14. REVOLTING BABYBOOMERS!

28th November 2018

It’s all our fault…I and my fellow babyboomers haven’t been building the homes we need…for decades.

So said our latest Housing Minister, Kit Malthouse, at a recent housing industry annual lunch….and he was roundly applauded for this perceptive and courageous critique of our housing record.

I really am not to blame, Minister, and that kind of throwaway but calculated remark at the end of a speech really makes me angry: no doubt it was in your briefing notes.  

I know you’ve only been in office for a few months, and you were gracious enough to acknowledge that you might not be there for very much longer...always good for a laugh the number of Housing Ministers we have had, except it isn't a joke…but I suggest you send your SPAD on a history course to learn what has really been happening about housing…well, at least for the last forty years…four decades should be enough to make sure you understand the real causes of why we haven’t been building enough homes…and then you might be able to devise some policies that really tackle the problem.

The Financial Crisis…and getting back to normal
After the 2007/8 housing market and global financial crash, it was too tempting for government and industry to think that ‘getting back to normal’ was the immediate task ahead. It was a time for reassurance and reversion to the familiar: though how the housing market behaviour of the preceding decade could ever have been thought of as a reassuring experience is mystifying. Plentiful evidence of how the crisis was emerging was steadfastly ignored.[i] All governments seemed determined to not address the fundamental flaws of a market that had not just broken in 2007/8, but had been dysfunctional since a much earlier financial crisis.

In September 1976, in response to the International Monetary Fund’s intervention, the Treasury dispatched civil servants to explain to councils the implications of DoE Circular 123/76.[ii] The ‘bright young man’, who came to my council in North London to explain this clever new policy to save money, told us authoritatively that ‘the party is over: it is not the function of government to spend on council housing or infrastructure’. He was genuinely surprised to be told that development usually went quicker and more cheaply if preceded by its infrastructure, and that housing prices and the performance of local housing markets were usually more stable and less volatile when there was a sufficient supply of new affordable housing. Although those responses could be found in any standard housing economic textbook of the time, the Treasury seemed to be unaware of them.



Even if a government wanted to prioritise home ownership in its housing policies...these might be some sensible things to do, according to an outline of an essay I did in my first term studying Land Economics at university in 1967...almost certainly copied straight from a standard textbook.

Litany of political failure and lack of leadership

The so-called ‘cap on council house building’ dates, therefore, from 1976 under the Labour government of Jim Callaghan, though it was reinforced and kept in place by both Conservative and Labour Governments, entirely on ideological grounds about tenure preferences and the power of local government relative to national government, and without any regard to the contribution that social housing supply makes to local housing markets and the national economy.

Since 1976, we have experienced a series of missed policy opportunities and policy failures that have reinforced the damaging long term impacts of that policy…here are just a few:

·         The failure by Gordon Brown to ask Kate Barker the right question…twice: how spatial planning and investment in infrastructure could be effectively integrated at national, regional and sub-regional levels to enable the cost efficient and speedy construction of new homes.  

·         The failure by all governments to recognise that s.52, and later s.106 planning agreements and Community Infrastructure Levy were and are not a fit-for-purpose substitute for public investment in essential infrastructure, including affordable housing.

·         The failure by Labour to restore local government financial autonomy through the Lyons Inquiry into Local Government 2007, and to reform and/or update council tax valuations since 1991.

·         The failure by Labour to deliver the ‘double devolution’ of powers and responsibilities to councils and communities as part of the modernising local government reforms of the early 2000s.

·         The failure by all governments to modernise, reform and diversify the housing supply side, as identified by the DCLG Housing Construction Task Force (2008-10),[iii] whilst continuing to inflate housing costs through demand side subsidies like the Help to Buy policy.

·         The failure by all governments that continues to this very day current to maintain an adequate supply of affordable housing in specific market areas to mitigate against volatility in both ownership and rental markets; with 1m fewer affordable homes in 2018 than there were in 1980 (whilst the population has grown by over 7m people).

·         The failure by all governments to prevent over £400bn of the Bank of England’s Quantitative Easing programme being used to inflate asset values (primarily urban land prices), creating long lasting market distortions, rather than investing in infrastructure and new housing.

