. Grade A was the upper middle class (higher managerial, administrative or professional). The middle class (intermediate managerial, administrative, professional) were in Grade B and C1 was the lower middle class (supervisory, clerical, and junior managerial, administrative, professional). The working class was divided into skilled manual workers (C2) with semi-skilled and unskilled manual workers labelled D. Grade E was composed of casual workers and those depending on state welfare for their incomes. Shelter (2016b) examined housing outcomes according to class (see Table 10.1). Table 10.1: Households below each ‘Living Home’ standard, 2016 (%) Social class A B C1 C2 D E

Affordability 18 19 23 31 41 35

Decent 17 14 18 16 20 27

Space 8 7 10 12 14 18

Stability 13 7 9 11 12 19

Neighbourhood 3 2 4 6 5 10

Note: For indicator definitions see Shelter (2016a) and Chapter Six. Source: Adapted from Shelter (2016b)

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In Social Class in the 21st Century (2015) Savage et al suggest that, in response to changes in the UK social structure, social class reclassification is necessary. They argue that three forms of capital – economic, cultural and social – should form the basis for this reordering. Seven classes were identified (see Table 10.2). Table 10.2: Social class in the 21st century %

Social Income, £ background1 per year (2011)

% Graduates

Housing value (2011)2

Other characteristics

Elite

6

51% from Social Class 1

89,000

57

97% home owners average house value £325k

Strong tendency to live in London and home counties

Established middle class

25

39% from Social Class 1

47,000

40

average house value £ 177k

Mostly live in Suburbia

Technical middle class

6

38% from Social Classes 6–7

37,000

23

average house value £163k

Mostly live in Suburbia

New affluent workers

15

33% from Social Classes 3–5

29,000

10

average house value £129k

Traditional working class

6

47% from Social Classes 6–7

13,000

10

average house value £127k

Mostly live in older industrial areas

Emergent service workers

19

43% from Social Classes 3–5

21,000

17

likely to rent average house value £18k

Mainly urban

Precariat

15

67% from Social Classes 6–7

8,000 (Frequent movement from unemployment to low-paid, insecure jobs)

3

80% rent Average house value £27k

Tend to live in industrial areas and away from urban centres

Notes: 1 Most common social class background based on National Statistics Socio-Economic Classification; 2 These self-reported house prices appear low given that, in 2011, the average house price in England was £232,485 and £366,435 in London. Source: Adapted from Savage et al (2015)

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Housing features prominently in Savage’s class categories; indeed, he claims that housing: … is the most important component of wealth. In the British case it has moved from about equivalent to average national income in the 1920s to around 300 per cent of that same amount today … Housing wealth is critically associated with location, and notable in that it distinguishes the metropolis of London from other parts of the UK. (Savage et al, 2015, pp 78–79) ‘Cultural’ and ‘social’ capital are also strongly influenced by the places in which people live.

Tenure By the late 1930s, tenure had acquired an identifiable, but variable, class relationship. Suburban homeownership was led by social classes A and B, and the estates constructed by local authorities ‘for the working class’ became residential areas mainly for social classes C and D although a section of the skilled working class were becoming homeowners. A metamorphosis in the class composition of housing tenures began in the late 1950s, gathered momentum throughout the 1970s and snowballed from the 1980s. The owner-occupied sector diversified by including more people from classes C1 and C2 and skilled workers whereas local authority estates increasingly became the territory of unskilled workers and social class E. Private renting was in decline, becoming the tenure of young, geographically mobile groups and older people who continued to live in the house in which they had settled. However, Clarke (2016, p 2) states ‘across England the proportion of private renters nearly doubled between 2003 and 2015 – in Greater Manchester the proportion has come closer to tripling’. This growth in private renting to a 19.8% market share in England has significantly changed its tenure profile with, as examples, the proportion of households aged 45–54 privately renting increasing from 4% in 2003 to 13.7% in 2014/15 and the number of households with children privately renting substantially increasing. Figure 10.1 sets out income distribution between tenures in 2014/15.

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Figure 10.1: Yearly income by tenure 2014/5 (% in each income band) Under 15k

15-30k 1.2

15.3

8.8

30-50k

Over 50k

2.0 9.6

40.8 24.4

35.6

23.4 35.5

34.0

36.0 34.7 54.6

24.7

12.2

54.4

19.7

28.5

4.8

Own outright

Buying with a mortgage

Local authority

Housing association

Private renter

Note: Many retired people with low incomes own their homes outright. Source: Adapted from DCLG (2016g)

Property wealth In 2015, housing wealth in Great Britain constituted 62% of total personal wealth and had increased fourfold since 1997 (ONS, 2016b), the outcome of a large increase in house prices, unevenly distributed across Great Britain. Treanor (2015, p 20) comments: An investment of £100,000 in housing in 1997 would have grown to £295,800 on average in the UK by 2013, giving a profit of £195,800. Interest on £100,000 borrowed at average mortgage interest rates over the same period would have cost £124,725, which is £71,075 less than the capital gain. On top of that they would have lived rent free.

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There been a tendency for prices in rich areas to increase at a faster rate than in poor areas. Lupton and Fitzgerald (2015) examined changes in house prices from 2007 to 2013 from the lowest decile to the highest decile. As prices increased so did change in relative values with the lowest decile declining by 6% and the highest increasing by 25%. Figure 10.2 sets out the distribution of property wealth. Figure 10.2: Median household net1 property wealth by household net equivalised income decile (£s): Great Britain, 2012– 14 300,000 250,000 200,000 150,000 100,000 50,000 0

1 After

Decile Decile Decile Decile Decile Decile Decile Decile Decile Decile 1 2 3 4 5 6 7 8 9 10

mortgage debt.

Source: ONS (2015)

According to the Redfern Review (2016) the wealthiest 10% of householders owned £1.5 trillion of housing wealth, ‘everyone else’ £2.4 trillion. House price growth in London after 2011 was strong resulting yet greater regional variations in housing wealth. Savills (2014b, p 1) stated: The shape of the housing market recovery post credit crunch means that the total value of London, the South East, South West and Eastern regions has risen by £435 billion over the past five years, with a net loss of £206 billion across the other regions. London and the South East account for just over a quarter (26%) of the UK’s housing stock, but 42 per cent of total value …

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By 2016 London was listed second – following Vancouver – in a league table of cities with the most over-priced property relative to income (Economia, 2016). It can be argued that, for owner-occupiers, the positive equity arising from real increases in house prices is illusionary: the capital gains made from house price increases above general inflation cannot be spent because, when a house is sold, the owner must buy a replacement property at the enhanced price level. Of course, second home owners – including private landlords – are exempt from this requirement. Nevertheless, a single house owner-occupier can benefit from house price inflation by: • using enhanced housing equity to raise income often via equity-release products supplied by financial institutions; • house sale, then renting for the remainder of a life span; • moving ‘downmarket’ as an owner-occupier especially by moving to a cheaper area; and • inheritance – providing the beneficiary with a home or a capital sum raised from sale. Homeowner wealth has been modified by taxes such as inheritance tax and land stamp duty tax plus the use of capital tests to determine eligibility for social care. House value is taken into account in assessing residential and nursing home charges and, with annual fees at £30,000 plus, this can result in rapid housing wealth erosion. Nevertheless, the historic gains from homeownership have been large and, in Nozick’s theory, undeserved, because state action has helped to generate this yield. The state planning system has restricted new housebuilding thereby forcing up the price of existing dwellings and, in the past, tax relief on mortgage interest provided high subsidies to homeowners who also benefit from capital gains tax exemption. ‘Generation rent’ There is a generational dimension to housing wealth. After 2004 owneroccupation in the UK started to decline producing newspaper headlines such as ‘Young give up hope of ever buying home’ (Daily Mail, 2016) and ‘The Plight of Generation Rent in Five Charts’ (Financial Times, 2016a). The Financial Times article noted that the number of young adults living with their parents has risen by 618,000 over the last 20 years to 3.3 million in 2015. This generation division has a class element. In 2016, the ‘Bank of Mum and Dad’ – only accessible if Mum and Dad have a bank – was involved in 25% of UK mortgage transactions (Legal and General, 2016).

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Private landlord wealth Private landlords are the new wealthy kids on the block. An analysis of private landlord characteristics (Lloyd, 2013), based on data for 2008/10, demonstrated that landlords were financially comfortable with most having a full-time job with pension rights and with a median £333,999 total net property wealth and a mean of £479,598. In a 2015 Shelter survey, 29% of private landlords said they had an annual household income of £70,000 or more and 20% £50,000 to £69,999 (Shelter, 2016c), the average monthly pre-tax profit on renting was £651 per month and 45% of landlords had no mortgage debt. This wealth and income puts them in a stronger position than first-time buyers to obtain mortgage finance. In the absence of compulsory registration in England, the number of private landlords is unknown but Ronald (2015) has estimated the figure at about 2.1 million. A 2010 private landlord survey found ‘More than three quarters (78%) of all landlords only owned a single dwelling for rent’ (DCLG, 2010c p 5) but, in Shelter’s 2015 survey, 59% of landlords owned only one property, 33% two to five and 8% more than five. A survey, based on invitations to answer a website questionnaire, found that 17.5% of landlords said they owned 6–10 properties, 10.3% 11–20, 6.2% 21–50, and 1.9% over 50 (Association of Residential Letting Agents, 2015). Assets accumulated over time are enabling more landlords to become major property investors, financing their purchases with cash rather than mortgages. A study by the Intermediary Mortgage Lenders Association (2014, p 1) revealed ‘Only 420,000 of the additional 1,310,000 properties in the private rented sector between 2007 and 2012 were financed by BTL [buy to let] loans’. By 2016, the total housing wealth owned by UK landlords had surpassed that held by mortgaged owner-occupiers with £1,077 billion of net housing equity held in privately rented homes (Financial Times, 2016b).

‘Social’ tenants The term ‘social’, now applied to local authority and housing association tenants, has subsidy and dependency connotations. Although some politicians maintain that a tenant who does not pay the market rent is subsidised there is a strong case for assessing the subsidy element in local authority and housing association sectors according to historic cost plus management and maintenance charges in relationship to rent paid. Despite the Right to Buy stripping the local authority housing asset base, local authority housing produced a £834 million surplus in 2011/12 (Wilcox et al, 2016b).

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Housing and income distribution Figure 10.3 records the Gini coefficient over time for household income both before and after housing costs. The difference between before and after housing costs partially reflects a propensity for some households to spend more on housing as a consumer choice but is more likely to mirror changes in relative housing costs such as the increasing share of private rented houses let at market rents. Noting Theresa May’s statement that she would focus on households ‘just managing’ (May, 2016a), Finch (2016) examined the average housing cost to income ratio among working age households between 1995/96 and 2014/15. For ‘low to median’ income working households the ratio had increased from 18.5% in 1995/96 to 24.6% in 2014/15. Figure 10.3: Gini coefficient UK, before and after housing costs, 1978–2014 Before housing costs

45

After housing costs

40 35 30 25 20 15 10 5 0 1978

1984

1990

1996

2010

2002

2014

Source: Adapted from McGuinness (2016)

Table 10.3 sets out the P90/P10 ratio (the income of the richest 10% compared to the poorest 10%) from 1979 to 2015. Table 10.3: The P90/P10 ratio, 1979–2015 Before housing costs

After housing costs

1979

3.0

3.0

1989

4.2

4.5

1998

4.0

5.0

2015

3.9

5.1

Source: Adapted from McGuinness (2016)

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Figure 10.4 sets out changes in absolute and relative child poverty before and after housing costs. There were marked regional variations with the difference between before housing costs and after housing costs child poverty incidence reaching 22% in Inner London compared to 8% in the North East (in 2013/14). Figure 10.4: Child poverty 1998/9 to 2013/4, Absolute1 and Relative2 (before and after housing costs) (% below poverty line) 50 45 40 35 30 25 20 15 10 5 0 1998/9 Absolute (BHS)

2003/4

2009/10

Absolute (AHC)

2013/14 Relative (BHS)

1

Fixed at below 60% of median equivalised income in 2010/11.

2

Below 60% of equivalised median household income in the year under examination.

2014/5 Relative (AHC)

Sources: Adapted from Full Fact (2016): DWP (2016)

Land In 1994 residential land price in England was £731,168 per hectare and £1,912,127 in London. By 2008 residential land price was £3,993,961 per hectare in England and £10,497,978 in London with residential densities increasing from 24 per hectare in England and 44 in London in 1994 to 44 in England and 122 in London in 2008. By 2010 residential land price had fallen to £2,360,338 per hectare in England and £6,283,593 in London (DCLG, 2016i). The coalition government stopped publishing residential land values alongside mean housing densities in 2010. Savills Residential Land Index (Savills, 2016) indicates that, in London, values are now about 20% above their 2008 level whereas, in the rest of England and Wales, they are 20% below the 2008 peak for green field sites. The UK landownership pattern is opaque but Cahill’s investigation has cast some light on the issue (Cahill, 2001). About 6,000 landowners, mainly aristocrats but including some large institutions and the Crown, own about two thirds of the land and, according to Cahill, a high proportion of the land available for residential development is owned by aristocrats. Savills (2012) estimated that,

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in London, 27% of potential building sites were owned by housebuilders, 17% by councils and housing associations with 57% held by private individuals or developers. Given the high land contribution to house prices, land ownership concentration has significant inequality implications. Space Belfield et al (2015, p 3) state: For most working age household types in England, floor space per person has been flat or has fallen since the mid-1990s; households with someone aged 60 or over, though, have seen increases in floor space per person. Trends have been less favourable in London (where space per person was already lower) and in the private rented sector. For private renters in London, space per person declined by a quarter between 1996 and 2012. Tunstall (2015) examined housing space distribution of over time. Space inequality declined from the 1920s to the 1980s but then increased and, by 2011, housing space inequality had returned to 1950s levels. Dorling (2014) attributed housing space differences to the spread of overall inequality – the wealthy having more money to spend on new large homes and extensions – and claimed that the contemporary housing issue is not a mainly a new building issue but one of unequal existing space distribution.

Gender Promoting gender equality was the remit of the Equal Opportunities Commission until 2007 when this Commission, with the Disability Rights Commission and the Commission for Racial Equality (CRE), were merged to form the Equality and Human Rights Commission (EHRC). The EHRC has the responsibility to ‘protect, enforce and promote equality across the seven “protected” characteristics – age, disability, gender, race, religion and belief, sexual orientation and gender reassignment’ (EHRC, 2009). The 2010 Equality Act was an attempt to synchronise and strengthen discrimination law and promote progress on equality. Existing law on discrimination was consolidated, strengthened and extended to the seven ‘protected’ characteristics covered by the EHRC. The Act contained clauses requiring a ‘public authority’ not only to ‘eliminate discrimination’ but to ‘advance equality of opportunity between persons who share a relevant protected characteristic and persons who do not share it’ and to ‘remove or minimise disadvantages suffered by persons who share a relevant protected characteristic ...’ (2010 Equality Act, Section 149). It also contained a clause requiring public

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authorities to have due regard to the desirability of reducing socio-economic disadvantage, in line with ministerial guidance. Thus, in theory, all inequality dimensions – with ‘socioeconomic disadvantage’ perhaps a low-profile surrogate for class – were incorporated into a harmonised public authority duty. The EHRC can conduct an inquiry into any matter which relates to equality and diversity or human rights with no specific standard of evidence needed to initiate an inquiry. Gender inequality in housing now forms part of the political and academic agenda but, up to the early 1960s, almost all housing discourses assumed policy should focus on the ‘patriarchal family’. The term ‘patriarchal family’ was devised by a section of the feminism movement to conceptualise the relationships involved in the ‘ideal’ family form – a male breadwinner and family head, and a female domestic carer – promoted as the ‘natural’ household structure. Feminists have argued that, rather than accepting this family form as society’s basic building block, it is necessary to disaggregate its structure to assess its impact on women’s life chances. Such disaggregation is difficult. In the past data compilation seldom incorporated a gender dimension and the family is still regarded as a private area in which relationships are negotiated on a voluntary basis. Thus, gender divisions in housing consumption (reflected in the expression ‘an Englishman’s home is his castle’), such as men’s sheds and a study or workroom for many men but for few women, have received limited attention in the housing literature. One way to explore gender and housing issue is to consider the position of women who form separate households. As Morris and Winn (1990, p 180) argue: Most women will go through stages in their lives when they either wish to, or are forced to, be part of a household where there is not a man present – such as younger single women, women experiencing relationship breakdown, and older women. The opportunities and constraints for all women are therefore indicated by the housing experiences of the 25% of households which, at any one point in time, are headed by a woman. Single women The 1975 Sex Discrimination Act made it illegal to discriminate against a person, directly and indirectly, on grounds of their sex. This Act helped to reduce such practices as refusing to accept a woman’s salary for a mortgage because of insecurity due to possible pregnancy – direct discrimination – and mortgage providers insisting that only people who worked full time could be given a mortgage – indirect discrimination because it is more likely to have an adverse effect on women. In 2006, although the gender gap was closing, fewer single women than single men – 42% compared to 51% – were owner-occupiers, mainly because

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women received lower pay. Moreover, as Gilroy and Woods (1994, p 34) point out, ‘the British form of home ownership with mortgages which bear down heavily in the early years, favours high or dual earners and therefore generally not women’. The gender pay gap continues. Single women are competing in the owner-occupation market with dual earners. So are single men, but men working full time earned £567 per week in April 2015 compared to £471 for women (Equal Pay Portal, 2016). Single women appear to have a lower homelessness risk than single men. A 1993 survey of single homeless people found that ‘the great majority of single homeless people interviewed were men ... 23% of people in hostels and Bed and Breakfasts were women as were only 7% in day centres and 13% on soup runs (Anderson et al, 1993, p  ix). However, Watson and Austerberry (1986) have argued that female homelessness is not less common than male homelessness, it is simply less conspicuous. Women are more likely to experience homelessness in private – sleeping on a friend’s floor for example – than in public. They will strive to avoid becoming street homeless due to the attendant risks of rape, harassment and violence. Lone parents There were 1.9 million lone parent households in the UK in 2013 (1.5 million in England) with 91% headed by a woman. Lone parent tenure is set out in Table 10.4. The high proportion of lone mothers living in the rented sector, with a marked switch from social renting to private renting, is the outcome of a number of factors. A job is a possible route from restricted housing choices but in 2014 only 63.4% of lone parents were in work – a consequence, in part, of the spatial segregation of lone parenthood in metropolitan areas where good jobs are relatively scarce, lone parents’ relative lack of marketable skills and the severely restricted supply of affordable childcare. Even when in work, lone mothers are likely to have a low income, which, in part, explains the low economic inactivity rate of lone parents. Clapham et al (1990) showed that, following separation and divorce, men were more likely to be homeowners than women and Feijten and van Ham (2010) have demonstrated that the adverse impacts of divorce and separation on ‘housing careers’ are long-lasting. Losing a home because of domestic violence is a further reason why lone parents are more likely to be found in the rented housing sector. There are a number of procedures available to enable the victim of domestic violence to remain in her home and to remove the perpetrator but these can be difficult to enforce. Thus the most viable option for many women needing to escape from domestic violence is to seek temporary accommodation through the homelessness legislation with a view to securing permanent housing via local authority assistance. In 2015 51% of homelessness applications were from single parents compared to 22% from couple

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households with children. As the availability of ‘social’ housing has declined and local authorities have been able to use private landlords to discharge their housing obligations, the proportion of lone parent households in the private landlord sector has increased. The bedroom tax has had a particularly adverse impact on single parent households with 150,000 of the 660,000 people having their benefits reduced because they have at least one unused room being lone parents (Guardian, 2013). The percentage of single parents living in ‘non-decent’ accommodation is higher than the percentage of couple households with dependent children – 19 compared to 17.6 – a gap that has increased since 2008 as proportionately more single parents have moved into the private landlord sector (Nomis, 2016). Table 10.4: Lone-parent families: tenure profile Single lone parent Owner Occupier Social renter

Private renter

1984

10.0

85.0

5.0

2004/05

20.0

61.1

18.9

2014/15

11.7

48.5

39.9

1984

39.0

54.0

7.0

2004/05

47.6

39.0

13.4

2014/15

37.5

32.3

30.2

1984

73.0

20.0

7.0

2004/05

79.2

12.9

7.9

2014/15

67.0

12.8

20.2

Previously married lone parent

Couple with dependent children

Sources: ONS (2014); DCLG (2016g)

Women, housing design and planning Some feminists have explored the implications of male dominance in architecture and planning for women’s lives. Despite the consequences of poor housing falling disproportionally on women, Roberts (1991) has noted the low level of female representation on the committees that influenced housing design (Tudor Walters Committee 1918; Central Housing Advisory Committee, 1944). Indeed, the Tudor Walters Committee relegated women to a sub-committee who were dissatisfied with the main committee’s initial recommendations stating they ‘depreciate the omission of an extra room or parlour’ and ‘are strongly of the view that the bath should be placed in a separate room not in the scullery’ (Ministry of Reconstruction Advisory Council, 1918, p 1). Roberts also comments on

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the ways that patriarchal family forms have been reflected in housing layouts such as the absence of sufficient space for children to play and the reluctance to include labour-saving amenities in working class housing. Burgess (2008, p 12) notes ‘planning policy has tended to ignore the fact that women and men use public space differently and have different concerns about how it meets their needs’ citing, as examples, more complex journeys with ‘trip chains’ to childcare, schools, work and shops plus after dark safety concerns.

