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Winning the political argument on HB

<strong>by Tony Clements</strong>
by Tony Clements

Former policy advisor to Rt Hon John Healey MP during his tenure as Minister of State for Housing and Planning. Executive Director of Place for Ealing Council.

I was unsurprised to see that a large majority of people support the cap on housing benefit, including over half of Labour voters.

I’m not really surprised by that. The argument on ‘fairness’ is compelling; why should those out of work be able to afford more expensive housing than those on work?

The cap, reduction of benefit to the level of the 30th percentile and the move from pegging benefits to CPI rather than RPI (meaning benefit rise at a slower rate than rents) will cause many poorer people to lose their home and force people out of communities where they’ve lived for years and have roots and family support.

So when Ed Miliband and others make this argument they are rightly defending people who will really suffer as a result of these reforms. But I do worry that it makes us look like, beyond the housing and policy world, as if Labour is defending high benefit budgets and only defends those on the lowest incomes who claim benefit (nevermind that around 40% of benefit claimants are in work).

This is not a good strategy for winning back the marginal seats in the south and midlands that we need to return to government.

So how should we oppose these moves?

We need to argue back from a vision of what communities should be like and then use that as the yardstick to measure and oppose these policies. In doing so, we present an alternative vision of a Labour future and argue for something beyond opposing particular measures.

Central to any vision of a sustainable community is that they are mixed. People accept and strongly support the idea that communities and neighbourhoods should be mixed – with no one segregated by wealth and race. Such segregation as exists in the USA and France rightly draws disaaproval. In London, the fact that the rich and poor have always lived ‘cheak by jowl’ is part of the city’s identity. On a policy front, let’s use the Tory rhetoric against them: both Cameron and IDS have spoken about the problems of concentrated poverty. They are right.

These HB reforms are a fundamental attack on the notion that people should live together in mixed income communities. And it is on that ground that we should oppose government measures, in a way that has wider appeal to even those who will not be affected by these changes.

What we would do instead to reduce the HB bill and maintain mixed communities is another question. Building more affordable homes in wealthier areas is part of the answer, but not the whole answer.

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Mean and nasty

<strong><span class="has-inline-color has-accent-color">Steve Hilditch</span></strong>
Steve Hilditch

Editor and Founder of Red Brick. Former Head of Policy for Shelter. Select Committee Advisor for Housing and Homelessness. Drafted the first London Mayor’s Housing Strategy under Ken Livingstone.

The Conservative Party never apologised for the corruption and gerrymandering practised by Dame Shirley Porter at the expense of the homeless and badly housed people of Westminster.  John Major once promised to do so when the legal process was complete and if the case was finally found against her, but it has never been forthcoming.  There is a deep and abiding suspicion that the Tories have never forgiven the Audit Commission for its role in bringing her to book and the constant embarrassment that the case caused them.  Some even think that the decision to abolish the Audit Commission could be some macabre form of revenge.

More important however is the strain of thought that has survived down the years: poor people should not be allowed to live in places like Westminster and, in Porter’s words, you have to be ‘mean and nasty’ to homeless people. 

One of the clear impediments in the way of the Government’s housing benefit reforms – the 21st century clearances – is the homelessness legislation.  Many of the people who will not be able to afford their homes after the HB changes will have rights under the 2002 Homelessness Act.  And Westminster Council is very alive to this.

An exchange of letters between the Westminster Cabinet Member for Housing, Cllr Philippa Roe, and Grant Shapps, disclosed in Dave Hill’s London Blog yesterday and also seen by Red Brick, couldn’t be clearer. 

Roe essentially has 3 demands, which taken together would gut the legislative safety net for homeless people.

First, she wants to tighten the local connection rules.  Currently, an applicant with 6 months residency in the borough could claim a local connection if they became homeless, and she wants this extended to 3 years.  6 months happens to be the length of the typical assured shorthold tenancy, and Westminster has long believed that the masses move into Westminster on a short tenancy just so they can make a homelessness claim on the City at the end of it.  In fact anyone with any knowledge of Westminster’s approach to temporary accommodation and the extraordinary length of time people have to wait for a home would avoid them like the plague if they had the choice.

Secondly, and more worrying, is her demand that the main homelessness duty under s.193 should be discharged by finding someone an assured shorthold tenancy in the private rented sector.  This would effectively remove the safety net that has been in place since 1977.  This is a possible outcome under the current Act and Guidance, but only if the tenancy meets conditions and the applicant signs a statement accepting the offer and saying that they understand it discharges the s.193 duty. 

Thirdly, she wants to end the requirement in most cases to offer temporary accommodation in borough.  The guidance seems to be widely ignored already and most of Westminster’s TA is out of borough and often the other side of London, but the change would give them more freedom to dump people far from their support networks, schools and jobs.

