Category: Blog Post

Building a Coalition for Building Homes

Post author By Leo Gibbons-Plowright
Post date February 28, 2021
4 Comments on Building a Coalition for Building Homes

In a way, it was almost inevitable that I would develop an interest in gentrification and housing. After all, I am a millennial and I grew up in Zone 2/3 of Inner London. I didn’t just watch my neighbourhood change as I grew up, I watched the door to a future my parents’ generation took for granted close before my eyes.

My parents moved to Forest Hill, South East London in the mid-80s. Even back then my parents couldn’t afford to live in Hackney or Tooting (my mum had been a big Citizen Smith fan). Growing up, South London was the butt of jokes – most of which revolved around it being poorly connected, scary or dull. But by the noughties, my area would start appearing in the aspirational columns about London’s new exciting suburbs. Housing prices rose sharply and continuously. The global housing market crash in 2008 couldn’t stop this runaway train and the last decade has seen my neighbourhood transform.

I noticed the most rapid changes taking place after 2011, when the London Overground was delivered to the area. I was away at university over this period and as I returned each summer, there were new cafes, estate agents and pizza places to replace the launderettes, sandwich shops and second-hand electronic stores. I remember chatting to the owner of Cafe No 41 on Brockley Rise around this period. He had owned Bertie Rooster’s Fried Chicken on the same site and he said he’d noticed the area changing, so he thought he’d better change too. Smart move.

Local NIMBYs, true to form, opposed the transformative rail connections. I remember my dad, who worked in transport, railing against the local opposition to it. He had been arguing for greater capacity for the Overground, for longer trains, and an additional station between Surrey Quays and Queen’s Road Peckham. As the Overground now sits at bursting point — a victim of its own success — he should’ve been listened to. Ironically, the Overgound has been a huge boon to their property-owning NIMBYs that opposed it.

But while I infamously remain sniffy towards NIMBYism, I do understand it. A rapidly changing neighbourhood can be discombobulating and disconcerting. As a strange teenager, I remember pleading with my friends to go to the array of cornershops in Honor Oak instead of the new Sainsbury’s Local if they were buying drinks and snacks before we had a kickabout in the park. Instinctively, I didn’t like what I saw as the homogenisation of my local mini-high street and I knew that Sainsbury’s would destroy some of those independent shops (it did) that I felt I had a relationship with. My instincts were to, in a way, keep my neighbourhood ‘static’.

I’ve been on a journey to try and understand the phenomenon that shaped my home town when growing up and understand my own feelings around it. While at university, I wrote my dissertation on the changing Toxteth and Canning areas of Liverpool. I had grand ambitions to start a university society that would work with the local community to improve ‘Town & Gown’ relationships in the nearby area. Like most of my plans, they crumbled due to a bad attitude and lack of endeavour. The dream ended with me getting into a fight at a Residents’ Association’s ‘cheese & wine’ night and quite literally being thrown out.

However, looking back on the experience, it gave me a good understanding of how gentrification works and was a valuable insight into a world I would later inhabit. Gentrification is an organic process and one seen in major cities around the capitalist world. The cliched but illustrative example is as follows – artists move into an area due to cheap rents and large spaces. They create an artistic community and the area becomes ‘cool’. With it being cool, it then becomes desirable. The greater appetite for the housing then pushes up rents and prices and gradually the area’s demographics shift.

It was once thought that cities would act like a pebble falling into a pond, rippling outwards and decaying inside. Yet from the 1970s onwards the shift has been back into the centre. Some hippies and squatters now own multimillion pound property in areas of our West End. Savvy boomers profited.

The process of gentrification can be sped by developers who see the opportunities offered by a rent-gap to maximise profits. In this, developers are simply capitalising on a saturated housing market and building where demand is. Likewise, ‘gentrifying’ businesses are responding to their new clientele not moulding customers from thin-air and wishes. Cereal cafes and posh chicken shops are a symptom of gentrification, not a cause. Today, many of the anti-gentrification activists I come across are ‘first wave’ gentrifiers themselves, similar if not a bit older than my parents.

While it is an organic process, gentrification does cause profound issues. Sharp rises in the cost-of-living create havoc for low-income families and at its starkest, drives them from their neighbourhood. As I mentioned in my last blog, social homes with secure and affordable rent is a fire-wall against gentrification. But London is increasingly being hollowed out, swathes of North & West London in zone 1 & 2 have become binary and soulless places – the very well-heeled live alongside enclaves of council homes occupying parallel lives. I worry that the evaporation of London’s Little Italy, will eventually happen to our Little Bengal and our Little Portugal.

***

My blood still curdles at a previous generation of local politicians who seemed to actively encourage the gentrification of their neighbourhoods, as a means of improving their patch. Gentrification doesn’t solve poverty, it just kicks it down the road. But for some local politicians, that once seemed enough. Angered by what I saw, I vowed to campaign against it. It signalled my first forays into local politics.

In my last blog, I wrote about Lewisham’s Residents Charter and how we’ve come along way from this era. Like our predecessors, we know that mixed communities are positive for social cohesion and shared uplift. Likewise, we also know that many of our large post-war estates are in need of urgent renewal. However, as an administration led by a new wave of politicians, we’re committed to ensuring that any regeneration produces a net gain in social homes, expanding our gentrification fire-wall in the borough.

Yet I do not remain hopeful for the future. Writing this, I am struck by just how long I was part of the problem and what that says for the future. I was driven into local politics by the anger that while my neighbourhood was being torn up and built back up, none of these homes were for me.

Developers, greedily lining their own pockets, were building ‘luxury flats’. Councils were failing to stand up to them and accepting schemes with pitiful amounts of affordable housing.

It’s been through sitting planning committee as a councillor that I learnt that most of these flats weren’t ‘luxury’. The only thing luxury about them was the unaffordable price. The housing crisis has simply become so insane in London that any market-value home is deemed luxury and therefore out of reach of someone like me — a young person without assets, earning the average London wage.

This situation has bred a culture of cynicism among an entire generation. As we discuss rents at house parties and scoff in frustration at the mere idea of saving for a deposit, we’ve grown suspicious of new housing and growth. Moreover, the council-led schemes of the past have led to a sour taste in people’s mouths. While these schemes, directly reducing social housing, could be an example of top-down gentrification — it would be wrong to view gentrification as a whole, as planted from top-down from developers.

If writing to note to my younger self, I’d be rather pithy. ‘Dear Leo, sick of chain stores and the champagne et fromages under those new flats? Let many, many, more flats just like that be built, so rents and prices round here come down and the demographics that fed those independent shops and the sandwich shop you loved so much, can remain.’ As this article highlights, the forces that drive gentrification ‘do not come from the construction of specific apartment buildings or retail complexes, no matter how many granite countertops or artisanal coffee shops they might contain.’ Increasing supply will lower prices.

***

It is only now that I see how damaging the framing of gentrification as a top-down process, thrusted-upon benign communities by developers, has been.

As a councillor, I have been shocked by the glacial and bureaucratic process of approving new homes in the borough. Not only that, I’ve seen how small interest groups have leant on councillors to reject new homes on spurious grounds.

But this is only the tip of the iceberg. As this Centre for Cities report highlights, our planning system operates like the old Eastern Bloc, rationing supply through a permit system. ‘In both the former Eastern Bloc and the English housebuilding market, firms must apply to planners for a permit, or a planning permission, to get the inputs they need to do business.’

We currently have a system that cannot respond to demand. Developers need to go through the process of receiving planning permission which is slow, often costly and fundamentally uncertain (planners can downsize or councillors can strike down an application, years into the process). This means ‘the amount of land that they can develop tomorrow is fundamentally unknown.’

It is this risk, inherent in our system, that means developers hoard land that has planning permission (or is likely to receive planning permission). As Centre for Cities notes, ‘this ‘hamster-like’ behaviour is rational as it means they will always have land on which those assets can be operating, even if planning permissions temporarily dry up.’ The report also notes:

‘A site that has planning permission or is suspected to have a high chance of receiving planning permission can greatly increase this price, especially near cities and large towns with successful economies and expensive housing’. To illustrative this point, in 2010, agricultural land without planning permission around Cambridge was worth roughly £18,500 per hectare. Once it received planning permission for housing, the value per hectare increased to £2.9m.
Developers must cover these high land costs, and they cannot escape them by increasing production or efficiency as the planning system rations the supply of land they require. They therefore need to pass their land costs onto consumers and sell new houses at high prices.
Developers experience a disadvantage trying to acquire land which can be lawfully developed, they enjoy the advantage of a sellers’ market when selling new properties to consumers due to slow buildout rates. This means that predominantly only big powerful developers can get hold of land which will get large-scale planning permission, and once they have hold it, they can build a slow ‘absorption rate’ keeping house prices high due.
If developers could instead just buy land and develop it without applying for a planning permission, then “planning gain” and thereby the absorption rate would both disappear. The price of land would reflect local demand and, as firms would and could only buy what they immediately needed, they would be forced to build new housing as quickly as possible to outcompete rival firms that could now do the same.