Ethnicity An ethnic group is a social group whose members: • share a sense of common origins; • identify with a common and distinctive history and destiny; and • feel a sense of unique collective solidarity. It is self-perceived and people can belong to more than one ethnic group. Thus, a note of caution also needs to be attached to the ethnicity idea. In completing questions related to ethnicity people are invited to assign themselves to a category, despite ‘other’ appearing in the list. Thus ethnicity is likely to be far more diverse than officially recorded. As the EHRC (2016, p 7) has stated: Britain is a very different place today compared to the 1960s, when casual racism and ‘no blacks, no dogs, no Irish’ signs were commonplace. Race equality legislation and changes in social attitudes have had an enormous impact. This is a cause for celebration. However, the evidence shows that, 50 years after the Race Relations Act 1965, stark inequalities remain. Differences in housing outcomes Table 10.5 sets out the statistical evidence on differences in housing outcomes according to ethnicity. In explaining these outcomes, some commentators have used the concept of ‘racist discrimination’, defined by the United Nations as: any distinction, exclusion, restriction or preference based on race, colour, descent, or national or ethnic origin which has the purpose or effect of nullifying or impairing the recognition, enjoyment or exercise, on an equal footing, of human rights and fundamental freedoms in the political, economic, social, cultural or any other field

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of public life. (Office of the High Commissioner for Human Rights, 1989, Part 1, Article 1) Table 10.5: Ethnicity and housing outcomes White British

African Caribbean

Indian

Bangladeshi

Pakistani Black African1

866

1.1

2.5

0.8

2.0

1.8

Owner-occupier

68

45

69

43

63

24

Renting from private landlord

15

15

24

22

24

34

Social rented

17

40

7

35

13

42

8.3

26.82

21.1

30.93

30.93

26.82

27.92

26.6

26.33

26.33

27.92

% of total population (England and Wales, 2011) Tenure

Overcrowded (% with children)

Living in sub-standard 20.5 housing (2011/12) Mean usable floor space per person (2010)

48.96

34.14

34.14

34.14

34.14

34.14

Flat or maisonette %

146

442

225

225

225

442

Statutory homeless, England (% of total acceptances, 2015/16)

63

374

374

374

374

374

Odds ratio of household with dependent children experiencing housing deprivation (2011)

1

1.3

1.5

3.7

3.4

2.1

Notes: 1 The category ‘Black African’ includes people with origins in over 50 countries including Ghana, Nigeria, Somalia, Angola and Zaire; 2 Black; 3 Bangladeshi and Pakistani; 4 All ethnic minorities; 5 Asian; 6 White. Sources: DCLG (2016g); de Noronha (2015); Equality and Human Rights Commission (2016); Finney and Harries (2013); Garrett et al (2014); and Gulliver (2016)

Ginsburg (1992), although careful to point out the interactions between the categories, makes a useful distinction between subjective racism, institutional racism and structural racism. The salience of these racism forms in determining housing outcomes is diminishing but, because housing circumstances change slowly, past discrimination affects current outcomes. 247

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Subjective racism Applied to housing, subjective racism refers to overt racial prejudice and discrimination by individual landlords, estate agents, homeowners and tenants. It can take a variety of forms such as racially motivated attacks, harassment, the steering of minorities to certain geographical areas and refusal to sell or rent a property to a member of a particular ethnic group. Subjective racism by landlords and estate agents was investigated by Daniel (1968) who arranged for three testers, English, West Indian and Hungarian, to apply for rented accommodation or buy a house. Discrimination was found in 60% of the tests, a finding influential in the passing of the 1968 Race Relations Act outlawing discrimination in employment and housing. A test replication in 1973 found that discrimination had been reduced to 12% in the sales sector and to 27% in the private landlord sector (Riach and Rich, 2002). There was some use of discrimination tests in the late 1980s as part of formal investigations by the CRE. Evidence of ‘steering’ – estate agents directing minority ethnic groups to particular areas, a practice common in the 1970s – was identified. In 1990 the CRE examined the practices of accommodation agencies, landlords and landladies, small hotels and guesthouses. Testers differing only in their ethnic origin visited agencies asking for details of accommodation, and testers with pronounced African, Caribbean or Asian accents telephoned to request details of a property and, if told none was available, a white tester telephoned 10 minutes later. They found that 20.5% of accommodation agencies, 5.5% of landlords and 5% of small hotels and guesthouses discriminated against minority ethnic groups (CRE, 1990). In 2008/09 a DCLG Citizenship Survey (DCLG, 2010d) found that, in the private landlord sector, 8% of Indian people, 8% of Pakistani people, 11% of black African people and 14% of black Caribbean people expected to be treated less favourably than other groups, compared to 4% of white people. Racially motivated harassment is an important factor in restricting housing opportunities because apprehension about harassment restricts the choices available in where people live. The DCLG Citizenship Survey (DCLG, 2009d) found that 6% of whites thought that racial or religious harassment was a very or fairly big problem in the local area compared to 16% for Indian, 18% for Pakistani, 14% for Bangladeshi and 10% for black Caribbean households. Women were particularly concerned. Institutional racism Institutional racism was defined by the Stephen Lawrence Inquiry (Macpherson, 1999, para. 6.34) as:

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The collective failure of an organisation to provide an appropriate and professional service to people because of their colour, culture or ethnic origin. It can be seen or detected in processes, attitudes and behaviour which amount to discrimination through unwitting prejudice, ignorance, thoughtlessness and racist stereotyping which disadvantage Black and Minority Ethnic people. The 1976 Race Relations Act extended the anti-discrimination legislation of the 1960s. Under the Act it became unlawful to discriminate, both directly and indirectly, on racial grounds. Direct discrimination was defined as treating a person less favourably than another on the grounds of race and included segregation on racial grounds. Indirect racial discrimination was defined as applying a condition such that the proportion of persons of the victim’s racial group who could comply with it was considerably smaller than the proportion of persons not of that group who could comply. The condition had to be to the detriment of the victim and the discriminator had to fail to demonstrate that the practice was justifiable irrespective of race, colour, nationality or the ethnic or national origins of the person to whom it applied. Individuals who believed they were victims of discrimination could bring civil proceedings against the alleged discriminator through the courts. In addition, the CRE acquired the power to instigate a formal investigation into an organisation where it had a reasonable belief that discriminatory procedures were in operation. If the investigation concluded that an act of unlawful discrimination had been committed, it could issue a non-discrimination notice requiring the organisation to change its practices. The indirect discrimination idea, incorporated into the 1976 Race Relations Act, prompted academic studies and CRE investigations into the practices of social landlords. The main findings of these investigations were that the formal and, more significantly, the informal processes involved in council house allocation and the activities of estate agents discriminated against minority ethnic groups. Structural racism This refers to the overall context of housing policy set by the government that results in racial inequality. Although academics and the CRE concentrated their attention on local authorities, ‘national legislation has been influential in determining the location and quality of black peoples’ housing opportunities …’ (Smith, 1989, p 49). Thus, for example, the Right to Buy has resulted in many of the most desirable council homes being sold on those estates ‘populated mostly by white working-class households who benefited from the racialised allocation policies of previous decades’ (Ginsburg, 1992, p 121).

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Housing and the labour market Examination of the relationship between ethnicity and housing outcomes shows considerable diversity between different minority groups. This diversity has led some authors to conclude: … the operation of racism, elaborated in its subjective, institutional and structural forms, provides an ‘easy’ explanation for the development and persistence of racial inequality. The development of a more complex and holistic account of racial inequalities in the housing market must also address a range of other factors … (Law et al, 1999) In the 1960s and 1970s, when the state had a significant role in housing, it was reasonable, when considering housing outcomes, to concentrate on state housing activity. However, in 2015, 80% of the UK housing stock was distributed by the market. Thus, explaining diversity in housing outcomes involves examining the economic position of minority ethnic groups. The EHRC (2016, pp 21, 25, 29) set out the relative economic positions of ethnic minorities. Its account included: • in 2013 unemployment rates across Britain were significantly higher for people from ethnic minorities (12.9%) compared with for white people (6.3%); • Pakistani/Bangladeshi women were less than half as likely to be employed compared with average employment rates for other women; • black workers with degrees earn 23.1% less on average than white workers with degrees; • overall, Pakistani/Bangladeshi and ‘Other’ ethnicity groups received lower pay than white people in Britain, with both groups having an average pay of less than £10 per hour in 2013; and • poverty rates were significantly higher for children living in a household headed by someone with from an ethnic minority: 41.9% compared with 24.5% in households headed by someone who is white. In part, these inequalities reflect the changing economic fortunes of the places where ethnic minorities originally settled. Sleepwalking to segregation? The 2001 urban riots in Oldham, Burnley and Bradford influenced government policy. The Cantle Report (Home Office, 2001, paras 2.1, 2.13) stated: … the team was particularly struck by the depth of polarisation of our towns and cities … Separate educational arrangements, community

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and voluntary bodies, employment, places of worship, language, social and cultural networks, means that many communities operate on the basis of a series of parallel lives. These lives often do not seem to touch at any point, let alone overlap and promote any meaningful interchanges … We believe that there is an urgent need to promote community cohesion, based upon a greater knowledge of, contact between, and respect for, the various cultures that now make Great Britain such a rich and diverse nation. The ‘community cohesion’ agenda was adopted by New Labour and rapidly became ‘absorbed within local government and related organisations to replace previous attempts of multiculturalism’ (Worley, 2005, p 1). In 2005 Trevor Phillips, then CRE Chair, promoted the ‘parallel lives’ theme claiming that the UK was ‘sleepwalking to segregation’. Residentially, some districts are on their way to becoming fully fledged ghettoes – black holes into which no-one goes without fear and trepidation, and from which no-one ever escapes undamaged … Residential isolation is increasing for many minority groups, especially South Asians. Some minorities are moving into middle class, less ethnically concentrated areas, what is left behind is hardening in its separateness. The number of people of Pakistani heritage in what are technically called “ghetto” communities trebled during 1991–2001; 13% in Leicester live in such communities (the figure 10.8% in 1991); 13.3% in Bradford (it was 4.3% in 1991). (Phillips, 2005, p 5) Finney and Simpson (2009) questioned the ‘sleepwalking to segregation’ notion and, later, Simpson (2012) interrogated the 2011 census returns to support the view that segregation was not increasing. He used the Index of Dissimilarity that he described as: The percentage of the group’s total population in England and Wales that lives in a local authority is compared to the percentage of the rest of the population that lives in that same local authority. The absolute difference in percentages is added up across the 348 local authorities of England and Wales, and then halved so that the Index is a figure between 0 and 100. (Simpson, 2012, p 2) He found that, from 2001 to 2011 the Index of Dissimilarity was about the same for Pakistanis, had increased for Chinese but had reduced for Indians, Bangladeshis, Africans, whites and Caribbeans. However, segregation measurement is fraught with difficulties. Thus, for example, the Index of Dissimilarity, used by Simpson, is

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a measure that identifies the average situation without any intimation of variation about that figure and therefore conceals considerable local disparities (Poulsen et al, 2009). Some commentators see advantages for ethnic minorities in ‘ethnic enclaves’ as a launching point for immigrants who do not speak the language of the host country, preserving cultural identity, a critical mass to generate commercial services and a safe haven, preventing acts of discrimination (van Kempen and Bolt, 2012).

Disability In the 1970s, a social justice paradigm began to emerge that stressed ‘identity’ politics. It argued that social justice is not just a matter of command over resources, it is related to ‘disrespect’ towards a person’s authenticity. It emphasised the importance of including marginalised groups in the decision making process in order to strengthen ‘identity recognition’ (Young, 1990). Although ‘identity politics’ is pertinent to ethnicity and gender, in this chapter it will be elaborated with reference to disability. What is disability? Historically disability has been equated with impairment, that is, the condition of being unable to perform specified tasks due to physical or mental unfitness. This definition was related to the medical model of disability characterised by: • a focus on the individual, specifically on the body; • reliance on a strong notion of normality as being able-bodied; • an emphasis on rehabilitation to ensure the disabled person is as ‘normal’ as possible; and • the medical profession as the ‘expert’ on impairment and hence on disability. In the 1970s, a different disability definition emerged that made a distinction between ‘impairment’ and ‘disability’. Disability meant ‘the disadvantage or restriction caused by contemporary social organisation which takes no or little account of people who have physical impairments and thus excludes them from the mainstream of social activities’ (Union of the Physically Impaired Against Segregation, quoted in Oliver and Barnes, 1998, p 17). This notion of disability as the consequence of a disabling process was embodied in a ‘social’ model that regarded disability as a set of challenges faced by people whose requirements have not been accommodated by the dominant culture. The social model generated two approaches to the disability and housing issue. ‘Independent living’ tended to stress the availability of cash benefits to enable disabled people to make choices about where they lived and the nature of their personal assistance whereas

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‘integrated living’ emphasised the collective involvement of disabled people in making choices about the overall pattern of accommodation. The pattern of housing provision for disabled people For most of the 20th century housing provision for disabled people was influenced by the medical model and the idea that disability was a personal tragedy to be mitigated by raising money to reduce the ‘suffering’ of ‘the disabled’. Disabled people were hidden at home or lodged in state and voluntary sector institutions. The advent of a community care policy in the 1960s started to shift this residence pattern but, under the tutelage of the medical model, the accommodation was often supplied in ‘clustered’ or ‘group’ units. This spatial exclusion of disabled people was compounded by the tendency to provide adapted property on council estates. From the 1970s the accommodation deemed necessary for ‘community care’ evolved under a number of different capital and revenue funding streams involving social services departments, health authorities, housing departments and housing associations. These income sources were often supplemented by housing benefit (HB), used to meet the revenue costs involved in providing housing related support. In 2003 an attempt was made to bring some order into the haphazard sources of finance for supported accommodation. The system is outlined in Box 10.1.

Box 10.1: Supporting people Over the years social housing providers identified a requirement to provide support to some of their tenants in addition to the normal landlord role of repair and rent collection – help from wardens in sheltered accommodation is an example. Funding for housing related support evolved piecemeal in the 1980s and, by 1998, the nine different funding streams available had produced a pattern of service provision that was ‘seen to be uncoordinated, unrelated to local priorities and frequently provider and funding driven’ (Foord and Simic, 2005, p 7). In 1998 the government announced that the existing funding schemes for housing related support would be amalgamated into a single stream, to be known as Supporting People, and would be allocated to local authorities for distribution to a range of housing related support providers. Supporting People would cover a range of circumstances including physical and sensory disability, homelessness, domestic violence, HIV and AIDS, alcohol and drug dependency, mental illness, learning disability and old age but HB still included some support elements. Supporting People resources are distributed to local government according to a needs-based formula. The assistance has the advantage that, in the form of ‘floating support’, help can be detached from tenure and concentrations of dwellings for people

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with ‘special needs’ in particular locations. Downsides to the programme have been a tendency for commissioners to purchase large scale, generic floating support services that are not geared to the needs of any particular specialist group and there has been controversy about the loss of wardens in sheltered housing for elderly people (House of Commons Communities and Local Government Select Committee, 2009). Given that the distinction between ‘care’ and ‘support’ is somewhat artificial, New Labour’s decision to end the ‘ring-fencing’ of Supporting People resources in 2009 offered the potential to facilitate more pertinent ‘care and support’ packages and provide an opportunity to integrate housing support into ‘right to control’ agenda – with its ‘selfdirected support’ and ‘personal budgets’ – being developed within the health and personal social services domains. The coalition government reduced the resources allocated to Supporting People by 11.5% but the enclosure of central funds in the diminishing general budgets of local authorities and the provision of some extra finance from NHS budgets at the local level means that it is difficult to track the impact of this resource reduction.