Shapps’ reply is non-committal although his promise to give the points ‘careful consideration’ is not as comforting as a rejection would be.  Even giving them ‘consideration’ risks undermining his carefully created reputation for being ok on homelessness.  

The wheels are starting to come off the HB proposals.  First, because even this Government might baulk at the prospect of having to tackle the homelessness safety net to make them work.  Secondly because they simply have not thought through the parallel policies of cutting HB at the same time as increasing rents rapidly.  And thirdly, because councils are beginning to get nervous about the unintended consequences that a rapid churn of poorer tenants might have for their budgets.  It’s not over yet.

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Housing disbenefit

<strong><span class="has-inline-color has-accent-color">Steve Hilditch</span></strong>
Steve Hilditch

Editor and Founder of Red Brick. Former Head of Policy for Shelter. Select Committee Advisor for Housing and Homelessness. Drafted the first London Mayor’s Housing Strategy under Ken Livingstone.

I can’t recall a time when housing issues have dominated the headlines in the national press like they have in the last week.  Having spent the best part of 40 years, off and on, trying to get newspapers to take housing stories seriously, all my Christmases have come at once.  Only Lady Porter and mortgage repossessions broke through onto the front pages like this.  It’s been hard to keep up.  The increasingly ridiculous Mayor of London managed to stir the pot beautifully.  Cameron’s pomposity and arrogance became ever more obvious at PMQs, further exposing his absolute lack of understanding of what it is to be poor. 

Nick Clegg’s synthetic anger about Chris Bryant and Boris Johnson comparing the housing benefit policies to social cleansing was clearly an attempted diversion that only succeeded in demonstrating how threadbare the government’s position is.  I am sure he has never engaged in hyperbole before.  Of course there are no armies and no machine guns just as many workplaces are not really run by ‘a little Hitler’ despite the protestations of the staff.  It is undoubtedly the case that many extremely poor people will be forced, by economic compulsion rather than armies, to move against their will, often out of areas where they were born and bred and where all their community connections and family support services are.  It will ruin many of the country’s most vibrant and genuinely mixed neighbourhoods, where rich and poor and all ethnicities live cheek by jowl and have done so for generations.  The imagery is therefore relevant: in truth it’s the power these images have to communicate the story that rattles Clegg.    

 Apart from attack being the best form of defence, the government’s strategy has been to keep the story focused on the few extreme central London examples rather than the many inner London, outer London, Home Counties, and the rest of the country cases where the HB reforms will hit people hard.  There are several reforms not just the cap; they will hit poor private tenants, they will hit poor social tenants, they will hit poor homeless people living in private leased accommodation, they will hit tenants everywhere not just in London, crucially they will hit people in work as much as they will hit jobseekers and other people who do not work, and the numbers affected will be in the many hundreds of thousands.

 The coverage has also revealed a basic ignorance in much of the media about the core story.  The Guardian started its front page story by referring to ‘council home associations’, whatever they are, and a presenter on News 24 asked a guest about social tenants living in rich areas of London despite the story being about Local Housing Allowance caps.  HB as an in-work benefit could be a feature in Stephen Fry’s General Ignorance round in QI.

 They say that no-one understands the entirety of how the housing revenue account subsidy system works.  In truth it’s a doddle compared to HB and the relationship between rents, HB and other benefits.  That’s why this story is about an emotional response and a feeling as to whether the government is right or wrong, and that’s why the imagery is so powerful and important.  So far, I’m delighted to say, it’s Government 0 Humanity 1.

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A long term increase in the benefit bill…

<strong>by Tony Clements</strong>
by Tony Clements

Former policy advisor to Rt Hon John Healey MP during his tenure as Minister of State for Housing and Planning. Executive Director of Place for Ealing Council.

So what would Labour do instead? It’s the standard question to us at the moment and indeed of any opposition.

It’s a difficult one to answer for a lot of reasons. One of those reasons is that whatever you do, you have to graft it on to what the other lot have done during their time in power.

One of the things Labour is likely to face coming into office again in the future is a considerably higher housing benefit bill. Yes, really – despite the caps and restrictions that will do real damage to mixed communities, the CSR paved the way for a rising bill in the long-term. Here’s why:

George Osborne announced two weeks ago that capital funding for ‘social’ or affordable housing would be cut. He says by 50%, in truth it’s more like 75%, but that’s a different issue. So how will the Tories justify their claims that they will build more affordable homes? By increasing ‘social’ rents to 80% of market rents and then allowing housing associations to borrow against these new higher revenue streams to build more homes. OK, well that could stack up. But how will people on the waiting lists be able to afford near market rents? They are often often workers on very low incomes, carers, disabled, workless etc? Well Nick Clegg has the answer here:

“People on low pay on those new rents will be compensated in full through housing benefit.”

