We are delighted to publish our first Letter to the editor, from Paul Brocklehurst! If you would like to get in touch with your thoughts, please write to us at [email protected]
Dear Red Brick editors and readers,
I am not going to spend any time in this letter on why we desperately need more affordable homes. We are all aware of the statistics on housing waiting lists, levels of homelessness, children sharing beds with siblings, and the impact of housing costs within the cost-of-living crisis. That is why Labour’s manifesto was clear, “Labour will deliver the biggest increase in social and affordable housebuilding in a generation”. So the simple question is how?
First, the Government needs to confirm a long term, 10-year, rent settlement for Registered Providers (social and affordable housing landlords). Only then can they plan and borrow for investment. The immediate increase in borrowing capacity will free Registered Providers to bid on the heavily subsidised affordable housing provided by private developers through their s.106 planning obligations. At present, this is not happening. This limits not only the delivery of affordable housing, but that of private housing as well. This is an urgent issue and needs to be resolved now.
Second, as the Government is proposing, it needs to urgently reform the planning system to ensure that all local authorities in the country have a plan to deliver the homes they need. By 2025, 78% of Local Authorities in England will not have an up-to-date Local Plan, and 38% will have a Plan that is 10 years old or more. What does this mean for affordable housing delivery? A few extreme illustrations of authorities with high percentages of green belt and their record of affordable home building might help. York has not had a Local Plan since 1954 and built a total of 3,329 homes in the 5 years to 31 March 2022. However, after accounting for Right to Buy loses, only a net 9% of those homes were ‘affordable’. Brentwood, over the same period, delivered a total of 1,394 new homes of which a net 8% were affordable. There are more examples that could be given, but let us be clear that in these areas, and many more, local authorities are not meeting their total housing requirements and certainly are not delivering the affordable homes we so desperately need.
Third, within the planning reforms, government needs to over-emphasise the importance of affordable housing delivery while ensuring that planning authorities bring forward the right mix of sites. We all agree that brownfield sites should be considered as a priority for development, but in many locations outside of London, the costs — such as for remediation, and construction — of developing brownfield sites means that they do not deliver the expected and necessary levels of affordable housing. Take Birmingham, in that 5-year period I referred to above, a total of 17,800 new homes were built. Yet after Right to Buy Registered Providers lost a net 994 affordable homes from their stock. You need to ensure that there are enough sites, effectively green field (not to be confused with Green Belt, but perhaps those as well, certainly Grey Belt!), being developed that can deliver the targeted level of affordable housing. There need to be checks and balances to ensure that local authorities are doing this.
Fourth, social rent needs greater emphasis among affordable housing requirements. Definitions and emphasis changed under the previous Conservative administration. In 2012, they changed the emphasis in grant funding and financial policy away from social rent (those homes with rents set at around 50% of market rents) to affordable rent (around 80% of market rent) in an austerity measure to lessen funding of affordable housing. While affordable rent might address part of the need for affordable housing, it should only be viewed as a piece of a larger jigsaw. We need to bring back social rent within the delivery mix. This change has been further accentuated by Right to Buy losses as I have illustrated above. There needs to be greater flexibility in what defines affordable housing, but one thing is surely clear, that social rent should begin to once again play a greater part in delivery in many areas. When I started in development over 20 years ago, the starting point was that social rent formed a large percentage of the affordable housing s.106 obligation on sites. We need to return to a point where planning policy sets a minimum percentage of social rent within the affordable mix. We should also be willing to accept other forms of affordable housing such as discounted market sales or rent to buy. The need is not uniform across the country, just as development viabilities are not, so there needs to be greater flexibility as to what is accepted.
Finally, I would like to challenge the Treasury. Affordable housing delivery should be considered as an investment in national infrastructure. We spend £31bn annually on housing benefit. Surely, a logical case can be made to commence a programme of government-led investment in affordable housing without viewing it as current account expenditure of the nation. We will have an asset, we may eventually reduce our housing benefit bill, it will lead to benefits for the wider economy – health outcomes, educational outcomes, social and labour market mobility – it would aid economic growth, improving fairness and creating opportunity.
With Labour’s attention on immediate planning reform, its focus on economic growth and delivering more homes of all tenures, and with a willing development industry ready to deliver, bridging the gap in affordable housing delivery is achievable.
ITV’s releases ‘Surviving Squalor: Britain’s Housing Shame’ on Sunday at 10:15pm. Unquestionably highlighting some of the most horrific housing conditions endures by people and families living in social housing in the UK.
Red Brick has long forewarned about the return of squalor. The national scandal that has been the neglect of housing. But as housing associations and local authorities are the only owner operator game in town, is it time for a rethink?
For many, these conditions are everyday norms. The perpetrators are not rogue private landlords, but housing associations and local authorities. And calls for regulatory intervention are falling on deaf ears.