Supported housing Supported housing covers a variety of housing types, including group homes, hostels, refuges, supported living complexes and sheltered housing. Residents of supported housing include a variety of vulnerable groups such as elderly people, people with mental, physical and learning disabilities and substance abusers. Much of the cost of meeting this non-housing related support is met outside HB via the Supported Housing Programme and other funding schemes and, as Clapham (2015, p 14) points out, ‘it is difficult to draw any clear dividing line between care support and help’ thereby making funding schemes complex. A review of supported housing (Blood, Copeman and Finlay (2016, p 2) ‘encountered considerable challenges in relation to the complexity of the sector, data availability, sampling and levels of response’. Supported housing costs are higher than conventional housing due to factors such as higher wear and tear, extra security, extra space and adaptations. These are reflected in higher rents supported by HB meaning that HB reductions, in particular restricting HB in the ‘social’ housing sector to the Local Housing Allowance (LHA) rules in the private rented sector and a general reduction of 1% per annum in social housing rents could have a significant impact on supported housing. Supported housing was exempt from these changes for a year (Wilson, 2016) and, in 2016, the government announced that exemption from the caps on the LHA would continue until 2020 but the 1% a year rent cut would apply to supported housing from 2017/18 to 2019/20 with exemption for specialist

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supported housing and fully mutual co-operatives, almshouses, Community Land Trusts (CLTs) and refuges.

Lifetime homes In the early 1990s the Joseph Rowntree Foundation developed the ‘lifetime homes’ idea, with 16 design features, such as a level threshold, chosen to ensure that a new house will meet lifetime needs. If all new homes were built to this standard then, over time, disabled people would not have to move to secure suitable accommodation and they would find it easier to visit friends and relatives. Following successful resistance to a press campaign to ‘save our doorstep’ (Raynsford, 2016), some lifetime homes design features were incorporated into Part M of the England & Wales Building Regulations in 1999 and the concept was widely used by housing associations when commissioning new dwellings. In 2008, as part of its review of the implications of an ageing population, New Labour announced that by 2011 the lifetime homes standard would be mandatory for public sector housing and an aspiration that by 2013 all new homes would be built to this standard. However, by 2015: Although adherence to Lifetime Homes standards in social housing was made mandatory by the last government, it remains up to local authorities as to what they require from the private sector. Progress has been slow: only about a third of new housing is currently being built to Lifetime Homes standards. The Greater London Authority is the only local authority in the country which requires all new homes to be built to Lifetime Homes standards (and 10% to wheelchair standard), and only four out of ten local authorities require at least some proportion to reach these standards. (Morris, 2015)

Disabled Facilities Grants The Disabled Facilities Grant (DFG) grant must be awarded if relevant criteria of being ‘necessary’, ‘appropriate’, ‘reasonable’ and ‘practicable’ are met. It is paid for essential adaptations to allow disabled people better freedom of movement into and around their homes and to access the essential facilities within it. It is meanstested but in 2005 this was abolished for families with children under 19. In 2016 the maximum grant that a council was required to pay was £25,000 in Northern Ireland, £30,000 in England and £36,000 in Wales per application but, if the cost of the eligible works was more, the council could use discretionary powers to increase the amount. A different system operates in Scotland with mandatory grants covering 80% of costs (100% where people are receiving specified state benefits) if the applicant is assessed by the local authority as being in ‘priority need’.

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DFGs do not cover local authority properties where improvements are paid for by the local authority. The coalition government initially limited its contribution to DFGs in England to inflation but later added limited extra resources. Resource inadequacy was revealed by a Building Research Establishment investigation which stated: Analysis using English house condition survey data has indicated that the total amount required to cover grants for all of those who are theoretically eligible under the current rules is £1.9bn at 2005 prices. This is more than ten times higher than the total amount of disabled facilities grant allocated in England in 2009–10 (£157m). (Building Research Establishment, 2011, p 3) As the private landlord sector has expanded, adapting homes has become more difficult. The 2010 Equality Act 2010 made it harder for landlords to refuse permission for home adaptations, but DFGs are only given if the tenant intends to stay in the property for five years.

The bedroom tax The bedroom tax had a significant impact on disabled people: no ‘spare’ bedroom for a spouse caring for his/her disabled partner; no ‘spare’ room to store wheelchairs/equipment; no ‘spare’ room for a young disabled child to sleep alone and with little prospect of ‘downsizing’ because the ‘spare room’ was needed. Local authority discretionary housing payments mitigated the problem but only to a limited extent.

Need and supply There are no routine procedures in place for assessing disabled people’s requirements that can be matched against the pattern of provision to identify unmet needs and plan future supply. The limited and dated available evidence indicates significant inadequacies. Indeed, in 2015, the UN Committee on the Rights of Persons with Disabilities announced an inquiry into the impact of the UK Government’s policies on the rights of disabled people. The inquiry is being conducted under the Optional Protocol to the Convention on the Rights of Persons with Disabilities, to which the UK has been a signatory since 2007, and is due to report in 2017. • Disabled people face a disproportionate likelihood of living in a deprived area (Papworth Trust, 2014). Clapham (2015) stresses the importance of

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neighbourhood and socio-economic factors in the subjective wellbeing of disabled people. • The Office for Disability Issues (2011) found that 9% of adults with a disability, as defined under the Equality Act 2010, struggled getting into any room within their own home, and 8% of adults with an impairment found difficulty getting in or out of their own home. • More than half (54%) of those with mobility problems who have looked for accessible homes said they found them difficult to find. (Leonard Cheshire Disability, 2014a, p 1). • 44% of councils had people waiting over two years for a grant with eight reporting waits of over four years (Leonard Cheshire Disability, 2014b). • The four features which are considered to be the most important for enabling people with mobility problems to either access their home or visit someone else’s home are: level access; flush threshold; sufficiently wide door and circulation space to move around; and use of a WC on the ground or entry floor. Despite requiring adaptations, the majority of households felt their home was suitable for their needs and had accessibility features that provide visitability to most people, including wheelchair users with those aged under 55 and private renters most likely to feel that their accommodation was unsuitable for their needs (DCLG, 2016j). • About 1.9 million households had one or more people with a long-term limiting disability that required adaptations to their home. A study by the Centre for the Analysis of Social Exclusion (2016) found that there were 3 million working age households including a disabled member (21% of working age households). • 54% of families with a disabled child are homeowners compared to 69% of families with non-disabled children. • Families with a disabled child are 50% more likely than other families to live in overcrowded accommodation, to think that their home in a poor state of repair and to report problems with wiring, draughts and damp in the child’s bedroom. • The majority of families with disabled children report that their homes are unsuitable for their child’s needs and the associated needs of other family members. Often the home is unsuitable in a number of ways with, for example ‘Some parents have to carry their children upstairs due to their property being inaccessible’ (Muscular Dystrophy UK, 2015, p 5). (All figures on disabled children and housing are taken from Joseph Rowntree Foundation, 2008, except when otherwise specified.)

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Scotland, Wales and Northern Ireland Writing in The Scotsman, Gerry Hassan said: ‘There is a deeply rooted belief in Scotland that we, as a society and community, prioritise and value the idea of equality’ (Hassan, 2013). There is some support for this belief in public opinion polls with 43.8% of Scots people wanting increased tax and spending compared to 36.4% of voters in England and Wales (British Social Attitudes, 2015). The Scottish National Party housing policy has a ‘leftish’, egalitarian tone. Ending the Right to Buy, compulsory private landlord registration, rent control, mitigating the ‘bedroom tax’ and land reform are examples. Moreover, the Scottish record on housebuilding is better than that of England and there has been a greater concentration of resources on social housing especially local authority housing construction. The outcomes of this policy direction in terms of wealth and income distribution will be long term but some current figures reflect the ‘Scottish difference’. Thus, for example, although London distorts the English figure, the gap between the proportion of children in poverty (below 60% of median income) before and after housing costs is 6% in Scotland compared to 11% in England (DWP, 2015). The National Assembly for Wales, dominated by Welsh Labour since devolution, has an ‘old’ Labour flavour in its housing policies reflected in reduced Right to Buy discounts as a prelude to abolition, strong opposition to the ‘bedroom tax’ and compulsory registration of private landlords. However, its housebuilding record has been disappointingly poor (see Chapter Five). Nolan (2014, p 71) notes: The Northern Ireland interpretation of inequality is less concerned with the gap between rich and poor. The term is understood mainly in terms of what is sometimes referred to as ‘horizontal equality’, that is the relationship between the two blocs, Catholic and Protestant, though section 75 of the Northern Ireland Act 1998 also placed an equality duty on public bodies with regard to various other categories, including race and disability. One category not included was class and the research agenda that has evolved since 1998 has tended to ignore vertical inequalities between rich and poor. While poverty is comprehensively researched, wealth is just as comprehensively ignored. So there can be only limited speculation on social inequality as the measurement of wealth disparities. The Democratic Unionist Party voted against the bedroom tax at the Westminster Parliament and called for its abolition in its 2015 manifesto (Democratic Unionist Party, 2015). Resistance to the bedroom tax resulted in its demise in Northern Ireland and substantial concessions on other aspects of the welfare reform package

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but this probably reflected the attempt to prevent withdrawal of resources from Northern Ireland – the welfare reforms, including the bedroom tax, if fully implemented, would have taken £750 million per year out of the Northern Ireland economy – than a glimmer of class politics.

Overview

• • • • •

Social justice is about fairness in the distribution of the goods and services. The idea has also been linked to the ‘respect’ given to different members of the community. Class inequality has been reflected in tenure divisions. Gender differences in housing outcomes have been influenced by the dominance of the patriarchal family form. Discrimination in the housing system, choice, location factors and economic variables have influenced ethnic variations in housing outcomes. The housing choices available to disabled people have been affected by the dominance of the medical model of disability.

Questions for discussion 1. What is the difference between social justice and social exclusion? 2. Distinguish between subjective, institutional and structural racism and give examples of their operation. 3. What have been the major objections of the disabled persons’ movement to the dominant form and location of the housing available to disabled people? 4. What evidence is there to support the contention that gender inequality is reflected in access to good quality accommodation? 5. What is the impact of housing costs on child poverty?

Further reading Inequality in the UK: 2016 (2016) by Chris Belfield, Jonathan Cribb, Andrew Hood and Robert Joyce provides valuable information on the impact of housing costs on income inequality and poverty. The relationships between class, gender and disability to housing outcomes are explored in Housing and social inequality by Jenny Morris and Martin Winn (1990) and Housing and inequality (2011) edited by Isobel Anderson and Duncan Sim. Laura Hemingway offers a comprehensive account of how housing influences the lives of disabled people in Disabled people and housing: choices, opportunities and barriers (2011). Forty years of struggle: a window on race and housing, disadvantage and exclusion (2016) by Kevin Gulliver is a good report on housing/ethnicity relationships.

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Websites A number of research findings relating to housing, class, disability and ethnicity can be found on the websites of the Joseph Rowntree Foundation and ‘Mind the (Housing) Wealth Gap’: www.jrf.org.uk and http://wealthgap.wp.st-andrews.ac.uk The Institute for Fiscal Studies produces informative papers: www.ifs.org.uk

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eleven Conclusion: Let’s be builders This chapter examines various answers to the ‘housing question’ organised under the perspectives set out in Chapter One and, in so doing, explores the strengths and weaknesses of each standpoint. Not all the solutions fit neatly into the approaches and they are not related directly to political party policies. Contemporary political parties have adopted programmes, not in accordance with policy rationality or ideological purity, but to win elections.

Laissez-faire The financial institutions’ misdemeanours in generating the housing boom and bust gave cold comfort to neoliberals. There was no rational supply/demand calculus driving the credit explosion – it was the product of fees to be harvested from each ‘securitisation’ stage, passing liabilities onto others (Financial Services Authority, 2010) and that ‘risk-taking was given priority over and above the imperative of protecting the capital of the banks’ (Brown, 2010, p 101). The orthodox neoliberal response to the credit crunch would have been to allow to market to wreak revenge on the culprits, but the banks were ‘too big to fail’. With the Royal Bank of Scotland about to join Northern Rock in going bust, Alistair Darling (2011, p 154) told his Treasury officials: I feel a deep chill in my stomach. If we don’t act immediately, the banks doors would close, cash machines would be switched off, cheques would not be honoured, people would not be paid.

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On hearing about a 37% reduction in mortgage lending the prime minister declared ‘these figures made my blood run cold’ (Brown, 2010, p 35). It took nation state involvement, augmented by the World Bank, the International Monetary Fund and the European Investment Bank to prevent the crisis becoming a catastrophe. In 2015, the UK bank bailout deficit was still £115 billion (National Audit Office, 2015). Moreover, the banks were ‘recapitalised’ through a variety of stratagems including ‘Funding for Lending’ and, because a high proportion of bank profitability comes from the mortgage business, mortgage demand was stimulated by schemes such as Help to Buy helping to ignite a new London house price boom that started to spread nationwide, at least until the Brexit vote produced market uncertainty. The result was to fuel the growth of a debt-burdened or asset-poor ‘jilted generation’. The people able to access homeownership have large mortgage debts and are highly reliant on low interest rates. Those unable to buy joined ‘generation rent’ and are caught in a ‘rent trap’ (Walker and Jeraj, 2016) with no escape from reality, ensnaring those well up the age scale. Clarke et al (2016) state: Locked out of home-ownership … private renters consistently spend a higher proportion of their incomes on housing than any other tenure group, with significant implications for both their immediate living standards and longer term prospects. It is possible to predict a ‘perfect storm’ for housing benefit (HB) costs when present tenure movements are projected. As ‘generation rent’ moves into old age – between 2011 and 2015 the proportion of 45–54 year olds privately renting increased from 12.5% to 14.9% – the elderly ‘generation rent’ will make a substantial contribution to HB expenditure. Lloyd (2012) predicts that, by 2060, the government will have to spend an extra £8.13 billion every year on HB for pensioners. Examining future HB costs for all potential recipients, Chaloner et al (2015, p 5) comment:

If trends over the past parliament were to continue unabated, total expenditure on housing benefits in the United Kingdom would increase to almost £200 billion in 2065-66 — with households in the private rented sector accounting for 63 per cent of the total, compared to 37 per cent today. Planning control The current principal neoliberal answer to the housing question is to relax, or even abandon, planning controls. Laissez-faire advocates have constructed a formidable

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case against planning restraint, mainly with reference to green belts (see Chapter Five). An IEA publication, ‘Abundance of land, shortage of housing’, concluded: … the empirical evidence from around the world shows, as conclusively as econometric papers get, that planning restrictions are a key determinant of housing costs. (Niemietz, 2012, p 21) Demand side subsidies Demand side subsidies are also condemned by many neoliberal economists as adding to demand but making little contribution to supply, thereby boosting house prices. Vince Cable, a member of the coalition government, said ‘an extension of the scheme to guarantee mortgages for any house purchase up to £600,000 and not just for first-buys fuelled demand with only a tenuous link to supply’ (Cable, 2015, pp 235–6), quoting neoliberal think tanks such as the Adam Smith Institute and the Policy Exchange to support his view. Low interest rates in the 2000s, compared to historic interest rates, also stimulated house price inflation. The Bank of England was made responsible for inflation control according to the consumer prices index – different to the retail price index in excluding many housing costs – and did not take into account the interest rate impact on asset value hikes. Some commentators attribute the lion’s share of current housing price inflation to new demand side factors. Saunders (2016, p 63) concludes ‘Inadequate supply is not the key cause of our high house prices’. He argues that the focus on new housing construction as a supply measure has ignored the impact of conversions and ‘over the last 40 years housing supply has increased faster than the growth in the number of households, so scarcity is no worse now than it was in the 1970s’ (Saunders, 2016, p x). Saunders blames the explosion in credit availability and its historically low cost since 2008 for the recent house price explosion, adding buy to let, parents’ drawing down housing equity to help their children and foreign money coming into the London luxury market. Those who deny that a shortage of homes has driven house-price increases also point to the ‘bargaining power’ of buyers, with real incomes rising until the credit crunch (Oxford Economics, 2016), and Dorling (2014) highlights the impact of rising inequality in income and wealth. There is a persuasive argument that demand side subsidies are part of the Treasury’s arsenal to accelerate house prices to produce extra land stamp duty tax (LSDT) revenue, bolster the banks and stimulate asset-based welfare because ‘when individuals own homes they can get by on lower pensions’ (Castles, 1998, p  13). The Treasury (2004, p  96) declared ‘Traditional methods of aggregate savings often ... fail to highlight the positive impact of asset growth’.

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Filtering theory Filtering theory – houses produced by market forces benefit the poor because movement into new homes by affluent people creates a vacancy chain so those at the bottom of the housing ladder move up – is an element in neoliberal thinking. Suburban expansion from the late 19th century to the 1930s, when large town houses were sub-divided into ‘rooms’ – Pritchard (1976) detects a marked increase in large house sub-division in Leicester from the 1920s – had an impact on the housing standards of the poor (Harris, 2012). However, such filtering was a very long process, produced small gains for low-income households and depended on a large increase in new supply relative to population size. Filtering impact has been limited by people, already well-established on the housing ladder, purchasing more space (Dorling, 2014). Rowntree’s observation that ‘a large number of bone fide working men, regular workers, or casual workers [are] unable to afford a sanitary or satisfactory house’ (Pigou and Rowntree, 1914) is as pertinent today as it was in 1914 when applied to contemporary ‘decent’ homes standards for men and women. The New Right In Chapter One, a New Right perspective with connections to neoliberalism was identified that privileged owner-occupation as a social stability pillar. To the New Right increasing homeownership is more important than the total new housing construction and the Conservative Party, with some justification (Lund, 2016), has identified electoral gains from promoting owner-occupation. The New Right also emphasised ‘national identity’ and this stress on ‘Britons First’ is associated with the housing issue. Those favouring UK withdrawal from the EU in the 2016 referendum campaign focused attention on net EU migration – 180,000 in the year August 2015 to August 2016 (ONS, 2016c) – adding to the 260,000 per annum net migration, from inside and outside the EU, since 2003 (Hawkins, 2016). Peter Saunders, a robust homeownership advocate, states ‘It seems clear that immigration has been another factor driving up and then sustaining high house prices’ (Saunders, 2016, p 80).

