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Labour Party Members in London are invited to a London Labour Housing Group Conference to be held on Saturday April 13 at a venue near Paddington/Westbourne Park.

LONDON BOROUGH ELECTIONS 2014: HOUSING POLICIES FOR LABOUR

SATURDAY APRIL 13     10.30-16.00

Keynote Speaker: JACK DROMEY MP Shadow Housing Minister

With * Karen Buck MP * Sir Steve Bullock * Cllr James Murray * Jacky Peacock * Cllr Hitesh Tailor * John Gray *

This Conference is for any Labour Member in London involved in or interested in housing but will be especially useful for Members standing for councils in 2014 or involved in writing Borough Manifestoes.

More details and a background discussion paper are available on the LHG website

To register for the Conference, email the chair of London LHG, Steve Hilditch, at [email protected] with name, contact details, CLP and Borough. There will be a charge of £5 on the day to help cover costs.

Sponsored by Unison Greater London

Join LHG at http://www.labourhousing.co.uk/join-lhg

A few days away in the glorious Arctic – with a two hour long view of the Northern Lights in their full splendour (see pics, included here as light relief because the rest of this piece is about filthy slimeballs rather than beautiful scenery) – were rather ruined by picking up a free copy of the Daily Mail in Oslo airport on the way home.  A mistake – even at free, the Mail is overpriced.
 
More fool me for reading it.  There were two highly contrasting stories: an attack on Hilary Mantel for criticising the Duchess of Cambridge, who, according to the paper, has suffered terrible invasions of her privacy. And a big splash on Heather Frost, 36, who lives with her 11 children in two houses that have been knocked together and who will be moving into a new home shortly.  Ms Frost also became a major feature story in the Sun, who appeared to have exactly the same information as the Mail, and dubbed her ‘the dole queen’. Her life and family were then splashed across virtually all the media.
Two points arise about this coverage. First, there were no limits on what the papers thought they could reveal about Ms Frost. We were given details of her childhood, her relationships, her health issues, and the names and ages – and pictures – of all the children, including 7 under the age of 16. We were treated to the strong opinions of ‘neighbours’, one of whom was quoted as saying: ‘It’s a disgrace. She treats her womb like a clown car’. (In fact it appears she is recovering from cervical cancer). Well I’m glad I don’t live next to her neighbours, but I wonder how long it took a journalist to get such a juicy quote?
Second, much of the information was later shown to be wrong or is hotly disputed by the victim. Her back story was very different from that presented by the rags. Her local authority seemed to be rather decent and restrained in face of the media barrage, with the lead member at Tewkesbury Borough Council telling the Today programme that the only true part of this story is that that Heather Frost has 11 children that have to be found accommodation by the council under the law of the land. Bravely facing a TV studio interview on ITV’s breakfast show, Heather categorically denied the newspapers’ accusation that she had said that if she doesn’t like the new house she has been offered she’ll just tell the council to ‘build her another one’.
To present the Duchess of Cambridge as a victim of intrusion at the same moment in time as they were ‘exposing’ Heather Frost is the height of hypocrisy. Heather Frost’s children have been exposed to ridicule and hatred and heaven-knows-what  else. This story demonstrates the nasty politics that both papers – and plenty of others in the media – play with the lives of real people, whether you like them or approve of them or not. Surprise, surprise, the right wing so-called Taxpayers Alliance also had plenty to say in condemnation (of Heather, that is, not Kate). And guess which story David Cameron condemned? At the very least it can be said that Heather Frost showed more dignity and a bit more class than the newspapers.
This all made me wonder where Lord Justice Leveson is at the moment. I was often concerned that the emphasis of his inquiry was on media intrusion into the lives of celebrities and politicians when a glance at any of our great tabloid newspapers shows gross intrusion almost every day in to the lives of very poor people who then have the weight of moral indignation thrown at them: people who do not have fancy lawyers and security guards to protect them or their children.
So what are these so-called ‘newspapers’ really up to? On Red Brick we have covered the demonisation of the poor as a deliberate political strategy on many occasions, and yesterday there was also an excellent piece on the same theme by Hayley Meachin, the press officer of the British Association of Social Workers, on Huffington Post.
As Hayley says: ‘Make no mistake, it is no coincidence that as the government seeks to make cuts to benefits, we have seen a deluge of negative stories about claimants over the past year.’

