Tim is right – the real housing crisis is in social housing for rent

Bravo Tim – at long last a clear and radical Lib Dem message on the scandal of social housing (Press Release 06 08 – ‘Jenrick’s planning reform won’t solve housing crisis’). We must pursue this with all possible force, because it is manifestly right and, in purely political terms, it highlights a massive void in the policies of the other two main parties.

As Tim says in his response to Jenrick’s lamentable proposals, there may be a shortage of affordable property to buy, but the real scandal concerns the least well-off. It is they who are condemned to rent insecure, insanitary, sub-standard dwellings. The social costs in terms of mental and physical health, education and financial hardship are incalculable – the fact is, no disadvantaged or struggling tenant should have to go within a million miles of the private rental sector. Above all else, we need an urgent campaign for hundreds of thousands more dwellings for long-term social rent. The question is how to deliver it, and so far, I have yet to see a convincing plan.

Predictably, the Tories cannot see beyond their pinhole focus on the private market – threatening to clamp down on landlords in the private rental sector, and feebly attempting to force developers to bear the financial cost of new affordable dwellings. In both cases, it is intrinsically counter-productive. It makes no sense trying to force private capital into a socially responsible role to which it will always be commercially and temperamentally opposed. Labour raised the issue at their last conference, but their solution relied on a model of local authority public works departments which ceased to exist decades ago.

There is no room here to discuss the weakness of the current system. In essence, Housing Associations are a hollowed-out travesty of their original function, and a similar reality confronts today’s Local Authorities. At a Fringe discussion in Bournemouth last September, Councillors described their struggles to extract meaningful Section 106 agreements from housebuilders, and those developing their own sites spoke of problems with financing and Housing Association-style cross-funding. They do their best, but a national scandal calls for a national strategy to solve it.

At local level, undesirable landlords and their sub-standard dwellings must be forced out of the system. In the 60s the Rachmann problem was addressed by compulsory purchase and demolition of slum properties. Maybe this needs to be revived, but we know the best solution, as also happened in the 60s, is to plan for the provision of thousands of cheaper, decent social homes.

This must be driven at national level, and we need an entirely new procurement model. At every turn, the biggest drag on progress is the presence of the profit motive at the heart of the system. The current model relies on trying to force private landlords and developers to act against their commercial interests, and concede profit for the public good. Fifty years ago, the big players in the market – Wimpey, Taylor Woodrow et al – were builders, who gradually saw the opportunity to become developers. In today’s world we will still need them to do the construction, but we must find a way to remove their natural impetus – to reward shareholders – from the equation of social housing development. Instead of trying to push against the grain, we need to align everyone’s interests in a cooperative way.

We need a radical and far-thinking new initiative, and I suggest something along the lines of a National Social Housing Development Corporation. It must have central government authority over planning and infrastructure issues but, with a non-profit structure as in Milton Keynes, for example, its only remit would be to fund, resource and enable local authorities to provide desperately-needed homes for social rent. Yes, it would also require state capital funding on the level of other major infrastructure schemes, but for an issue far more pressing and morally imperative than roads, railways or any of the other current major investment proposals. It would be one-off, transformative in terms of social payback, and create an enduring national asset. What’s more, the fiscal payback would begin as soon as the scandalously inflated sums paid in social rent to private landlords began to fall away.

We should all get behind Tim to push this uniquely worthwhile cause – surely this is what a motion on housing at a Lib Dem conference should look like?

* Brian Edmonds is a newly re-joined LibDem member, who currently lives in France.

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25 Comments

  • David Evershed 10th Aug '20 - 12:15pm

    Most developments of above ten or so houses are required to have around 30% affordable housing, which is for shared ownership (part owned part rented) or full rental at below market price.

    That seems a good compromise and not too big a disincentive for developers.

    We just need lower growth in population numbers and fewer divorces to help keep demand for housing lower. Younger folk need to work together to have shared equity ownership to get on the property ladder and then let inflation do the rest over time.

  • Kay Kirkham 10th Aug '20 - 1:06pm

    The 30% rule is widely flouted. The developer submits a viability statement which says that the development is unviable if the social housing is included and the planning authority is then supposed to get an independent assessment. Funnily enough this agrees with the developer and the planners roll over because they are afraid of the expense of contesting the inevitable appeal to the Secretary of State.

  • John Marriott 10th Aug '20 - 1:14pm

    ‘A developers’ charter’, ‘A licence to print money’, ‘More building on flood plains’, ‘Slums of the future’. Whatever slogans you prefer, all apply to this blatant cronyism. There was nothing basically wrong with the 1947 Town and Country Planning Act, nor its Section 106 that delivered far more than just so called ‘affordable’ housing.

    I see that one of Mr Evershed‘s solution is better family planning. So was Marie Stopes. However she was apparently also in favour of eugenics. I do have some sympathy with his views on divorce. Indeed, with all those single mums trying to get a roof over their heads I often wonder where their former partners are. Having another family elsewhere one must assume!

