This post is by Stephen Hill, Director- C2O futureplanners
This won’t sound very important; but, before the month is out, we should expect the government quietly to drop their New Garden Cities Prospectus. It’s run out of political time. It won’t win any votes in this parliament. As a housing professional, with some involvement in this initiative, my first reaction was disappointment, but not surprise.
About two hours later, my citizen heart took over. ‘How dare they’, I thought, ‘how dare this government walk away from this, for their own political convenience?’ Garden Cities might or might not be the answer, but this would have been the government’s only serious attempt to find new ways to increase housing supply through large-scale developments. This is a dereliction of duty to meet a national housing crisis. If you don’t understand why, let me try and explain; and its starts with the economy and incomes.
The nature of most businesses is they are now focussed on decapitalising labour in order to succeed – in their terms. We can already see this process at work as public services are taken over by private businesses. It’s no coincidence that incomes have just fallen by the largest amount in real terms since 1987. Most of us will continue to get poorer in real terms, and poorer in relation to the elites who run these businesses, can avoid taxes, expatriate tax revenues, or trade in the speculative value of commodities and assets; ‘investing’ in new homes in world city centres as the ‘new gold’.
With housing costs continuing to rise, and consuming at least 60-70% of net incomes, in many cases, we are finding it more and more difficult to spend on other things that might ‘boost the economy’, whatever that now means, or just live a ‘normal’ social life. Direct and indirect tax revenues will fall. Large and unpredictable energy price increases coming in the near future could bring on a ‘perfect storm’ in the current housing crisis.
No government since the 1974 Housing Act has done anything that amounts to much more than rearranging the furniture in a condemned house. From the introduction of the Right to Buy in 1980, there was a net decline in the amount of affordable housing every year till 2008, despite new house building. What did anyone think was going to happen?
The latest demand side measures, like Help to Buy, are enriching landowners, existing home owners, housebuilders and mortgage companies, whilst also making new homes even more unaffordable than before, as house prices rise and incomes stagnate or fall. Housing benefit cuts and the ‘bedroom tax’ are already turning out to be a self defeating process of managing the queue that increases public spending rather than reducing it. Call it ‘Pass the Parcel’, except these are people: councils exporting their poor residents amongst themselves to no net beneficial effect.[i] Rather than focussing 100% on increasing supply, this is an expensive diversionary activity by politicians to punish the poor for being so unwise as to be poor, and to be living in the ‘wrong’ place at the ‘wrong’ time. No one has a right to a home or a place in the city, any more; and that could soon apply to more of us.
All this, so that politicians can appear to be doing something; but really to avoid doing anything that would actually make a difference. We are in an end game that may take another ten to fifteen years to play out. But make no mistake, the absence of an integrated housing and incomes policies under any government for a generation is destroying the economy and the fabric of our society. Even with the latest plan to build another 165,000 affordable homes by 2018, there will be one million affordable homes less than there were in 1980, whilst the population has grown by 7 million people.
Governments seem to have forgotten the fundamental importance of sound and stable housing markets to the economic and social life of the country. Consider this: the number of months in the last 40 years that housing has had a minister of Cabinet rank – the number of housing ministers over the same period. Guess which is the larger number? And how many of those ministers do you remember?
The 1974 Housing Act, however, was a unique piece of legislation; introduced under the Conservatives, it fell at the general election, but was immediately passed by incoming Labour. All parties could see how important it was. The Act was a concerted attempt to renew our inner cities through government action, and by unleashing the disruptive and highly effective innovation of the housing association: small locally based organisations meeting a myriad of local needs in locally appropriate ways. A good number of them are now in the same monopoly provider league as the major housebuilders, with relatively few still genuinely grounded in their communities of place. Housebuilders and large housing associations are serious capitalist enterprises, and do not need government support. They should now be left to do what they can do, and sink or swim on their own merits. Central and local government needs to find and support new producers, and intervene directly in markets where housing supply is desperately needed but just not happening: for if not them, then who?
The measures are simple; strategic planning, land assembly, public and local banking systems, reform of central and local government finances and taxes, smart procurement, and so on. Simple – because we used to know how to do this. Simple – because most other countries inEuropeand the OECD seem to manage this without much difficulty. I was talking with a Danish developer at the Centennial Congress of the International Federation of Housing and Planning, recently, explaining how our ‘system’ worked. His eyes widening every moment, he finally exclaimed, “How did you get yourself into such a situation?” Nobody could or would have invented the system we now have.
These measures are what all UK governments have shirked or abandoned for a generation, for political rather than true national advantage. It would now require extreme political courage and a political time horizon that spans two or three governments to remake a credible housing policy and delivery system. With no party likely to secure an overall majority at the next election, or two, and no party seeming to have the first idea what to do, then it feels like time for us citizens to demand a different, more radical and unified approach from all our politicians.
We should look to those disruptive citizens in community land trusts, coops and cohousing groups who are just getting on and doing what the market and politicians won’t do. In villages, towns and cities across the country, they are no longer waiting for others to provide for them. They don’t understand why they are still made to feel that they have to ask permission to take responsibility for their own housing solutions. Let these disruptive citizens (who do want more homes to be built for ‘other people’, as well as themselves) take a lead, join up with those unfashionable housing associations that still care for their place and their people, and work with small and medium sized house builders that understand their local markets. Support them to come up with the new generation of disruptive innovations in housing. They may be small, but no smaller than housing associations in 1974.
Critics will say that that this is too small-scale to be economic or make a difference. Resources have to be focused on large-scale developments and regeneration projects that produce homes quickly and cheaply. I’ve been working on housing projects at all scales since the mid-1970s, and I seem to have been very unlucky in missing out on these cheap, fast and high quality new housing projects. Some of the current crop of large projects are taking 20-30 years, and producing barely 100 homes a year on average over the life of the project. This is a self-serving myth of the big housing providers and unimaginative public officials who think, or want us to think, this is the only way. They also need to remember that we just don’t do large-scale housing very well. The 20th century is littered with mistakes of well-intentioned mass housing projects that have had to be put right only at huge public cost, a generation or so later. We also know what some current politicians think of much that is being produced today.
Instead, maybe we should just be making many, many more small scale interventions, replacing worn out parts of our villages, town and cities; organically and imaginatively renewing or adding to places at a scale we can identify with. It’s a big ask: nearly 100,000 more homes a year than is currently being built. It’s also a 100,000 more homes than housebuilders can or even want to build.
We should now demand of all our politicians that they accept collective responsibility for solving the housing crisis: rediscover the spirit of 1974. Forty years on, they should start work now on a major Housing Bill for 2014. Only by working together over two parliaments could the parties take on all the vested interests that have frustrated previous one-party attempts to do what is needed. What is it that we need and want? An affordable home…affordable, that is, relative to what we earn…a home that is well designed, consumes little energy, and is in a well-connected neighbourly place where we need to be. How can that be so difficult?
This idea will undoubtedly be dismissed as naïve, unreal and idealistic. But if the normal ‘real’ world housing market solution is one which accommodates the selfishness of the already housed at the expense of the unhoused, and which induces and tolerates impoverishment, homelessness, a culture of cruelty, the disruption of family life, the displacement of urban populations, and increases social and economic polarisation, then please call me an idealist.