The Problem with Land…no one wants to deal with it
In 1900, Cass Gilbert, later the architect of the Woolworth Building in New York, was right in saying, “The building is merely the machine that makes the land pay”. It is hard to accept that a century later, that principle is now fully embedded in the omissions and commissions of UK government policy that will take a great deal of undoing. To this day, the penny has yet to drop at the Treasury. At a recent event in Parliament, the former Permanent Secretary to the Treasury, Lord Macpherson, claimed he spent years trying to convince his Treasury colleagues that we needed to tax land, “It worries me...that we don’t have a land tax…In a sane world, we would have a proper land tax.” But he was the one who was branded ‘mad’, and so our Treasury remains totally economically illiterate about land price, its impact on resources available for social housing and infrastructure, and its other macro-economic effects. We are still living with the consequences of those hopeless decisions in 1976.

The words of Grant Shapps, many Housing Ministers ago, “We need a housing market that’s BORING…where things are really quite predictable,” illustrate his frustration at a situation that was nevertheless beyond the appetite of government to address with policies that would have actually made a difference: building more social housing.  In the face of comments reliably attributed to the then Chancellor of Exchequer, “I don’t understand why you (Nick Clegg) keep going on about the need for more social housing – it just creates Labour voters” and to the Cabinet just before the 2015 General Election “Hopefully we will have a little housing boom, and everyone will be happy as property values go up” that policy option was never likely.

These two diagrams, left, tell an interesting story about the slide from coherence of housing market behaviour pre-1985 and Big Bang to an extended era of divergence and volatility that continues to this day, and the relationship of land and housing prices to national economic performance.

 

The Ultimate Question




There is now a surprising, but also long overdue, consensus across the political spectrum that more social housing is urgently needed; not just because the needs of unhoused households are so great. It is at last recognised that the absence of a sufficient supply of affordable housing increases the volatility of housing costs for everyone, and imposes a significant deadweight of additional costs on the public purse in health, social care, public safety and criminal justice policy areas, to name a few. Minister, this has been known and evidenced for decades.[iv]

The lifting of the cap of council house building, announced by the Prime Minister at this year’s Conservative Party Conference was very welcome. But it was not, as often implied in commentary, the relaxation of a recent short term restriction. It’s been 42 years since it was originally applied…thus proving Douglas Adams right…the answer to the Ultimate Question of Life, the Universe and Everything really is 42. 


But as the computer Deep Thought observed when he had finally calculated the answer (apologies if you are not a Hitchiker's Guide to the Galaxy fan)…‘You’re really not going to like it, you know’…and they are not, the politicians and the Housing Ministers, every one of them that have held office since 1976 are not going to like 'the answer'.. 

The only people responsible for there not being enough affordable and safe homes for all are YOU. 

---

[i] Inter alia Ambrose P et al (2005) Memorandum to the Prime Minister on Unaffordable Housing Zacchaeus 2000 Trust, http://taxpayersagainstpoverty.org.uk/files/Z2K_Memorandum_to_the_PM_on_unaffordable_housing.pdf  and Harrison. F (2005) Boom Bust: House Prices, Banking and the Depression of 2010 Shepheard-Walwyn http://thepropertyhub.net/tpp069-18-year-property-cycle/

[ii] http://dclg.ptfs-europe.com/AWData/Library1/Circulars/Department%20of%20Transport/1976/006-76%20DTp.pdf

[iii] http://webarchive.nationalarchives.gov.uk/20120919192621/http://www.communities.gov.uk/documents/housing/pdf/1526670.pdf

[iv] “The Real Cost of Poor Homes” Ambrose P (1996) & “The Real Cost of Poor Homes: Footing the Bill” Barrow. M and Bachan. R (1997) RICS, and “Debt, Death & Deadweight – The Acts of Parliament” Harrison. F (2018), https://landresearchtrust.org  which explores the revenue-raising alternative to taxes that destroy people's wealth, health and welfare.

13. 'WE ARE THE VOICE OF THE DEMAND SIDE!'

I’ve spent almost a year trying to write Part 2 of Big, Bold and Beautiful …against a policy backdrop for housing and community housing, in particular, that has been either constantly changing or completely stuck. At the recent National Community Led Housing Conference in late November, I was asked to make a short contribution to one of the plenary sessions, attended by over 300 people, on the subject of ‘Scaling up, not selling out’. I spoke on the subject of ‘Growing a niche vs. changing the mainstream.’

 This is an extended version of what I said at the plenary, which I realised was what I had been trying to write all year.  So, here is ‘Big, Bold and Beautiful Part 2’, which invites you to consider that our ambition for ‘scaling up’ is about much more than just housing. Community housing is taking local action on political problems that politicians can’t or won’t tackle; particularly the impact of land prices on social and economic inequality and national productivity. It is our commitment to tackle these much bigger issues that is the natural and best safeguard against an enlarged community housing sector ‘selling out’ on our values.