So, in a nutshell, it’s a shift in the cost of subsidising housing from up-front capital to build homes to putting more people on higher levels of benefit, so they can afford near-market rents.

They’ve moved the bill from the Department of Communities and Local Government to the Department of Work and Pensions – nifty footwork from Eric Pickles.

That’s great for cutting big capital budgets now in order for the Chancellor to say he’s wiped out the deficit before the next election: it’s rubbish for the taxpayer in the future who has to shoulder the long-term costs. 

It’s like a great big housing PFI: avoid the capital investment up-front, pay more in the long-term.

p.s. I think there’s good reason to think that the benefits system won’t cover these costs ‘in full’ as Nick Clegg says, but that’s for another post.

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Feeling Insecure

<strong><span class="has-inline-color has-accent-color">Steve Hilditch</span></strong>
Steve Hilditch

Editor and Founder of Red Brick. Former Head of Policy for Shelter. Select Committee Advisor for Housing and Homelessness. Drafted the first London Mayor’s Housing Strategy under Ken Livingstone.

30 years ago a political consensus emerged that council tenants should have the protection of security of tenure, leading to the ‘Tenants Charter’ in the 1980 Housing Act. All political parties supported the move – it was a Labour bill then taken up by the Tories after Thatcher won power.

The policy did not however emerge from academia or from Whitehall. It was the outcome of campaigns and pressure from tenants all over the country. It was a campaign for fairness and justice, that landlords should not be able to remove tenants from their homes without going before a court and providing evidence that a term of the tenancy had been breached in such a way as to justify the tenant losing their home. It was a campaign rooted in the bad practice not only of council landlords but also housing associations who sometimes removed tenants in a punitive and capricious way with no rights of complaint or redress.

Losing your home, and probably being declared intentionally homeless as well, is a serious matter. The basic principle is that it should not be decided by the landlord acting alone, but should be based on evidence and a set of rules. That is all security of tenure and the many extensive ‘grounds for possession’ entails: simple consumer protection. Without security of tenure, tenants have fewer rights against eviction than I have to appeal against parking tickets.

Many people become social tenants after major disruption in their lives, especially homelessness and being dumped in temporary accommodation for months or years at a time. Many people who become tenants do so because they are vulnerable in some way, through age or disability or because they have children. A secure home provides them with the platform to rebuild their lives, to put their children in a school for more than a temporary period, for some to register with a doctor for the first time, for many to consider work for the first time. They become part of the community, neighbours, and, because they have a long-term home, feel it is worth making a local contribution. Security is the foundation of the big society. We all say we want to build more stable and mixed communities but a policy of insecure tenancies would move some people on against their will at the point where they are finally settled and likely to be contributing most.

The government has yet to explain how insecure tenure will work in practice except to say that new tenants will be reviewed after a period to see if they still qualify for a home. Insecure tenants will live in fear that their landlord will decide against them and they will be out. It is an extraordinary disincentive for people to take work or to get a better job. In my experience social tenants simply do not fit the media and government stereotype of fecklessness and scrounging: they are aspirational, but their aspirations are realistic. They are not anticipating setting up a business, becoming the next self-made millionaire, and joining the Cabinet. They aspire to getting a low paid job, enough to make ends meet, or to getting a promotion and having a bit more spare cash. They aspire to leading a better life or at least ensuring that their children do.

The government has begged the question of what will trigger eviction. Few if any social tenants will make it to the higher rate tax band so there will have to be some lower point at which a tenant is deemed to have enough to justify being kicked out. It will be a bureaucratic nightmare of means tests and reviews. To be honest, some social landlords have difficulty managing one set of tenancy conditions without taking this on as well.

Nor should we give any time of day to the argument that it is right that tenants should be moved on from ‘subsidised’ housing. Council housing no longer receives subsidy, it pays its own way with rent covering costs including the cost of debt. Housing associations receive grants (well, they did until the CSR) to help meet the capital cost of new homes but there is no revenue subsidy – rents cover costs and over the lifetime of a home will make a significant surplus. Even if social housing had a straightforward revenue subsidy, my response would be ‘so what’. Society subsidises poor people is not a shock headline. The economy is full of subsidies and reliefs.

As a society we have failed to tackle poverty and inequality. That is why social rented housing exists and why it will continue to be essential. Over 30 years, social housing has been given the residual role of housing the poorest and most vulnerable and, by and large, it has done a hellish job well. But it has only done so by learning to respect its customers individually and as a group and by creating a partnership between landlord and tenant. We should not go back to the dark ages.