Some of the worst offenders are receiving the most funding
The need for social housing has never been starker. So stark even the Tory Government has made an allocation to fund 30,000 new social homes. Notably following a recent funding announcement under the Affordable Homes Programme. In London, Sadiq Khan has seen £3.46bn distributed. The bulk of the funding is conditional on an emphasis towards social rent.
This funding comes with new conditions attached. These include all new buildings requiring sprinklers and that no combustible materials exist in the facades. Nevertheless, it must be noted that the biggest beneficiary for funding affordable housing in the capital was not a local authority. Instead Europe’s largest housing association, Clarion Housing will receive £240m to deliver 2,000 homes, of which 1,250 are for social rent.
Previous concerns over controversial mega mergers are coming home to roost
Clarion Housing was a merger between Affinity Sutton and Circle Housing Group in 2016. This occurred under the then Minister of State for Housing and Planning Gavin Barwell. Two of the housing associations in the Circle group had chronic problems with its repairs and maintenance services.
Circle had found itself downgraded as a result of ‘serious issues of disrepair’. Nevertheless, the mega merger went ahead. This was despite John Biggs, the Mayor of Tower Hamlets, condemning the lack of local accountability in the transfer to Clarion of Old Ford (Circle). The original stock transfer from the local authority crucially had this as a term in the original transfer agreement, which was completely disregarded.
Highlighting local concerns about the merger, and lack of local accountability, Labour MP for Bethnal Green and Bow, Rushanara Ali questioned the Government. In response, Barwell argued that the housing associations involved believed the merger “will create a more efficient organization”.
Red Brick has long argued for the Mayor to undertake a full audit of board membership of housing associations. While not against those with private sector experience, we need to balance this with expertise in social housing, alongside experiences of tenants and residents.
Clarion Housing continues to dodge regulator judgement despite serious controversies
Clarion Housing have been constantly in the news for all the wrong reasons. Not least down to the tireless campaigning of those affected, particularly across London. ITV Political Correspondent, Daniel Hewitt, has been legendary in his journalism. In particular through coverage of the appalling conditions on a housing estate of 500 homes in South London.
It appears too many residents in 2021 are living in squalor. In this situation finding themselves infested with vermin and plagued with damp issues. The scale of the most recent case prompted consideration whether Clarion Housing breached standards by the Regulator for Social Housing (RSH). The RSH had cleared Clarion just three months prior following an investigation into a major repairs scandal 5 years before. That time concerning buildings in Tower Hamlets.
But that is only the tip of the iceberg, red tape and bureaucracy in the Housing Ombudsman is holding back a tide of cases
Last November, Clarion featured in another investigation, this time by the BBC, investigating how they manage complaints handling and service charges. To date, further action has been actively delayed by the Housing Ombudsman, giving excuses such as not being able to take it on given the different tenures of those effected within a group complaint. The Housing Ombudsman is the ultimate gatekeeper to the RSH.
Still to this date, both shared owners and social tenants continue to pursue their case with the Housing Ombudsman. Almost three years after originally raising concerns with the landlord. Yet these recent regulatory judgements do not fill them with much hope.
But what does this achieve? Cases with the Housing Ombudsman can take up to in excess of a year to process. Even after having to slog through a complaints process that can be manipulated to take over a year in itself. Experiences all too familiar for those whose landlord is Clarion Housing. Along with other dysfunctional housing associations and local authorities.
For those living in the rat infested damp ridden flats that don’t even break social housing regulations, they are left to despair. For those currently living in temporary accommodation, or those who have been made homeless for weeks on end, after repeated leaks and floods of sewage water, lack of action from the Housing Ombudsman or RSH evaporates any sense of hope.
Clarion Housing Resident, Tower Hamlets 2021
Sector needs to do more to prioritise existing housing conditions
But what is the sector doing to tackle the problem of poor housing conditions? The short answer is not enough. Co-Founder of the Social Housing Under Threat campaign (SHOUT), Tom Murtha, aptly pointed out something did not quite sit right as to why housing conditions were not even on the agenda at the Chartered Institute of Housing’s ‘Housing 2021’ annual conference. This was an event that Housing Minister Christopher Pincher could not be bothered to attend in person. Coupled with Daniel Hewitt’s lack of invitation to speak, as pointed out by Tom Murtha below:
Wondering why this is not on the agenda at #housing2021 and why @DanielHewittITV wasn’t invited to speak? Are we not concerned that some tenants are forced to live in unsafe and unfit homes and their voices are ignored? #housing21https://t.co/quahLmdW57
What was on the agenda was housing’s role in health and wellbeing. In addition to this was a panel featuring the RSH’s new Director of Consumer Regulation. Since January 2021 Kate Dodsworth has taken up the mantel. She has also talked about “the road to consumer regulation”, Although called for housing associations to fix their issues now and to “not wait for the regulator to come round in a couple years”.