    What I would like to see is far more social housing being built by COUNCILS and, most importantly, with NO RIGHT TO BUY, before we let the Richard Desmonds of this world loose on the housing provision market.

  • Barry Lofty 10th Aug '20 - 1:21pm

    As long as large developers pay massive amounts into Tory party coffers, building regulations will always be tilted towards the developers interests. Cynical I know but that has been the way it works for generations, until someone has the courage to take them on for the greater good I cannot see any change!

  • Sue Sutherland 10th Aug '20 - 1:30pm

    I agree with Brian, we must have a massive programme of building social housing to rent so people don’t have to live in squalor any more . One of Beveridge’s evils has returned because people are forced to live in totally inadequate housing.
    There has been no political will to tackle this problem for decades, including when Labour was in power. We are facing another terrible recession as a consequence of the pandemic and this usually results in a downturn in the housing market and builders becoming redundant. Before this happens the party must lobby for government to invest heavily in social housing to rent to meet a desperate human need and to keep a major part of the economy moving.

  • Antony Watts 10th Aug '20 - 2:11pm

    Surely the issue is not the cost of a house, but the cost of the land. And one idea could be to “nationalise” pieces of land – ownership of local councils – and then seek investments to build lower cost rental hosing on it.

    Properly designed of course – no more rows of dog kennels!

  • Build ‘council homes’ (with no ‘Right to Buy)…The policy was implemented (by both major parties) in a country where 2 million homes were uninhabitable due to war damage…

    Relying on the ‘good nature’ of property developers and large builders has proved as useful as hoping for a ‘caring’ Tory administration to tackle a problem that doesn’t affect ‘them or theirs’..

  • Peter Martin 10th Aug '20 - 3:09pm

    The Government can currently borrow at close to 0%. So could build a house for £300k which it could easily rent out for, say, £500 per month which would give it a return of 2%. So even in the unlikely event that all the £500 was used up in maintenance and admin costs it still wouldn’t actually cost anything.

    If we factor in that the £300k would include the cost of raw materials like bricks, which will bring in 20% VAT, and Labour which will bring in income taxes, and that the money remaining will be spent and respent, bringing in more taxes, the Govt actually comes out ahead.

    And it still ends up owning the £300k house.

    So where’s the difficulty?

  • Building houses to live in at cheap rents can assist in less stress on the NHS ( mental stress etc).Cannot this be part of the philosophy of ‘well being’?
    Yes. The 1947 Town and country planning act with section 106 worked well. Macmillan housing minister under Churchill.s govnt built substantial numbers of houses,one that I grew up in.Johnson could learn from his hero of this time. Equally there is nothing wrong with redeveloping Local Authority Public Works to provide the houses AND equip the young with apprenticeships to build them (not to mention modular housing factory apprenticeships)
    Could not the ‘fiddling’ with Section 106 be sorted with no loopholes if the developers were given an incentive paid AFTER they have built the social houses
    If the NSHDC can be applied to Milton Keynes can it not be tweeked ? What is the holdup?
    Also when council houses are built THERE SHOULD BE NO RIGHT TO BUY . In time as wages rise and ,hopefully, housing stock increases which drops the price of a house the renter can then buy and someone else occupies the council rental property maintaining council funds.
    Yes the system is wrong and we must campaign to change it.

  • Steve Trevethan 10th Aug '20 - 3:59pm

    Yes!
    If we believe in genuine market competition might we need to re-introduce council housing so that there is real type competition in the rental market?
    Might State owned housing do this and lower the nation’s internal living costs and so make us more competitive internationally?

  • As a Milton Keynesian you could do a lot worse than look at the history of our development corporation. A combination of statutory planning functions, enough cash for quality infrastructure, genuine talent and passion for place-making and political goodwill at national and local levels.

    Of course much has led to national derision (we have far more real cows than concrete ones) but speak to people who live here and you get a different story from miles of linear parks, good air quality, quality leisure facilities like the Xscape snowdome, ease of getting around, and all the redway cycle paths.

    We’ve found that many new city inhabitants are more supportive of growth when they’ve benefitted from it before – expansion is a much harder sell in older villages which are being brought into the city area, although there’s been real successes in building green buffers around existing villages to maintain their character.

    I could see it working on local levels to deliver key projects – but at a national level you’d essentially be bypassing councils and risking putting large scale developments into less sustainable areas (e.g. nowhere near train stations.) Like the often announced but rarely delivered garden villages for example.

    Glad to see Tim and other Lib Dems speaking out so strongly against the Jenrick proposals. There are some things we could look at in there – national housing targets and revising the duty to cooperate which just leads to blaming each other for border developments in my experience. But overall it’s going to lead to pile ’em high budget developments with much less character and local needs unmet, and less ability to influence them.

