Council housing has a rich history. It transformed the housing conditions of millions of people. It owed its origins to a small number of visionary pioneers. In a special post, Steve Schifferes recalls the life of a pivotal figure, John Wheatley.
John Wheatley, a leader of the “Red Clydeside” group of Labour MPs in the 1920s, was a key figure in the development of housing policy in the UK, and the architect of the 1924 Housing Act which built nearly 500,000 homes in the interwar years and put council housing on a firm financial and political basis for the next 50 years.
At a time when the very concept of council housing is under unprecedented attack, it is useful to look again at Wheatley’s legacy.
Wheatley’s concern about housing stemmed from his own impoverished background as the son of an Irish miner in the Lanarkshire coalfields. Wheatley himself went down the pits at age 12, and lived in a one-room terraced house with his eight brothers and sisters, parents, and lodgers. The children all slept together in a bed that was rolled out at night. There was only a communal toilet and water had to be hauled from a common tap. Wheatley later described the degrading conditions of such housing in his pamphlet ‘Mines, Miners, and Misery’, where he blamed the mine owners for dehumanising their workforce.
Wheatley managed to escape from the pits through self-education and eventually managed to become a successful businessman, setting up a printing firm which printed religious calendars and local papers. His financial success allowed him the freedom to carry out his political activities without interference, and he was able to subsidize the printing of leaflets and the organisation of meetings.
Wheatley had not started out as socialist but as an Irish Nationalist, and was a leading member of the United Irish League in Glasgow before he joined the Independent Labour Party in 1906. Wheatley was also a devout Catholic, and his first act was to set up a Catholic Socialist Society, to convince the Irish Catholic community that there was no incompability between religion and socialism. He ran foul of the Catholic establishment in the City, and in 1912 an angry mob converged on his houses to burn him in effigy for his heretical beliefs – an event he watched with equanimity from his front porch.
Wheatley soon became active in local politics, serving as a councillor for Shettleston, and when it was amalgamated with Glasgow, as leader of the Labour group on the City Council. Glasgow had the worst housing of any major UK city, with the majority of its population living in unheathly one or two room tenement blocks with little sanitation. Death rates for the poorer wards were very much higher than in the affluent West End. And housebuilding had virtually ceased as the “housing famine” increased, putting pressure on accommodation and rents.
From the outset, Wheatley argued that only the government could supply the answer to the housing problem by building reasonably priced housing for workers. He sought to capitalise on the successful activities of the Glasgow City council to help subsidise the cost of building such housing, proposing that the surplus from the municipal tramways be used to build “Eight pound (per year) cottages for Glasgow citizens.”
What transformed the housing issue in Glasgow was the First World War. As a major munitions centre, Glasgow’s population expanded rapidly with an influx of workers to the shipyards and armaments factories. The result was a squeeze on housing, especially affecting existing tenants whose husbands were in the armed forces. The ILP under Wheatley – despite its anti war stance – began agitating over the evictions of servicemen’s wives, calling the landlords the “huns at home.” By October 1915 they had built a mass movement, led by women, of rent strikers who prevented evictions and marched on the sherriff’s court. When the workers at the Parkhead Forge (led by a Wheatley ally, David Kirkwood) threatened to go on strike to support the rent strikers, the government conceded and introduced rent control throughout the UK for the duration of the war.
Wheatley himself was always clear that rent control was a temporary measure due to the failure of the private rented sector, and the real answer was the provision of state-subsidised housing. In 1922 he was elected to Parliament, and in 1924 he had a chance to put his ideas into practice when he was appointed Minister of Health in the first Labour government.
There had already been two failed attempts to involve the national government in the provision of housing after the war – the Addison Act in 1919, which aimed at providing “Homes Fit for Heroes” but fell victim to the Geddes Axe and was cut by the Coalition Government as too expensive. In 1923 Neville Chamberlain introduced a housing act designed to subsidise private sector provision, but little housing was built.