It is our system which creates the circumstances for large developers to be able to buy the rationed land for development and build slowly as they face little competition.

But this isn’t a cry to rip-up the rule book. Local planning frameworks should remain in place and offer clear rules of what can be built and where. However, areas zoned for development should be greatly expanded. As the campaign group Priced Out argues:

‘For the areas that are zoned for development, there should be transparent rules about what cannot be built there — which could include what the developments are used for, and rules on look and feel — with everything that does not contravene these rules allowed. Alongside this we already have extensive national building regulations, rules on the sustainability of developments, and various other regulation which is already in place.’
Priced Out Manifesto | Rules-Based Planning

However, when reaching out to colleagues to express these views and concerns, I receive immediate and blanket push-back. Those I speak to see the bureaucracy of our planning system as a bulwark against lowering standards. They instinctively reject ideas about cutting red tape and increasing competition to raise standards. Developers are the bad guys that need to reined in by councillors, rather than firms rationally gaming a broken system that we uphold.

It has become fashionable across the political spectrum to deny that our housing crisis is linked to a lack of supply. Campaigners against new market-sale homes often point to the fact that the UK has 216,000 long-term vacant homes, which could occupy a sizeable chunk of our 280,000 homeless people, if only they were happy to be bussed to Cornwall or Cleethorpes.

However, rather than suggesting that we do not need to increase supply, our empty homes highlight our nation’s stark housing shortage. In the UK, only 0.9% of homes are long term vacant. In a healthy market, surpluses provide ‘a strategic reserve which they can use to respond to sudden changes in consumer demand.’

Compare our situation to Japan, a nation with an affordable housing market. In Japan, less than 5% of homes are socially rented (here it is around 17%). Across Japan, 5.6% of homes are long-term vacant, while Tokyo the figure is 2.5% – which is a higher share of empty home than in Burnley – other most affordable city in England and the one with the most vacant housing. Suppressing vacancy rates in the UK will only make the situation worse. Instead, we need to build enough to homes to create a healthy surplus.

As I have written previously, the housing crisis cannot be tackled by local authorities building themselves. This blog succinctly nails the issue: The UK’s housing affordability crisis is too little supply, which cannot respond to prices. However, getting Labour Party colleagues and angry young millennials alike to accept that we need developments of market-rate properties on a huge scale in areas of the country where our housing shortage is most acute — will be an uphill battle.

Steam-rolling through reforms won’t work. Instead, we need to start that process of chipping away – gradually building a coalition in support for house building. And maybe one day we can get more people to say yes-in-their-backyard to luxury flats.

Leo Gibbons-Plowright

Leo is a Labour and Co-Op Party Councillor for Forest Hill in Lewisham.

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Tags building, cities, developers, gentrification, housing supply, Labour Party, millennials, NIMBY, NIMBYism, NIMBYs, planning system, rules based planning, social cohesion, supply

Blog Post

New Roofs or Old Ceilings?

Under Corbyn, Labour announced its bid to combat high rents through old-style rent ceilings. If we look back across history we see these have had many unintended consequences. Often we have found the introduction and continuance of rent controls have done more harm than good. So should Labour continue to embrace such a policy?

We know rent legislation cannot cure housing shortages. Rather, regulations such as rent ceilings merely mitigate the effects by giving comfort to sitting tenants – at the expense of prospective tenants. All too often we see false views on rent control spill over from popular misconceptions into apparently learned debates. It is for this reason why Labour must resign rent ceilings to housing history and focus on the real problems at hand.

History shows Rent Controls are Bad

In Britain we have recognised the damage done by rent controls as far back as The Rent Act in 1957. Where at the time we witnessed expensive properties freed from such regulations. Why? Because old-style rent ceilings foster dilapidation of housing stock, encourage immobility, and distort land-use patterns. It simply makes housing worse.

Originally the introduction of rent ceilings sought to protect tenants from rent rises caused by war-time shortages. Often caused by bombing. Yet many places have seen them retained and enforced ever since. Their perception as a temporary measure were often short lived, almost always becoming destructively permanent.

Late Swedish socialist economist Assar Lindbeck once said “rent controls appears to be the most efficient technique presently know to destroy a city – except for bombing”
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An unsurprising statement when the average waiting time for a rent-controlled unit in Sweden is 11 years. In Sweden keeping rents low for a small section of renters sees tenants hold onto property they no longer wish to live in. Rent regulation incentivises lucky rent regulated tenants to sublet in the black market, often for a significant profit. One would argue this is hardly a socialist panacea.

Price Signals Allow Markets to Respond

Back in 1906 an earthquake hit San Francisco. Subsequent fires destroyed thousands of acres of buildings in the heart of the city. It resulted in 225,000 people becoming homeless. The city of 400,000 lost more than half its housing in three days. Yet market driven construction of new homes put roofs over many earthquake victims heads. In effect developers were able to respond to market demand through rising price signals.

Nevertheless, each remaining household still had to shelter 40% more people than it did before the quake. So what do you think the first local paper observed following the earthquake – a huge housing shortage surely? No, in fact the first San Francisco chronicle following the earthquake made no mention of housing shortage at all.

The market had responded and there was over three times more homes available to rent than advertised for sale. Just goes to show what can be achieved by the market without rent controls having distorting effects on new supply.

Rent Controls Deter New Construction

Contrast this to 1946, where the San Francisco population had increased from 635,000 by 200,000. All over a six-year period. By comparison, the number of dwellings had only increased by a fifth. While in 1906 the city had to shelter 40% more people than before the earthquake, by 1946 the city only had to accommodate around 10-12% more than before the war. This did not stop the Governor at the time going on record to describe the housing shortage “as the most critical problem facing California”. But what was so different?

In 1906 higher rents could signal to the market to build new construction. However, by 1946 imposing rent ceilings made this method of stimulating supply for rental homes illegal. The result? 730 houses listed for sale for every 10 homes listed for rent. The absence of a ceiling on selling homes, in conjunction with a ceiling on rents, had considerably distorting effects. It meant that prices were to rise as a large and increasing demand encountered a relatively fixed supply.

This meant many landlords ended up selling at inflated market prices, rather than renting to tenants with a price ceiling. Rentals effectively become almost impossible to find. At least at legal rent levels. Rich people with money still found plenty of homes to buy. Ceilings on rent provide the rich an advantage to satisfy their housing needs. Restrictions on rent only make this condition worse. We must also recognise that during this time incomes in San Francisco had doubled in comparison to levels before the war. This allowed people to pay more in rent even though legally they did not have to, exacerbating the proliferation of the black market.

Rent Controls Reduce Mobility and Increase Unemployment

Research by Joseph Schumpeter on unemployment recognises the correlation between lack of labour mobility and structural unemployment. In turn, rent controls artificially create more pressures on cities, notably because inhibiting rent increases puts a brake on the natural drift out to towns. We know more people leave London for the rest of the UK, than move from other places in the country to the capital. This is primarily due to relative affordability.

Studies from San Francisco by Stanford University shows rent control limits renters’ mobility by 20% and lowers displacement, which comes at the expense of a reduction in rental housing supply by 15%. Rent controls lead to a less mobile workforce, more structural unemployment, and less supply. No doubt hampering the economy and increasing state borrowing unnecessarily.

Rent Controls are Denigrated Across the Political Spectrum

Notwithstanding the above, rent control is considered the least contentious area of economics and is widely denigrated by economists from around the world. The agreement cuts across the political spectrum, from Hayek and Friedman agreeing on the “right”, to architect of the Swedish Labour Part’s welfare state Gunnar Myrdal on the “left”. It has literally been no longer a debate within the profession for a considerable length of time.

Rent Stabilisation is Ineffective

Maureen Corcoran has reflected on Germany’s rent regulation through its local rent index, arguing regulation improves affordability and transparency. But we have seen since Germany has moved to stricter rent control, with a 5-year rent ceiling, finding new rental property has become increasingly difficult. Rent stabilisation typically has more flexibility and freedom around having an ability to change tenant than old style rent ceilings. For example, if you make repairs, you can increase rents. Labour has mooted such types of control in the past, but we know these too still do more harm than good.