 

 

Niche…mainstream…small and special…large and special…all terms of comparison that suggest that one solution about the scale of community housing may be better than another. But, what exactly are we comparing? Building another home is…just building another home. What’s special about that?

So, why do we do it…community housing? It’s the question that people in positions of power ask: “Why are you doing this? This is what we do!” Except of course, they don’t. It’s the question that colleagues ask “Why on earth do community groups spend years of their lives doing what the market or public policy should offer?” Except of course, they don’t offer.

‘Why’ is the question I always ask groups when they’re starting out, and the answers are only partly about housing. But they are all about identity and place, and politics: not traditional left and right party politics, but important ideas about how they want to live. The sense that they are working together with others to resist powerful forces that are not for the common good…being excluded from your home village, your home neighbourhood…or the opposite…being abandoned and left behind…paying so much money to buy or rent your home that the rest of your life is impoverished… loneliness and isolation, especially for older people…the effects of climate change…or a phrase I heard just recently, “These new places have no soul.”

These issues lie at the heart of a politics that so-called mainstream politics is not touching. Yet ironically, it is the catchphrases of important recent political events that describe our concerns. Taking Back Control…a feeling that autonomous communities should be able to influence the forces that affect them. “Local governance” is how one group described their purpose. Better Together…the fact that the citizen and the state can work together to do things that neither can achieve on their own.

Imagine a city mayor or government minister proposing to break the link between house prices and the market and link them only to income, as the London CLT has done through effective community organising at St Clement’s Hospital? That would be a brave politician. But we citizens can do this if we think this is the right thing for our place, our community; and the state can then work to help us.

The power of community organising and community knowledge

The Living Wage Campaign also began through community organising. No politician would have dared embark on such a risky endeavour; unilateral interventions into the labour market. But now it is established as a widely accepted norm, politicians can endorse and adopt it without risk. Businesses respond to the moral imperative, through peer pressure, political scrutiny and public opinion. There are many historical precedents of social innovation led by citizens and civil society organisations, and subsequently adopted as public policy norms: public education, public libraries, public parks, hospitals, birth control, probation services etc. Some of these are now returning to their community roots as ‘austerity’ or ‘small government’ dogma bites. Therefore, why not also ‘housing’ in the control of those who live in it? 

Davis receiving his wizard's hat as the first

recipient of the John E Davis Award for

Scholarship at the 2012 Conference of the

National CLT Network USA in Burlington,

Vermont

When Bernie Sanders became Mayor of Burlington in Vermont, in 1981, he faced an affordable housing crisis in the city. He did two things. He brought community organising into the town hall, and brought in an ‘expert’, John Emmeus Davis, from the Institute of Community Economics, to advise the state and its citizens on how to set up community land trusts. Davis describes community housing groups as occupying ‘the contested ground at the intersection of property, power, and place.’  He joins with other practitioners and advocates of community organising, like Luke Bretherton, writing in his recent book 'Resurrecting Democracy', in emphasising the need for community groups to own the information about their circumstances and the particular local context in which they are working.
The relaunch of the Community Housing Fund, by the Housing Minister at the conference, is therefore an extraordinary opportunity. The Community Housing Fund’s investment into an expanded network of local community housing support hubs will create a unique laboratory of housing market innovation, with a wealth of locally gathered evidence about what is needed and what works in particular places.

Government has never before put resources into developing highly localised policies. Civil servants are still nervous about it, and are probably wondering why such a lot of effort needs to go on spending quite a small amount of money: small for them, that is. They certainly can’t develop locally appropriate housing solutions on their own. But we could help them, and together we can learn how to make housing policy differently. We should all thank that nice Mr Osborne, the most political of recent Chancellors, and author of the Community Housing Fund, for this extraordinary political opportunity to scale up our influence, and help change the mainstream politics of housing.

Fair Housing - Protest, Action, Hope 

City Hall, Burlington, Vermont -

Fair Housing Month is a regular part of

civic life

Those in established positions of power commonly think of community housing groups as a kind of protest…implicit criticism of them… sometimes a threat, but mostly a bit of a nuisance. They might well be right. The market and policy have failed to provide the kind of housing many citizens need, as even central government now readily accepts.

But Davis describes citizens and communities as problem solving as well as problem defining. These are protests, certainly of anger, but not of victimhood. They are protests for a better future, rather than imagined happier pasts. These are protests of impatience and action, with citizens volunteering to do it themselves, rather than waiting for solutions that have not yet come from those who might have been expected to be more helpful and competent.