Wheatley built the foundations of his housing policy carefully, first working to gain an agreement between builders and the building trades on the expansion of the apprentice system to ensure there was the workforce to expand housing production. He also sought agreement with building materials suppliers to limit any price increases, and carefully consulted the local authorities. Under Wheatley’s plans, local authorities would receive long term 40 year subsidies to build council housing under municipal control with a guarantee against any losses. Wheatley aimed to eliminate the housing shortage in ten years, with house building rising from 135,000 per year to 450,000 houses per year in the final year of his plan. Wheatley aimed at a high standard of housing suitable for skilled workers and available to all, “homes not hutches” as he called it.
Wheatley fell out with the Labour leadership under Ramsay MacDonald over his attitude to the 1926 General Strike, and due to his left wing views was not reappointed in the 1929 Labour government – and remained a fierce critic of its orthodox economic policy in the face of the growing world economic crisis. He died in 1930, just before the Labour government fell and the pound was devalued.
MacDonald joined a new National government dominated by the Conservatives. That government abolished the Wheatley Act as too expensive and returned to a policy of slum clearance with its emphasis on the rehousing of “slum dwellers” in houses and flats of lower quality. This led to a number of rent strikes by existing tenants, who objected to having their rents increased in order to subsidize the rents of the new tenants, who at that time could not afford council housing.
Wheatley’s legacy lived on, however, through the post World War II expansion of council house building – and council housing became the basis for Labour’s rise to power in the major urban centres.
Steve Schifferes is Professor of financial journalism at City University. Formerly a producer at London Weekend Television and a BBC journalist, he also worked at Shelter, the National Campaign for the Homeless.
Labour Housing Group, Socialist Health Association and Unite the Union are organising a Conference on tackling the housing and health divide, to take place in London on June 13 2011.
PRESCRIPTION FOR A HEALTHY BRITAIN
Speakers are Alison Seabeck MP – shadow housing minister; Karen Buck MP – shadow welfare reform minister; Dr Stephen Battersby – President, Chartered Institute of Environmental Health; Angela Mawle – Chief Executive, UKPHA
Costs (includes lunch) £50 for statutory or commercial organisations, £25 for voluntary organisations and individuals, £12 for members of LHG or the Socialist Health Association. Unfunded organisations or individuals please contact us.
Bookings through SHA at http://www.sochealth.co.uk/confs/Booking.php
Categories
Waiting for the Barbarians
We don’t often delve into the world of poetry on Red Brick – a bit of Burns prompted by a literate Scottish friend is all I can recall. But I was struck by references to a poem by the C20th Greek poet CP Cavafy in a recent speech by Julia Unwin, head of the Joseph Rowntree Foundation.
The poem ‘Waiting for the Barbarians’ was written in 1904, the same year that Joseph Rowntree wrote his founding document for the three Rowntree Trusts. Julia interprets the poem like this:
“Cavafy describes a town threatened by barbarians, where fear of what is to happen closes down the small town. The orators stop declaiming, the poets stop writing, people hide away and the marketplace empties. The barbarians are coming and there is no point in any creativity, any beauty, and any values. No point in enterprise. No point in education. But the poem concludes, once the word has come that there are no barbarians: and now what shall become of us without any barbarians? These people were some kind of a solution.
“It seems to me that the biggest risk we face is to see the outside world as so frightening that we allow it to paralyse us, and therefore step back from our historic role of speaking truth to power, and making sure that the social contract for the 21st century is one that allows us to describe clearly the social good that JRF and JRHT were established to promote.”
Joseph Rowntree himself, in his founding memorandum, stressed the need to look beyond ‘superficial manifestations of weakness or evil’ and to direct more thought and effort into searching out ‘their underlying causes’.
