10 things about 2012: part 1

The first of a two-part look back at the issues and people that I was blogging about in a momentous year for housing.

1) Private renting: a year of growth

I predicted in January that 2012 would see the private rented sector overtake social renting. As things turned out, I was wrong – but not by much. Whether you judge it by the number of homes or the number of households or the answers given by people in the Census, a combination of growth in buy to let, shrinking home ownership and the slow decline of social housing mean it will happen sooner rather than later.

It was also a year that the boundary between the two sectors continue to blur: social housing responded to the tenure shift as a series of social landlords from Thames Valley to L&Q launched private renting initiatives; private landlords like Grainger registered social housing subsidiaries; and the government approved proposals in the Montague report to kick start institutional investment in private renting.

Yet with size surely comes responsibility. Coalition rhetoric about strong families and stable communities failed to match the reality of short-term, insecure private tenancies. The Labour opposition made tentative proposals for reform of letting agents and tenancies and rents as calls for reform increased.

The year ended with the Census confirming the astonishing rise of private renting and I highlighted some alarming implications for the future housing benefit bill.

2) Welfare reform: implementation and some backtracking 

Speaking of which, 2012 was the year of welfare reform implementation, with the bedroom tax understandably dominating the agenda for social landlords but increasing awareness that this was only one part of a perfect storm of changes due from April 2013.

The year began with the final parliamentary stages of the Welfare Reform Act. As the Lords battled with the Commons in a game of parliamentary ping-pong, I highlighted doubts about how the benefit cap would work. By the end of the year, even the DWP seemed to agree, with concessions in the Autumn Statement followed by an announcement that the cap will now be introduced in only four London boroughs from April before being introduced in the  rest of the country over the summer. You would never guess from the DWP press release that this was not the original plan.

The second half of the year brought growing doubts about the implementation of the universal credit from October 2013. I blogged about how it resembled a slow motion train crash and a whole series of warnings about the detailed regulations. For housing organisations though, direct payment of housing costs to tenants is the key concern and publication of the first results from the demonstration projects and witnesses at a public accounts committee hearing confirmed the impression that we are flying blind on what will happen.

3) Homelessness: a suitable safety net?

A devastating report for Crisis in December spelt out the point that welfare reform cannot be taken in isolation:  key elements of the housing support system are changed too. The year brought continuing tension between local authorities looking to cope with the new system and ministers promising that safeguards would remain. April saw a furious row between housing minister Grant Shapps and Newham mayor Sir Robin Wales over plans to send homeless people as far away as Stoke-on-Trent.

However, this was only a response to the previous year’s changes in the local housing allowance. In November, the homelessness legislation was substantially weakened when Localism Act regulations allowing local authorities to discharge their homelessness duty into the private rented sector became law. Any private tenancy has to be ‘suitable’ in its physical condition, affordability and location but it remains to be seen how this will work in practice.

4) From Shapps to Prisk

Speaking of Grant Shapps, I blogged extensively about his housing reforms, his record on housebuilding, his regular rows about statistics and the man who we learned was not just a minister but a rapper too. However, I never guessed that in addition to his many faces, Shapps also had many names. September saw me blog about his move from the housing portfolioto become chair of the Conservative Party.

The new DCLG team brought us Mark Prisk as housing minister and Nick Boles as planning minister. I blogged early on about the potential for creative tension between the two over issues such as the green belt. Boles carved himself a high profile with public statements about the need for more new homes while Prisk left me unimpressed with his defence of government policies but hoping that delivery matters more to him than his media profile.

5) Welfare reform II: strivers and scroungers

The move from housing to a party role thrust Shapps straight into the growing political row about welfare between the main three parties. The political aspects were nothing new, with the Conservatives attempting to use Labour opposition to the benefit cap to argue that the opposition was therefore opposed to hard-working families. However, the temperature was steadily raised as the budget numbers implied a need for another £10 billion of welfare cuts after the election. In April, news leaked of a Conservative plan to cut benefits for the under-25s. In June David Cameron made that official with a speech contrasting hard-working families and claimants. And by October strivers v scroungers rhetoric was filling the party conference speeches of both the prime minister and chancellor George Osborne.

However, the Lib Dems spent the second half of the year trying to put some distance between themselves and their coalition partners. Notwithstanding Nick Clegg’s plan to allow parents to raid their pension funds to buy houses for their kids, the party made it increasingly clear that it would block more radical Conservative ideas on welfare. In the Autumn Statement there was no sign of ending housing benefit for the under-25s or cutting benefits for large families. However, it also confirmed plans to restrict the increase in most working age benefits including the local housing allowance to just 1 per cent between 2014/15 and 2015/16. Austerity – and the fall-out for housing – will last for at least four more years.

Originally published on my blog for Inside Housing


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