In New York rent stabilisation has ‘luxury de-control’, akin to the 1957 Rent Act in the UK. If a rent gets to a particular level, then it can leave the rent stabilisation regime all together. Professor Ingrid Ellen of NYU argues that outside of Manhattan rent stabilisation does not have that big of an effect on the market. She argues apartments can often be as close as $200 a part in terms of median market rental levels, in comparison to rent stabilised rents. This suggests even modern versions of rent ceilings remain ineffective for the most part.

The Evidence is Overwhelming: Rent Ceilings are Bad

Developers essentially end up wanting to build less, which can’t be a good thing. The rules in New York meant you typically did not have rent stabilised levels on new lettings, which was one way the rules tried to avoid such an issue. But still, what you saw in post-war New York was the conversion of a lot of rental apartment blocks into condominiums for home ownership. Once again, resulting in a net loss of rental stock. Lower supply means higher prices.

Thankfully, recent studies continue to put the rent control question to bed. In August 2020 by Thao Le, Edward Coulson, and Lily Shen published ‘Tenant Rights, Eviction, and Rent Affordability’. The paper demonstrated that for every one-unit increase in the toughness of rent control, evictions are reduced by almost 9%. It found rental housing costs becomes 6% more expensive where tenants have more protection against landlords through regulation. While a higher Tenant-Right Index is also negatively associated with a decrease in housing supply and an increase in the homeless rate. When we put ideology before evidence, empirically we see rent controls lead to worse outcomes.

Gauche Caviar?

Hanchen Jiang, Luis Quintero, and Xi Yang recently released their paper ‘Does Rent Regulation Affect Tenant Unemployment? Evidence from New York City’. It found that often the beneficiaries are those who are more well off and such regulation denotes a significant transfer of wealth to those on higher incomes. Rent-stabilised tenants are empirically more likely to be unemployed than private market-rate tenants, particularly if you are white and highly skilled. To what extent this could ever be seen as a progressive outcome still remains to be seen.

If Labour is to continue to encourage the proliferation of rent-controlled property it should achieve this through the construction of new social housing. Not blanket market distorting rent regulation. Rent control is great if you get it. However, it merely comes at the price of greater inequality for future generations.

Rent ceilings offer no cure to the housing shortage, and in combination with a planning system currently disconnecting local housing supply from local demand, demand-side rent regulations merely create more problems than they solve.

Christopher Worrall

Editor of Red Brick. He is currently an Investment Manager at Guild Living, a Non-Executive Director of Housing for Women, and is on the Labour Housing Group Executive Committee.

Chris also co-hosts and produces the PricedOut UK Podcast.

He writes in a personal capacity.

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Tags Assar Lindbeck, Corbyn, Germany, Labour, New York, rent ceilings, rent control, rent regulation, Rent Stabilisation, San Francisco, Tenant Rights

Blog Post

Rent controls: a retrospective

Post author By Nick Bano
Post date February 24, 2021
2 Comments on Rent controls: a retrospective

For more than 70 years, between the First World War and the late 1980s, the United Kingdom had a system of rent controls for private sector tenants. The policy was, on almost every metric, a success – argues Nick Bano.

This middle portion of the 20^th century stands in stark contrast to the housing conditions of the 21^st: unlike today, there was no great housing or homelessness crisis; and the ‘homes fit for heroes’ and mass squatting campaigns of the 1940s and 1950s alleviated the worst of the of the scarcity caused by bomb damage.

In fact, as the brilliant 1939 film Tenants In Revolt shows us, mid-century working class housing campaigners were actively calling for “luxury flats” – a demand that has now become anti-gentrification groups’ ultimate bogeyman. While today’s campaigners are forced to make insipid calls for the barest essentials of homelessness reduction, tenants under a rent control regime had moved on to demanding luxury.

Potted history: a consensus for rent controls

In 1915, reeling from a powerful rent strike movement in Glasgow that held the wartime government in check, Asquith’s administration passed the Rents and Mortgage Interest Restriction Act. While it was designed a measure against wartime profiteering, the spirit of the 1915 Act remained in force almost uninterrupted until rent controls were finally dismantled in 1988. Importantly, the government realised that rent controls have to go hand-in-hand with relatively secure tenancies, to stop landlords from escaping the law by evicting tenants and re-letting at a higher rent. The 1915 Act therefore introduced security of tenure, too.

The rent control mechanism was immediately recognised as being important, popular and successful. Just three years later the 1918 Hunter Committee found majority support for rent control among tenants and – strikingly – among landlords, too. As a consequence, Parliament amended the 1915 Act slightly in 1919, before proper new legislation re-establishing rent controls (the Increase of Rent and Mortgages (Restriction) Act) was passed under Lloyd George’s Liberal-Conservative coalition government in 1920.

Again, Parliamentary inquiries (the Onslow Committee of 1923, the Marley Committee of 1931 and the Ridley Committee of 1937) acknowledged on the broad success of the measures, and recommended the continuation of the rent control scheme (with some adjustments to the mechanics, and an increase in the number and type of de-controlled tenancies). This slight watering-down was then reversed in 1939, as war loomed again.

After the Second World War rent controls remained in place. They continued to function reasonably well for more than 10 years, even after the Blitz had caused a genuine and serious scarcity of homes. Neither the 1945 Labour government, nor the Conservative government that followed, abolished them.

The following Tory government, however, seriously weakened the system under the Rent Act 1957: rent controls were abolished for all new tenancies, and some more expensive existing tenancies. This led to the system of ‘Rachmanism’ – where tenants were bullied out of their homes (or bullied into accepting new rents) – which effectively forms the model of the current oppressive system of ‘shorthold’ tenancies. A new Labour government in 1964, however, re-introduced rent controls in short order.

The high point came in 1974. Following yet another glowing report on the functioning of rent controls (by Hugh Francis QC in 1971), a Tory government extended rent controls to furnished as well as non-furnished accommodation.

The destruction of rent controls in 1988

By the mid-1980s the Thatcher government had decided that it wanted to create a housing market that wasn’t restrained by rent stabilisation measures, the disastrous effects of which we are experiencing today.

The genius of the Thatcher regime was that it never actually destroyed rent controls. They still exist, although the controls are (unsatisfactorily) tied to the market rate: a tenant who disagrees with a proposed new rent is still entitled to complain to a tribunal, and the tribunal will not let the new rent exceed the market value. But the 1988 Housing Act destroyed security of tenure, which is crucial to the functioning of a rent control system. Landlords know that they can avoid the rent control measures by simply demand a new rent – any rent they like – and that they can evict the tenant quickly on a ‘no fault’ basis if they can’t or won’t pay the higher rate. As a result, the formal system of controlled rent increases is almost never used. Rent control was abolished by the back door.

For the last 30 years we have not just had a lack of effective rent controls. Instead, because Thatcher’s aim was to generate a profitable housing market, the current system has rising rents by design.

A second, odd effect of the 1988 Act settlement is that rent controls became controversial. That never used to be the case. For most of the 20^th century, opposition to rent controls was the exclusive domain of landlords, war profiteers and hard-line Tories. But since the 1990s there has been a looming sense that we are all Thatcherites now: that anyone who advocates a return to a long-standing legislative programme (propped up by decades’ worth of inquiries and reports) was somehow radical.

A shrinking private rented sector is a victory

The major effect of the rent control regime was the decimation of the private rented sector. By the 1980s it had fallen to just 8% of homes in the UK. This is, for anyone who is not a landlord, a triumph. Privately rented housing is the least secure and most expensive form of tenure, and anyone who is housed elsewhere is almost certainly better off for it.

How does this reduction happen? Rent controls restrain the profitability of landlordism, and some landlords flee the market. But a reduction in the number of rented homes does not, of course, reduce housing supply: ‘disappearing landlords’ do not cause homes to be knocked down or to be left unoccupied. As the Bank of England’s John Lewis and Fergus Cumming explain here:

“Some landlords will sell up as letting becomes less lucrative. But at the end of each sales chain is either another landlord or someone who was previously renting. If it’s another landlord, aggregate rental supply and demand are both unchanged, and so are rents. If it’s a new owner occupier, the supply of rented property has shrunk by one, but so has the number of renters. The tightness of the rental market and thus rents are unchanged”.