  • Steve Trevethan 10th Aug '20 - 5:05pm

    “If you’ve got a policy, flaunt it” (From “The Producers”)

  • Neil Hickman 10th Aug '20 - 7:43pm

    Please, no more of this dreadful weasel-phrase “affordable rented housing”.
    A rented property is deemed to be “affordable” if the rent is no more than 80% of market rent. So if market rents spiral out of control, 80% of market rents aren’t going to be far behind. And obviously this metric doesn’t look at all at the actual ability of people to afford the housing in question.

  • John Marriott 11th Aug '20 - 8:45am

    @Neil Hickman
    I never use the word ‘affordable’. Affordable to whom? I have always preferred the term ‘low cost’, because that’s what these properties should be. They aren’t mansions, but decent, well built practical homes to rent and should never sold or offered as ‘buy to rent’.

  • Alex Macfie 11th Aug '20 - 9:49am

    David Thorpe: The reason the Lib Dems are so associated with the Coalition’s failures is that the leadership of the time (and supporters of the continuity leadership candidate now) promoted the idea that we needed to “own” the Coalition, warts and all, including stuff the Tories did and we opposed. Had we conducted the Coalition in a more arms-length manner (no rose-garden joint press conference, our ministers in a separate front bench, clear differentiation in campaigning), then our achievements would have been more clearly ours, and the Tories would own policies that they had promoted.

  • John Marriott 11th Aug '20 - 11:54am

    Back to the dreaded Coalition, hey? Most of the time I was politically active, the Lib Dems claimed to be different from the ‘old parties’, untainted by power and offering a fresh approach. The trouble is that, when you are in power or, as was the case from 2010 to 2015, sharing power, you are often faced with tough decisions and the need for compromise. Some of us have been in that position in local government so we know what it’s like.

    However, as I have written countless times on LDV, if you want to stay pure, then you will be condemned for ever to be outside the tent looking* in. So, pass your conference motions, stay in your comfort zones, you’ll certainly feel better. On the other hand, if you are prepared, as the late Jo Grimond famously said, to march towards the sound of gun fire, then you might at least present yourselves as human beings with a few of their faults and some of their virtues.

    * verb changed hopefully to get past the editors

  • The coalition served its main purpose, which was to save our economy in a time of financial meltdown, and I will be eternally grateful for that. Sometimes you have to work with your enemies for the good of all, the NI peace agreement comes to mind , what a different world we would live in if enemies could bury their differences and talk and work together to solve the problems they face for the good of the ordinary people who share their different countries with them. Some hope of that I suppose.

  • @ Barry Lofty “The coalition served its main purpose, which was to save our economy in a time of financial meltdown”.

    I’m sure that’s what they believed they were doing, Barry, but all the evidence about the austerity economy they imposed is that they made it worse…. and imposed punitive action on those least able to cope with it……. so I’m afraid I won’t be eternally grateful.

    In an interview on the BBC Politics Channel last week, Gus O’Donnell, Cabinet Secretary under both Brown and Cameron, gave the credit to the much vilified Gordon Brown for responding so rapidly to the crisis triggered off by Bush in the USA in 2008.

  • Alex Macfie No Rose Gardens butters no parsnips. It’s what they did that matters, the rest is froth.

  • Barry Lofty 11th Aug '20 - 1:08pm

    David: I am sure we could argue, discuss all that went on inside that coalition but I took it rather more personally at the time having not long retired and also losing a large chunk of my retirement savings when the Equitable Life scandal happened so was very happy that some stabilisation was returned to the money markets, selfish I know!

  • Peter j bodiam 11th Aug '20 - 8:54pm

    if we built houses for rent and then charged a percentage of a person’s income as the rent then if a person was out of work then they would pay the same percentage of there benefits till they found work again and they would not be homeless.

  • Brian Edmonds 12th Aug '20 - 7:58pm

    Well that’s more or less that, then. I don’t think a single respondent engaged to any degree with the arguments I put forward. Most were the usual suspects, only interested in riding their own hobby horses, and continuing their petty personal squabbles. Maybe it’s presumptuous to expect Tim, or anyone in a position of responsibility, to engage on this forum with what is undoubtedly a vitally important issue. The problem is, I don’t see intelligent thinking anywhere from this party, on any major policy area. Those with a voice are content to signal their virtue and pander to fashionable niche causes – with the exception of Brexit, there hasn’t been a single conference motion on a major issue since I re-joined. That’s why I can’t find a leader to vote for, and why I’ll be off when my membership expires.

  • Peter Davies 14th Aug '20 - 5:04pm

    The reason why Milton Keynes could be planned by a body accountable only to national government is that initially, there were few local voters. People who wanted what MK offered moved there. Those that didn’t didn’t. There are still places where that model could work. For the rest of the country though, you need local solutions that fit with existing communities. Getting rid of the Right to Buy is key. We need to ensure that local authorities have an incentive to increase the housing stock in their area. How they do it is then up to them.

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