Ed Miliband made two statements this week that are of importance to housing: on the ‘mansion tax’ and on ‘trickle down’ economics.
Support for the mansion tax hits a number of targets. It is an important message that the burden of additional taxation will be felt most at the top. It is a useful source of additional revenue. And it will help control the superheated London luxury housing market, a global market that has had a significant rippling effect on the price of property across the capital.
I have a natural tendency to disagree with Simon Jenkins, and his Guardian piece saying that the income from a mansion tax should go to local government rather than the national exchequer is no exception. Given that a large proportion of ‘mansions’ are in the boroughs of Westminster and Kensington and Chelsea, there is no reason on earth why those boroughs should benefit disproportionally.  Instead, a different argument should be applied: the money should be used specifically to put more grant into the affordable housing sector to get more homes built at genuinely affordable rents.
An even bigger Miliband theme was his attack on ‘trickle down’ economics: the theory that has dominated global economic policy for three decades. By reducing taxes and removing regulation at the top, so the theory goes, more economic activity will be generated and the benefits will be felt by everyone. Miliband has previously argued that the saying ‘a rising tide would lift all boats’ cannot be applied to economics where the evidence suggests that recent economic growth has disproportionally benefited those who are rich already: wealth drifts upwards and doesn’t trickle downwards.  He quotes Henry Ford, who used to say: ‘I have to pay my workers enough so they can buy the cars they are producing’, and he sees a British equivalent in housing, once understood by Macmillan but now needing to be re-learned: for houses to be built, people have to have the income to buy or rent them.
Trickle down ideas have had a bad effect on housing policy over the decades. For many years the assumption was made that an executive house built on a new estate in the sticks helped the poor because in theory everyone could move up one leaving an extra home for someone at the bottom.  The theory never worked in practice of course because of pent-up demand and the propensity of household formation to increase when supply increased.  However the theory still dominates Tory thinking and especially that of Boris Johnson, who seems to believe that any house built anywhere in London will eventually help the poor because any extra supply will help bring prices under control.
The imbalance of supply and demand means that we will not see any benefit from trickle down for many years to come, even if the theory works. The only effective way to help people on low incomes, the homeless and people on waiting lists is to build homes that have sufficient capital grant (or an equivalent like free land) at the start to enable them to be let at genuinely affordable rents. Even these homes will eventually pay for themselves and produce surpluses that will, in time, help to subsidise more new homes, just as council housing is doing now.
The two Eds, Miliband and Balls, are slowly challenging the economic assumptions and misguided dogma that have been in place since Thatcher, revealing a more radical economic policy, and one that is good for housing prospects: tackling debt not through scorched earth policies but by promoting growth – and construction will be key.

The enormous gap between the world inhabited by David Cameron and Iain Duncan Smith and the real world of social housing residents is well illustrated by a report from the Circle Housing Group based on a survey of 1444 people across their tenure types.
Faced with what Circle’s Chief Executive, Mark Rogers, calls a ‘perfect storm’ of ‘substantial, high impact changes in their external environment, arriving all at once’ the survey aimed to uncover the financial realities faced by residents. Even before the storm arrives, 30% said they lie awake at night thinking about money issues. Only 38% save on a regular or even an occasional basis although a large majority agreed that saving is important. 57% agreed that they would ‘like to be able to save but I never seem to have any money to put by’.
With Universal Credit on the horizon, which will be predominantly an online service, less than half felt confident using technology and only 55% have internet access at home. 4% do not have a bank account but many more are ‘underbanked’ in that they have a bank account but do not use it because they prefer to use cash. Circle says that ‘Many of our customers are not aware of the changes to welfare that are facing them and how these will affect them’.
Research by the National Housing Federation discovered that 89% of social landlords expect rent arrears to increase under Universal Credit and direct payments on a monthly basis. The Government says it will switch back to payment to the landlord if a tenant gets into trouble – but by then for many of them it will be too late. Once in debt, the fragile finances of many tenants – well illustrated by the Circle survey – will make it very difficult for them to get back on course.