There are lessons to be taken from this as Labour cranks up its policy-making machine. Especially in housing – Rowntree himself took a big interest in the land question, an issue that has never gone away – Labour could suffer from a poverty of ambition due to the sheer scale of the housing problems that will have to be addressed. As Labour surveys the huge and seemingly irreversible changes being brought in by the Tories, it risks policy paralysis because of the dominance of the deficit in political debate (housing will never be tackled without huge expenditure of capital, which implies borrowing).
Unfortunately this time the barbarians have made it into town, but there is strong resistance. And they won’t be in charge forever – today they will lose many more council seats, next May they will lose London. The challenge for all of us in housing is to grab Ed Miliband’s blank sheet of paper, apply our collective creativity and values (less sure about beauty) and write a whole new housing chapter that really does go beyond the superficial manifestations to tackle the underlying causes.
May 3, 2011. Today is the deadline for housing associations to submit their ‘offers’ to the Homes and Communities Agency about what homes they might build over the next four years. Islington Council in London has thought long and hard about its strategy for delivering affordable homes. In an exclusive article for Red Brick, Councillor James Murray, Executive Member for Housing at Islington, sets out the borough’s plan.
Today marks the latest stage (and by no means the final one) in attempts by housing associations and others to steer a course through the government’s new ‘Affordable Rent’ programme. This programme’s headline has been known for a while: that housing associations would be allowed to charge up to 80 per cent of market rent on new build homes and a percentage of their relets. But teasing out the practicalities and implications of how this works in practice is taking a lot more discussion.
And in London, the acute implications of rent levels being set at 80 per cent of market – particularly in the inner-London boroughs and particularly for family-sized properties – have inspired months of discussion between London boroughs, the Homes and Communities Agency, and housing associations operating in the capital.
As part of this discussion, many London boroughs have set out their initial positions on ‘Affordable Rent’. In Islington, our position has focused on how we can respond to the concerns we have about the difficulty of using ‘Affordable Rent’ to address housing needs in our very high value borough.
We believe a different model is more appropriate for Islington. We are asking housing associations to work with us and use grant from the local authority – in the form of public land at discounted rates and capital from our new homes bonus – rather than grant from the government’s main ‘Affordable Rent’ programme. In return for this, we ask that housing associations build homes at social rents.
We believe that this is the best way to tackle our housing crisis in Islington. Like many London boroughs we have thousands of overcrowded families, and several hundred who are severely overcrowded (lacking two or more bedrooms). It is clear that tackling this means prioritising more family homes for social rent.
Since the election in May, 2010, we have prioritised a new council home building programme that means we will be on-site for over 100 new homes this year. Alongside our council-owned stock, we want to continue to work with our housing association partners.
In Islington we have a strong relationship with a number of housing associations. Through historical links, stock transfers, and new build projects, housing associations have played and continue to play a vital and positive role in Islington’s affordable housing stock.
We want this relationship to continue, and we believe that our plan for social rent with local authority grant will be the best way to enable willing housing associations to continue to build the kind of homes we need.
It goes without saying that the 80 per cent of market rent ‘Affordable Rent’ properties would be completely unaffordable in Islington. Our social rents are currently between 30 – 35 per cent of market rent, and so this would represent more than a doubling of the current levels.
Allowing properties to be developed at 80 per cent market rent would mean the new tenants either face an enormous rent hike or a deep benefits trap. Those not on benefits may decline to move into a new flat in future – even if doing so would relieve overcrowding or reduce under occupation – because of the unattractiveness of higher rents for new build properties. And for those on benefits, the looming prospect of caps makes the outlook uncertain and grim.
Some have suggested allowing 80 per cent market rent on, say, one-bed properties, and offering a rent level less than 80 per cent on the larger family dwellings. This may work in some places, but we do not believe it works in Islington. Our planning policy is explicit that we need the family homes rather than new one-bedroom flats. Our current council-owned stock is over 40 per cent one-bed properties – we are in fact piloting a separate programme of selling certain one-beds through shared ownership and using the capital raised to build new family homes.