Even if this happens on a large scale, the glut of supply caused by retreating landlords will necessarily reduce house prices. It is this policy, rather than the proven failures of help-to-buy, shared ownership and high-end speculative development, that will achieve various governments’ stated aim of increasing home ownership. The contemporary history of the UK shows this to be correct, and no amount of abstract economic modelling can erase that.

There will always be people who prefer to rent privately, of course, and the market has always catered for them. But those generous souls who would prefer to pay off a landlord’s mortgage rather than their own presumably make up a figure much closer to the 7% of the population that rented privately in the mid-1980s than the 20% (4.5 million households) forced to rent privately today.

The Renters’ Reform Bill

In 2019 it became both parties’ policy, and then a formal Queen’s Speech commitment, to abolish ‘no fault’ evictions. In other words, we can expect some form of security of tenure to be restored to private tenants. As set out above, security of tenure is the missing piece of the still-existing rent control framework (without ‘no fault’ evictions, unless the tenancy agreement has a provision for rent increases, landlords will have little choice but to increase rents by the formal, controlled system of statutory notices).

So the good news is that the Tories – whether they realise it or not – have now reverted to their 20^th century position: they are now within the consensus that supports rent controls. I, for one, welcome them back into the fold.

Nick Bano

Nick Bano is a lawyer and housing activist.

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Tags first world war, landlords, Private rented sector, Rachmanism, Rent Act 1957, rent control, Renters Reform Bill, tenants

Blog Post

Guilt by Associations

Leading housing associations are losing their integrity as charitable organisations. They continue to trade on a set of myths about the sector that no longer hold true – writes Suz Muna.

Housing Associations Build Social Housing

Associations are increasingly indistinguishable from private developers and landlords, and their activities are increasingly focussed on market-level rents and sales. The result is that the interests of tenants and leaseholders trail in the wake of the board’s need to generate large surpluses and satisfy their lenders.

Associations generate larger profit margins by developing for market sale and rent than from any other activity. Inevitably, the profits are greatest in London where house prices are higher. The boards of Associations increasingly gravitate towards construction, and especially in the South East. They are aided and abetted by government policy, regulatory institutions and finance houses.

Analysis of the sector shows that there has been a considerable shift in its stock profile over the last few years. For example, in 2019 the category of housing with the largest percentage of growth was in market sale (non-social leasehold), jumping almost 16% (8,500 units) on the previous year.

The change in profile over a seven year period spanning 2012 and 2019 illustrates a sharp jump in Low Cost Home Ownership (LCHO) units, and a corresponding decline in supported housing. The ring-fencing of grants under the Supporting People programme ended in 2009.

Stock profile changes include conversions from the more secure types of tenancy with cheaper rents attached such as social rent which is capped at 50% of market rents. Often these are converted to less secure tenancies with higher rents.

Property lawyers Savills captured this trend in May 2019 when they noted that “the amount housing associations generated from new open market home sales increased 16% (£221 million) to £1.61 billion between 2016/17 and 2017/18, with 37,000 homes for sale contractually committed to be built in the 18 months from December 2018”.

Housing Associations Fund Their Activities from Rents

This is a myth that should be busted, not least because it implies a stability that is absent. In fact, house building in particular is funded through debt leveraged on existing homes. The Regulator for Social Housing anticipates that debt of £42 billion will be added to the sector’s debts over the next five years. And ratings agency Standard & Poor predicted that the need for housing associations to rely on debt to fund their activities will increase not decline in the future.

Housing Associations are Governed by People with a Commitment to Social Housing

One trend drives another. The focus on development means that associations deliberately attract board members with backgrounds in equity and finance, squeezing out those with any genuine commitment to, or experience of, social housing. The exceptions are occasional hand-picked and often financially reimbursed ‘tenant board members’ with no democratic mandate.

Many housing associations publish brief biographies for their board members. What these show is just how widespread board-level involvement has become by people whose careers span financial services, planning, development, property markets, private finance initiatives, and insurance industries.

There also exists a golden circle whereby the housing association and housing sector institutions populate each others’ boards. One Housing Group, St Mungos, Clarion, Paradigm, and Onward Housing for example, are all led by ex-employees of the Regulator of Social Housing. The Chair of Peabody’s board, Lord Kerslake, previously headed the Homes and Communities Agency.

The corporate plans developed by associations inevitably reflect the highly commercial interests of its board members, and the vicious circle is complete.

Associations Have Inclusive Cultures

An inclusive culture would in fact be a terrible hindrance to an ambitious housing association, and frowned upon by its institutional backers. To help ensure that associations are unchecked in their commercial direction of travel, they are moving away from democratic influence by tenants and residents, preferring methods of engagement over which the landlord has almost exclusive control.

Tenant and Resident Associations (TRAs), the most democratic of engagement models, are being replaced by Tenant Scrutiny Panels whose members are appointed by the landlord. This is akin to the derecognition of a trade union in favour of an employer appointed staff council – something that many associations also seek to do.

The Greater London Assembly noted in 2018 that the Grenfell Tower fire had “brought into sharp focus the lack of effective mechanisms for social housing residents to have their concerns addressed and to hold their landlords accountable for property standards and management.” The Assembly also noted that TRAs were being actively undermined by having recognition by the landlord made contingent on adoption of the association’s model constitution.

What these trends produce for tenants is inadequate repairs and maintenance services, high rents and service charges, anti-social behaviour problems, discrimination against those with disabilities, unsafe homes, and the cladding scandal. Despite huge leaps forward in communication technology, alerting the landlord to a problem is becoming increasingly difficult, and attempts to find a resolution too often feel like a war of attrition.

It Doesn’t Have to be Like This

It is all too clear to the tenants, residents and staff of housing associations that this sector has undergone a fundamental transformation, but that public perception has yet to catch up. It is wealthy, powerful and almost wholly unaccountable. Remedy is needed in the shape of much firmer, independent scrutiny and regulation, rent controls, and a supply of genuinely affordable housing through local authorities.

The Social Housing Action Campaign (SHAC) is a democratic, voluntary network of tenants, residents, and workers in housing associations and cooperatives. It campaigns to improve the lives of those who live in HA accommodation and reduce the commercialisation of the sector. SHAC is keen to build links with Labour councillors and MPs with an interest in housing. It is developing a political representatives network and would welcome contact via [email protected].

Suzanne Muna

Suzanne Muna has worked in housing for the last 20 years, serving continuously as a trade union representative alongside her paid work. She is secretary of the Social Housing Action Campaign, a trustee of the Public Interest Law Centre, and a member of the Unite Housing Workers branch committee

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Tags grenfell, housing associations, low cost home ownership, regulator for social housing, social housing action campaign, tenant and resident associations, TRAs

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Compromise and Council Houses

Post author By Leo Gibbons-Plowright
Post date February 20, 2021
3 Comments on Compromise and Council Houses

In part two of this three part blog contribution we continue to hear from inside the tent to what extent our planning system is truly representative and democratic. Do cries of ‘social cleansing’ hold any veracity, or does left-wing NIMBYism refusal to accept trade-offs manifest itself to the same effect?

Once upon a time, I would’ve stood on Reginald Street in Deptford in searing anger. Even with the land cleared and the hoardings up, I would still be bitter about what my colleagues had been put through. But today I’ve found myself mellowed. As I watch the diggers at work, laying the foundation for 117 new social homes, I wryly smile to myself. Today, the fight for these homes seems so easy, so tiny, so inconsequential.

The old Tidemill school site on Reginald Road had long been earmarked for the development of new homes. Instead of allowing the vacated site to fester, Lewisham Council agreed to a ‘meanwhile use’ leased and the area was handed over to a volunteer community group to operate. With the land, they created a ‘community garden’.

A ‘community garden’ is a bit of a misnomer, as it conjures up the image of an area open and shared by all in the neighbourhood. In reality, due to a lack of volunteers, by the time of its closure, the garden was overgrown, locked up, and open for a few hours each Saturday. Insiders say that a small clique living on well-heeled streets over in Brockley, operated the site as their own semi-private enclave. No big deal, we felt, because at least the land was semi-utilised.

The trouble only started when the council request the stewardship of the land to be returned so that our long-awaited housing development could get underway. Reneging on their promise to hand back the land when the ‘meanwhile use’ was up, the community group refused to hand over the keys. And thus, the ‘Save Tidemill Garden’ campaign arrived.

It quickly snowballed.