From an anonymous correspondent
As welfare ‘reform’ and housing cuts bite ever harder, when do we reach the point where the government concedes that the hardship caused is an inevitable consequence of rebalancing the public finances and reducing the deficit?  So far, they seem to be in deep denial.  This contrasts with the Thatcher era, because when she increased unemployment as a tool of economic policy, she at least admitted that the growth in joblessness was a price which was (on her reasoning) worth paying.
The Cameron government seems either to deny that there is any hardship or to blame anyone other than the ministers who have instituted the cuts.  Whenever some new example of the horrendous effects of their policies (here’s a good example – Ed) is presented to them they have a range of stock responses.  We’ve been wondering if there is a standard Whitehall crib sheet for ministers.  Well by sheer chance, we’ve been sent what looks like the housing and welfare crib sheet in a plain brown envelope.
In the interests of open government, here it is…
Say the cuts are avoidable. This is Eric’s favourite. The trick is to give the impression that all the cuts can be made painlessly by eliminating luxuries and sacking backroom staff.  You can use his little list.  Even the Prime Minister makes this excuse: at PMQs last week he accused councils of making high-profile cuts ‘to try to make a point’, not because they need to.  Some people will believe him.
Blame the victims.  This works well too.  Extravagant housing benefit claims may only happen in a few isolated cases, but even so the press will lap them up, especially if they are large families, unemployed, migrants or – even better – all three.  Give the impression that such claims make up most of the welfare budget.  Whatever you do, don’t admit that over half of welfare spending goes to older people as they are seen as deserving of it.  If talking about housing benefit, try to give the impression that it’s spent by the tenants themselves to fund their indolent lifestyles – whatever you do, don’t admit that the money goes to landlords who are pushing up rents because there are insufficient houses.
Use the keywords. We know it sounds boring, but you have to repeatedly refer to ‘scroungers’, ‘strivers not skivers’ and talk about ‘subsidised housing’ not council homes.  This helps confirm the impression that most welfare spending is a waste of money.  Suggestions for new and even more derogative terms are always welcome.  IDS has made a good attempt to link welfare recipients in the public mind with drug addicts and alcoholics. Follow his lead.
Blame the previous government. It’s their fault we have too few homes.  Focus on the fact that housebuilding in Labour’s last year was the worst they achieved, even though we know that was because of the credit crunch.  Don’t admit either that (a) housebuilding under the coalition is on average 45,000 homes less per year than the output under Labour, or (b) that 2010/11 and 2011/12 were the two worst years since the war for English housebuilding.
Blame local government. So Westminster’s putting homeless families up in expensive hotels and Camden’s sending them to Coventry (or Leicester, or somewhere else absurdly far from London).  Brilliant: we can say how stupid this is and tell them to stop, even though we know they can’t.
Don’t admit that policies to cut the welfare budget affect anything else.  For example, some academics argue that cuts in benefits for private tenants mean that more of them will become homeless, or that more people will need accommodation with lower rents in the social sector.  Deny that this will happen.  If any evidence emerges that shows you’re wrong, under no circumstances must you agree with it.  Better still, don’t read the evidence then no one can accuse you of knowing the facts but ignoring them.  Alternatively, officials may be able to find an obscure or outdated source that on the surface appears to contradict the evidence: use it!
Deny that cuts are taking place.  For example, is there any part of your budget that you have decided to protect, however small? Grossly exaggerate its importance.  Take a lesson from Grant Shapps: every time someone said funding for homelessness was being cut and decimating services he would point to his department’s small fund for homelessness prevention, and claim that because it hadn’t been reduced then either services had been unaffected or – yes! – any cuts were local councils’ fault.
Apply a sticking plaster.  It’s obvious to a fool that the scale of the welfare cuts must – in reality – mean massive hardship.  Furthermore, Labour will find deserving cases (people dying of cancer, homeless ex-servicemen, that sort of thing).  First, always offer to investigate the particular case, implying you might do something (even if you won’t). Second, point to the money that’s been set aside for special cases (e.g. discretionary housing payments).  Never fail to give the impression that this is sufficient to deal with any genuine hardship.  Mention the amount e.g. DHPs total £60 million in 2012/13. This will seem a large sum to the public even though it’s only a tiny fraction of the cuts taking place.
We’re dealing with it. Unfortunately some problems are so big and so obvious that you’ll have to pretend you’re doing something about them.  For example, every fool knows builders have virtually stopped building.  Given that the housing budget had one of the biggest cuts of all in the Spending Review there’s precious little we can do, but you must pretend otherwise.  First, argue that output is going up even when it’s going down (NB. Don’t appear on Sunday Politics, choose programmes where they don’t do their research).  Second, have some useful initiative available that sounds like it might solve the problem even if it’s far too small to make any difference.  Grant gave us NewBuy and FirstBuy, which both sound sufficiently impressive, but we might need to invent one or two more when people realise how inconsequential they are.  Say we are selling more homes under right to buy as if this helps solve the problems, even if we aren’t and it doesn’t.
Joking aside, Richard Vize made the excellent point in the Guardian last week that Cameron and Co. are undermining local government and failing to prepare people for the depth of the cuts that are now hitting them – with much worse still in the pipeline.  He says that ministers are ‘giving the impression that public services can indeed manage cuts without pain or profound change. They can’t.’  How can the coalition expect to be taken seriously as a government, if they make cuts on an unprecedented scale over a dangerously tight timescale, but refuse even to admit there might be consequences for public services?