So our priority in Islington has to be family homes at genuinely affordable rents. With our well-known high property prices in Islington, we believe that social rents, offering close to a level playing field with council rents, are the right level for this.
That is why we have said we will support schemes from housing associations that offer homes at social rent, and that are subsidised where necessary through our grant in the form of public land or capital. We have a pipeline of sites identified from public land – enough land for over 500 homes immediately, with several hundred more being looked at for the future. And our decision to dedicate almost all the borough’s new homes bonus to new home building means this year we can offer £1 million capital grant.
We have been pleased by the positive reaction from a number of housing associations to our plans. We are currently in negotiation with one of our housing associations on the details for a new scheme that would be the first under the new regime to offer social rent with land subsidy from the borough.
Our model will not be appropriate for allLondonboroughs – just as the ‘Affordable Rent’ model is not appropriate for Islington. But although it is self-evident that our position is outside the government’s main programme, we are committed to working with willing housing associations to make this work for them and for those in our borough with the most acute housing need.
Shirley Porter, responsible for the ‘Homes for Votes’ scandal in the 1980s – what the Law Lords called ‘a deliberate, blatant, and dishonest use of public powers’ that amounted to ‘political corruption’ – would never have been brought to book if new Audit proposals by the Tory government had been in place during her reign in Westminster in the 1980s.
Some people think that the Tory Party has never forgiven the Audit Commission for the tenacity they showed in bringing their brightest council star Porter to justice and causing huge embarrassment to the Thatcher/Major governments. The Tories nationally never apologised for what was done in their Party’s name.
Now Eric Pickles and Grant Shapps have proposed ending the right of electors to raise ‘objections’ to the local authority’s accounts with the council’s official Auditor. They say it is ‘outdated’ and ‘over-burdensome’ on council tax payers – well, not in Westminster, where £12m was recouped from Porter (and it should have been £40m, the amount set by the Law Lords in their judgement). Removing the right to object is contradictory to both their localism policy and their repeated statements that they wish to devolve power not just to local government but to the people.
Porter’s gerrymander in Westminster would not have been exposed if it had not been for outstanding work by opposition councillors and others in the community who were concerned about the council’s housing policy as described here and here and here. But it was the process by which local electors could raise a formal objection to the council’s accounts that ensured that an initially sceptical Auditor was required to look into the matter; investigations that led to the most damning report ever issued about a local authority. Moreover, it was the independence of the Audit Commission standing behind the Auditor that ensured that the case was brought to a conclusion – and it took more than a decade. There was a lot to withstand – political pressure to have the matter dropped, a personally offensive campaign against the Auditor, and criticism of the high cost of the forensic enquiry (dawn raids on city hall, tens of thousands of documents and dozens of interviews) and the court cases.
Pickles’ and Shapps’ proposals are contained in a CLG consultation document on the ‘Future of local public audit’. It sounds dull but there is a lot in this consultation of concern to anyone with an interest in local government and its probity.
The consultation paper says that “The right to object to the accounts was first introduced more than 150 years ago, at a time when the auditor was the only individual to whom an elector could raise issues of concern.”
But in Westminster, less than 25 years ago, the council wouldn’t listen to the accusations that there was gerrymandering going on, the government wouldn’t listen, and the Tory party certainly wouldn’t listen. The only route that worked for local people was to raise an objection to the District Auditor, who took a serious and independent view of his role in tackling improper behaviour. This right should be retained.
It’s a complicated business, housing. Those poor souls at the Policy Exchange and their pollsters YouGov apparently can’t tell the difference between social housing and council housing. Despite generating alarming headlines (‘Public backs limit to social housing areas’ – thanks, Inside Housing) a glance at the detail of the poll (and the base data, entitled ‘Fairness’ presumably with a touch of irony) shows just a little confusion. Although the discussion in the Policy Exchange report ‘Just Deserts’ is about social housing, the actual questions asked were about council housing. Just as well they didn’t wander into the fantasy world of ‘Affordable Rent’?*
Strange questions they were too. “People should not be offered council houses that are worth more than the average house in their local authority” Agree or disagree? Despite requiring considerable knowledge – what is the average, how do council houses compare in value, might there be a different answer for housing associations, does this ever happen in reality? – the question is really quite leading. So no surprise that a majority say they agree. It tells us very little about public attitudes to council houses, and nothing whatsoever about public attitudes to housing association properties to rent (because they weren’t asked about that).
