Mr Sad and Mr Angry

It is hard to know whether to be sad or angry about the Chief Executive of Genesis Neil Hadden’s statement about the future of the association.
To recap, he told Inside Housing’s Pete Apps that the huge housing association will no longer provide affordable and social rented homes and that it will in future only build market and shared ownership homes. Even more shocking, it will review all of its existing general needs rented homes as they become vacant with a view to selling or changing tenure.
When I first went to work in Paddington, 43 years ago, Paddington Churches Housing Association (which amalgamated with others to form Genesis), along with its neighbour Notting Hill Housing Trust, was a beacon of enlightenment, working against terrible odds to bring housing relief to tenants living in the appalling slums of north Paddington and north Kensington, the home of Peter Rachman and his ilk. PCHA’s proud progress, from its formation in 1965, to a single home in 1966 (curiously, given its name, the first few properties were not in Paddington, but in the Queens Park area of Brent where I now live), to becoming a 33,000 home mega organisation, is recorded here.
As an independent charitable organisation, PCHA won the backing of both local Conservative and Labour politicians. Founded by remarkable local clergy it spoke proudly of its ‘Christian concern’ for the poor and homeless. Its first press release was headed: ‘Churches in Paddington form Housing Association to provide homes at low rent for needy Paddington families, irrespective of colour, race or creed.’ Sadly, somewhere along the line it lost its soul and forgot this mission.
Neil Hadden seeks to pin the blame on the Government, and, as we discussed on Red Brick last week, that is almost correct. Almost. He is right that the Government has no interest in providing genuinely affordable rented accommodation. It is only interested in market solutions, throwing money around in a vain attempt to revive home ownership and support private landlordism. And, nasty as they are, they are in turn trying to shuffle blame onto housing providers for failing to deliver enough homes. Inaccurate attacks on housing associations that seem to emanate from No 10 Downing Street have been very well refuted by several commentators, including Kevin Gulliver, Carl Brown, and Colin Wiles, who says that associations need a rebuttal team to defend themselves.
But it would be wrong to shift all the blame away from the big associations themselves. Large associations like Genesis and NHHT and others have been shifting their focus, as a matter of strategy, for many years. They have moved from providing social rented homes for homeless and badly housed people towards shared ownership and the intermediate market, then towards general market homes for sale or rent. The changing balance was the central struggle of my time as a Board member of NHHT in the 2000s, and maximising social rented provision was a big part of my pitch to become chair of Genesis in 2002. I failed in that bid, reaching the play offs against the distinguished winning candidate, Adrian Bell. I’m not sure what difference it would have made if I had done the job. The debate centred on pragmatic finance but what was changing underneath was the culture. Put slightly less than delicately, a brilliant developer who was a member of the NHHT board would say ‘Let’s make shed loads of money from market development, then we can spend it on what you want’. The problem was that the ‘developer’ mind-set took over, the board discussed little other than high finance and new schemes. And the money for social rented homes never seemed to come out at the other end.
By fingering the Tory Government and the associations themselves, I’m not allowing the Labour Government to get away scot-free. The continuous squeeze on grant, chasing what seemed like a good objective of getting more output for the money put in, pushed associations along the road of being more commercial, looking to make surpluses from other activities to make up for lost subsidy.
Realising where it would lead, some associations kicked up a fuss and retained their commitment to meeting the needs of homeless and badly-housed people. They deserve great credit for keeping to their principles against the odds. Pete Apps quotes Tony Stacey, chief executive of South Yorkshire Housing Association and chair of Placeshapers, who responded to Neil Hadden by saying: ‘It depends what you’re about as an organisation, and it depends on your ethics as an organisation’. That is exactly it.
Over the years, and not just recently, some of the big players gave the clear impression that they didn’t want to have to deal with the difficulties posed by building and managing social rented housing with very fine margins. Nor did they want to deal with the issues that emerge from crass poverty. I learned that the flowery language around their concept of ‘mixed communities’ really just meant having fewer social rented tenants and more home owners. Much nicer to spend your time in exciting meetings in the City, doing big land deals, juggling hundreds of millions of pounds, playing with gleaming models of shiny new developments, complaining about councils dumping difficult families through nominations, and telling the world that housing associations should cater for ‘aspiring people’.
Far from being victims pushed out forcibly into the cold commercial world by the decisions of Governments, they were instrumental in creating the policies we now suffer from. Just looking at the two associations mentioned so far, Kate Davies of Notting Hill was influential in the development of Tory policy before the 2010 election through the Localis and Centre for Social Justice think tanks, which proposed the core set of policies that have been pursued in Government. Neil Hadden worked with Policy Exchange on last year’s ‘freedoms’ report.
For years some of the larger associations have been angling for a trade-off between reducing the requirement for grant and something they like to call ‘freedoms’ – to do what they like, to be fully commercial, to set their own rents, to select their own tenants, to set the terms of their own tenancies. One response to the recent rent cut has been for some associations to look to deregister as social landlords, another destination some have been preparing for.
One argument that has emerged from amongst associations is that councils should be given a new lease of life so that they can be responsible for meeting housing need whilst  housing associations concentrate on providing market-related homes in the middle ground. Some have sold homes on the open market and ‘converted’ homes from low rents to high rents – well beyond what is required by funders – to get more money for development. Some support the right to buy for the same reason.
Although not just a London issue, there is an opportunity for a new London mayor to get tough. My angry self will argue that associations that have lost interest in meeting housing need should not get a penny in grant. They should be banned from selling, or converting to a different form of tenancy, any home provided with public grant. If they want to play developer, let them go off and do it properly without public support. My sad self would prefer the mayor to do a full audit of the activities of big associations and require them to focus on meeting housing needs again. There should be a full review of board membership – I am not against people with private sector skills being involved but they should be properly balanced with people who know something about social housing  and housing need, including tenants and residents. I would also support the mayor becoming responsible for the regulation as well as the financing of housing associations.