Widely trailed, Boris Johnson’s speech at the CIH Presidential Dinner glossed over the dreadful failure of his housing and planning policy.  But, clever chap, he got a good press with his ‘proposal’ that London should retain income from Stamp Duty.
There can be no doubt that putting an extra £1.3 billion a year for 25 years into London housing would have a beneficial effect.  But Johnson knows fine well that the Treasury under Osborne will not allow such a thing.  Transferring the income from a national tax to London would not raise an extra penny in total, so the Treasury would have to increase another tax or make more cuts elsewhere to fund it.  He also appears not to understand that, even with an extra £1.3 billion income stream, he would not be allowed to go to the capital markets to borrow against it because that would count as additional public borrowing, which his Government says time and time again that it is opposed to.
However, we should welcome his apparent conversion to Keynesianism.  Not only did he say ‘I am calling on the coalition to give us the tools and we will solve the crisis, supporting and creating hundreds of thousands of jobs and boosting economic growth across the UK along the way.’  But he also called for councils to be given more freedom to build homes by removing the borrowing limits placed on town halls by the Government.  Perhaps he has been reading Red Brick.
I would even go so far as to agree with his statement that: ‘What is needed now is a radically different approach which optimises City Hall’s role, unlocks the potential of the capital’s boroughs, allows developers including housing associations to up their game and creates a stable supply of land for housing. Above all, London needs a stable funding stream which will support and accelerate its housing and infrastructure delivery.’
Behind his headline-grabbing Stamp Duty non-policy Johnson said a couple of interesting things that are worth noting – one encouraging and one worrying.  The encouraging comment was calling for ‘a new affordable housing settlement for London from 2015 with rents reflecting incomes and within housing benefit levels’.  That appears to be a complete about-turn from his previous positions on both rents and benefits but I would be happy to see a debate commenced based on what he said.  The worrying one was his call for further measures to ‘deregulate house building’ which I suspect is closer to his real agenda.
Johnson habitually makes a grand statement to distract attention from his failures.  His Stamp Duty plan gives the impression that he is a great radical held back by the dead weight of conventional thinking (the estuary airport dubbed ‘Boris Island’ comes to mind as another example) whilst his actual policies and programmes fail in the background.  On his performance, he still claims to have built over 50,000 affordable homes in his first term when all that happened was that the programme agreed by Ken Livingstone and the Labour Government in 2008 was delivered (slowly it has to be said).  And he still claims to be delivering 50,000 affordable homes in his second term knowing full well that the homes are unaffordable in any real sense of the term (eg rents at up to 80% of market).
So, a couple of points to press Johnson on in the future, but overall, as this was probably his biggest housing speech of the year, it was the usual mix of grand gestures, obfuscation, and diversion.  No doubt the CIH Presidential Dinner got a laugh out of him – I prefer Eddie Izzard myself – but in housing policy terms it was a damp squib.