‘Radical’ social reformism Social reformism’s guiding maxim is that, because housing markets function inefficiently and produce unjustifiable inequalities, state corrective action is necessary. Social reformism covers an extensive and eclectic range of possible interventions, classifiable as ‘radical’, ‘moderate’ and ‘ameliorative’. Some share the neoliberal distaste for demand side subsidies and planning controls although

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several ‘left’ politicians are eager to maintain green belts. In 2015 Jeremy Corbyn declared: Developers will nearly always argue for the release of Green Belt land because it is easier for them compared to developing brownfield sites. But we don’t simply want our towns sprawling outwards with reliance on cars growing – and the Green Belt has prevented that to a certain extent. (Corbyn, 2015, quoted in Redbrick, 2015) Sadiq Khan (2016, p 66), in his London mayoral manifesto, said he would oppose building on the green belt declaring it ‘is even more important today than it was when it was created’. Rent control Rent control is abhorrent to laissez-faire economists. When Labour suggested modest rent regulation in the 2015 general election campaign, the IEA asserted: ‘95 per cent of economists disagreed with the proposition that rent controls had a positive impact on the amount and quality of broadly affordable rental housing’ (Bourne, 2014, p  10). ‘Classic’ rent control certainly contributed to a decline in private sector lets but was highly effective in promoting low-cost homeownership. Post 2004, as private landlordism expanded, homeownership declined, not surprising given class and generation related income and wealth switches and the advantages conferred by the state on private landlords. The sustained growth in private landlordism has created a cash-rich ‘rentier’ coterie capable of outbidding potential homeowners. Part of the case against rent control is that it merely transfers existing houses between tenures. It can be argued that, by putting their capital into new homes, private landlords build to let. Statistics on new home acquisition by private landlords are sparse. Bentley (2015, p 16) maintains ‘mainly owner-occupiers purchase new build homes. Private landlords tend to buy existing homes, meaning their investments merely change the tenure profile of what is already there’ – hence the extra incentives introduced by the Conservative government to persuade institutional investors into the build to let market. Moreover, ‘new build housing adds less than 1% to London’s housing stock each year’ (British Property Federation and Molior London Ltd, 2014, p 2). Thus whereas HB to ‘social’ landlords at a cost of £15.4 billion in 2016 helps to finance new homes, HB to private landlords, costing £9 billion each year, makes little contribution although it helps to finance the sub-division of existing houses into flats. ‘Classic’ rent control – a rent freeze and ‘fair’ rents – would be difficult to implement. A necessary prelude would be a compulsory private landlord register including property portfolios and current rent levels. George Osborne’s measures

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to curb private landlordism, reducing tax advantages and adding 3% LSDT on second homes, can be categorised as ‘ameliorative’. HM Treasury (2015a) estimated a £825 million gain in 2019/20 from LSDT on second homes indicating no significant movement away from private landlordism. However, the strategy would become ‘radical’ if private landlord tax relief was totally abolished and the LSDT levy was increased to 10%! A right to buy for private tenants? During his 2015 Labour Party leadership campaign Jeremy Corbyn said: So why not go with Right to Buy, with the same discounts as offered by way of subsidised mortgage rates, but for private tenants and funded by withdrawing the £14 billion tax allowances currently given to Buy to Let landlords? (Corbyn, 2015, quoted in the Independent, 2015) Unlikely support for this proposal came from the think tank Civitas, reflecting its move from an offshoot of the laissez-faire IEA, towards the New Right agenda. In a Civitas publication, Saunders (2016) proposed a statutory right to buy, on the same terms as council tenants, for private landlord tenants. To prevent landlords resorting to eviction, tenants would have five years’ security of tenure at inflation-limited rents. There would be a cap on discounts to ensure landlords did not suffer losses meaning that, in the main, landlords would keep a slice of their capital gains. It would be limited to properties at least 25 years old to encourage landlords to buy new properties. They would have their tax concessions restored and the extra LSDT levy would be abolished. Despite Saunders’ concessions, private landlordism would probably be eradicated at an even faster rate than under ‘classic’ rent control. Land taxation Henry George’s land tax idea still has appeal. The Land Value Taxation Campaign (2016) emphasises that its annual land tax proposal applies to the land site value not including any improvements and gives a long list of its advantages, most derived from Henry George’s Progress and Poverty (1979 [1879]). In stating ‘Although described as a tax, it is not really a tax at all, but a payment for benefits received’, the Land Value Taxation Campaign (2016, p 1) echoes Lloyd George’s attack on the landed interest as accumulating undeserved wealth via the impact of infrastructure investment by the community on land values. Land value taxation would be costly to implement – Lloyd George’s scheme required ‘an army of valuers’ (Packer, 2001) – and previous experience of ‘betterment’ taxation suggests that landowners will hoard land in the hope that a future government would

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repeal the tax making enhanced local authority compulsory purchase powers (see Chapter Five) necessary for land taxation to have an impact. Increasing ‘social’ housing supply The post 1979 slump in UK housing construction coincided with a steep fall in ‘social’ housing output. As Smith (2016, p 127) has remarked, ‘social housing provision went out of fashion, even though the need for it did not’. UK construction labour model: modernise or die (Falmer, 2016), commissioned by the government, noted that, since the relegation of ‘social’ housing to a residual role in housing supply in the 1980s, housing supply has not kept pace with housing requirements. The failure to invest in not-for-profit housing fuelled house price increases as low-income households were forced into paying more for less housing space. The Conservatives disliked ‘social’ housing, especially when supplied by local government. That’s why they endorsed the term with its association in working class communities to ‘the social’ and ‘welfare’. Although ideologically attracted to housing associations as ‘third way’ participants, New Labour was parsimonious in the resources it injected into the sector for new build, preferring to upgrade existing ‘social’ houses mainly by pump-priming stock transfer. Some ‘radical’ social reformer politicians are suspicious of housing associations, regarding them as lacking local accountability and adopting a paternalistic attitude to their tenants. The larger associations have been accused of being too eager in adopt the neoliberal agenda, ‘developing into property companies that buy and sell land, dealing increasingly in selling existing properties’ (Corbyn, 2007 quoted in Placeshapers, 2008, p 8) and granting large remuneration packages to their executives. New build: the role of local government Radical social reformers assert that homeownership is beyond the income of lowincome households and many view local government as better mechanism than housing associations to secure greater rented accommodation availability. The decline in local authority new construction output in England has been dramatic – down from 126,000 in 1975/76 to 2,080 in 2015/16. Some local authorities are developing housing companies, building houses for market sale, shared ownership, for rent at market and affordable rents, as well for ‘social’ rent outside the Housing Revenue Account (HRA) so that the homes do not become eligible for Right to Buy (RTB). However, the contribution to total housing production is very small. Reviving the sector, now asset-stripped by RTB and stock transfer, will be a long process, although ‘reverse stock transfer’– from housing associations to local government – would enhance local government’s capital base.

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Borrowing conventions have been a major barrier to local authority involvement in housing supply. Wilcox (2016b, p 16) has drawn attention to the longstanding argument that international fiscal rules make a distinction between government and corporate (trading) sectors with the outcome ‘we have rather oddly ended up with sundry railway and utility services in the UK operated by other countries’ public corporations’. Classifying local authority housing as ‘trading’ would release its investment borrowing from tight Treasury constraints. The 2015 decision of the ONS to reclassify housing association debt as public sector is salient. When the ONS classified £60 billion housing association debt as a public sector liability, the Office for Budget Responsibility (2015) calculated this would cost £4.5 billion per year but could be easily absorbed by the extra £27 billion generated from extra tax receipts between July and November. Hence, even the existing borrowing rules are not a high impediment to new local authority investment in residential construction: political distaste for local authority housing has been far more potent. Cost–benefit calculations, taking into account HB reductions from lower ‘social’ rents and other factors, reveal gains in moving from ‘benefits to bricks’ realised over a reasonable time span (Chaloner and Pragnell, 2016). Giving the HB budget to the ‘Northern powerhouses’ and the ‘Midlands engine’ would enable experiments in assessing capital and future revenue expenditure together. Direct labour Over time sustained local authority housing output would produce a large housing stock, probably increasing in value, with more homes distributed according to non-market criteria and – if flats, high or low, are avoided – contributing to a fresh council house image. Moreover, the houses could be built by direct labour. Housing output discussions often neglect the importance of building industry capacity. A major failure of the New Labour and the coalition government was their inattention to the residential construction industry. Arcadis (2015, p 6) states: The construction industry’s productivity has barely increased in the past 20 years, and whilst many industries have invested in labour saving plant and technology, construction is as dependent on scarce labour as it was in 1993. When, in 2007, 170,000 new houses were built in England, the residential construction industry was overheated despite a significant increase in EU workers. In the recession, the industry lost thousands of employees. Ramping up housing production across the UK to even a modest 230,000 houses per annum would require 120,000 extra workers over a range of specialisms: bricklayers, plasterers, roofers, scaffolders and quantity surveyors (Arcadis, 2015). The 3% apprenticeship levy announced by the Conservative government in 2015 will help in the long

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run, as will offsite prefabricated production, but building worker supply remains a major problem. Well-managed local authority direct labour organisations, with their tradition of fostering apprenticeships, could make a significant long-term contribution to new house construction. Scotland is cautiously leading the way in restoring local authority housebuilding (see Chapter Five). Twinch (2016) maintains: Scottish councils aren’t subject to the same sort of caps on their Housing Revenue Account (HRA) borrowing, while the Right to Buy is being phased out. They enjoy priority access to public land. And, in January, the Scottish Government announced it was increasing the grant rate for councils to build social homes from between £46,000 and £50,000 per unit, to £57,000 and £59,000. The Falmer report repeated Arcadis’ estimate that 120,000 extra construction workers were necessary, adding that 620,000 will be needed to replace those expected to retire in the next 10 years. It claimed that ‘the prognosis for the industry, if action is not taken quickly, is that it will become seriously debilitated’ (Falmer, 2016, p 8). Noting the residential construction industry’s ‘low productivity’, the report, echoing Wheatley’s 1924 deal with the building industry, called for long-term investment in modern methods of construction (‘pre-manufacturing’) which will come only from certainty, not from the boom and bust sale market, hence public investment in social housing and institutional investment in private renting were necessary. Theresa May’s government started to take an interest in prefabricated houses. In December 2016 Your Family Group, a housing association, signed a £2.5 billion agreement with a Chinese construction firm that could deliver 25,000 modular homes per year. Housing benefit for homeowners HB is paid to renters. It is a neoliberal idea reflecting the notion that state activity in the housing domain should be limited to income supplements to very low-income households to enable them to rent a minimum standard house from a private landlord (Hayek, 1979). Working low-income homeowners receive no help related to their housing costs. The result has been to push lowincome households, especially those with children, into the rented sector with consequences for the spatial distribution of poverty and HB expenditure. The growth in private landlord lets is directly related to area deprivation levels. In the 10% most deprived areas, private landlordism increased by 89.5% between 2001 and 2011 and, in the least deprived decile, by 37.2% (Rhodes, 2015). Even the Centre for Social Justice has recognised the salience of low-income household

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movement into the private landlord sector. In Home improvements: a social justice approach to housing policy it notes: Most significantly, renting privately is rapidly becoming the new norm for low-income families. Over the last decade the number of lowincome households in the private rented sector (PRS) has doubled from one million to two million. This brings certain challenges. (Centre for Social Justice, 2016, p 10) In a marked change in tone from its previous pronouncements on ‘social’ renting and the ‘dependency culture’, it lists ‘challenges’ as ‘The PRS is less likely than social housing to provide a secure base that families need to thrive’ (Centre for Social Justice, 2016, p 10) and the reluctance of private landlords to house lowincome families. Future HB spending could be added to the ‘challenge’ list. ‘Radical’ social reformers – perhaps reflecting entrenched ‘left’ distaste for homeownership as a mechanism to fragment opposition to capitalism via tenure divisions (see Chapter One) – distrust the tenure. However, as Owen Jones (2015) reminded his Guardian readers, ‘Nearly 8 out of 10 Britons aspire to homeownership’, partially because of the security and autonomy the tenure carries. Paying HB to homeowners may be regarded an extra demand side subsidy, possibly leading to house price increases, but landlords already receive HB and any potential house price hike would be mitigated if accompanied by rent controls that would increase the housing supply available to potential lowincome homeowners. Moreover, HB to renters is permanent whereas HB to homeowners will diminish as mortgages are paid off.

‘Moderate’ social reformism Mansion tax A mansion tax was included in the 2010 Liberal Democrat manifesto. It captured both land and building value and the threshold was set at £2 million. It did not form part of the coalition agreement but the Labour Party included a mansion tax in its 2015 manifesto with progressive rates starting at £2 million and households with modest incomes able to pay the tax on property sale. Alternatives to a mansion tax include extra council tax bands (Raynsford, 2016), increasing inheritance tax and imposing progressive capital gains taxation on homeowners. Rent regulation There are diluted versions of the radical proposals on rent control outlined above. Labour’s 2015 rent regulation scheme, based on the German system, would

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have limited private landlord rent increases for new contracts to inflation. Rent regulation in Scotland under the 2016 Private Renting Act allows local authorities to apply to the government for rent regulation powers and imposes very limited restrictions on rent increases. These schemes are so insipid they could be relegated to the ameliorative category. ‘Living’ rents ‘Living rents’ – halfway between ‘affordable’ (up to 80% market rent) and ‘social’ rents – have been discussed in Chapter Six. Applied in the non-market supplier sector, this would mean tenants would, at the cost of higher up-front government grants, pay a lower rent and be in a better position to save for a deposit to become a homeowner. In the long-term HB costs would reduce. Sadiq Khan’s 2016 London Mayor election manifesto declared: Sadiq will create a new form of affordable housing, with rent based on a third of average local income, not market rates. A new form of tenure, more affordable, and giving you the chance to save for a deposit. (Khan, 2016) A variation on this idea has been put forward by Renewal, a Conservative inclined think tank. Skelton (2016, pp 1–2) notes ‘The European referendum showed that many “left-behind” voters are now rebelling against a system that they believe is no longer delivering for them’ and that ‘a stark decline of home ownership has taken place among those on low incomes’. He suggests a ‘new generation of low-rent homes with a fast track to home ownership’ with housing associations renting homes at ‘no more than 1/3rd of the average low income in the area’ (Skelton, 2016, p 17) but: After two years a tenant would have the option to buy their home. Discounts akin in value to Right to Buy would become available for them to buy the property, which would be facilitated through an extension of Help to Buy style equity loans. This delivery mechanism will provide a stable revenue stream that will ensure any homes sold can be replaced. (Skelton, 2016, pp 27–8) Direct commissioning Between the wars, direct ‘social’ housing commissioning by central government had considerable support (Lund, 2016). In 2016, the Conservative government announced ‘the government will directly build affordable homes’ (Prime Minister’s Office, 2016, p 1). The proposal involved the government in directly

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commissioning ‘small and up-and-coming companies to build thousands of new homes on sites right across the country’ (Prime Minister’s Office, 2016, p 1). It is a limited initiative, aimed producing 13,000 homes, but has the longer-term potential to add a new commissioner – the central government – to intervene in areas where local authorities are reluctant to allow new building. ‘Housing First’ Whereas New Labour’s approach to single homelessness involved a process of instilling ‘housing readiness’ before permanent housing was offered, ‘Housing First’ moves homeless people immediately from the streets or homeless shelters into their own accommodation. Research evidence demonstrates it has considerable impact on the long-term wellbeing of homeless people (Padgett et al, 2016). However, the approach has not been endorsed by government or the House of Commons Communities and Local Government Select Committee (see Chapter Seven), perhaps because ‘Housing First’ helps in converting homelessness from a ‘personal problem’ into a housing issue. ‘Powerhouses’ and ‘engines’ In the 1950s and 1960s governments tried to influence industrial location through Industrial Development Certificates (IDCs) requiring any large manufacturer to apply for permission to locate a new venture. IDCs were abandoned in the 1980s as interfering with the market. New Labour did not revive IDCs, regarding London as a magnet for growth for the entire UK economy, although it did take steps to redistribute some public sector jobs. London is the ‘housing crisis’ hub and, to some, receives disproportionate media attention. Responding to claims that the coalition government’s ‘Help to Buy’ would fuel an already overheated housing market, Danny Alexander said ‘People who think that there’s a housing bubble should get out more. They should get out of Kensington and Chelsea, and go to Manchester or Birmingham, and major towns across the country’ (Alexander, 2013, quoted in BBC News, 2013). In 2015 the price to income ratio in the capital was 9.5, compared to 5.0 in the UK; the average private landlord rent in London was £1,400, in England £625; and the rate of homelessness acceptance per head of population in London was twice the northern rate (Value Office Agency, 2016). In 1997, London’s population was 7 million, in 2011 8.2 million, and in 2016 8.7 million. Between 1997 and 2014, gross value added (GVA) – a money value for the amount of goods and services that have been produced, less the cost of all inputs directly attributable to that production and based on workplace – was 39% higher in London than in the UK as a whole. London’s GVA increase from 2010 to 2014 was 24% compared to 11.1% in the North West and its GVA per head of population was far higher

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than in any other region or country (Harari, 2016). If a proportion of future growth was directed away from London via ‘powerhouses’, the housing problem could be alleviated. Unfortunately, resources allocated to the ‘powerhouses’ have been limited and the ‘combined authorities’ essentially have the same constrained boundaries as the metropolitan counties, abolished in 1986. Reducing under-occupancy ‘Spare room subsidy’ withdrawal was justified as a downsizing incentive but under-occupancy is a far more common in the owner-occupied than in the ‘social’ housing sector. According to the 2011 Census, 82.7% of owner-occupied households had at least one spare bedroom, compared to 39.4% of ‘socially’ renting households. Downsizing by homeowners could be encouraged by: an annual wealth tax including home value; amending council tax bands; ending the 25% single-occupancy council tax reduction; removing Stamp Duty Land Tax on pensioners who downsize; building more homes aimed at the requirements of older people and local government incentive schemes targeting on retired households.

Ameliorative social reformism Many schemes can be placed under the ameliorative social reformism category with some, depending on implementation detail, perhaps worthy of promotion to moderate status. The Lyons Report, although endorsing new garden cities and garden suburbs, was replete with platitudes and ameliorative measures, probably because it was prepared for the Labour Party prior to the 2015 general election and extra resource commitments might have produced spending splurge accusations from the Conservatives. Lyons recommended the government ‘should make a clear commitment to building new homes’ and local authorities should ‘play a much more energetic role’ in leading housing development (Lyons, 2014, pp 34, 64) Lyons’ ameliorative proposals included Help to Build loan guarantees for small builders; loan guarantees for housing associations; equity loans for private landlords; and creating housing growth zones. Amending existing planning regulations to provide support for self-build; more rural exception sites; extra floors on London homes; converting commercial buildings to housing; allowing housing association to be exempt from reductions in rent in return for a commitment to new building; ending VAT on home improvement and repair to bring more empty homes into use and a special tax on foreign housing investment in London, following Vancouver’s 15% levy, fall into the ameliorative category. So too do an extra community charge on second homes as is happening in some Welsh local authorities and greater use of Community Land Trusts – non-profit corporations that develop perpetual affordable housing,

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usually on donated land – but limited by lack of donors and threatened by the government/housing association deal on selling homes, at discounts, to tenants. The Redfern Review (2016) suggested a Housing Commission to devise and sustain a long-term strategy to promote housing supply but the notion that housing can be taken out of politics is fanciful given the long history of housing’s involvement in political manoeuvring (see Lund, 2016). Affordability tests, applied in 2017 to buy-to-let mortgages and similar to the ‘stress’ tests already applied to other mortgages, may curtail the private landlord sector.