And the second question was “People should not be offered council housing in expensive areas” Agree or disagree? Also rather leading and confusing.
This selection of questions tells me more about Policy Exchange and the point they wanted to make in the first place. I suspect they know – and if they don’t, YouGov should – that if you ask positive questions about mixed and balanced communities you get very different answers. But that wouldn’t fit PEx’s obsession with contradicting the pro-equality conclusions in The Spirit Level, would it?
*PS I’ve started calling ‘Affordable Rent’ SCARE tenancies – standing for So-Called Affordable REnt. Will it catch on?
The Welfare Reform Bill, currently in Committee Stage in the House of Commons (follow the debates here), contains many provisions which will have a profound effect on the housing opportunities of people on low incomes in the years to come.
One of the changes that has attracted little attention is designed to tackle under-occupation in the social rented sector. From 2013 housing benefit will be reduced if the household is of working age (the limit is rising from 60 to 65) and is deemed to be living in accommodation which is too big for their needs. An ‘underoccupying’ claimant will lose a proportion of their HB, which will no longer meet their current housing costs, with an average loss of £13 per week.
The government’s own impact assessment estimates that 670,000 social tenants will be affected, around one-third of all HB claimants in the sector. In the north, between 40-50% of tenants will be affected, in London around 20%. This is an extraordinary number of people.
Affected tenants will face a ‘choice’: make up the shortfall from their other income, take in a lodger, or move to smaller accommodation in either the social or the private rented sector. Even if only half of those affected decide to move, pity the poor landlord in the north when 1 in 5 of all tenants knock on the door asking for an urgent move to smaller accommodation. In London, additional transfer requests from 10% of tenants would swamp the housing allocations system.
Nearly 4 in 5 of those affected currently ‘underoccupy’ their homes by just one bedroom. They are hardly evil – most people with one spare bedroom do not recognise themselves as underoccupiers, and often the last bedroom is small anyway – but they will lose £11 per week on average. Over recent years policy had moved strongly towards recognising that the real challenge in underoccupation is to tackle cases where there are 2 or more spare bedrooms, where there is most to gain. Under the new rules, a family of 6 with 2 sons and 2 daughters living in a 4 bedroom property would be deemed to be underoccupiers, and would receive the arbitrary HB ‘fine’.
The loss of an average of £13 per week might not be noticed by the Cabinet of millionaires, but this is a huge sum of money to anyone on a very low income. The policy’s only chance of success will be if there is a supply of smaller homes to transfer into. Yet the government’s impact assessment admits that there are simply not enough smaller housing association and council properties available.
The policy is the opposite of the ‘moral hazard’ – where people are insulated from the consequences of their own actions. In this case people will face the consequences of the government’s actions with no reasonable course of action open to them to avoid or pre-empt or respond to the change in policy. It is coercive and in a nasty way: if they cannot move, they will face deliberate impoverishment with no way out.
Will the policy achieve its stated aim and save any money? Labour shadow welfare reform minister Karen Buck thinks not. Tenants who are unable or unwilling to move will fall into rent arrears, with the risk of eviction (and loss to the landlord) triggering the costs associated with a rise in homelessness. The government thinks that some will move into the private rented sector, where rents are higher even for smaller properties, so the cost will go up not down.
And in a final irony, the policy will not even address, indeed will avoid, the biggest single issue in the underoccupation debate – which is what to do with underoccupiers of retirement age whose family has moved on.
For our previous post on the Tories’ market solution to underoccupation, click here.