Opposite the development site, sits the Birdnest pub in Deptford. I like the boozer, but if I say it wears its counter-cultural chic a little too earnestly on its sleeve, you might get what I mean. It’s filled with students, old rockers and geezers, and was a perfect local meeting point for the Save Tidemill campaign.

Close your eyes and picture a row of wooden tables, on each one, sits a different segment of the Save Tidemill campaign’s coalition.

Table 1: The founders of the garden, mostly your classic NIMBYs, primarily asset-rich and comfortable. They’ll miss their garden when it’s gone and they don’t want pesky social housing spoiling their Saturday afternoon sun-spot.
Table 2: Assorted Left-wing groups. Nearly all older NIMBYs as well, these lot are driven primarily by political opportunism and they want to find a wedge issue to campaign against the local Labour council (internally in the Labour Party, or externally). For this group, they’ll reject any council-led development programme from the pin-head of ideological grounds. Any development that is not 100% council ‘target rent’ is rejected, even if the private sale properties on-site are necessary to fund the building of the social homes. It means that in reality, they reject any new large-scale affordable house building.
Table 3: Eco-Nimbys, probably Green Party members, you know the ones — the type of people who weep over fallen trees on the HS2 path, despite HS2 being a piece of crucial infrastructure to increase our rail and freight capacity and reduce our over-reliance on private cars and lorries which has a huge knock-on effect on our nation’s carbon emissions and the death of more of your bloody trees.
Table 4: Anarcho-crusties / Green-Black Groups. A bit like the Eco-Nimbys but they are more inclined towards violence towards the man.

The Save Tidemill campaign only got as noisy as it did because Tables 1 & 2 framed the building of this new social housing as corporate ‘ecocide’ and therefore managed to connect with Tables 3 & 4. The campaign itself was risible. Misinformation was spread in the neighbourhood and councillors who spoke up for the scheme were relentlessly attacked. Eventually, the rhetoric spilt over into direct action.

Cllr Joe Dromey, one of the few who were brave enough to face the misinformation head-on, would eventually be attacked on the street by masked protestors. Cllr Paul Bell, who led the scheme, would take his address off the Lewisham Council website out of fear of reprisals. He had been accosted in the street as well, while leaving a council meeting.

But as nasty as the campaign got, I never felt like our plans were in jeopardy. Here were 117 new social homes, as well as 41 for shared ownership and 51 for private sale, replacing a ‘meanwhile use’ garden and an old and dilapidated block at 2–30a Reginald Road. The new green space on the development would be accessible to all unlike the Tidemill Garden, and the tenants of 2–30a Reginald Road would be provided brand new high-quality homes on lifetime tenancies. Those in housing need would be given what they deserved. The case was a no-brainer.

Lewisham Council has a Residents’ Charter that guarantees all residents impacted by a regeneration scheme are given the right to remain on their estate and guarantees an increase in genuinely affordable housing. To me, these guarantees are not only morally right, but they also make political-strategic sense.

Left-wing groups and other opportunist political opponents have desperately and repeatedly tried to leap into our estate regeneration proposals for political gain. And while they may have recruited a few new paper-sellers in the process of campaigning, they have failed to stop any major schemes.

Take the regeneration of Achilles Street, New Cross. Despite a campaign by left-wing NIMBYs spreading fearmongering and disinformation among tenants and leaseholders, an estate ballot returned 73% in favour of the regeneration. The likely outcome of this renewal will be 450 homes on site, with a minimum of 50% of the total homes built being affordable, and a minimum of 35% of the total homes built will be Council-owned homes for social rents.

Similarly, even Lewisham Council’s joint-venture with Grainger to build 324 new homes for rent off Besson Street in New Cross slid fairly comfortably through planning, with the ward’s left-wing councillors speaking in favour of the proposals. On the Besson Street scheme, 65% will be leased at market rent to fund the 114 homes which will be lease at London Living Rent. The scheme also delivered an array of other amenities for the area including a new GP surgery and community space for the New Cross Gate Trust.

The left-wing NIMBY groups rejected Besson Street because London Living Rent is not social housing. Instead, these are genuinely affordable rents set by the average incomes in the Telegraph Hill ward. Each household will sign a secure 5-year tenancy that is automatically rolled-over if they want to remain. In Lewisham, we need to build all sorts of tenures, not just social housing, and these homes are designed and will cater to our key workers who will never be eligible for social housing.

On the hoardings that line Besson Street today, someone has scrawled ‘stop social cleansing’. But in fact, these new homes will help key workers — your nurses, your police officers, your school teachers, remain in our borough near where they work. Even more absurdly, the cries of ‘gentrification’ and ‘social cleansing’ were used for Achilles Street and Tidemill Garden. These schemes offer net-gains in social housing — they are a firewall against gentrification and help low-income families remain in our community.

The left-wing NIMBYs have tried to peddle the falsehood that these estate regenerations are not supplying social housing because the new homes will be provided at London Affordable Rent — which is pegged at 2016 social rent levels. London Council target rent is now £105.87pw for a two-bedroom property, while London Affordable Rent is £158.85pw. The 13 residents of Reginald House who would be offered a new home on the development, would continue to be housed at their target rent. For the 104 homeless families being offered a new home, it’ll be a huge fall in rent and for many, the first time they’ve ever had a secure, decent home for their family.

Affordable housing funding is extremely restricted by an austerity-driven Conservative government. But as this article highlights, in 2016, Sadiq Khan as Mayor of London, managed to negotiate funding from central government for new affordable homes. While funding for social homes, at target rent, were ruled out, the government did agree to fund new homes at Khan’s London Affordable Rent. London Affordable Rent is sent at 2016 target rent levels and is deemed a social rent. While target rent levels have fallen since, year on year – a plan devised by George Osborne to reduce the housing benefit bill — London Affordable Rent has stayed static, that’s caused the disparity.

The long and short of it is that for these homes to be funded and built at all, they’ll need to be at London Affordable Rent. Working with a charitable provider and building at London Affordable Rent was the only way Lewisham Council could get this many genuinely affordable homes built at the Old Tidemill site. For activists, it’s a choice of viable developments, providing social homes at London Affordable Rent, or no new social homes at all. Sadly, I know where some groups would side.

The refusal of these left-wing activists to accept those trade-offs, reveals, more than anything else, just how out of touch they are with the lives of London’s precariat and working-poor. The median rent for a two-bedroom property in Lewisham is £365.75 per week, above the housing benefit cap. Moreover, ‘no DSS’ discrimination remains rife in the private sector. Many of our poorest residents cannot afford the private sector and if they can, they remain in overcrowded sub-par accommodation.

Even if new homes on Achilles Street and Tidemill Garden are more expensive than target rent council homes, they are seismically cheaper and more secure than the private sector. The homeless families moving into these homes will care more about a new chance in life than the fact that a registered charitable provider is supplying them a life-time tenancy and not the council. Nor are they likely to quibble about a rent far more affordable than their temporary accommodation or home in the PRS.

Don’t let perfection be the enemy of the working class.

And that’s why these campaigns do not work and never build traction beyond those four tables. Because their arguments are devoid from the lived-reality of the housing crisis and the trade-offs necessary to build new social housing. Despite our reputation, councillors are not daft. We clock that no young renters joined the chorus against the Tidemill Garden development at our local Labour meetings, even if they did follow the Momentum whip.

During Lewisham Labour’s manifesto working groups in 2017, it was noted that it was our young Momentum members who were the ones most enthused by our Besson Street plans. Not only did they like that the income generated from the scheme would help provide services for our residents, they knew from personal experience how life-changing it would be to move into long-term, stable housing in the private rented sector. Like me, they can only dream of a home at London Living Rent.

Councillors speak to residents in our wards all the time and we know that the overwhelming majority accept schemes like Achilles Street, Tidemill and Besson Street are positive. Of course, we still take precautions — we ensure we engage early on any estate regen project and we ensure the facts of a scheme are widely disseminated. On Achilles Street, we held meet-and-greet drop-ins to tackle misinformation. Yet when push comes to shove, sensitive and policy-compliant council-led schemes to build new social and affordable housing are going to have broad support.

While not as politically-heated as large estate regeneration, smaller social housing developments, such as estate-infills can be trickier. Faced by densification of their area without an offer of a new home, current tenants and leaseholders on an estate often take a ‘what’s in it for us?’ approach to the building of essential affordable housing. Moreover, infills often only remain viable if they are larger in scale than many residents are willing to accept.