Marxist political economy By analysing state involvement in housing as an element in capitalist accumulation, Marxist political economy has made a potent contribution to understanding housing policy. The perspective gathered oxygen from the role played by global capital in creating the credit crunch and the subsequent worldwide recession with capitalism keeping wages down but, in order to continue capital accumulation via consumption, promoting higher debt via ‘financial products’. Household debt was very high in the UK prior to the credit crunch – 160% of average income in 2007 compared to 103% in 2000 (Bank of England, 2015) – and the ultimate inability of the working class to pay this debt triggered the financial crisis. Harvey (2011) draws attention to the long history of capitalist booms and busts prompted by land/property speculation and the ways that promoting homeownership from the 1980s turned the city over to developers and speculative financiers producing an inevitable bust. However, Marxists have always predicted that each successive capitalist crisis must be more severe than the previous one leading to the inevitable collapse of capitalism. Yet capitalism did not disintegrate during the 2007/08 financial crisis. States, ‘as lenders of last resort’ and international financial organisations stepped in to stabilise the system, albeit with the longer-term consequence of austerity for working people as they were required to reduce the state debt produced by bank bailouts. In addition, a new debt cycle was created. Housing’s role in generating growing inequality has been highlighted by Thomas Piketty. In Capital in the 21st century (2014) Piketty demonstrated that, over the long term, the rate on return to wealth has surpassed economic growth so, without strong collective intervention, income and wealth will become yet more concentrated. Rognlie (2014) claims that Piketty failed to allow for capital depreciation in his calculations and, when this is taken into account, housing wealth has been almost entirely responsible for the increased returns on capital and hence primarily responsible for growing inequality. Whatever the virtues of Marxist political economy as an explanatory theory – and there are many – its normative dimension remains undeveloped. Marx and Engels believed that the capitalist system produced housing problems so, without eradicating capitalism, housing problems would continue. New forms

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of housing supply and distribution would emerge only within a new social order. Thus Marxist political economy action within the housing domain consisted of promoting working class radicalism via support for grassroots protest on housing issues. However, ‘socialist’ housing schemes have had a drab, joyless atmosphere. Without new specifics for its vision, Marxist political economy can be dismissed as ‘an intellectual toy rather than a serious political project’ (Gray, 2009, p 19). Nevertheless, Marxist political economy, when directed to change within capitalism, suggests a number of policy avenues that fuse into the social reformism’s radical proposals. State financed housing, run by tenants, not state bureaucracies, and private landlord eradication are two examples. New towns, directly controlled by their citizens, also fit into the Marxist political economy approach. Lenin is rumoured to have stayed in Letchworth in 1907 and been impressed. New town development was a prominent feature of Soviet policy after 1918.

The behavioural approach The behavioural perspective has been an undercurrent in social reformism and Marxist political economy. Neoliberalism has not highlighted the approach but the notion that failure in a competitive, market economy is related to personal characteristics underpins laissez-faire ideology – hence the often seamless blend of laissez-faire economics into neo-conservatism to fashion ‘the New Right’. The behavioural approach has been applied at individual – often blended into ‘interpersonal’ family relationships – and community levels. Applying the approach means adopting Octavia Hill’s housing management principles, that is, zero toleration of rent arrears, frequent visits from housing managers to improve character, ‘nudge’ incentives for good behaviour – Hill gave extra rooms – and organising tenants into self-help groups. Other inducements, based on US President Clinton’s 1998 Quality Housing and Work Responsibility Act, and the Yarlington Housing Association’s ‘Household Ambition Plans’ (Johnson, 2013) might include, as tenancy conditions, contributing no less than eight hours of community service work per month and requiring tenants to keep fit, give up smoking and actively look for work. Troubled Families Tony Blair’s New Deal for Communities and his Neighbourhood Renewal Fund focused on improving ‘social’ capital in deprived neighbourhoods (see Chapter Nine), but towards the end of his premiership, Blair’s attention shifted towards individuals. In 2006 he declared: The most socially excluded are very hard to reach. Their problems are multiple, entrenched and often passed down the generations …

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About 2.5 per cent of every generation seem to be stuck in a life-time of disadvantage and amongst them are the excluded of the excluded, the deeply excluded … Their poverty is, not just about poverty of income, but poverty of aspiration, of opportunity, of prospects of advancement. (Blair, 2006) This marked a step away from branding entire neighbourhoods as ‘underclass’. In the late 1990s, Geoff Mulgan, seconded from the think tank Demos to the Social Exclusion Unit, estimated the ‘underclass’ at between 8% and 10% of the population (Lloyd, 1997). Three years after Blair’s speech, Gordon Brown accepted Blair’s premise and promised ‘Starting now and right across the next Parliament every one of the 50,000 most chaotic families will be part of a family intervention project – with clear rules, and clear punishments if they don’t stick to them’ (Brown, 2009). The coalition government adopted this individual focus. The August 2011 disturbances, when thousands of people rioted in London and in cities and towns across England, were met with a strict law and order response but, in 2012, the coalition government launched its Troubled Families Programme aimed at working with local government to tackle the problems of 120,000 ‘troubled’ families. The programme was expanded in 2013 and, in accordance with the localism agenda, local authorities were given considerable autonomy to design and deliver their responses. Most responses involved the creation of special teams to work with the ‘troubled’ families. By 2016 over £1 billion had been spent on the programme but an evaluation (DCLG, 2016k, p 49) found ‘no consistent evidence that the Troubled Families Programme had led to any systemic or significant improvements in families’ outcomes over the period that it was possible to observe changes’. Despite this Westminster focus on a small number of ‘troubled families’, Conservative politicians have continued to view the ‘underclass’ idea – applied to a large section of the working class – as politically irresistible. As Powell (2015, p 341), in the context of HB cuts, states: ‘The poor are marginalized by policies that purport to help and are stigmatized for their marginal position in a selfperpetuating circularity that informs policy’. Iain Duncan Smith (2011) said ‘there is a steady rise of an underclass in Britain – a group too often characterised by chaos and dysfunctionality … and governed by a perverse set of values’. He promoted a change in the official poverty definition away from income measures towards ‘a range of other measures and indicators of root causes of poverty, including family breakdown, debt and addiction’ (Duncan Smith, 2015). Moreover, the coalition government redefined ‘welfare’ when, in 2014, it started to send a spending breakdown to taxpayers. ‘Welfare’, associated by many people with payments to people out of work, was identified as 25% of public expenditure but it included spending on ‘personal social services’, which include looking-after children and long-term care for the elderly, the sick and

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disabled plus spending on public service pensions to retired nurses, soldiers, and so on (Hood and Johnson, 2014). There has been extensive media support for the council house/welfare dependency connection. The right-wing press have a long history of promoting the ‘Broken Britain’ image and TV has entered the ‘poverty porn’ showground via programmes such as ‘Shameless’, ‘We All Pay for Your Benefits’, ‘The Scheme’ and ‘Benefits Street’ –‘produced by Love Productions, 70% owned by Rupert Murdoch’s global media conglomerate Sky’ (Tyler, 2014, p 1) The outlook for ‘social’ tenants, especially those in the local authority sector, looks austere. ‘Social’ housing is being reduced to an ‘ambulance service’ (Fitzpatrick and Pawson, 2014) with its tenants blamed for their ‘hidden injuries of class’ (Cobb and Sennett, 1993). Unsurprisingly, the coalition government’s £26,000 benefits cap was very popular: to many people in work in the north, unaware of the high private renting costs paid by HB to private landlords in London, £26,000 without working was outrageous. This popularity encouraged the Conservative government to implement a lower cap. Benefit cuts and the increasing sanction use have been accompanied by conditionality and stigmatisation in access to ‘social’ housing endorsed by some housing associations. When London and Quadrant, the Hyde Group and East Thames announced their intention to merge, the designate deputy chief executive urged tenants to ‘knuckle down’, stating: We have been responsible and are partly to blame for the dependency culture we have created but in future we will be asking our residents to take more personal responsibility in respecting their homes and making an effort to help themselves. (Bailey, 2016)

Social constructionism There is a political agenda implicit in the social constructionist approach. Nozick (2001) argues that social constructionists desire to change society and, by portraying reality as contingent, societal transformation becomes more plausible. Thus, in ‘deconstructing’ past dominant ‘grand narratives’, social constructionists have helped release the ‘subjects’ of these constructions enabling them to interpret their own circumstances with a better chance to legitimacy. This produced an interest in ‘identity’ politics, that is, the personal liberation of groups marginalised from mainstream politics. In the past, dominant ‘reality’ constructions have categorised certain people as naturally ‘lesser beings’ but, by denying the capacity of social science to generate transcendent truths, social constructionism has helped to liberate ‘difference’. Social constructionism has made a valuable contribution to housing studies by debunking the allegedly ‘rational’ approach to housing policy with its assumption that housing problems can be treated by ‘top down’

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directives based on claims to ‘expert’, ‘universal’ knowledge that is becoming an increasingly commodified product (Imrie and Allen, 2016). However, at the heart of social constructionism is a languid, ‘nothing is real, nothing to get hung about’ mantra. As Winlow and Hall (2013, p 30) comment: A growing proportion of 21st century social exclusion analysis appears to be more interested in the ways in which powerful and influential social groups construct images of the poor as profligate, lazy, immoral and dangerous. Liberals approach the danger of the ‘stereotype’ with a broad spectrum antibiotic, simply denying that all universal forms and categories exist. However, just as this helps to protect the victims – although not very effectively if popular discourse is anything to go by – it does a better job of protecting the oppressors; very little interest is now paid to the realities of social exclusion … It is insufficient to demonstrate how an issue has been constructed and to direct attention to those responsible for the construction. If the social constructionist paradigm is to cultivate accomplishment, a more determined attempt will need to be made to distinguish plausible from implausible constructions otherwise any form of construction and related identity politics, malign or benevolent, can become acceptable. Shildrick et al (2012) exposed the ‘three generation workless culture’ myth. Extensive investigations in the north east failed to find any ‘three generation workless’ incidence and two generational worklessness was very rare. In stigmatising ‘social’ tenants, particularly council tenants, attention is focused on the low incidence of working households in the sector. The number of adults living in social ‘housing’ without work in England has fallen by almost 20% since 1996 but, at 62%, remains well above the 22% of those buying with a mortgage (Keohane, 2016). ‘Social’ housing is allocated according to ‘need’ hence people with disabilities are far more likely to live in ‘social’ housing. In 2011, the incidence of people aged 16–64 reporting that their day-to-day activities were limited a lot was five times higher among ‘social’ tenants than among owner-occupiers (Nomis, 2016). The incidence of long-term sickness/disability was 11 times higher among economically active ‘social’ housing tenants than those buying with a mortgage (Keohane, 2016). In 2015, 38% of economically active ‘social’ housing tenants were in work but ‘social’ tenants in work formed a high proportion of the ‘precariat’ with a mean gross hourly weekly wage in 2015 of £7.69 in the local authority sector and £7.88 in the housing association sector compared to £13.00 for people buying with a mortgage. In 2013/14, 1.8 million working people were in poverty in the ‘social’ housing sector – up 400,000 since 2003/04 (MacInnes et al, 2015). This reflected the higher incidence in the ‘social sector’

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of households headed by women, ethnic minorities and people in work but with ‘limiting health conditions’. A survey of over 1,000 Londoners by Real London Lives (2014) found that more than half believed that people who live in ‘social’ housing are unemployed but a three-year research study of social tenants by the Centre for Housing Policy at the University of York revealed that, of those who could work, 92% work at least 16 hours a week, 69% work more than 30 hours a week and 82% of couples with children work (Real London Lives, 2014). As a member of a committee that interviewed council tenants who were causing the local authority problems through rent arrears and alleged ‘anti-social behaviour’ I must have interviewed more than 1,000 people over ten years. Very few could be categorised as ‘chavs’, ‘underclass’ or ‘feckless’. Most were trying to make ends meet in precarious, ‘no pay, low pay’ circumstances, made more uncertain by the HB labyrinth.

Housing politics There is a near consensus among politicians and housing pundits that housing supply needs to be increased to well above the 2015/16 rate of 190,000 in England including conversions. Need/demand guesstimates place new housing requirements for England at 220,000 to 245,000 per year to keep pace with household formation but household formation is influenced by supply and the ‘backlog of need’ is often excluded from political and media future housing requirements. A more realistic minimum estimate is 300,000 per year. As argued in Housing politics in the United Kingdom: power, protest and politics (Lund, 2016), land politics is at the heart of the housing shortage, especially in England. Land cost in the 1930s, when planning controls were sparse, was 10% of the price of a house, compared to estimates of over 50% today. However, there are strong vested interests involved in maintaining land scarcity. Via LSDT governments obtain substantial resources from the house price increases associated with housing scarcity – £10.7 billion in 2014/15 and forecast to rise to £17.8 billion by 2020/21 (Statistics Portal, 2016a, 2016b). Land owners, including developers with substantial land banks, benefit from ever-increasing land prices. As revealed by the ‘credit crunch’, the asset base of the banks rests on maintaining and enhancing land/property prices. Environmental lobbies oppose green belt and greenfield development. The Green Party’s 2015 manifesto (Green Party, 2015, p 41) committed the party to build 500,000 new ‘social’ rented homes but declared it would ‘minimise encroachment onto undeveloped greenfield sites’ and did not support garden cities. The Campaign to Protect Rural England, the National Trust and local branches of the Civic Trust – founded in 1957 by Duncan Sandys – are vociferous in their resistance to building in green belts. Established owner-occupiers have an interest in opposing new housing. Not only is development perceived as threatening ‘privacy’, ‘quiet enjoyment’, ‘the

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character of a neighbourhood’, road safety, views, wildlife, and so on, extra homes in a neighbourhood threaten house values. These feelings are strongly held and their holders often well-organised. Local councillors and MPs resist them at their political peril (Lund, 2015; McCabe, 2016). Indeed, Alex Morton, later to become an advisor to David Cameron, recognised the baneful NIMBY (Not In My Back Yard) impact and suggested a resident ballot on proposed developments with ‘Developers … free to offer financial incentives to households being balloted over any planned development to ensure that their proposals went through’ (Morton, 2010, p 24), an idea recently revived in relationship to ‘fracking’ (Guardian, 2016). This is a bleak picture but, even before Brexit, there were signs of change. The Treasury, in pursuit of economic growth, ditched the ‘localism’ agenda and cajoled the DCLG to publish the National Planning Policy Framework (DCLG, 2012a). This contains some of the necessary ingredients – not least placing the decision on whether a local development plan is ‘fit for purpose’ with the national Planning Inspectorate – to push local authorities into a pro-development stance. After a hiatus when concern about UKIP’s electoral advance led to the National Planning Policy Framework being put on the backburner, the Treasury is promoting brownfield development in green belts and insisting that Local Development Plans are prepared. Estimates of the number of local authorities without an up-to-date adopted plan vary but, in 2016, an investigation (Barnes, 2016b) found that 60% of 322 English councils did not have such a plan and, even when a plan is in place, local authorities were failing to deliver (Morton, 2016). However, there are other weapons in the Treasury’s armoury, not least the gradual move towards extra service resources for local government coming only from business and domestic rates. This weapon could be enhanced by increasing the New Homes Bonus so that it forms a larger share of the central resources distributed to local government and by attaching the payment more firmly to delivery. Public opinion seems to be adopting a more pro-development attitude. Although the findings need to be interpreted with scepticism – there is a difference between a general attitude and a specific proposal in your backyard – according to a DCLG (2015c, p 3) survey: Opposition to new homes in England has continued to fall substantially between 2010 and 2014. In 2010 46 per cent of respondents said they would oppose new homes being built in their local area compared to 31 per cent in 2013. This fell to only 21 per cent in 2014. Similarly, those supportive of house building in their local area rose from 28 per cent in 2010 and 47 per cent in 2013 to 56 per cent in 2014.

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Brexit The 2016 referendum on EU membership exposed a simmering dimension to the housing/class relationship. Leave vote probability increased with age and Ashcroft (2016, p 1) states ‘two thirds (67%) of those describing themselves as Asian voted to remain, as did three quarters (73%) of black voters’. People living in London and Scotland were more likely to vote to remain. However, there was a strong class factor in voting behaviour with 57% of Classes A–B voting to remain and 64% of classes C2, D and E voting to leave (Ashcroft, 2016). At 72%, turnout was the highest in a UK vote for 25 years and was especially high, relative to earlier general election turnouts, in pro-leave areas. The outcome led some commentators to conclude that the referendum was: About so much more than the European Union. It is about class, and inequality, and a politics now so professionalised that it has left most people staring at the rituals of Westminster with a mixture of anger and bafflement. (Harris, 2016, p 1) The likelihood of voting to stay could be predicted by the length of the voter’s drive and, if a deprivation index was needed, then just count the ‘brexit’ vote. There had been a ‘Peasant’s Revolt’. (O’Neill, 2016, p 1) The role of housing in this ‘Peasant’s Revolt’ is difficult to isolate. Private renters and people with mortgages slightly favoured staying in the EU but private renting is strongly related to age and no breakdown of voting by private tenants according to age was available in the Ashcroft analysis. Belfield et al (2016) identify a real growth in incomes of between 5% and 10% between 2007/08 and 2014/15 for the poorest 35% of households but these were reduced to between zero and 2% after housing costs. Hills et al (2016, p 280) record a real 11% reduction for men and 9% for women in the weekly earnings of ‘social’ tenants in full-time employment between 2006/08 and 2013. Nick Clegg in Politics: between the extremes (2016, p 240) having asserted that the private sector cannot deliver the required new homes and ‘the state must step in instead’, states: The social and political imperative to do so have also been underlined by the referendum: shortage of affordable housing in deprived areas is one of the most powerful catalysts for the anger and frustration that drove so many lower-income groups to back Brexit … They simply do not feel they get a fair share of the public cake … That 70% of council tenants and 68% of housing association tenants voted ‘Brexit’ gives credence to O’Neill’s claim that the peasants revolted due to ‘a strong sense

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of being ruled over by institutions that fundamentally loathe them, or at least consider them to be in dire need of moral and social correction’ (O’Neill, 2016, p 2). Such contempt was revealed in the absence of special measures to alleviate the fear of the disproportionate area immigration impact. Towards the end its term in office, New Labour introduced a modest ‘Migration Impacts Fund’. It was abolished by the coalition government. Just about managing The ‘Brexit vote’ had weighty political consequences. David Cameron resigned and Theresa May removed Oliver Letwin, George Osborne and Michael Gove from government, warning her new Cabinet that ‘politics is not a game’ (quoted in BBC News, 2016). In her first public speech as prime minister she declared ‘Union’ meant not only ‘the precious bond between England, Scotland, Wales and Northern Ireland’ but a union ‘between all of our citizens, every one of us, whoever we are and wherever we’re from’ interspersing her speech with phrases ‘if you’re a white, working-class boy, you’re less likely than anybody else in Britain to go to university’ and ‘You have your own home, but you worry about paying a mortgage’ (May, 2016a, p 1). May promised that government policy would concentrate on ‘just about managing’ families. The new government immediately announced that the plan to create a budget surplus by 2020 would be abandoned, prompting a House of Lords Select Committee on Economic Affairs (2016, p 3) to comment that ‘this could pave the way for releasing restrictions on local authorities and enable them to boost housebuilding activity substantially’. In her speech to the 2016 Conservative Party Conference May declared that the Brexit vote ‘was a vote not just to change Britain’s relationship with the European Union, but to call for a change in the way our country works – and the people for whom it works – forever’ and her plan was ‘a plan to tackle the unfairness and injustice that divides us, so that we may build a new united Britain, rooted in the centre ground’. It will mean ‘government stepping up. Righting wrongs. Challenging vested interests. Taking big decisions. Doing what we believe to be right. Getting the job done’ (May, 2016b, p 1). However, the Treasury’s Autumn Statement (HM Treasury, 2016b) indicated only a very modest change in direction. The introduction of extended pilot schemes for the housing association tenant’s RTB indicated that the scheme had been thrown into the long grass. It was announced that letting agents’ fees would be abolished and the housing benefit/Universal Credit taper was reduced by 2%. However, the benefit freezes and cuts set in motion by George Osborne and directed mainly at Universal Credit were continued despite the anticipated rise in inflation. Both working and non-working ‘just about managing’ families — tagged JAMS by the media — will be affected by these measures. The Resolution Foundation (2016, p 21) declared ‘Overall the Chancellor reversed only 7 per

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cent of the inherited policy-related hit to the poorest half of families’ calculating severe cuts in incomes by 2020 such as £3,650 for a household with two adults and three children renting privately and with a joint income of £32,320 in 2010 and £2,640 for a single parent with one child earning £14,580 in 2010. Rather than being eliminated by 2020/21 the budget deficit would increase and the lion’s share of the additional borrowing was allocated to infrastructure improvement. Housing benefited from this relaxation in fiscal constraints. A £2.3 billion Housing Infrastructure Fund was announced to enable local authorities in high demand areas to deliver the infrastructure necessary for new houses and an extra £1.4 billion was provided for affordable housing supply with the restrictions on spending on rented accommodation abolished. However, ‘social’ housing was not included in the programme and the Office for Budget Responsibility (2016) predicted an overall reduction in new affordable housing supply by 13,000 from 2016 to 2021 as a result of the move away from shared ownership schemes — which would have generated more income for suppliers — to affordable rented houses. Sadiq Khan, London’s Mayor, announced that the separate London allocation would be used to fund social rent level homes with fixed grant rates of £60,000 per unit.