Alan Johnson MP’s interview with Progress covered a lot of topics, including the future of trades unionism, but it was his comment about public spending that attracted my attention.
Let’s look at what was actually said in the Progress piece:

Asked whether Labour should commit to stick to the government’s spending limits for its first two years in office – as it did in 1997 – Johnson says it is ‘difficult to think what else you can do’. ‘We can’t get away from the fact that the fiscal deficit has got to come down,’ he argues.

Johnson is a sophisticated political thinker, even if I don’t always agree with his conclusions.  But throwaway remarks like this, and he isn’t alone in saying it, are unhelpful, because we have to challenge conventional thinking about public spending and, in particular, public borrowing to fund investment.
The oft-quoted example of Labour accepting the Tory spending plans for 2 years after 1997 to establish its credentials (remember prudence?) doesn’t work for me.  The Tories as much as admitted that Kenneth Clarke’s proposed spending cuts were designed to make it look as if his tax cut promises for the election were affordable: they wouldn’t have stuck to the spending limits if they had won.  Especially in relation to housing, accepting the Tory budgets set Labour on a bad course and a failure to build affordable homes that was not really overcome until 2008.
The position in 2015 will be very different from 1997.  By 2015 it is likely that output will hardly be any higher than 2008, we may have had the triple dip, and the economy will still be running seriously under-capacity.  Most people will be poorer and some people will be a huge amount poorer, especially those who were the poorest to start with.  Services across the board will have been decimated and needs will have increased significantly.  The housing crisis will have intensified even more, with homelessness rising rapidly and rents becoming increasingly unaffordable along with energy costs, travel costs and other basics.
To have policies fit for the circumstances Labour will need a radical new approach to tax and spend.  Contrary to what Alan Johnson said, it is relatively easy ‘to think of what else you could do’.  Ed Miliband’s notion of ‘pre-distribution’ caused some mirth (helpful explanations here) but is a vital concept in rebalancing public spending to limit the cost to the taxpayer of market failures.  For example, the idea of the ‘Living Wage’ resonates with people and is being taken up by a wide range of progressive employers, cutting the cost of income support.  The super-rich and mega-corporations have to pay their taxes and some new taxes (eg on the super-heated central London property market) will be justified.  The Banks carry on regardless and are still not paying for the profit-driven recklessness that caused the collapse.  Income and wealth inequality is greater than it has been for decades.
In housing, far from being ‘out of control’ the housing benefit bill is the direct consequence of policy decisions (eg not building social housing, dumping homeless people in the private rented sector) and the financial crisis (unaffordable home ownership leading to ‘generation rent’).  Building social rented housing and limiting private rent increases would help bring it down.  Housing investment pretty much pays for itself through increased taxes and reduced unemployment.  Better accounting practice across departments would allow investment in housing to be measured through savings in health and other budgets.  And, as we have argued before, changes to Treasury conventions, to bring the UK in line with international practice, could enable the public corporate sector to borrow prudentially and be much more productive.
There are many more ideas around.  But we are still a long way from a General Election and the point where the Labour Opposition has to make promises and detail its tax and spending plans.  In housing we already have some bankable commitments, notably the promise to fund 125,000 extra affordable homes (of which 40,000 would be social rent) through the bankers bonus tax and the sale of G4 licences.  But at this stage it is vital to challenge conventional views of public spending and the one-dimensional logic that the deficit can only be reduced through cuts in public services: it can equally well be reduced by a mix of policies on pre-distribution, reduced tax avoidance, targeted tax rises, and the promotion of growth and investment.
Just like challenging the dominance of the ‘scrounger’ narrative, this is another area where using the right language consistently will reap political benefits.
 