However, colleagues, alongside the wider public, accept the trade-offs needed to deliver social housing schemes and policy compliant applications will often be looked upon sympathetically. Broadly, public and institutional support (i.e. amongst the council’s political group) work in tandem. It is why councillors can feel emboldened to champion our promised new social and affordable housing schemes and face down the political pressure from noisy campaigns to abandon policy complaint schemes.

But in the grand-scheme of things, I know that all these battles for social housing are small-fry. Local authorities do not have the resources to purchase new land to build social housing on. The scope of what we can achieve is extremely limited. Despite our good work, we can’t even build enough council homes to replace the ones we continue to lose from right-to-buy.

In short, only the private sector is going to get us out of this housing crisis. While affordable housing programmes have institutionalised support, across the political spectrum market-rate builds are viewed with suspicion. This suspicion leads to a widespread lack of public support for market-rate builds and in my view, this in turn leads to councillors having a pre-disposition to be swayed by NIMBY-campaigns.

In part three of this series, I’ll explain that if we don’t accept this reality, and take a new approach to development, the housing crisis will never be beaten. We need to build a new consensus — one that agrees that a lack of supply (+ building in the wrong places) is causing our housing crisis and that we need market-rate developments at large scales that we cannot deliver without reform.

This is option two, and the only one left.

Leo Gibbons-Plowright

Leo is a Labour and Co-Op Party Councillor for Forest Hill in Lewisham.

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Tags Affordable Rent, Council housing, disinformation, keyworker, NIMBY, Planning, planning reform, social homes, Social housing, YIMBY

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Shared Ownership Will Not Provide All The Answers For Key Workers Hoping to Buy

Post author By Steve Collins
Post date February 17, 2021
1 Comment on Shared Ownership Will Not Provide All The Answers For Key Workers Hoping to Buy

The Government has made the startling admission that it does not know how many people have transitioned to full ownership under its Shared Ownership model. Despite not knowing how effective it is, the Government has set out its expectation that Shared Ownership will account for the “vast majority” of the home ownership homes it funds.

Whilst the proposed new Shared Ownership model will make it easier both for people to buy an initial stake and then to increase their equity in the property, for some, the uncertainty over exactly how long it will take them to fully own their home will still not suit their needs. If you buy an initial 10% stake, after 15 years of gradual staircasing at 1% you would still only own 25% of the home. Legal fees apply at each increase and if shared owners want to buy larger shares using the existing process then all fees (valuation and legal) remain their responsibility. However large their share is, tenants also have to pay 100% of service charges.

For some aspiring homeowners, this part-rent, part-own process remains complicated and unattractive. Yet with first-time buyer deposits jumping £10,000 last year to nearly £60,000, key workers and those on lower incomes will struggle to buy on the open market. Despite the return of some 10% deposit mortgage deals, rising house prices combined with a partial public-sector pay freeze make saving this amount of money completely unrealistic for many.

As we have argued before in this blog, the key to widening access to home ownership is addressing the difficulty in saving for a deposit. It is this that is blocking many renters who could afford mortgage repayments from being able to buy a home. This has been compounded by coronavirus. The Joseph Rowntree Foundation’s annual report on poverty highlights that 41% of private renters who have seen a drop in income since March have had to use their savings to make up for the shortfall; savings that they might have been hoping to use for a house deposit. Many others didn’t have any savings to fall back on; over two thirds of social renters and almost half of private renters in the bottom half of the income distribution had less than £500.

Rent to buy schemes address this hurdle by not requiring any initial deposit when people move into a brand new house. They also provide a clear and defined route to full ownership with tenants buying their home outright at a set 5 yearly interval. Paying only an affordable rent enables them to save more for a deposit than if they were renting privately. At Rentplus we add to that by giving them a gifted lump sum of 10% of the value of the property when they are ready to buy.

In the meantime all repair and maintenance costs are covered by the landlord and service charges are included up until the point they become full homeowners.

The model is open to aspiring buyers provided they are working or in training. They undergo a financial assessment of their likely ability to buy before being accepted onto the scheme. Generally, applicants need to be on the local housing waiting list or Help to Buy or Shared Ownership register to be considered and they usually have a local connection to the area. In some areas up to half of tenants have moved out of existing social housing; freeing this up to be re-allocated to those most in need. Over half of all our tenants are key workers.

Unlike the unknown effectiveness of shared ownership in helping people to fully own their home, this spring the first of Rentplus’ tenants will become 100% homeowners after just 5 years.

Whilst all tenants are currently on track to buy, inevitably down the line some people’s circumstances will change and not everyone will be successful in purchasing at the planned date. In these cases tenants can opt to renew their tenancy in five year increments up to 20 years. If at this point they still can’t buy, we will work with the council and housing association to support them to look for new accommodation. They will have still benefitted from a 20 year affordable rent.

Rentplus’ model is fully funded by institutional investment bringing in additional housing finance and enabling councils to direct their grant funding to delivering social rented homes.

The main constraint to the model is that demand outstrips supply as only a small proportion of local authorities have adopted it to date.

Homes England reported a 34% decrease in affordable home ownership scheme starts over the six months to September 2020. Whilst coronavirus was a factor, this highlights the much greater role that privately funded providers can play in boosting the overall number of homes for first-time buyers with no reliance on Government funding.

The Government and local authorities should do more to encourage the development of innovative home ownership models on a much wider scale instead of putting all their eggs in the unproven, shared ownership basket.

Steve Collins

Chief Executive of Rentplus, the leading affordable rent to buy housing provider.
Steve has over 25 years’ experience in housing and development, both in private and public-sector organisations.

This includes working for the then Homes and Communities Agency where he had responsibility for the successful delivery of over 42 Government programmes with a combined value of c.£900m pa, aimed at accelerating the delivery of housing and public sector land across the country.

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Tags innovative home ownership, key workers, rent to buy, shared ownership

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Dangerous cladding: The government must end this crisis now

Post author By Thangam Debbonaire MP
Post date February 14, 2021
6 Comments on Dangerous cladding: The government must end this crisis now

As Shadow Secretary of State for Housing, I am extremely concerned about the remediation of unsafe cladding on residential blocks and the impact this is having on leaseholders.

I have been contacted by pregnant women trapped in dangerous flats, elderly people unable to move into retirement accommodation and families on the brink of bankruptcy after receiving five-figure bills for a problem they did not cause. These are just a few of the heart-breaking stories now common across the country.

Because the government response has been so painfully slow, hundreds of thousands of leaseholders across the country remain trapped in unsafe blocks during a third lockdown, facing increasing interim costs. When you look at the knock-on effects, including those unable to sell or re-mortgage their property, the number of people affected is much higher.

Broken Tory promises

This week, the government announced another package of measures to try to fix the cladding scandal. While headline-grabbing figure of £3.5 billion is a huge victory for Labour and the campaigners across the country who have worked tirelessly on this, it will not protect many leaseholders from mounting debt.

For many of the people affected by this crisis, this latest announcement will feel like a betrayal. On at least 17 occasions, government ministers promised that leaseholders will not be left with the bill.

Sadly, these promises have been broken by this week’s announcement, which includes the detail that funds to fix buildings will only be given to those over 18 metres tall – and the residents of lower buildings will be forced to take out loans to pay to fix fire safety problems. You can watch my speech here.

This is not the first time that leaseholders have been let down in this this crisis. A year ago, the Chancellor said, “all unsafe combustible cladding will be removed from every private and social residential building above 18 metres high.” This has not happened. Buildings haven’t been able to access the fund. Nine of every ten pounds has not been paid out.

Many of these problems stem from a refusal to properly evaluate the risks. Three and a half years on from the Grenfell Tower disaster, the government still has not done a proper investigation of the number of buildings involved, the risks or the cost of reducing that risk. Until we know the scale and nature of the problem, any response will be ineffectual.

Labour’s plan

I am leading Labour’s response to this problem and am working with campaigners and specialists from across this country – and in other countries too – to get justice for those affected.

Last week I forced a vote in Parliament calling on the Government to: urgently establish the extent of dangerous cladding and prioritise buildings according to risk; provide upfront funding to ensure cladding remediation can start immediately; and protect leaseholders and taxpayers from the cost by pursuing those responsible for the cladding crisis. I am disappointed the government did not back the motion, they chose to abstain – despite many backbench Tory MPs speaking out to protect leaseholders in their constituencies.