Perhaps after ITV’s ‘Surviving Squalor’ is released they should come knocking somewhat sooner.
Lacking transparency, Housing Ombudsman statistics are massaged to cover the backs of its largest members
Kate is the former CEO of Gateway Housing, who topped the tables in the Housing Ombudsman own “complaints failures index”. This is despite only having found to be 9 times at fault between 2017/18 and 2019/20. Clarion Housing in comparison were at fault a staggering 129 times.
Determinations by Housing Ombudsman 2017/18 to 2019/20
Oddly, the index weights the number of determinations by how many homes each social landlord manages. In a way, this makes larger landlords appear lower down the rankings, despite having higher total numbers. Larger organisations claim they are more efficient – as aforementioned by Lord Barwell. But if true, bigger organisations should be indexed more heavily based on size. As opposed to the other way round.
In the latest landlord performance data published by the Housing Ombudsman, complaints received on Clarion Housing about complaint handling has seen a 250% increase in 2019/20 compared to 2017/18. Over the past three years Clarion Housing has received 1,899 complaints, of which 42.5% are related to property conditions.
What is not transparent from these figures is the number of tenant’s and leaseholders impacted by the complaints. By way of example, over 500 homes were affected in the ITV investigation, but these are not logged as individual complaints. Nor are they split out by tenure.
Social media is making prevalence of cases harder to ignore
In Channel 4’s ‘Grenfell: The Untold Story’ the poor treatment of residents by both landlord and local politician was all too revealing. It revealed how the then MP Victoria Borwick urged a mother concerned about being without water for days to “take baths with people next door”. This exemplifies the growing sense of the “us and them” society that we know is so deeply corrosive to our cohesion as a nation.
This remarkable footage emerged from a meeting concerning repairs and maintenance. It provides such crucial evidence of the plight put forward by many residents, many of whom are no longer around.
Snippets from this weekend’s ‘Surviving Squalor’ also highlight the ineptitudes of some local authorities too. Chronically ill Mehdi was living with water leaks contaminated with “significant faecal contamination”.
His landlord?
Lewisham Homes – a recent nominee for the Tpas England Awards Shortlist. While TPAS expressed their shame at the conditions some tenants are having to endure, they highlighted that their awards cover a range of categories. Admittedly, not just “managing homes”.
Real capitalism in the interest of humanity can help solve our low-income housing issues
So herein lies Sadiq’s funding conundrum. At present grant can only be provided to local authorities or housing associations. Some of which face reputational damage resulting from serious causes of concern and ESG related controversies.
Under the Labour-led Wheatley Act 1924 we as a country subsidised private builders to create homes for those on low-incomes. If we are to provide grant to the private sector conditional on owner operation at social rent levels, we would enable funding packages to be less reliant on those guilty of such poor management. Instead, we see the lion’s share of London’s funding for example go to a housing association with the most complaint determinations against its name. Clarion Housing.
At present we are dealing with the inability of the country to meet the heavy burdens now placed upon it. Back in 1924 private enterprise had little to no interest investing money in houses for letting purposes. Yet today we see operators indeed willing to invest. Whether this be through the burgeoning Build-to-Rent sector, or the nascent Single Family Rental sector, the local authority and housing association is no longer the only possible investment partner to bear these costs.
At the time, John Wheatley described his socialist housing funding proposals as “real capitalism – an attempt to patch up, in the interests of humanity, a capitalist ordered society”. Yes you read that correctly. The first socialist Labour government knew it had to patch up these interests through what it described “real capitalism”. For this reason, it is not outside Labour principles to fund housing at social rent levels for direct provision by the private sector. Nor has it ever been.
We need to diversify who owns and operates social housing
At present, only Registered Social Landlords can own and operate affordable housing under the eye of the regulator. Often forward funding from housebuilders and developers who do not have a long-term interest in the construction of the property. We have seen Clarion Housing’s own Group Director of Development highlight the “lack of commerciality in the sector”. It comes as no surprise that we see just as many issues with new build social housing, as we do with buildings coming to the end of their life.
In America federal states fund the construction of affordable rental housing for those on low-incomes through conditional tax credits. They provide this to both for-profit and not-for-profit owner operators through its Low-Income Housing Tax Credit (LIHTC) programme. By being sector agnostic both state and federal government drive competition, and thus commerciality, into funding programmes.
We should explore progressive innovative new funding models of low-income rental housing. For those on the left we cannot shun the private sector. We must work progressively with it to provide more options for those in most housing need. This will allow government to be less reliant on some of the worst offenders to deliver housing for those on low-incomes.
The ultimate goal?
To make fewer people have to survive squalor.
Christopher Worrall
Editor of Red Brick.
He sits on the Labour Housing Group Executive Committee, is Chair of Poplar and Limehouse CLP, and co-hosts the Priced Out podcast.