Let us be builders During the 1945 general election campaign Aneurin Bevan said: ‘We have been the dreamers, we have been the sufferers, and now, we are the builders.’ (quoted in Kynaston, 2007, p 44). In the past 30 years new housing construction has come to be regarded, at best, as grim necessity yet building homes is a virtuous activity and should not only be about keeping pace with population growth plus alleviating homelessness and overcrowding. The production of mobile phones, food, TVs and cars (UK new car sales in the UK were 2.6 million in 2015, compared to 2 million in 2006) is not based on ‘top down’, ‘need’ estimates. Housing is a consumption good: people want better homes with more space and the housing dearth affects lifestyle opportunities. A YouGov poll of people under 45 found that 19% said they had experienced a delay finding a job, while 16% said they had postponed getting married (Lawrence, 2016). In 1944, Lord Woolton, chair of the coalition government’s reconstruction committee, declared he ‘had come to the conclusion that the key to the housing problem is to build more houses’ (quoted in Lyttelton, 1962, p 101). At equal risk of stating the obvious, sustained, robust, new house construction, built on a plentiful – hence cheap – land supply, would produce:

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• more choice in where to live. • more ‘balanced’ communities in new developments so that poverty becomes less concentrated. Although rarefied statistical analysis has cast doubt on the value of mixed communities and diluting spatial deprivation, as Tennyson’s Northern farmer declared (Tennyson, 1865), ‘the poor in a loomp is bad’, contributing to the difficulties of everyday living on a low income (Spicker, 1987). • a fall in house prices. Although the housing market is ‘made’ by the existing housing stock, new housing supply, even at 2015 levels, injects about 12% of properties transactions into the market each year (HM Revenue and Customs, 2015). At 300,000 new UK homes per year this would be 23%, that, upheld over time, would reduce house prices. • improvement in energy efficiency. New homes are far more energy efficient than older houses and they are safer. • more internal space. Even in 2000 new homes in the UK were the among the smallest in Europe: 76m2 compared to 137m2 in Denmark, 126.4 m2 in Greece, 119 m2 in Belgium, 96.6 m2 in Spain and 87.7 m2 in Ireland (Kintrea and Morgan, 2005). Since 2000 they have become smaller: €200,000 bought 119 m2 in Spain, 94 m2 in Belgium, 97 m2 in Germany and 39 m2 in the UK (Deloitte, 2016). RIBA research demonstrated that, in 2011, the family homes sold by the UK’s eight largest private house builders was on average 8m2 – a single bedroom – smaller than the minimum standards recommended for London (Royal Institute of British Architects, 2015) more garden space where wildlife can flourish. Mature suburbia is a wildlife haven. Rabbits, not people, could live in ‘rabbit hutches’ and children could look after them when playing outside. • help for disabled people as more houses, built to ‘lifetime’ homes standard, could be built. Boosting new housing construction to the level necessary to meet requirements in England will be a very long process. Until supply is more closely matched to demand, the affordability issue will need to be addressed by switching demand side subsidies that fuel house prices to production incentives. Low interest rates have also contributed to house price inflation. If low interest rates are deemed necessary to promote economic growth – shortly after the ‘Brexit’ vote the Bank of England reduced the base rate from 0.5% to 0.25% – then it will be necessary to dampen the house price impact by measures such as extending capital gains tax to homeowners. Private landlords, part of a burgeoning ‘rentier’ class – including landowners, financial speculators, ‘intellectual property’ (patents, copyright, trademarks) owners and lenders who derive income ‘from ownership, possession or control of assets that are scarce or made artificially scarce’ (Standing, 2016, p 5) – have benefited considerably from low interest rates on loans that have helped to boost their capital pots. Ensuring landlords pay capital gains tax plus a rent

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freeze and the reintroduction of ‘fair’ rents or a right to buy for private landlords’ tenants would promote homeownership and lower house prices. George Osborne expressed the politician’s dilemma in building more houses, when, as Chancellor of the Exchequer, he said: The challenge is that we want several things which don’t sit comfortably together. For most people, their home is the biggest investment of their lifetime. And, of course, they want that asset to increase in value over time. But a home is also a place to live and build our lives – and we want all families to be able to afford security, comfort and peace of mind. That means homes have to be affordable – whether you’re renting or buying. The only way that can be achieved over the long term is by building more, so supply better matches demand. But we are a small and crowded island, keen to protect our green spaces and ready to object to new development. So the British people want our homes to go up in value, but also remain affordable; and we want more homes built, just not next to us. You can see why no one has managed yet to solve the problems of Britain’s housing market. (Osborne, 2014) Osborne opted not to try to solve the problems of Britain’s housing market preferring to retain electoral support in ‘middle England’.

Fixing our broken housing market The government’s white paper Fixing our broken housing market (DCLG, 2017) declared: Since the 1970s, there have been on average 160,000 new homes each year in England. The consensus is that we need from 225,000 to 275,000 or more homes per year to keep up with population growth and start to tackle years of under-supply. This isn’t because there’s no space, or because the country is “full”. Only around 11 per cent of land in England has been built on. The problem is threefold: not enough local authorities planning for the homes they need; house building that is simply too slow; and a construction industry that is too reliant on a small number of big players. (DCLG, 2017, p 9) The white paper stated ‘over 40 per cent of local planning authorities do not have a plan that meets the projected growth in households in their area’; ‘there is a

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large gap between permissions granted and new homes built’ (DCLG, 2017, p 13) and that large scale house builders, with few incentives to increase productivity, dominate the commercial sector. To lower these barriers, it listed a number of modifications to proposals already in the pipeline. So that local authorities would not be able to ‘duck potentially difficult decisions, because they are free to come up with their own methodology for calculating “objectively assessed need”’ (DCLG, 2017, p 14), there would be consultation on a new standard methodology for assessing need. Every local authority will have to have an up-to-date plan and will be subject to a central ‘housing delivery test’. To overcome slow house building and the reliance on a small number of big players, the housing market would be diversified by opening it up to smaller builders and ‘those who embrace innovative and efficient methods’(DCLG, 2017, p 14); housing associations would be encouraged to build more; options to encourage local authorities to build again would be explored; institutional investment in the private rented sector would be supported; it would be made easier for people who want to build their own homes and more modular and factory built homes would be encouraged. Local authorities would be able to revoke a planning approval for an undeveloped site and use compulsory purchase powers to enable the build out of a stalled site. There was a promise of full transparency in land ownership and land option purchases. In recognition that delivering more new homes to alleviate the housing problem is a long-term project, the white paper contained a section on ‘Helping People Now’. This included amendments to existing policies such as ‘starter homes’ – now, like shared ownership homes, to be available to households that ‘need them most’ (DCLG, 2017, para 4.14), those with an income of less than £80,000 (£90,000 for London) – and the mandatory requirement for 20% starter homes on each site would be abandoned in favour of an expectation that housing sites would deliver a minimum of 10% affordable home ownership units. The only commitment to the voluntary Right to Buy for housing associations was additional regional pilot projects. The private rented sector would be made more ‘familyfriendly by taking steps to promote longer tenancies on new build rental homes’ (DCLG, 2017, para 4.14). There was little in the white paper to provide short-term assistance to ‘just about managing’ families other than modifications to the ‘starter homes’ initiative to concentrate the new houses on to households that ‘need them most’ and targeting of affordable houses on rented as well as owner-occupied houses. Rolling out the voluntary Right to Buy over a long time period will reduce the need for local authorities to sell their higher value homes and hence enable them to retain more ‘social’ housing. Unlike Labour’s 2015 manifesto commitment longer-term private landlord tenancies would apply only to new houses and did not include rent increases limited to inflation. The white paper mentioned a consensus on a housing need from 225,000 to 275,000 or more homes per year to keep pace with population growth and start

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to tackle years of under-supply but the DCLG did not present its own evidence to support the 225,000 to 275,000 per year estimate and it did not amend the commitment to 200,000 homes per year by 2020. The government now measures new homes as net additions, that is, not only newly-built homes but also converted properties. In 2015/6 about 190,000 net additions were made to the stock in England but only 169,940 newly built houses were supplied, the rest were conversions often resulting in lower space standards. Comparing newly built houses and projections of a 210,000 per year increase in household formation leaves a 40,000 plus deficit. Moreover, the backward mirror household formation projections are self-fulfilling and there is a large backlog of unmet need. 300,000 new homes per annum – as suggested by the House of Lords Select Committee on Economic Affairs (2016) – is a more realistic requirement. There were useful ideas in the white paper on ways to increase new housing supply such as using a standard methodology to estimate future local housing needs and this, together with the increasing reliance on business rates and council tax receipts, may push local authorities towards releasing more land. However, in many ways, the white paper’s proposals may restrict new housing supply. The penalty on local authorities that, in the absence of an approved up to date plan, there would be a presumption, on appeal, in favour of sustainable development has disappeared and, despite the warm words on encouraging local authorities to build, the requirement for a Right to Buy on the homes built by local housing companies will restrict action. Direct commissioning of houses by central government was not mentioned. The white paper was due to be published in December 2016 but was delayed because, according to some media reports, its initial proposals had been opposed by Conservative backbench MP worried about development in their constituencies (Cahill, 2017). Restrictions on green belt development were intensified in the white paper, with, for example, local authorities now required to consider extra homes from estate regeneration before releasing green belt land, and the idea that planning consent on brownfield sites within green belts would be easier was seemingly abandoned. The white paper received a hostile press reception with the Telegraph (2017) stating the white paper ‘does little to tackle bigger housing issues’ and the Guardian (2017) declaring that housing experts had called on the government to ‘stop dithering and start building’. Theresa May’s concern for the ‘just about managing’ seemed insincere. In 1946 when England’s first new town was proposed, Stevenage Residents’ Protection Association organised opposition including placing fake railway signs, in Russian symbols, renaming Stevenage, ‘Silkingrad’. On a visit to Stevenage, Lewis Silkin’, the responsible minister, had his car damaged but, addressing a public meeting, he told the hostile audience ‘It’s no good your jeering, it’s going to be done’ (Municipal Dreams, 2013). Today such political gumption – ‘getting the job done’ in pursuit of the common good – is all too rare.

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Index

Index Note: Page numbers in italics indicate boxes, figures and tables.

Numbers 1597 Vagrancy Act, 160 1601 Act for the Relief of the Poor, 157 1824 Vagrancy Act, 160 1834 Poor Law Amendment Act, 160–161 1848 Public Health Act, 25 1851 Act for the Regulation and Inspection of Common Lodging Houses, 194–195 1851 Labouring Classes Lodging Houses Act, 105 1868 Artisans’ and Labourers’ Dwellings Improvement Act, 180 1869 Housing Act, 183 1875 Artisans’ and Labourers’ Dwellings Improvement Act, 180–181 1875 Public Health Act, 26, 190 1890 Housing of the Working Classes Act, 27, 105 1909 Housing and Planning Act, 28 1919 Housing and Town Planning Act, 31, 135, 181 1919 Housing, Town Planning, etc. Act, 106–107 1923 Housing, etc Act, 106 1924 Housing (Financial) Provisions Act, 106 1926 Housing (Rural Workers) Act, 182 1930 Housing Act, 136, 181, 182 1932 Town and Planning Act, 33 1933 Housing (Financial Provisions) Act, 30–31, 32 1935 Housing Act, 32, 190–191, 191–192 1935 Restriction of Ribbon Development Act, 33 1937 National Housing Act (USA), 81 1946 New Towns Act, 33 1947 Housing and Town Planning Act, 111–112 1947 Town and Country Planning Act, 33 1948 National Assistance Act, 161 1949 Housing Act, 33, 183 1949 Housing Act (USA), 81 1954 Housing Repairs and Rents Act, 183 1957 Housing Act, 192 1957 Rent Act, 35 1959 House Purchase and Housing Act, 183 1968 Race Relations Act, 248

1971 Town and Country Planning Act, 146 1972 Housing Finance Act, 97, 136 1974 Housing Act, 183 1974 Housing and Community Development Act (USA), 82 1975 Housing Rents and Subsidies Act, 38 1975 Sex Discrimination Act, 243 1976 Race Relations Act, 249 1977 Housing (Homeless Persons) Act, 162–163, 167 1978 Inner Urban Areas Act, 210 1980 Housing Act, 40–41, 141, 150 1980 Local Government, Planning and Land Act, 112 1980 Tenants’ Rights, etc (Scotland) Act, 150 1986 Building Societies Act, 41, 65 1986 Tax Reform Act (USA), 81 1988 Housing Act, 41, 60, 129 1989 Local Government and Housing Act, 185 1990 Town and Country Planning Act, 59, 146, 221 1996 Housing Act, 155–156, 163–164 1996 Housing Grants, Construction and Regeneration Act, 185 1997 Housing (Fire Safety in Houses in Multiple Occupation) Order, 196 1998 Quality Housing and Work Responsibility Act (USA), 82, 85 1999 Immigration and Asylum Act, 148 1999 Local Government Act, 59 2000 Local Government Act, 56 2001 Housing (Scotland) Act, 150, 174 2002 Homelessness Act, 164–165 2003 Homelessness (Scotland) Act, 174 2004 Housing Act, 141, 196–197 2006 Government of Wales Act, 72 2006 Housing (Scotland) Act, 71 2006 Management of Houses in Multiple Occupation Regulations, 196 2008 Housing and Regeneration Act, 60 2010 Equality Act, 242–243, 256 2011 Localism Act, 56, 114, 172, 226 2013 Enterprise and Regulatory Reform Act, 199 2013 Growth and Infrastructure Act, 146

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2014 Housing (Wales) Act, 72, 176 2014 Wales Act, 72 2015 Conservative government, 45–46 austerity agenda, 59 brownfield sites, 115, 120 cabinet, 54 direct commissioning, 271–272 Fixing our broken housing market (DCLG, 2017), 285–287 governance, 52–53 green belts, 115, 124, 287 home improvement, 199–200 housebuilding, 114–115, 287 housing policy objectives, 2 local plans, 122 low-cost homeownership, 144–145 mortgages, 139 neighbourhood deprivation, 226–228 private landlords, 46, 69 Right to Buy, 60–61, 286 2015 Derogation Act, 199 2016 Homeless Reduction Bill, 174 2016 Housing Act, 45 2016 Housing and Planning Act, 132, 147, 199 2016 Private Renting Act, 271 2016 Renting Homes (Wales) Act, 204 2016 Scotland Act, 47

A absolute poverty, 223, 241, 241 Act for the Regulation and Inspection of Common Lodging Houses 1851, 194–195 Act for the Relief of the Poor 1601, 157 Addison Act see 1919 Housing, Town Planning, etc. Act affordability 19th century, 134–135 homeownership, 132–133, 152–153 and market price, 128 Northern Ireland, 150–151 and planning, 146–147 rented accommodation, 129–132 rents, 62, 151, 152, 271 Scotland, 150–151 and standards, 135–136 Wales, 150–151 see also housing cost overburden affordable housing, 129, 221 agency, 19 Alexander, Danny, 272 Allen, J., 91–92 ameliorative social reformism, 273–275 apartments see flats

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apprentices, 67–68 arbiter Marxism, 15 area-based programmes, 210, 223 aristocrats, 241 Arms Length Management Organisations (ALMOs), 188 Artisans’ and Labourers’ Dwellings Improvement Act 1868, 180 Artisans’ and Labourers’ Dwellings Improvement Act 1875, 180–181 assured tenancies, 3, 41 asylum seekers, 148–149 Atkinson, R., 156 Atlanta, 82 austerity agenda, 59

B balanced communities, 218–220, 221, 227, 284 see also mixed communities Baldwin, S., 29–30 Bank of England, 66–67 Bank of Mum and Dad, 66, 133, 238 banking crisis, 83–84, 261–262 see also credit crunch banks, 65–66 Bardhan, A., 97 Barker, Kate, 44, 146 Barnet, S., 132 Barnet London Borough Council, 131 housing needs assessment, 117–118 Barton, C., 129 Battiston, D., 149–150 bed and breakfast hostels (B&Bs), 194–195 bedroom standard, 193, 202, 202 bedroom tax, 245, 256, 258 see also spare room subsidy behaviourism, 15–17, 275–277 Belfield, C., 242 benefit cuts, 277 Bengtsson, B., 78 Bevan, Aneurin, 32–34, 283 Big Society, 52 Birmingham, 106 black and minority ethnic (BME) housing associations, 61 Blair, Tony behaviourism, 16 cabinet, 54 housing policy, 125 stock transfer, 57 troubled families, 275–276 bonding social capital, 213 Branson, N., 136