They are, above all, protests of hope. One of the longest serving volunteers at the RUSS self-build CLT project in Lewisham was asked about his attitude to the project after he failed to be allocated a home in the ballot, “Oh, I’ll continue to support it. There are not many things that you can do that are so hopeful.”  That’s what ‘Taking Back Control’ and ‘Better Together’ can look and feel like: genuine civic participation of a kind that we desperately need to rebuild the foundations of our decaying democratic institutions, and repopulate them with people experienced in practical local political activism, and not political careerism.

Terms like ‘niche’, ‘small is beautiful’, ‘alternative’ (to what?) are all tried and tested tactics used by those already in positions of power and influence for defining ‘the other’, and then marginalising ‘the other’ as a perceived threat to their interests: ‘the other’, in this case, being all of us citizens.  Whereas, in an effective democracy, citizens and community housing groups should justifiably have as powerful a voice in making housing policy as the supply side: the housebuilders, housing associations and professionals with whom central and local government traditionally make their housing policies and plans.

The demand side has never had a place in policy making.  We citizens are the voice of the demand side. It’s time for us to become a powerful voice in making housing policies that are right for our places. Community housing is not a niche activity; it is about fair housing opportunities for all.

The task ahead…not more of the same

All the national community housing bodies must now work productively together. They must build on and share their strengths, and acknowledge and repair their weaknesses. They will need to reimagine their identities and structure. Some already are. The primary task is no longer to secure a future for themselves, but to grow the number of informed everyday citizens actively involved in the housing challenges of their place, creating powerful networks of national and local voices arguing for and actually delivering fair housing solutions. They must work together with national and local government in a new fair housing alliance that speaks for every citizen and every community.

Attending two launches of new local community housing hubs, since the conference, was affirmation, if any was still needed, that only effective local networks of involved citizens, community groups, councils, landowners and enabling professionals and developers have the entrepreneurial capability to expand community housing production. The Community Housing Fund has the ability to give new momentum to the policy trajectory initiated in 2009 by DCLG’s Housing Construction Roundtable, charged by the Treasury with diversifying the supply side and increasing housing supply overall after the financial and housing market crash; including with community and self-build homes.

The one-off project specific support developed in the early days of CLTs, and the piecemeal resources available to housing projects emerging through the Community Rights programme have been critical to creating the political moment in which the Community Housing Fund became possible. The CLT Start Up Fund, for instance, was essential for its time, and will continue being valuable. The Community Right to Build Seedcorn and its successor programme filled a temporary gap. But now we need something radically different.

The bureaucratic and geographic limitations of Community Rights, their policy instruments, and the thinking that goes with them, are simply not fit for the purpose of creating new markets and expanding supply through community housing. If they need to be retained at all, they should be re-focussed so that they are not just one more of those unnecessary barriers to production that then takes an age to be removed. The number of CLT and cohousing groups have doubled to over 350 active projects in the last few years. There are have been a small handful of Community Right to Build Order projects since 2011. Draw your own conclusions. Holding on to past practice and policies in one policy area will become a serious and damaging drag on progress in another.

Our role, as citizens and community organisations, is now the creation of new markets, expanding supply and innovating in a policy area almost devoid of innovation, with new products, new suppliers, new ideas about building design and social organisation. We actually do this rather well already. We make markets by liberating the energy, intelligence and knowledge of citizens and our communities. If only existing rules apply, we will only get what we always got. We know that doesn’t work, and so the Fund would be wasted: ‘doomed from the start’!

The role of government is to retain strategic oversight, (as seems to be the intention with a departmental advisory board), and to focus investment on what works in particular places, or has greatest potential to work in the future, and can be used to improve mainstream production. As Professor Whitty, the Government’s Interim Chief Scientific Adviser, said in his address to Care and Repair England, just before Christmas, about how government should respond to citizens’ demands for new housing and care choices for older people, ‘Look at the data, and listen to what people tell you’.

 

 

REMEMBER? WE ARE THE VOICE OF THE DEMAND SIDE!  

The role of community organising is examined more fully in  my essay ‘Taking self-build out of its ‘small and special box’: citizens as agents for the political and the social of self-build’ (pp 247-266) in ‘Self-Build Homes: Social Discourse, Experiences and Directions’ edited by Michaela Benson and Iqbal Hamiduddin and published by UCL Press December 2017

Available to download http://discovery.ucl.ac.uk/10038399/1/Self-Build-Homes.pdf