Lining their pockets

Originally posted on August 24 on Inside Edge 2, my blog for Inside Housing

Something about the rash of stories this week about ‘private landlord subsidy’ left me feeling very uneasy.

The stories were based on a briefing from the National Housing Federation (NHF) on how the amount of housing benefit that goes to private tenants has doubled in the last decade. As reported in the Daily Mail and elsewhere that means ‘Private landlords rake in £9bn a year from Housing Benefit’.

The figures were mostly familiar ones about the big increases seen since the financial crisis in the total bill, the number of claimants and the number of private tenants who are in work and also on housing benefit.

David Orr argued:

‘It is madness to spend £9bn of taxpayers’ money lining the pockets of private landlords rather than investing in affordable homes.’

He’s right, it is madness. Yes, private landlords do get £9.3bn in housing benefit. Yes, the bill has doubled since 2008.

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Beyond the deal

Originally posted on October 13 on Inside Edge 2, my blog for Inside Housing

If the result of the NHF ballot was a foregone conclusion, just about everything else about the extension of the right to buy remains unclear.

With a majority of 93% by stock and 86% by membership, the NHF has a result it can present to the government as a resounding endorsement of its voluntary deal. True, it’s only 55% of those eligible to vote (or, as Joe Halewood argues, 20% of all registered providers) but that presentation is what really counts. Given the dubious nature and timing of the vote, this was always going to be the result (see my related post Deal or No Deal?).

But anyone looking for a response from Greg Clark at the Conservative conference on Monday will have come away disappointed. The communities secretary extolled the virtues of the right to buy, argued housing association tenants have the same ambitions to own as everyone else and delivered the line Tories wanted to hear: ‘We are doing what we promised, we are extending the right to buy to housing association tenants.’ But there was no explicit reference to the deal rushed through in time for the conference.

The omission may just be a demonstration of the political sensitivity involved. Early reports said Clark had watered down the manifesto pledge (something he denied, though the voluntary arrangement may result in the right to a discount rather than a right to buy for some tenants). However, it’s also a reflection of how much has still to be resolved.

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Deal or no deal?

Originally posted on September 28 on Inside Edge 2, my blog for Inside Housing

As the clock ticks down to 5pm on Friday, what should really count in the momentous decision to be taken by housing associations?

My first thought was this is like the ‘offer he can’t refuse’ scene in The Godfather. Vote No to the ‘voluntary’ deal on the Right to Buy and you may not wake up in bed next to the head of your favourite horse but you will be inviting Osborne to do his worst in the spending review in November.

Then I thought of the BBC. Looked at in terms of narrow self-interest it seems a no brainer. Better, surely, to strike a deal on the most generous terms you can now than wait for the government to impose the same thing on much worse terms later. That’s exactly what the BBC did before the Budget when it ‘voluntarily’ swallowed the cost of free TV licenses for the over-75s in return for an increase in the license fee.

My next thought was more cynical. Isn’t the NHF a bit like the Premier League when it signed the deal with Sky that excluded the rest of football from its TV billions? Even Sky didn’t make the other clubs sell their best players to pay for it.

And then I came back to the comparison that defenders of housing associations in the House of Lords spent the Spring and early Summer making: the complaint that this is the biggest seizure of charitable assets since the dissolution of the monasteries. Except that as far as I know the monastic orders did not voluntarily agree to the seizure provided they received full compensation paid for by the forcible sale of convents.

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Role model?

If we have a Living Wage, why not a Living Rent? Well, now we do.

With due respect to the Scottish campaign of the same name, the report launched this week by Savills, the Joseph Rowntree Foundation and National Housing Federation addresses directly what I’ve long thought to be perhaps the most important question in housing policy: how to make homes genuinely affordable to people on low incomes.

Current policy gets nowhere near that. Employment may be at a record high but millions of people are trapped in low paid work, in part-time jobs and zero hours contracts, and average earnings have only just begun to rise again after years of decline.

Yet private sector rents are too high, leaving families reliant on housing benefit whether they are in or out of work and vulnerable to cuts to come: projections by Savills suggest that one in four of us will be private renters by 2019. ‘Affordable’ rents are only affordable in relation to a market artificially inflated by speculative investment and the aftermath of the financial crisis. Even social rents rise by an inflation-plus formula regardless of what’s happening to earnings.

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