One of the more offensive acts of this government has been to put the Equalities Act 2010 up as a topic for debate on its ‘Red Tape Challenge’ website.
Housing organisations have been at the forefront of promoting good policy in equalities and diversity for many years – the latest evidence being CIH’s publication this month of its guide to delivering housing services to lesbian, gay, bisexual and transgender customers – and should be ready to make the case for the retention of the Act in its entirety, together with its supporting regulations.
The 2010 Equalities Act – summarised here – pulled together the previous diverse strands of discrimination and equalities law into a coherent whole and added new duties and responsibilities. It harmonised the legislation to provide a single approach wherever possible.
Extensions included the new duty on public bodies to consider socio-economic disadvantage when making strategic decisions, wider definitions of discrimination, harassment and victimisation, stronger duties to help eliminate conduct which the Act prohibits, to advance equality of opportunity and foster good relations between people who share a relevant protected characteristic and people who do not, the use of positive action, amendments to family property law to remove discriminatory provisions and additional statutory property rights for civil partners.
What has caused so much offence is that all the other topics posted on the Red Tape Challenge website seem to involve changes to regulations whereas the equalities topic invites comment on the entire Act, which is of course primary legislation only recently passed by Parliament.
That is not to say that the other topics are unimportant – the website reads like a list of all the things where more not less regulation is probably needed (eg Major Hazard Industries, Biodiversity, Pensions).
It is worth a look at the comments contributed to the Red Tape website on equalities. It is pleasing to note the relative lack of hateful comments (compared to many website discussions on this topic) and the many positive and supportive comments.
So what is the government up to? The equalities website says that the government’s approach is as follows: “We do not want public bodies to have to show people these things: how they worked out whether their rules and services were fair; what they looked at when they checked that their rules and services were fair; who they involved when they were working out their equality goals; how they were going to check whether they had met their goals. We will not make public bodies tell us how they will work out how they are going to check that they are meeting their goals. This is because it will not help public bodies make equality better.”
Accusations of ‘red tape’ and ‘box ticking’ are often little more than a back door attack on the purpose of the regulations themselves. I suspect this is exactly what is happening on equalities. The whole housing sector should be watchful.
I branched out my blogging career this week, and published a post on the excellent Southern Front. A lot of attention has been paid to what happens in London as the housing changes kick-in, but more needs to be paid to the impact on the areas where people will move to. There will be inevitable pressure on services as poorer families move to Basildon, Hastings, Harlow, Grays. But there will be a great deal of rapid demographic and social change in local communities and in the past Labour has not always articulated well people’s worries about such changes. Full post below:
Migration from London is a housing time bomb for the South
David Cameron tried to make electoral headway last week with his much publicised speech on immigration. But migration isn’t just about foreigners. In the next few years, towns in the south and east are going to see far more new arrivals from London than they will from overseas, as the government’s housing policies push poorer families out of the capital.
From Boris Johnson to Polly Toynbee, there’s been plenty of coverage about what will happen to London when social housing and benefits changes bite – the end of mixed communities in the capital.
Too little attention has been paid to what happens in the places where people move to: the towns and districts around London, which are some of Labour’s key battlegrounds in winning back the south.
People have an instinctive aversion to the overblown rhetoric which some have used to describe these changes, such as ‘Kosovo-style social cleansing’ or ‘final solutions’. But nevertheless, we should be clear on the scale of what’s going on.
London Councils, the body representing the 32 London Boroughs, undertook a study using DWP’s own figures showing that London would see 82,000 families forced out of their homes because of the cuts to housing benefit in the private sector. That’s the equivalent of every household in Basildon and ten thousand more on top, packing their bags and hitting the road.
That’s just in the private rented sector. In social housing, the government is pushing housing association rents up to 80% of the market rate. That makes social housing massively more expensive in London than in surrounding towns and counties. To take one example: 80% of market rent for a three bed social home in Bethnal Green in Tower Hamlets is £416 a week, which is £238 more than in Harlow or £256 more than Crawley per week.