I believe the UK Government must establish a National Cladding Taskforce to address unsafe cladding and protect leaseholders from the costs of remediation. The Taskforce should be underpinned with strong powers to establish the full extent of dangerous materials on buildings, prioritise them according to risk and ensure there is enforcement against those who refuse to undertake works. It must be backed with up-front funding and include a legally enforceable deadline of 2022 to make all homes safe. There is more on Labour’s plan here.

What’s next?

I spoke about the problems faced by leaseholders on Question Time last week, when a member of the audience spoke about how she is trapped in an unsafe flat, with no end in sight. I will be doing all I can to keep the pressure up and spur the government into action.

The next opportunity to force further changes out of the government will come on 24 February, when the Fire Safety Bill comes back to the Commons.

This date will be a chance for the Government to reflect on the failing of their latest announcement and bring forward a set of legally binding commitments to deliver on the promises they made to leaseholders.

I am hopeful that Conservative backbenchers will also see sense and vote with us. I am particularly encouraged by the response from some Tories this week, who were vocal in their disappointment with Robert Jenrick’s latest announcement.

Last week, Keir Starmer challenged Boris Johnson on this during Prime Minister’s Questions. Justice for all those affected will continue to be one of my top priorities over the coming weeks and months.

Thangam Debbonaire

Thangam Debbonaire is the Labour Member of Parliament for Bristol West and
Shadow Secretary of State for Housing.

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Tags cladding, dangerous cladding, grenfell, leaseholders, National Cladding Taskforce

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The Great Tory Planning Power Grab

Post author By Johnson Situ
Post date February 11, 2021
1 Comment on The Great Tory Planning Power Grab

Recent planning reforms by this government are nothing else than a power grab, and risk future housing and our response to the climate emergency – writes Councillor Johnson Situ.

It takes something special to unite councils (of all political colours), planning bodies and campaigners in almost uniform condemnation. In recent weeks, MHCLG has reached that feat with a string of announcements and reforms to planning, which as ill-judged as they are impractical. Robert Jenrick has given these proposals lofty names such as ‘Planning for the Future’ or ‘Right to Regenerate’ but scratch beneath the surfaceand this is nothing more than a power grab from a national government intent on deregulating planning at the cost of genuinely affordable homes being built and our ability to respond to the Climate Emergency.

Much has been written about the impact of another top-down reform to the planning system. Firstly, it is important to recognise that the planning system does need reform. Secondly, a decade of cuts to local government has meant that the planning head count has significantly decreased over the years. Yet we must recognise the plan making process can be made far more nimble and better at including communities from the onset if planning departments are adequately resourced.

However, a recent report from the LGA which showed that more than a million homes granted planning permission in the past decade still had not yet been built highlights a wider issue that needs resolving.

Equally, our vision for building high quality, genuinely affordable housing must be coupled with our commitment to tackle the climate emergency – which includes driving up environmental standards in residential homes. That ambition is dependent upon a framework that empowers local authorities to make planning decisions that promote positive environmental and public health outcomes. However, proceeding with the recent announcement risks degrading local authorities’ ability to promote high quality, sustainable housing through the planning system.

So, if the government were interested in planning reforms that supported councils to meet the housing crisis and respond to the climate emergency, here are some things they could announce, and if not, policies the next Labour government should introduce instead:

A build out clause in granted permissions

The Government’s new Right to Regenerate proposals, which seem to amount to privatising public land by stealth, are deeply flawed. Many councils such as Southwark have ambitious council homes building programmes and are using land to build council homes. It is also silent on land banking from developers. Surely, any reforms to planning should enable planning authorities to refuse planning applications based on record of building out permissions?

Enable plan making that is responsive to the local community and changing environment

It is a well-known fact that the current plan making process takes too long, and a running joke that by the time most plans are completed they are up for renewal again. This is particularly concerning for our response to the Climate Emergency and enabling councils to develop the right policies to encourage carbon saving technology at the right time. In recent years we have seen significant strides made in the renewable energy technology and communities have come together to develop co-operative energy organisations, all of which needs a national planning framework that actively supports it.

A report by The Committee on Climate Change in February 2019 calculated that if the current 27,000-50,000 homes built in timber frame in recent years increased to 270,000 annually, this would absorb and store three million tonnes of carbon. Now this will not be the answer to meet the entire housing need, but creating a national planning framework that enabled local authorities to strengthen plans to respond to modern methods of construction, should be a priority.

Local Authorities are ready to go further and in recent times many have already strengthen their requirement for environmentally friendly energy, and increasingly car-free developments are a fixture in more local plans. Here in Southwark, we have committed to a net zero development across our key masterplan area by 2030.

Development in the area will be car free and the promotion of walking and cycling as well as electric buses, taxis and commercial vehicles will help tackle air and noise pollution. We are developing a District Heat Network linking new developments to the South East London Combined heat and Power plant, which will deliver both significant savings in C02 emissions and cheaper energy costs for residents. This will complement a range of low carbon energy options on new build homes across the masterplan area

A spatial planning system, which gives local authorities the ability to have a more formalised say in transport infrastructure

One of the key recommendations from Labour’s Planning Commission was the need for a spatial plan which provided a national framework but also placed a formal role on the local authority. The message of addressing regional inequality will be ignored if local communities get no say on whether their area has better transport infrastructure, and that applies for inner cities as well as northern towns and coastal areas. Whatever your view is on Heathrow’s third runway, it is absurd that the local authority had no formal input within the decision making, when local residents will have to live with the impact on air pollution and traffic in the area.

In short, if this government were serious about meeting the housing crisis and responding to the climate emergency, it would strengthen the role of local authorities within its most recent proposals. Instead it has continued with a decade-long vision to deregulate planning. The stakes are high, and we will need to be bold to build the social and genuinely affordable housing the country needs, as well as responding to the climate emergency. Reheated policies from the 80’s will not work and that is why Southwark Labour, like many Labour authorities, will be fighting these new proposals and campaigning tirelessly to elect a Labour government.

Johnson Situ

Johnson is the Labour Councillor for Peckham Ward (Southwark) and Cabinet Member for Climate Emergency, Planning and Transport

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Tags climate change, community engagement, Housing, planning for the future, planning reform, right to regnenerate

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How does planning perpetuate generational inequality?

Post author By Leo Gibbons-Plowright
Post date February 6, 2021
7 Comments on How does planning perpetuate generational inequality?

Credit: Ewa Horaczko London Photographer

In part one of this three part blog contribution we hear from inside the tent to what extent our planning system is truly representative and democratic. Or whether hyper-local Not-In-My-Back-Yard (NIMBY) opposition perpetuates the generational inequality we should all oppose.

It was early in the evening when I realised things were not going as I had planned. You could cut the tension with a knife. I started to tot-up how I thought the votes would go; for, for, against, against, don’t know, I…don’t know.

I swivel my chair to turn away from the public gallery. There’s nothing worse than catching the eye of someone giving you the stare. ‘These people must hate me’, I think to myself, ‘they must think we are faceless droids, nodding through applications without a care in the world’.

But tonight we’re not nodding through an application, we’re on the verge of blocking 63 new homes.

I am sitting in Lewisham Council’s planning committee. On a usual night, I would sit in faint bemusement as colleagues act out a charade — we ask for clarification, we look again at that the cross-sections, we offer apologetic looks to objectors and we firmly ask our officers to make sure all planning conditions are enforced. It is a charade because we know the application is policy compliant before the night begins. The material grounds for refusal may be as flimsy as renters’ rights, but “we’re gathered here tonight” because 5 or more people have complained about an application’s impact on their backyard. After the usual impassioned rant on immaterial considerations or a pained lament to our hands being tied, councillor’s will grant planning permission.

But tonight, is different. This application has not only generated considerable opposition, but the application itself has (potentially) solid grounds for refusal. I can see my colleagues getting tetchy. Objectors have been and gone, and as usual, a scatter-gun approach has been utilised. Locked and loaded, we’ve been pummelled with round after round of complaints: this area can’t take any more homes (it can), this will increase parking pressure (most occupants won’t own a car), this site can’t accommodate this many homes (it can). However, two complaints gain traction.

The development would replace an underutilized plot of land — specifically, a scruffy-looking light industrial estate, and replace it with 63 good quality homes, 20 of which are affordable (14 social, 4 shared-ownership) and a much-needed increase in new business space (an 110% uplift). While it was argued that the application would improve biodiversity across the site, the redevelopment would mean the felling of 38 trees. Moreover, some nearby social housing blocks would experience overlooking from the new flats. At the closest pinch point, the buildings would be 3.8m away from each other, rising to 7.2m away at its furthest. It was acknowledged that for a small number of neighbours, they would no longer be looking out onto trees but at a ‘green wall’ on the side of new flats.