Index

Bretherton, J., 170–171 Brexit, 68, 70, 264, 281–283 see also EU referendum bridging social capital, 213 Brown, Gordon, 54, 124, 220–221, 276 brownfield sites, 112, 115, 120 Buck, Karen, 186 Build to Let, 138–139 Builders Finance Fund, 46 building industry see construction industry building societies, 65–66, 104 Building Societies Act 1986, 41, 65 bureaucracies, 8 Burrows, T., 120 Bush, George W., 83 Buy to Let, 68, 239

C Cabinet, 53–54 Cable, Vince, 263 Cameron, David, 16, 124, 227–228 Cameron Commission, 73 Campaign to Protect Rural England (CPRE), 114, 123, 124, 279 Canterbury City Council, 131–132 Cantle Report, 250–251 Capital in the 21st century (Piketty, 2014), 274 capitalism, 12–13, 274 Carbon Emissions Reduction Target (CERT), 189 Carlisle City Council, 133 “Cathy Come Home”, 162 Census standards for overcrowding, 193–194 Central Board of Health, 25 Centre for Regional Economic and Social Research (CRESR), 214 Centre for Social Justice, 17, 269–270 Chadwick, Edwin, 24–25, 189–190 CHAIN, 169 Chamberlain, Joseph, 181 Chamberlain Act see 1923 Housing, etc Act child poverty, 241, 241, 258 choice-based lettings (CBL), 62, 98, 220 Christophers, B., 96 Citizen Hobo: How a Century of Homelessness Shaped America (Depastino, 2003), 19 City Deal, 57 Civitas, 266 Clarke, S., 262 clearance see slums: clearance Clegg, Nick, 141–142, 281 Clinton, Bill, 82–83, 85 coalition government (2010-15) affordability, 146–147

austerity agenda, 59 cabinet, 54 construction industry, 67 decent homes, 197–198 Disabled Facilities Grants (DFGs), 256 elected mayors, 56–57 energy efficiency, 198 English regional dimension, 56 financial regulation, 66–67 governance, 52 homelessness, 171–174 homeownership, 45 Homes and Communities Agency (HCA), 55 housebuilding, 58, 113–114, 125, 198–199 housing benefit (HB) and Local Housing Allowance (LHA), 138 housing bubble, 272 housing policy objectives, 2 local planning, 59 localism agenda, 117 neighbourhood deprivation, 224–226 overcrowding, 199 private landlords, 68–69, 138–139, 199 Right to Buy, 141–142 self-build, 67 social housing allocation, 147 troubled families, 276–277 Code for Sustainable Homes, The (DCLG, 2006b), 188, 198–199 Coelho, M., 113 Coleman, Alice, 211 Commission on Social Justice, 232 common lodging houses see lodging houses Communities First, 215 community care, 253 community cohesion, 251 Community Infrastructure Levy (CIL), 146–147 community land auctions, 122 comparative housing studies, 77–79 convergence thesis, 95–97 compulsory land purchase, 120–121 compulsory purchase orders, 182, 183–184 concealed households, 156 concentrated poverty, 222–223 Conservative governments building societies, 65 council housing, 42–43 home improvement, 183 homeownership, 34–35, 43, 45 housebuilding, 34, 108–109 housing associations, 41 local authorities, 58 mortgages, 41, 43

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overcrowding, 190–191 policy transfer, 97 private landlords, 41, 42 rent control, 30, 35, 42 Right to Buy, 40, 40–41, 45, 64 rough sleeping, 167–168 slum clearance, 32, 181 subsidies, 31 tenant empowerment, 62, 63–64 see also 2015 Conservative government Conservative party homelessness, 171–172 housebuilding, 113 construction industry, 67–68, 268–269 see also housebuilding consumer subsidies, 43, 54, 82, 128, 136–137 see also demand side subsidies; Housing Benefit (HB); Local Housing Allowance (LHA) convergence thesis, 95–97 cooperatives, 93, 94–95 co-ownership, 79 co-ownership societies, 64 Corbyn, Jeremy, 265, 266 Corkhill, R., 195 cost-rental housing corporations, 90–91 council housing, 6 allocation criteria, 147–148 Conservative governments, 42–43 inter-war period, 31–32 low demand, 210 Scotland, 70 see also local authorities Cowan, D., 145 credit crunch house prices, 44, 66, 92, 97 Marxist political economy, 274 New Labour, 44–45, 261–262 Spain, 92 USA, 82–84 Crisis, 156 Crook, T., 146, 221 Crosland, Anthony, 39 crowding see overcrowding culture of poverty, 17 Cutteslowe Wall, 30 Czech Republic, 93–95

D Daniel, W.W., 248 Darling, Alistair, 261 Davis, D., 127–128 De Decker, P., 96

336

decent homes, 185–188, 186–187, 189, 197–198, 223 England, 200, 200 lone parents, 245 defensible space, 211 demand side subsidies, 263 Democratic Unionist Party, 258 Department for Communities and Local Government (DCLG), 54 Department for Work and Pensions (DWP), 54 Depastino, Todd, 19 deposits, 133 Derogation Act 2015, 199 Design Improvement Controlled Experiment (DICE), 212 design improvements, 211–212 devolution, 47, 53, 70–75, 118–119 Dewilde, C., 96 direct commissioning, 271–272 direct discrimination, 243, 249 direct labour, 268–269 Direct Labour Organisations (DLOs), 106, 110, 112 disability, 252–253, 278, 284 bedroom tax, 256 housing need and supply, 256–257 Disabled Facilities Grants (DFGs), 255–256 discourses, 18, 19 discrimination, 242, 243, 249 see also racist discrimination distributive justice, 231 district councils, 56 domestic violence, 244 dominant discourses, 18, 19 dosshouses, 160, 194–195 Droste, C., 95–96 Duncan Smith, Ian, 17, 225–226, 276 Dunleavy, P., 219

E East Germany, 85–86, 87–88 eco-towns, 188–189, 198 elected mayors, 56–57 empirical explanations of continuity and change behaviourism, 17 laissez-faire economics, 7–8 Marxist political economy, 14–15 social constructionism, 19–20 social reformism, 11–12 empowerment, 62–64 energy efficiency, 198, 200, 201, 284 England

Index

decent homes, 200, 200 Disabled Facilities Grants (DFGs), 255 energy efficiency, 200, 201 overcrowding, 201–204, 202 English Partnerships, 55 English regional dimension, 55–56 Enterprise and Regulatory Reform Act 2013, 199 enterprise tenure, 93 enveloping, 185 equality, 232 Equality Act 2010, 242–243, 256 Equality and Human Rights Commission (EHTC), 242, 243 Essay on the Principle of Population (Malthus, 1803), 15 essentialism, 18 Estate Action Initiative (EA), 212 ethnicity, 246–252, 247 EU referendum, 70, 264, 271 see also Brexit eugenics, 17 European Economic Area (EEA) migrants, 149–150 European Housing Exclusion Index, 99 European Union (EU), 69–70, 98–99, 98 evictions, 85, 199 Excessive Housing Cost Overburden, 99 exit politics, 62 externalities, 5, 10, 24, 189–190

F Fabian socialism, 9, 11–12, 16 Fabian Society, 31 fair rents, 38–39 families, 243, 246, 275–277 family homelessness, 158, 161, 165–167 Fears, C., 129 Federal Housing Administration (FHA), 81 Federal National Mortgage Association (FNMA), 81 feminists, 243, 245 Field, F., 127–128 filtering, 5, 264 financial crisis, 83–84, 261–262 see also credit crunch financial institutions, 65–67 Financial Services Authority (FSA), 66 Fitzpatrick, S., 72, 116–117 Fixing our broken housing market (DCLG, 2017), 285–287 flats, 37–38, 219 flexible tenancies, 226 foyers, 169–170

functionalist sociological theory, 12 funding cuts, 59 Funding for Lending, 66

G g15, 60 Gamble, Andrew, 8 garden cities, 28, 124–125 Garden Cities of Tomorrow (Howard, 1902), 28 garden suburbs, 28 garden villages, 125 Gauldie, E., 134 Gautreaux programme, 222–223 gender, 242–246 General Needs Index, 55 Generation Rent, 139, 238, 262 Gentile, A., 92 gentrification, 184 Germany, 85–89, 95–96 private landlordism, 99 rent control, 78, 86, 87, 88 social market economy, 97 tenure security, 98 Gilroy, R., 244 Gini coefficient, 240, 240 Glasgow, 71, 105 Glass, Ruth, 184 Glennerster, H., 10, 210–211 globalisation, 97 governance, 52–53, 52 government, 52 Government of Wales Act 2006, 72 governmentality, 20 green belts, 122–124, 123–124, 279 Conservative governments, 35, 115, 124, 287 Germany, 89 social reformism, 265 Green Deal, 198, 200 Green Party, 279 greenfield sites, 121–122 Greenspan, Alan, 82 Gretna, 31 Growth and Infrastructure Act 2013, 146

H Hall, S., 278 Halsbury, Lord, 14 Hampstead Garden Suburb, 28 Hansmann, H., 104 harassment, 248 Harloe, M., 1–2, 134 Harvey, D., 12

337

Understanding housing policy: third edition

Hausgeld, 88–89 Hayek, Friedrich von, 4, 5, 6, 7 headship rates, 116 health, 24–26 Heath, Edward, 183 Hegel, G.W.F., 11 Heilbroner, Robert, 96 Heinemann, M., 136 Help to Buy, 46, 66, 133–134 Heseltine, Michael, 144 high-rise buildings, 37–38, 219 Hill, Octavia, 135, 275 Hills, J., 218–219 Hilton Young, E., 181, 191 Hinterland (Mullin, 2013), 219 Hirschman, A.O., 64 HM Treasury, 54, 55 Hobhouse, Leonard Trelawney, 11 Hole, James, 134–135 home, 156 home adaptations, 256 Home Builders Fund, 46 home improvement, 183–185, 199–200 Homeless Reduction Bill 2016, 174 homelessness, 173, 195, 244–245 1948 National Assistance Act, 161 1977 Housing (Homeless Persons) Act, 162–163 1996 Housing Act, 163–164 2002 Homelessness Act, 164–165 causes, 157, 158–159 coalition government (2010-15), 171–174 definitions, 155–157 families, 158, 161, 165–167 historical legislation, 157, 160–161 Housing First, 272 New Labour, 164–165, 166, 167 Northern Ireland, 176–177 prevention, 165–167 process, 158–159 rough sleeping, 167–171, 172, 173–174, 176 Scotland, 174–176, 175 single people, 159, 161, 244 single women, 244 social construction of, 19 statutory, 157, 165–167 Wales, 176 Homelessness (Scotland) Act 2003, 174 Homelessness Act 2002, 164–165 homeownership affordability, 132–133, 152–153 by age, 153 coalition government (2010-15), 45 Conservative governments, 34–35, 43, 45 Czech Republic, 93, 95

338

decent homes, 185 East Germany, 86 and gender, 243–244 Housing Benefit (HB), 269–270 inter-war period, 29–32 Labour governments, 36–37, 39 low-cost, 144–147 Marxist political economy, 14 New Right, 9, 264 property wealth, 236–238, 237 protection, 145 and social class, 235 Spain, 91–92 Sweden, 90 taxation, 36 USA, 82–84 see also owner-occupation homeownership ideology, 29 Homes and Communities Agency (HCA), 55 Homes for the future: more affordable, more sustainable (DCLG, 2007), 44, 188 Homesteading, 144 Hope V1 programme, 84–85 house prices, 152, 167, 236–238 and affordability, 132 credit crunch, 44, 66, 92, 97 Czech Republic, 95 effect of demand side subsidies on, 263 effect of new construction on, 284 Germany, 89 laissez-faire economics, 5 low-demand areas, 217–218 Northern Ireland, 74 Spain, 91, 92 Sweden, 91 Thatcherism, 43 USA, 83, 84 House Purchase and Housing Act 1959, 183 housebuilding, 45, 107–108, 108–111, 110, 111, 119, 283–285 coalition government (2010-15), 58, 113–114, 125, 198–199 Conservative governments, 34, 108–109, 114–115, 287 Czech Republic, 94, 95 Germany, 89 inter-war period, 30, 108 Labour governments, 32–33, 33, 44, 58, 106, 108, 109, 112–113, 125 Liberal Democrats, 58, 113 local authorities, 32–33, 34, 106–107, 267–269 private sector, 107–108 Spain, 92 Sweden, 89, 91

Index

USA, 81, 84 household formation, 115–116 household income, 236, 240–242 see also income selectivity; residual income approach houses in multiple occupation (HMOs), 196–197 housing as a social problem, 24 special characteristics, 9–10 as a verb, 18 Housing (Financial) Provisions Act 1924, 106 Housing (Financial Provisions) Act 1933, 30–31, 32 Housing (Fire Safety in Houses in Multiple Occupation) Order 1997, 196 Housing (Homeless Persons) Act 1977, 162–163, 167 Housing (Rural Workers) Act 1926, 182 Housing (Scotland) Act 2001, 150, 174 Housing (Scotland) Act 2006, 71 Housing (Wales) Act 2014, 72, 176 Housing, etc Act 1923, 106 Housing, Town Planning, etc. Act 1919, 106–107 Housing Act 1930, 136, 181, 182 Housing Act 1935, 32, 190–191, 191–192 Housing Act 1949, 33, 183 Housing Act 1949 (USA), 81 Housing Act 1957, 192 Housing Act 1969, 183 Housing Act 1974, 183 Housing Act 1980, 40–41, 141, 150 Housing Act 1988, 41, 60, 129 Housing Act 1996, 155–156, 163–164 Housing Act 2004, 141, 196–197 Housing Act 2016, 45 Housing Action Areas (HAAs), 183–184 Housing Action Trusts (HATs), 42–43, 62 housing allowances, 94 Housing and Community Development Act 1974 (USA), 82 Housing and Planning Act 1909, 28 Housing and Planning Act 2016, 132, 147 Housing and Regeneration Act 2008, 60 Housing and Town Planning Act 1919, 31, 135, 181 Housing and Town Planning Act 1947, 111–112 Housing Association Grant (HAG), 39 housing associations, 3, 39, 41, 59–61, 61–62, 148, 268 housing benefit, Germany, 87, 88–89 Housing Benefit (HB), 54, 129–130, 137–138 Conservative governments, 41, 43, 168

Generation Rent, 262 homeownership, 269–270 New Labour, 219 private landlords, 265 supported housing, 254 housing cooperatives, 63–64 Housing Corporation (HC), 55, 130 housing cost overburden, 79, 98, 99, 131, 132, 151 housing costs, 240 housing design, 211–212, 245–246 Housing Finance Act 1972, 97, 136 Housing First, 170–171, 272 Housing Grants, Construction and Regeneration Act 1996, 185 Housing Health and Safety Rating System (HHSRS), 186, 187, 204 housing indicator standards, 78 Housing Infrastructure Fund, 283 Housing Market Renewal Fund (HMRF), 216–218, 220 housing needs, 55, 279 see also housing requirements housing needs assessment, Barnet London Borough Council, 117–118 Housing of the Working Classes Act 1890, 27, 105 housing options interviews, 166, 167, 173 housing outcomes and ethnicity, 246–247, 247 EU, 98–99, 98 USA, 99 “housing plus”, 61–62 housing policy, 1–3 Housing policy: from social breakdown to social mobility (Centre for Social Justice, 2008), 225–226 housing politics, 279–280 housing related support, 253–254 Housing Rents and Subsidies Act 1975, 38 Housing Repairs and Rents Act 1954, 183 housing requirements local, 117–118 national, 115–117 Housing Revenue Account (HRA), 58, 137 housing standards, 204–205 see also decent homes; overcrowding housing statistics, 80 housing strategies, 58–59 housing supply, 119–125, 267 see also housebuilding housing vouchers, 82, 84, 85 housing wealth, 236–239, 237, 274 Howard, Ebenezer, 28 human capital, 213, 213

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Hynes, P., 148

I idealist theory, 11 identity politics, 252, 277 illegal migrants, 201 immigration, 9, 148–150, 264, 282 Immigration and Asylum Act 1999, 148 improvement grants, 183, 184–185 income by tenure, 236 income distribution, 240–242 income selectivity, 184–185 independent living, 252 Index of Dissimilarity, 251–252 indirect discrimination, 243, 249 Inner Urban Areas Act 1978, 210 Institute of Economic Affairs, 4–5 institutional racism, 248–249 instrumental Marxism, 14 integrated living, 253 intentionality, 163 Interdepartmental Committee on Physical Deterioration, 27 interest groups, 7–8 international housing statistics, 80

J Jacobs, K., 156 Javid, Sajid, 54, 121 Johnsen, Sarah, 171 Jones, Colin, 143 Jones, M., 219 Joseph, Sir Keith, 17, 35–36 Joseph Rowntree Foundation, 116, 255 “just about managing” (JAMS), 282 justice see distributive justice; social justice

K Kemeny, J., 86, 96 key workers, 144 Khan, Sadiq, 265, 271 Knorr-Siedow, T., 95–96 Kynaston, D., 218

L Labour governments home improvement, 183–184 homeownership, 36–37, 39 housebuilding, 32–33, 33, 106, 108, 109 mixed communities, 33–34 par value cooperatives, 64 private landlords, 38

340

rent control, 32, 38–39 slum clearance, 181, 183 subsidies, 31 see also New Labour Labour movement, 27–28 Labouring Classes Lodging Houses Act 1851, 105 laissez-faire economics, 4–9, 44, 261–264 Lanchester, J., 83 land banking, 121 land compulsory purchase, 120–121 land prices, 10, 279 land stamp duty tax (LSDT), 2, 46, 139–140, 140 land taxation, 27, 28, 266–267 Land Value Taxation Campaign, 266 land values, 28, 89, 104, 241 landowners, 241, 266–267 Large Sites Infrastructure Fund, 46 Law, I., 250 Laws, D., 7 Laying the foundations: a housing strategy for England (HM Government, 2911a), 227 Le Corbusier, 37 Ley de Arrendamientos Urbanos (1964, Spain), 92 Liberal Democrats garden cities, 124–125 housebuilding, 58, 113 local plans, 121 mansion tax, 270 Regional Growth Fund (RGF), 225 Liberal Party, 27, 28 Lifetime Homes, 255 linking social capital, 213 Living Home space standard, 203–204, 233 living rents, 271 Lloyd George, D., 27, 28, 31, 104, 106 local authorities, 56–59 compulsory land purchase, 120–121 as enablers, 58–59 funding cuts, 59 home improvement, 185 homelessness 1977 Housing (Homeless Persons) Act, 162–163 1996 Housing Act, 164 2002 Homelessness Act, 165 2011 Localism Act, 172 bed and breakfast hostels (B&Bs), 195 prevention, 166–167 Scotland, 174–175 Wales, 176 housebuilding, 32–33, 34, 106–107, 267–269