Many families in need of housing will find their only choice is to get on a waiting list outside of London or rent privately in south eastern towns.
These new arrivals will be the families on the lowest incomes, placing greater pressures on shrinking public services in towns around London. There will be even greater pressure on social housing. Campaigners know the importance of housing as a source of anger and frustration across key seats in the south, and how easily it is linked to issues of race and immigration. These problems may get a lot worse in the coming years.
Families moving out from London will disproportionately be from ethnic minority groups. Anyone familiar with the BNP’s campaigns across the east and south east will know that the campaigns were made credible by something that people did see around them; a rapid increase in ethnic minority families. This was, in many cases, the result of people being re-housed temporarily out of London while major regeneration schemes (for example in Canning Town) began or while they waited for social housing to become available in their home borough.
That will now take place on a far larger scale but this time, with no right of return.
This will be a big challenge for activists, councillors and candidates. We need to raise early the concrete concerns about new pressures on housing and public services. We should put the Tory MPs and council leaders on the spot: do they think these policies are right? Have they lobbied their government for resources to manage the change? What provision are they making for housing, schools and health?
And, we must also be the first to articulate people’s legitimate concerns about the nature, speed and scale of change in their community. We didn’t do that in the past as part of the immigration debate and neglected to address the feelings people have about change they can’t control and the sense of powerlessness that can create. We can’t afford now to be caught flat-footed on an issue that the right and far-right can capitalise on.
At the same time, we need to be advocates of those forced out of London and make them part of the campaign. Active local Labour parties are well placed to see first where new families arrive, what their needs are and how best to engage with them. We should help foster through local institutions, community and faith groups the integration of those moving into south eastern towns from London – any separation will only breed distrust.
In the south, Labour should tackle this issue head on and make it a key campaign which unites existing communities and those leaving London. It should be a campaign against a Tory government’s market fundamentalism that thinks nothing of uprooting tens of thousands of people from their families, neighbourhoods and jobs and forcing them into areas and communities which are not well placed to receive them.
The Tories seem to have invented the New Homes Bonus in a panic when they realised that stripping away Labour’s regional infrastructure for housebuilding would leave them with no policy at all, see our previous comment here. But the NHB is proving even more bizarre than we predicted.
Yesterday, Shadow Housing Minister Alison Seabeck published her research on the distribution of the Bonus, showing the wild variations in payments across the country. The research, confirmed by the House of Commons Library, shows that Richmondshire, in William Hague’s constituency, qualifies for a New Homes Bonus of £56,449 for adding just nine homes to their housing stock, whilst Scarborough is entitled to just £7,356 despite adding nearly three times as many. For each additional home, Richmondshire will receive 2033% more in New Homes Bonus money than will Scarborough.
Rather like the general cuts to local authorities, the richer parts of the country do better than the poorer parts. The 10 least deprived local authorities in the country receive over 20% more in NHB funding for each new home than do the 10 most deprived authorities. This matters because in future years the bonus will be funded by ‘top-slicing’ the main council formula grant – so some of the country’s most deprived areas will lose out on grant in order to pay large bonuses to wealthier areas – and by 2016 the cost will be £1.2bn each year! Research by the National Housing Federation indicated that the net impact of this policy will see the North losing £100m in funding each year.
Here are Alison’s examples:
|
New Homes Bonus ‘Losers’ |
New Homes Bonus ‘Winners’ |
||
|
Local Authority |
NHB per Home |
Local Authority |
NHB per Home |
|
Scarborough |
£294.24 |
Elmbridge |
£2,080.05 |
|
South Lakeland |
£496.96 |
West Berkshire |
£2,082.19 |
|
Preston |
£783.84 |
Three Rivers |
£2,122.85 |
|
Barrow-in-Furness |
£972.08 |
Chiltern |
£3,694.00 |
|
Burnley |
£990.37 |
Richmondshire |
£6,272.16 |