To me, the choice was clear about the actions we needed to take for the greater good. Over the next 20 years, London will need to build a million new homes. It is a steep task, and that will only be made possible if politicians are brave enough to be straight with the public about our need to densify and be able to communicate the trade-offs we all need to make.

It is hard to express in words the pain our housing crisis causes, walk down any street in London and you’ll be surrounded by lives touched by it. Most councillors have seen the worst cases, the homeless families trapped for years in bedsit ‘temporary accommodation’, or the damp-infested, unlicensed HMOs we occasionally investigate. But our housing crisis touches even those who are from the outside, ‘comfortable’ — families with steady employment who know that they’re one Discretionary Housing Payment delay away from losing their home; the key workers who can no longer afford to live near their place of work, and the young professionals locked out of homeownership for life — all are transient, cycling through extortionate and insecure properties, priced out of neighbourhoods they briefly called home, simply existing, in a private rented sector not fit for purpose.

The site of this application was an urban setting, and if London is to densify as needed, we will need to accept properties overlooking each other. While a few flats would have their amenity impacted, were we really going to act for the few and not the many? If we were to block this, how long would site stay underutilised, undeveloped and unviable? Years at least.

And while we heard from the developer who told us about the quality of the design, the urban greening and green wall. And while officers mentioned our housing targets as they authoritatively flicked through their slides. We never heard from those for whom those targets aren’t just numbers, but chance in life, a future. We never do.

I’ve never once had a homeless family attend a planning committee. I sometimes wonder whether any private renter has ever spoken against an application at one of my committees? It takes time to get involved in the planning system, read papers, submit responses and attend the committee. It means we hear from the time-rich.

Our case-by-case discretionary planning system encourages people to get involved in the planning process only when a case directly affects them. The system encourages decisions to be based on a hyper-localised impact assessment, based on feedback from a relatively small number of people whose amenity will be negatively impacted. The system allows councillors to be swayed by localised concerns in the febrile heat of a civic hall. In essence, the system offers the ideal conditions for Not-In-My-Back-Yard (NIMBY) voices to be successful.

For, for, against, against, for..I think.. oh no, they’re going to vote against!

Several councillors are pushing hard on the loss of trees and objectors saw their opportunity. They brought up our climate emergency declaration and opined that these majestic trees — not accessible and at the back of an industrial estate, were essential oxygen masks for the area. The fact that old light industrial units were being replaced by energy-efficient new homes and business space was overlooked. More importantly, the fact that densification near transport hubs (like this site) is an important mechanic in encouraging a model shift to more sustainable transport methods, thus improving air quality and lowering carbon emissions long-term, was overlooked.

Again, the bigger picture was being missed and this isn’t a failure of individual councillors, but something embedded into the design of our planning system.

Another colleague rose up and said he’d vote against. Gulp, that’s another. For, for, against, against, against. He couldn’t let these homes be built due to its impact on the nearby social housing tenants. He’d listened to the homeowners who said they were not speaking for themselves, but on behalf of others, those less fortunate than themselves and who were hit hardest by this development.

16 new social homes were not going to be built because a few existing social tenants would now look at a wall of a block, rather than some trees. Again, this is a product of a system that gives councillors selective feedback. We only hear from those set to lose from any given scheme and never those set to gain.

In the end, I moved to support the officer’s recommendation for approval and the application was granted planning permission via a deciding vote by the Chair. But I was left reeling from what I saw, and my anger would only grow as I read about far larger policy-compliant schemes, being blocked by councillors across London.

In writing this piece, I hope to show how and why applications that comply with a local plan can be rejected by your local councillors. I hope to give people an insight into how our planning system’s much-vaunted democracy, tilts the system unfairly towards the well-to-do and perpetuates generational inequality. Despite facing huge housing pressure, we face a system that provides fertile ground for hyper-local opposition to block developments.

When drafting our local plan, comments from my colleagues often take a broader view, looking at the needs of our borough as a whole. The need for economic growth, densification and regeneration, and the need to tackle housing need and combat gentrification by building more is accepted. These things are then balanced and traded off against ensuring good design, protecting unique heritage, and ensuring manageable density for the area’s infrastructure.

Moving away from our ‘one-shot’ approach to planning engagement is good for democracy. By ‘front-loading’ or ‘up-streaming’ planning consultations, we can help achieve a more representative and democratic planning process. Less time-rich demographics can provide feedback at a single point when it is necessary. All in all, it will mean that planners and politicians will get a more holistic view when drafting their local plans, in an environment that offers them the space to see the bigger picture.

Moreover, the proposed move to a rules-based planning system and away from a discretion-based system is positive. It will mean evenings like I’ve described above, will become a thing of the past.

Defenders of the status quo remind us that almost 9 in 10 residential planning applications are granted permission at committee-stage. However, this is a form of survivorship bias, ignoring the countless applications for new homes that were never submitted because the risks of being rejected by planning officer or councillors are too great. The issues in our symptom run far deeper than those outlined here. In fact, councillors directly blocking new homes is only the tip of the iceberg.

Leo Gibbons-Plowright

Leo is a Labour and Co-Op Party Councillor for Forest Hill in Lewisham.

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Tags consultation, democracy, Planning, planning application, planning committee, representation

Blog Post

Ending rough sleeping needs more than a sticking plaster

Post author By Rachel Blake
Post date February 5, 2021

In December, I gave evidence to the MHCLG select committee about the impact of Covid-19 on rough sleeping. My message to them was we desperately need investment in front line housing advice and long-term funding for genuinely affordable housing to really tackle the complex causes of rough sleeping. The pandemic has shown is what is politically possible, but short-term sticking plasters really need to become longer term solutions – and now is the time to make that case to the Government.

At the start of the lockdown councils were told by the government to do ‘whatever it takes’ to support our communities. One of the actions we took was to quickly house rough sleepers. Prior to the pandemic hitting rough sleeping had been steadily increasing after a decade of austerity, having been all but eliminated under the last Labour government.

The ‘Everyone In’ initiative made local authorities responsible for housing rough sleepers and those at risk of rough sleeping. This was regardless of priority need, local connection or recourse to public funds.

We stepped up to the challenge in Tower Hamlets, the borough I represent. Around 260 individuals either rough sleeping on the streets, or at imminent risk of rough sleeping, were given emergency accommodation. 49 of this group had No Recourse to Public Funds (NRPF). We placed entrenched rough sleepers into newly procured commercial hotels and emergency B&B accommodation. Statistics are one thing but each number represents a life transformed and having a roof over your head unlocks access to so many other services and life chances.

Now we face a situation of uncertainty about future funding to support this cohort of people. While the Government has called for councils to come up with a plan on how to move rough sleepers on to the next stage of accommodation, we have again stepped up, but we need funding to back us all the way.

The Next Steps Accommodation Programme, a £400m national fund, offers some help but the costs we face are substantial. Housing benefit claims won’t cover the cost of the support for a group with complex needs. Ongoing announcements about additional funding streams create pressure on already under resourced teams to write ‘bids’ and applications for resources for projects that are so clearly needed. This relationship between local and national Government is breaking and needs urgently fixing.

Now we are in a further lockdown, with high levels of Covid cases and temperatures plummeting, we need the Government to make suitable provision. On a practical level normal provision such as hubs will not work as self-contained units are still required. If the Government does not get this right it will lead to an increase in infections. A decade of austerity has shown that if you simply turn off the funding taps in one area it leads to further pressures on other public services with longer term impacts on other services like the NHS.

It’s taken a time of crisis for the Government to step in and give councils the funding they need to tackle rough sleeping and they desperately need to address the long-term undersupply of genuinely affordable housing. If something good can come out of the pandemic, it’s eradicating rough sleeping. The Government has a real chance to not undo the progress we have made.

Rachel Blake

Rachel is the Deputy Mayor for the London Borough of Tower Hamlets. She was elected to represent the Labour Party for Bow East Ward in May 2014 and appointed to Cabinet in July 2015.

Rachel has held Cabinet Member roles for Regeneration, Planning, and Air Quality. Rachel is now the Cabinet Member for Adults, Health and Well-being.

She has previously been called in as an expert witness to the Housing, Communities and Local Government Committee on its inquiry into the long-term delivery of social and affordable rented housing.

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Tags covid-19, Everyone in, Homelessness, MHCLG, next steps, rough sleeping, Tower Hamlets