For many people the Government’s attacks on housing benefit have been something to do with people getting £100,000 a year from the State to live in the posh bits of London.  David Cameron repeated the point only last week.
Campaigning against this powerful image, repeated endlessly by the Government’s spin machine, has been an uphill task.  But it seems to me that the campaigning is beginning to pay off.  The message is gradually getting through that the HB caps, the overall benefit cap, direct payments, and now the 1% cap on benefit increases, are hitting far more than a few people in central London.  And as more case studies and examples of extreme impacts on families come to light, it is becoming common to hear people say ‘I thought it was about scroungers not people like them’.
The issue that might become the battering ram for opposition to the reforms is the ‘bedroom tax’ on social tenants.  Although causing damage nationally, the impact of the bedroom tax is greatest in the North where ‘having a spare bedroom’ has historically been less of an issue than in the south and London.  Now hundreds of thousands of people are being informed by their landlords that their benefits will be cut in April and the huge effect this will have on families is gradually reaching the media, where the Guardian, the Daily Mirror, and Channel 4 have highlighted some truly appalling cases.  Callous seems a timid kind of word to describe the collective punishment being visited on people who dare to occupy more space than the Government says is allowed.
The National Housing Federation has campaigned brilliantly on this for some time and their briefings and website reports are excellent.  Social landlords up and down the country have been warning their tenants of what is to come and raising the alarm in the media – although some of them could be more vocal on behalf of their tenants than they  have been so far.
So I agree with the drift of the argument put forward by Penny Anderson in the Guardian that the bedroom tax could ‘light the touchpaper of protest’.  She asks if this issue could become the poll tax of today, but that may be going too far because the poll tax affected everyone whereas the bedroom tax is more targeted.  But I do think it could be the issue that forces the Government to retreat as MPs of all parties face constituents in their surgeries that have a very strong case for an additional bedroom above that allowed by the miserable policy, and as tenants realise that they can’t get a transfer to smaller accommodation.
Tories need to be faced with the victims of this policy.  How many will dare do what Lord Freud did on radio and tell a woman whose son is joining the armed forces that she should get a lodger while he is away from home?
And if you only have time to read one article about the bedroom tax and its implications, I recommend this from John Harris in the Guardian.
Update: Or if you have time to read 2, then here is Jules Birch’s brilliantly researched piece on the same theme.  Not sure how he has time to read all that stuff!!