8 replies on “Mr Sad and Mr Angry”

We’ve known for ages that the housing system in this country is broken – just blaming the Government and carrying on as before won’t fix it. Social housing providers must shoulder some of the responsibility, having been wrongly obsessed for decades with eligibility and access – forgetting that whereas you might need affordable housing at some stage in your life, this may change, and why should you hang onto this scarce and valuable social resource to the detriment of the thousands of others who are homeless or on waiting lists?
Maybe the Tories will bring about the revolution we need to shock the system into a new paradigm: to rebalance supply and demand, to reset prices to meet affordability, and to have a healthy mix of home ownership and rented housing, with a social housing sector that is valued by all. There is a role for Housing Associations to play in building homes to meet mid-market demand and rethink how we make best use of our existing social rented homes. And I think we can strengthen our resolve to protect the most vulnerable from the excesses of the market – otherwise who will prevent the exploitation and appalling conditions that prevailed when the private rented sector was last king?
“Back to Rachman ?” on @LinkedIn

Sad or angry? Definitely angry! What Genesis is doing is a betrayal of their history and their tenants. I’m now waiting with interest to see what HCA do in response. I’ve seen nothing from Genesis about tenant consultation so we’re about to find out whether co-regulation is the toothless cop-out on the govt side that most people have assumed it to be…
It’s also interesting that it’s the mega-associations that have been making noises about following this kind of path. Something to bear in mind when mergers are being mooted.

Strangely there seems to be no mention of the fact that Genesis have charitable status (I believe) and as such are required to act in a manner consistent with their charitable objectives. Which also, very conveniently, means that they’re exempt from corporation tax. Are they proposing to forfeit this?

Strange how the vitriol from within the HA “movement” never had such vitriol for A Plan For Homes by the NHF.
Here we had the HA’s overarching umbrella body saying Homes For Britain is wonderful, government like idea lets have rally to cement this euphoria….only to see in less than 24 hours the first 2015 budget elicits RTB2 for HAs.
NHF launch A Plan for Homes which is 40% less in number for an indeterminate time and included not ONE new property at social rent – not ONE! An outcry from the 1200 or so HAs as to their industry body caving in to the Conservative agenda? Haha you must be kidding!!
Then the NHF saying housing is on the general election agenda with even greater delusion which then led to 1% rent cut, pay MORE to stay and the benefit cap at £84.62 per week in 83.1% of UK housing.
All HA’s then get castigated by Times / Spectator / Channel 4 piece and the NHF puts up the most woeful of woefully woeful performances in true Baldrickian style.
Then 1 HA out f this 1200 or so says the building of SR and the toxic misnomer called AR is not attainable in London and the ‘movement’ (ahem!) spits out its dummy and spews bile on this 1 in 1200! Perspective anyone?
Here we have 1 HA conforming to the NHF agenda and the NHF has attracted what in terms of challenge or vitriol? Yes diddly squat!
Genesis as the whipping boy for the repeated failures of the Teflon coated NHF and for the lack of spine of 1199 other HAs from daring to challenge THE most confrontational government in the history of the social housing model – and is there anyone in housing who can say that the current climate is conducive to the development of social housing? No thought not!
Genesis issue is so out of perspective in the vitriol it has received and they make a convenient whipping boy for the failures of the rest of the ….ahem….movement!

[…] The reaction of a large London based association to decreasingly favourable terms of trade by effectively declaring UDI from Government programmes for ‘affordable housing’ stimulated widespread reaction in the sector. One commentator strikes a balance arguing that ‘the Government has no interest in providing genuinely affordable rented accommodation. It is only interested in market solutions, throwing money around in a vain attempt to revive home ownership and support private landlordism’ but ‘it would be wrong to shift all the blame away from the big associations themselves…(who) have moved from providing social rented homes for homeless and badly housed people towards shared ownership and the intermediate market, then towards general market homes for sale or rent.’ […]

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