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RTB won't sprinkle magic dust on threadbare housing policy

In yet another announcement by leak the Government has let serious media outlets (well, today’s Sunday Express and the Star) know that David Cameron will tomorrow announce a further increase in the maximum discount available for the right to buy (RTB), from the £50,000 announced before Xmas to £75,000. It appears the new discounts will come into effect almost immediately.

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RTB: not ‘one for one’ and definitely not ‘like for like’.

Yesterday’s publication of the consultation document (and the draft impact assessment) on the Government’s plans to increase the discounts available for the Right to Buy and for ‘one to one replacement’ with affordable homes is about as cheering as the pre-Xmas homelessness figures.
In many ways it’s a clever offer, or a clever bit of spin, in that it appears to deal with previous complaints about the RTB, and especially the lack of replacement of the homes sold, which meant that future generations of potential tenants effectively paid the price for sales.  It remains to be seen whether the proposed rise in discounts – to an upper limit of £50,000, an effective increase from 25% to 50% – will ‘reinvigorate’ the RTB as much as the Government hopes.  They estimate that some 300,000 tenants are eligible for the RTB and have the financial means to exercise it.  But many houses and the more attractive homes have already been sold and there is huge uncertainty over future property values – we are all more risk averse than we were.
A proportion of the additional receipts will be channelled back, either nationally or locally, into further housing provision.  But this will meet only a share of the cost of replacement, which will be variable between regions.  If the additional RTB proceeds only meet part of the cost it cannot be said that the new scheme itself achieves one for one replacement.  Replacement will require the use of other existing resources – land, borrowing capacity, local affordable housing funds (eg from s106 deals) and New Homes Bonus.  These should already be committed to affordable housing provision.  At best this seems like double counting and is more like a sleight of hand.
As a nationally conferred right, RTB sits uncomfortably with the Government’s commitment to ‘localism’.  Few if any local choices are available within the scheme and, given that local authorities are supposed to be in the driving seat of new housebuilding, the Government is reticent about placing the responsibility for replacing the homes sold at the local level.
Councils will not have any choice when it comes to deciding what type of replacement homes should be provided.  By central dictat they will be ‘affordable rent’ and not ‘social rent’.  Given that all of the homes that will be sold will be social rented, even if you accept the ‘one to one’ replacement argument it cannot be said that they are ‘like for like’.  The exclusion of the option to provide social rent is another step in its removal as a form of tenure and its substitution by the much less affordable and much less secure ‘affordable rent’ product.  CLG’s assertion that the provision of ‘affordable rent’ to replace RTB sales will ‘ensure that our ability to meet housing need is not impaired’ is highly questionable.  The misuse and indeed abuse of the word ‘affordable’ is getting worse every day.
The consultation runs until February and it is planned to introduce the new discounts through secondary legislation in April 2012 or shortly after.

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Tories up to their usual tricks

A horrible cough and cold picked up in Liverpool meant a weekend with a box of lemsip, a
Henning Mankell novel and watching lots of football without feeling guilty.  It was an error to switch on the computer and risk my temperature going even higher because the name Grant Shapps appeared in several places.
We are used to the parade of statistics about social housing claiming to show that it is
full of benefit dependent scroungers, caused so we are told by the policy of allocating housing according to housing need.  Having set up the Aunt Sally to throw sticks at, the Tories are feeling confident enough to take more steps in their campaign to end social
housing.  Westminster has elbowed its way to the front with their apparently reasonable new allocations policy giving significantly higher priority to employed people.  Shapps was quick to congratulate them, saying that he plans to extend the policy nationally.
Westminster’s cabinet member for housing, Jonathan Glanz, said the scheme “acknowledges and rewards” people who are “contributing to the economy…. We have
got so many people not working that it gives worklessness an attractiveness as a way of life.”  The  ex-Guardian journalist David Henke has shown what the implications of rents policies might be in changing the the social composition of Lady Porter-land – a long term ambition of the Council – and Guthrie McKie, Labour’s housing spokesperson, said: “The Council is shifting its housing failures on to the most vulnerable people in our community.  Due to its failure to provide sufficient social housing, the Council is doctoring its allocation policy… The Council is hell-bent on turning Westminster into a ‘no go’ area for the poor and low-income families.
Shapps popped up in several papers, including the Telegraph where he said: “Up until now, access to council housing has too often been blocked for hard-working families who do the right thing.  So I’m determined to end the something-for-nothing culture and replace it with a system that actively recognises individuals who work hard and play by the rules.
A conspiracy theorist, which I am normally not, might see a link between this and the other housing story given major prominence in advance of the Tory Party Conference – giving new impetus to the Right to Buy by massively increasing discounts.  The link is that people on benefits are highly unlikely to exercise the Right to Buy.
It has been a feature of council housing since the RTB was introduced in 1980 that, as council homes are bought by tenants who work, the proportion of remaining tenants who are economically inactive rises.  Many buyers still live in the same home on the same estate with the same social composition, and others have sold on to new occupiers who could afford to buy them out.  But the headline statistics show that council tenants are less likely to be in work, therefore more reform is justified because the tenure has failed.
Shapps’ thumbs were itching to tell us all about it on Twitter: “The right to buy is back” proclaimed The Great Builder.  And he provided a helpful link to a CLG webpage of questions and answers.
You might think given everything that has previously been said about council tenants that there is no-one left, apart from Frank Dobson, with anything other than housing benefit to live on.  But to justify the new RTB policy the Government has to employ reverse spin: suddenly there are plenty of tenants earning money through work who may have a bit to
spend.  CLG tell us that “38% of social tenants are well-off enough not to need Housing Benefit and over 800,000 tenants are in full-time work. Nearly 60% of social housing tenants who are couples with children do not claim housing benefit. Therefore many social tenants will be able to meet the cost of the mortgage after allowing for the discount.”
Pass the lemsip.  Perhaps Kurt Wallender has the answers.