Nick Clegg has been on the media a lot in the last few days saying, amongst other things, that the Government should not have cut capital expenditure so fast in the early days of the Coalition.  This is a welcome statement although not accompanied by an apology for getting it so disastrously wrong – in housing, the cut was 60% and it has caused immense damage.
On the Marr Show today, he said the Government was committed to finding ‘innovative’ ways of raising funds for capital investment but ruled out a return to the ‘bad old days’ of traditional Government borrowing.  But, he added, ‘if people have ideas about how we can provide further capital investment into our infrastructure, without breaking the bank, of course we are open to that.’  Red Brick is glad to help.
It seems everyone is talking about getting capital investment through ‘innovative’ methods of financing these days – although it flags up in my mind the experience of ‘funny money’ loans in the 1980s (interest rate swaps and sale and leaseback of council buildings come to mind) and the expensive disaster of the Private Finance Initiative in the last two decades.  The pressure is on because the Chancellor’s economic strategy is so obviously failing and growth is nowhere to be seen, so they are casting around desperately for new ways of financing capital that are somehow consistent with ‘Plan A’.
The best questions are often the most straightforward ones.  Recently we have asked ‘why do we stick to borrowing rules that clearly discriminate against public corporate investment?’ and ‘why do we not do more housing investment when the ‘multiplier’ effect is so strong that the Government gets its money back?’  Today’s question is ‘what is wrong with borrowing anyway?’
A blog last year by leading economist Jonathan Portes, Director of the NIESR, provides most of the answer – there is nothing much wrong with borrowing even when there is a large deficit.
Portes sets out his basic argument like this: ‘with long-term government borrowing as cheap as in living memory, with unemployed workers and plenty of spare capacity and with the UK suffering from both creaking infrastructure and a chronic lack of housing supply, now is the time for government to borrow and invest. This is not just basic macroeconomics, it is common sense.’
His logic has a number of steps:

• First, the economy has shown no growth since Autumn 2010 and may not regain its 2008 position until 2014. In the UK it is now a far longer period of depressed output than the Great Depression.
• Secondly, public sector net investment has been cut in half over the last 3 years and will be cut further over the next 2. Falling construction output has become a central factor in the lack of growth and a key reason for the double and possibly the triple dip.
• Thirdly, the cost of borrowing is historically low and below the rate of inflation.  It costs basically nothing.
• Fourthly, the Government could fund a £30 billion (2% of GDP) investment programme through the traditional method of issuing gilts for a cost of about £150 million a year.  Or as Portes says, it could be funded through the ill-fated pasty tax or closing a few loopholes in the tax regime.

We need to get out more and take these arguments to the public.

One of the most consistent themes on Red Brick has been to highlight the economic benefits of housing investment.  The strong multiplier effect means that there are much wider benefits than just the original investment.  And in terms of deficit reduction, housing investment tends to pay for itself by creating employment and reducing benefit requirements.
These lessons are well rehearsed in a report published by the Northern Housing Consortium, researched and written by Sheffield Hallam University, which analyses in detail the impact that housing organisations (housing associations, councils and ALMOs) have on the economy of the north, both in terms of their day to day activities and their investment activity.
Based on surveys of organisations managing over 1 million dwellings (over 90% of the north’s social housing), who built more than 8,000 homes in 2011/12, the report estimates that they had net income (mainly rents and fees) of over £6,000 million, spent over £121 million on community investment, £1,373 million on refurbishment, £1,227 million on repairs and maintenance, and £834 million on direct employment of staff.  About two-thirds of construction spending was retained in the north.  Sheffield Hallam estimate that the organisations supported a total output of £10,269 million in the north and 116,900 full time jobs.
The report assesses the future outlook for the organisations and the beneficial economic impact they have, and highlights a number of major risks:

• Welfare reform – especially the bedroom tax, which will affect 240,000 tenant households in the north, and direct payments, which could increase rent arrears from 3% to 7% of the total rent roll.
• The ‘affordable rent’ programme, which is reducing grant input to development in the north, requiring a higher level of borrowing to fund schemes and raising rents (the relationship between social rents, affordable rents, and market rents is a major issue in the north).
• Concerns over Supporting People funding which is estimated to provide 2% of organisations’ income and which is used directly to support tenant services.
• More positively, council housing finance reform is making more money available for investment although some authorities with a ‘decent homes’ backlog face serious risks.
• And the Localism Act 2012 may provide new opportunities for organisations to deliver public services.

As the number of people employed by housing organisations in the north is as high as the number employed in car manufacturing and call centres combined, the report demonstrates that the Government’s stated policy that it wants to balance growth throughout the economy and encourage more activity in the north could be seriously undermined by its policies towards the housing sector.