Index

neighbourhood deprivation, 225 overcrowding, 190, 191, 192 public health, 25–26 see also council housing local authority tenants, 3 see also council housing Local Authority Voluntary Stock Transfer (LVST), 57 local connections, 163 Local Government Act 1999, 59 Local Government Act 2000, 56 Local Government and Housing Act 1989, 185 Local Government Board, 26 Local Government, Planning and Land Act 1980, 112 Local Housing Allowance (LHA), 137, 138, 143, 254 local housing requirements, 117–118 local plans, 45, 56, 112, 117, 121–122, 280 Localism Act 2011, 56, 114, 172, 226 localism agenda, 117 lodging houses, 105, 160, 194–195 London, 56, 169, 237–238, 241, 272–273 London County Council (LCC), 28, 105–106 lone parents, 244–245, 245 Losing Ground (Murray, 1984), 15 low demand, 210, 216–218 low-cost homeownership, 144–147 Lupton, R., 221–222, 224 Lyons Commission, 67, 273

M Macmillan, Harold, 34, 35, 108, 124 Major, John, 43, 44, 52 Making every contact count: A joint approach to preventing homelessness (HM Government, 2012), 172 Malthus, Thomas, 15 Management of Houses in Multiple Occupation Regulations 2006, 196 management priority estates, 210–211 mansion tax, 270 market distortions, 5–6 market efficiency, 5 market rents, 41, 45, 79, 127–128, 226, 227 USA, 84 Marx, Karl, 233 Marxist political economy, 12–15, 16, 95, 274–275 Matthews, P., 113 May, Theresa, 124, 240, 282 mayors, 56–57 McDonald, N., 115–116

meaning, 18 median voter attraction, 7 migration see immigration Mill, John Stuart, 27 Miller, P., 19–20 Milner Holland Report 1965, 38 Ministry of Munitions, 31 minority ethnic groups see ethnicity mixed communities, 33–34, 220–222, 227 see also balanced communities Mixed Communities Demonstration Initiative (MCDI), 220–221 moderate social reformism, 270–273 Monk, S., 222 Morgan, N., 26 Morris, J., 243 mortgages, 65–67, 68, 153 Bank of Mum and Dad, 238 Conservative governments, 41, 43, 139 credit crunch, 97 protection, 145 USA, 81, 82–83, 84 Muir, J., 53 Mullin, Chris, 219 municipal rented sector, Czech Republic, 94 Murray, Charles, 15

N National Assistance Act 1948, 161 National Assistance Boards, 161 National Federation of Housing Association (NFHA), 130 National Housing Act 1937 (USA), 81 national housing requirements, 115–117 national identity, 264 National Infrastructure Commission (NIC), 55 National Planning Policy Framework, 114, 129, 280 National Tenant Voice, 64 neighbourhood deprivation 2015 Conservative government, 226–228 area-based programmes, 210 coalition government (2010-15), 224–226 design improvements, 211–212 New Labour, 212–216, 223–224 priority estates, 210–211 neighbourhood planning, 114 Neighbourhood Renewal Fund (NRF), 215–216 neoclassical economics see laissez-faire economics neo-Conservatism, 8 neoliberalism, 96

341

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see also laissez-faire economics Netherlands, 98 new build see housebuilding New Deal for Communities (NDC), 214 New Labour, 44–45 brownfield sites, 112 community cohesion, 251 construction industry, 67 credit crunch, 44–45, 261–262 decent homes, 185–188 elected mayors, 56 governance, 52 homelessness, 164–165, 166, 167 housebuilding, 44, 58, 112–113, 125 houses in multiple occupation (HMOs), 196–197 Housing Benefit (HB), 219 Housing Corporation (HC), 55 housing policy objectives, 2 Lifetime Homes, 255 local authorities, 58–59 low demand, 216–218 low-cost homeownership, 144 mixed communities, 220–221 neighbourhood deprivation, 212–216, 223–224 Northern Ireland, 73 overcrowding, 193 performance management, 59 private landlords, 45, 68, 69, 197 rent control, 137 Right to Buy, 141 rough sleeping, 168–171 Scotland, 70 social housing allocation, 147 stock transfer, 57–58, 62, 220 sustainable homes, 188–189 tenant empowerment, 62, 63, 64 troubled families, 275–276 underclass theories, 16 Wales, 72 new liberalism, 9, 11, 16 New Right, 8–9, 16, 264 new towns, 124–125 New Towns Act 1946, 33 Niskanen, W.A., 8 Nolan, P., 258 non-profit housing enterprises, 87 Northern Ireland, 73–75 affordable housing, 150–151 area-based programmes, 224 Disabled Facilities Grants (DFGs), 255 equality, 258–259 governance, 53 homelessness, 176–177

342

house prices, 74 housing standards, 204, 205 planning, 119 stock transfer, 74 Northern Ireland Assembly, 73, 74 Northern Ireland Housing Executive (NIHE), 73, 74 Northern Rock, 65, 66 not-for-profit landlords, 3 see also housing associations Nozik, Robert, 232, 277

O Obama administration, 84, 85 occupancy rating, 193–194 occupancy standard, 202, 203 organic theory see idealist theory Ormandy, D., 193 Osborne, George, 128, 140, 285 othering, 20, 30 overcrowding, 189–191, 191–192, 202, 203 coalition government (2010-15), 199 England, 201–204 impact, 194 lodging houses, 194–195 measures, 192–194 USA, 99 owner-occupation, 3, 219–220 Germany, 87, 88 improvement grants, 185 under-occupancy, 273 see also homeownership

P P90/P10 ration, 240, 240 par value cooperatives, 64 Paragon Group, 69 parents, 244–245, 245 parish councils, 56 path dependency, 78 patriarchal families, 243, 246 patrimony, 91 Peabody Trust, 134 People’s Budget 1909, 28 people’s house, 34 performance indicators, 59 permanent building societies, 104 ‘perverse incentives’, 163–164 Phillips, Trevor, 251 Piketty, Thomas, 274 planning, 245–246 and affordability, 146–147 Germany, 89

Index

planning control, 262–263 Pleace, N., 170–171 Polanska, D.V., 96 policy transfer, 97–98 poor law, 157, 160–161 Poor Law Amendment Act 1834, 160–161 Poovey, M., 20 population growth, 15, 115 post war planning, 33 post-truth, 18 poverty, 222–223, 227, 241, 241, 258, 278 culture of, 17 poverty trap, 130 power, 18 pressure groups see interest groups Preston, 26 Pringle, J.C., 17 priority estates, 210–211 Priority Need Order 2002, 165 private finance, 41, 60 private landlords, 3, 68–69, 104–106, 265 Conservative governments, 35, 41, 42, 46 Germany, 87, 99 Labour governments, 38 property wealth, 239 racism, 248 regulation, 197 Right to Buy, 143 Spain, 91 subsidies, 138–140 tax concessions, 139 see also rogue landlords private rented sector affordability, 147, 151 Czech Republic, 94 decent homes, 185–187, 198 New Labour, 45 Right to Buy, 266 Spain, 92 Sweden, 91 tenant demographic, 235 USA, 84 Private Renting Act 2016, 271 private sector housebuilding, 107–108 privatisation, 96 producer subsidies, 81, 91, 128, 136–137 Progress and Poverty (George, 1879), 27 Progressives, 28 property wealth, 236–239, 237, 274 public choice theory, 7–8 public health, 24–26 Public Health Act 1848, 25 Public Health Act 1875, 26, 190 public housing, 81, 84–85 public sector, 91

see also council housing Public Sector Net Cash Requirement (PSNCR), 60

Q Quality Housing and Work Responsibility Act 1998 (USA), 82, 85 quangos, 55

R Race Relations Act 1968, 248 Race Relations Act 1976, 249 racism, 247–249 racist discrimination, 246–247 radical social reformism, 264–270 Rawls, John, 231–232 Raynsford, N., 116 recession, 67 see also credit crunch; financial crisis recommodification, 95, 96 Redfern Review, 132, 133, 237, 274 Regional Development Agencies (RDAs), 56 regional dimension, 55–56 Regional Growth Fund (RGF), 56, 225 Regional Spatial Strategies (RSSs), 56, 112 registered social landlords, 3 see also housing associations relative poverty, 223, 241, 241 removal laws, 160 rent, 27, 152 affordability, 62, 151, 152, 271 Conservative governments, 41, 42 living rents, 271 Scotland, 70 social rent, 62 see also market rents; rent control Rent Act 1957, 35 rent allowances, 97 rent control, 5–6, 107–108, 136 Conservative governments, 30, 35, 42 Czech Republic, 93–94 Germany, 78, 86, 87, 88 Labour governments, 32, 38–39, 137 social reformism, 265–266 Spain, 92 Sweden, 89–90 rent pooling, 136 rent regulation, 270–271 rent substitute payments, 88–89 Rent to Buy, 45, 145 rented accommodation, 3 affordability, 129–132

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see also council housing; Generation Rent; housing associations; private landlords; private rented sector Renting Homes (Wales) Act 2016, 204 Report on the sanitary condition of the labouring population of Great Britain (Chadwick, 1842), 24–25 residual income approach, 129–130 Resolution Foundation, 282–283 Restriction of Ribbon Development Act 1935, 33 retrofit, 189 revenge evictions, 199 Ridley, Nicholas, 129, 164 Ridley’s reform, 137 Right to Buy, 141–144, 142, 286 balanced communities, 219, 227 coalition government (2010-15), 141-142, 45 Conservative governments, 40, 40–41, 45, 60–61, 64, 286 New Labour, 141 Northern Ireland, 150–151, 151 policy transfer, 98 private tenants, 266 Scotland, 71, 143, 150, 151 structural racism, 249 Thatcherism, 40, 40–41 Wales, 72, 150, 151 Roberts, M., 245–246 rogue landlords, 38, 69, 199 Rolnik, R., 95 Rose, N., 19–20 Ross, Stephen, 162 Rough Sleepers Initiative, 168 rough sleeping, 157, 167–171, 172, 173–174, 176 Royal Bank of Scotland, 66

S safety net approach, 129–130 Sales, R., 148 sanitary reform, 24–25 Saunders, P., 263, 264, 266 Savage, M., 233–234 Savills, 237, 241–242 Savills Residential Land Index, 241 Schedule A, 36 Schmidt, S., 95 Schwartz, A.E., 84 Scotland affordable housing, 150–151 child poverty, 258 council housing, 70

344

devolution, 47, 70–71 Disabled Facilities Grants (DFGs), 255 equality, 258 governance, 53 homelessness, 174–176, 175 housing policy objectives, 2 housing standards, 204, 205 independence referendum, 47 new build, 269 New Labour, 70 planning, 118–119 private landlordism, 105 rents, 70, 271 Right to Buy, 71, 143, 150, 151 rough sleeping, 176 Social Inclusion Partnerships, 215 stock transfer, 71 temporary accommodation, 175 Scotland Act 2016, 47 Scottish Housing Quality Standard, 204, 205 Scottish National Party, 71, 258 Scottish Parliament, 70 secure tenants, 3 securitisation, 83 segregation, 250–252 self-build, 67 Senior, Nassau W., 5 settlement laws, 160 Sex Discrimination Act 1975, 243 Shaftesbury, Lord, 190 shared ownership, 144–145 Shelter, 131, 156, 194, 203, 233, 239 Shelter Scotland, 175 Shildrick, T., 278 Simpson, L., 251 single homelessness, 159, 161, 244 Single Regional Government Offices, 56 single women, 243–244 Sinn Fein, 74 Skelton, D., 271 Skelton, Noel, 29 slums, 26–27, 180–181 clearance, 32, 134, 135–136, 181–182 externalities, 5, 134 functionalist sociological theory, 12 Smith, Adam, 160 social capital, 213, 214 social class, 232–235, 233, 234 see also underclass social constructionism, 18–20, 19, 277–279 social distribution, 232 social exclusion, 232 Social Exclusion Unit, 213 social housing, 79, 129, 278–279 allocation criteria, 147–148

Index

Conservative governments, 112 decent homes, 188 Germany, 86, 88, 95–96 immigration, 148–150 lettings, 144 Spain, 92 supply, 267 see also council housing; housing associations Social Housing Grant (SHG), 41 Social Inclusion Partnerships, 215 social justice, 231–233 social liberalism see new liberalism social market economy, 97 social reformism, 9–12, 95 ameliorative, 273–275 moderate, 270–273 radical, 264–270 underclass theories, 16 social rent, 62 social tenants, 239 Society for Improving the Conditions of the Labouring Classes, The, 105 space, 242, 284 Spain, 91–92 spare room subsidy, 273 see also bedroom tax Spencer, S., 195 St David’s Agreement 2015, 72 standards, 135–136 see also decent homes starter homes, 45–46, 227, 286 state housing, 93 statutory homelessness, 157, 165–167 statutory standard for overcrowding, 192–193, 201 steering, 248 Stephen Lawrence Inquiry, 248–249 Stephens, M., 78 Stephenson, A., 173 stock transfer Czech Republic, 93 Estate Action Initiative (EA), 212 New Labour, 57–58, 62, 220 Northern Ireland, 74 Scotland, 71 street counts, 169 structural determinants, 157 structural racism, 249 student debt, 133 subjective racism, 248 sub-prime mortgages, 82–83 subsidies, 134 consumer subsidies, 43, 54, 82, 128, 136–137, see also Housing Benefit (HB); Local Housing Allowance (LHA)

demand side subsidies, 263 producer subsidies, 81, 91, 128, 136–137 subsidised council housing, 6 Sunderland, 219 supported housing, 254–255 Supporting People, 253–254, 254 Sustainable communities: settled homes; changing lives, a strategy for tackling homelessness (ODPM, 2005), 166, 167 sustainable homes, 188–189 Sweden, 89–91, 96

T tax concessions, 139 Tax Reform Act 1986 (USA), 81 taxation, 36 temporary accommodation, 173, 174, 175 see also bed and breakfast hostels (B&Bs) tenant empowerment, 62–64 Tenant Management Organisations (TMOs), 63 Tenant Participation Compacts (TPCs), 63 Tenant Services Authority (TSA), 55 tenant-ownership cooperatives, 90 tenant’s choice, 42–43, 62 Tenants’ Rights, etc (Scotland) Act 1980, 150 tenure, 2, 3, 46, 47, 78–79, 235 Czech Republic, 93 lone parents, 245 yearly income by, 236 Thatcher, Margaret, 8–9, 43, 52, 124, 168, 211–212 Thatcherism, 39–44 Theory of Justice, A (Rawls, 1971), 231–232 tower blocks see high-rise buildings Town and Country Planning Act 1947, 33 Town and Country Planning Act 1971, 146 Town and Country Planning Act 1990, 59, 146, 221 Town and Planning Act 1932, 33 town councils, 56 Treanor, D., 236 Treasury, 54, 55 troubled families, 275–277 Trump administration, 85 Tsenkova, S., 96 Tudor Walters Committee Report (1918), 31, 135, 245 Tullock, G., 8 Tunstall, R., 221–222 Turner, John, 19 Turner, T., 210–211 Twinch, E., 269

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Understanding housing policy: third edition

U underclass, 15–16, 276 under-occupancy, 273 Universal Credit (UC), 54 Unwin, Raymond, 10–11 Urban Aid, 210 USA, 78, 81–85, 96, 99, 222–223

V vagrancy laws, 160, 168 Vision to end rough sleeping: No second night out nationwide (HM Government, 2011), 172 voice politics, 62–64 voting system, 7 vulnerability, 172

W Waldegrave, William, 112 Wales, 72–73 affordable housing, 150–151 Communities First, 215 Disabled Facilities Grants (DFGs), 255 equality, 258 governance, 53 homelessness, 176 housing standards, 204, 205 New Labour, 72 planning, 119 Right to Buy, 72, 150, 151 Wales Act 2014, 72 wealth, 236–239, 237, 274 Webb, Beatrice, 11–12 Webb, Sydney, 11–12 Weber, Max, 233 welfare, 276–277 welfare capitalism, 79 Welsh Housing Quality Standard (WHQS), 204, 205 West Germany, 85–87 Westminster core executive, 53–54 Wheatley, John, 27, 28, 31 Wheatley Act see 1924 Housing (Financial) Provisions Act Whitehead, C., 115–116 Wilcox, S., 133, 152–153, 268 Wilson, W., 129 Winlow, S., 278 Winn, M., 243 Wohngeld, 87 see also Hausgeld women, 243–244, 245–246 Woods, R., 244 Woolton, Lord, 283

346

workhouses, 160–161 Working Neighbourhood Fund, 216 worklessness, 278

X X-inefficiency, 8

Y young people, 66, 91–92, 168, 169–170, 238

Z zero carbon homes, 188, 198

Understanding welfare: Social issues, policy and practice

“It should be on the bookshelf of anyone, novice or veteran, interested in UK housing policy, and will be essential for undergraduate and graduate students specialising in the area.” Joe Finnerty, University of Cork, Housing Studies journal (on the Second edition)

The third edition of this bestselling textbook has been completely revised to address the range of socio-economic factors that have influenced UK housing policy in the years since the previous edition was published. The issues explored include the austerity agenda, the impact of the coalition government’s housing policies, the 2015 Conservative government’s policy direction, the evolving devolution agenda and the recent focus on housing supply. The concluding chapter examines new policy ideas in the context of theoretical approaches to understanding housing policy: laissez-faire economics; social reformism; Marxist political economy; behavioural perspectives and social constructionism. Throughout the textbook, substantive themes are illustrated by boxed examples and case studies. The author focuses on principles and theory and their application in the process of constructing housing policy, ensuring that the book will be a vital resource for undergraduate and postgraduate-level students of housing and planning and related social-policy modules. Brian Lund is Visiting Lecturer at Manchester Metropolitan University. He has served as Housing Committee Chair of a large metropolitan housing authority and was an Open University Tutor for more than 25 years. He is the author of Housing politics in the United Kingdom: Power, protest and politics (Policy Press, 2016).

UNDERSTANDING HOUSING POLICY

“An excellent historical and theoretical review of housing policy: thoughtful, well informed, critical and up to date.” Chris Paris, University of Ulster

UNDERSTANDING HOUSING POLICY

Understanding welfare: Social issues, policy and practice

THIRD EDITION

“An excellent update that puts current housing policy into a historical context. This will be very helpful to my students.” Alan Winter, London South Bank University

Series Editor: Saul Becker, University of Birmingham, UK • Presents  topical and innovative approaches to understanding social issues, policies and welfare delivery by leading experts • Accessible texts with chapter-specific summaries, questions for discussion and full bibliographies, with an attractive series design using boxes and illustrations to help understanding • Builds into a library of essential reading for students

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