The economic and social arguments supporting social housing are strong, yet Greater Manchester has recorded a loss of 47,000 (-16%) social homes across Greater Manchester between 1997 and 2019.
National statistics show that across GM as social housing has fallen, housing waiting lists and temporary accommodation has risen.
Mayor of Salford Paul Dennett and author of “Safe as Houses” Stuart Hodkinson give their views on the state of social housing and what needs to be done to improve it.
It was the crises of two wars that shook the world that kickstarted the building of public housing in the UK. Post 1919 and 1945 gargantuan efforts were made by government to provide what they called “homes fit for heroes” returning from the wars. Truly affordable, secure and healthy homes were built on an unprecedented scale to house the working class population who had fought and endured the horrors of war, only to return to the UK to live in the ubiquitous, bleak overcrowded slums of urban Britain.
The benefits for the families moving into these well appointed homes were manifold. Increased health, wealth and peace of mind from having a suitably priced secure tenancy with an accountable landlord, who had standards to maintain, positively changed the lives of millions, across generations. But the faded memory of the conditions that led to the development of public housing, and a political agenda primed against it, has led to its decline.
Public housing owned and managed by local authorities, AKA council housing, reached a post war peak of 32% of the UK housing stock. By 2018 this had dropped to 8%, with the huge loss of 4.5 million of those homes since 1979. The majority of this loss was due to right-to-buy sales or transfer of the housing stock to housing associations and other Registered Social Landlords (RSL) organisations. Housing stock under local authority or RSL control is commonly referred to as social housing.
The transfer of housing stock from local authority control to housing associations has also created controversy, with many saying landlord accountability has been weakened. Grenfell Tower, previously council stock, was run by a Tenant Management Organisation during the disaster in 2017 and the regeneration plans for the former council owned Seven Sisters tower blocks in Rochdale, with the loss of around 700 social rent homes, is being overseen by Rochdale Boroughwide Housing.
In the midst of another global crisis a repeated cry for “homes for heroes” has been raised by the cross-party Local Government Association. Spokesman for the LGA, Tory leader of Swindon council David Renard says “we owe it to the health, care and other essential public service workers, who have risked their lives to keep the country running, to provide them with affordable, high-quality homes.”. The report, “Delivery of council housing: a stimulus package post-pandemic” published by the LGA calls for government to support councils to produce “a new generation of 100,000 high quality social homes per year.” The research presented in the report states:
- Investment in a new generation of social housing could return £320 billion to the public purse over 50 years and add more than 4 million homes.
- Every £1 invested in new social homes can generate £2.84 in the wider economy
- Each new social home would generate a saving of £780 per year in Housing Benefit.
Safe as social housing
In “Safe as Houses”, published by Manchester University Press, author and associate professor at the University of Leeds Stuart Hodkinson documents the rise and fall of public housing, paying particular attention to the changes in housing policy that led to the tragedy at Grenfell. He believes that in this LGA report, they have produced a “no-brainer” economic argument for the government to follow:
“From an economic and financial perspective it makes absolutely a 100% sense for government to borrow and build housing directly… the case for council housing in general has been established for eighty years really. The economics have never been in doubt. When the state can borrow more cheaply than anyone else, the state has land, and the state can acquire land cheaper than anyone else. So the state through its collective power… can get the best deal for anything pretty much.”
Hodkinson believes that the only people that would lose out in following the LGA’s social house building plan would be the private land owners, landlords and developers, who he says have made
enough money from the current housing system to live on it “till eternity”. He went on to point out the importance of such a large scale building project during challenging economic times:
“It’s common sense economics and it also enables the government, when there is a recession, to inject an enormous amount of money into the economy in different ways. Knowing that what it is producing at the end of it is something that is socially useful… actually building things we need. It is giving people jobs and consumption power to spend in the economy.”
Salford City mayor Paul Dennett is also the portfolio holder for Housing, Planning and Homelessness at the Greater Manchester Combined Authority and is in charge of re-drafting the Greater Manchester Spatial Framework that will provide a plan for the location and types of housing to be built across the region over the next 20 years. Dennett told The Meteor that he welcomes the LGA report, as he does any contribution to public discourse that emphasises the “need for truly affordable housing – AKA council or social housing – solutions to our current housing and homelessness crisis.” When asked if the economic case for social housing is sound, Dennett replied:
“Absolutely! There are huge savings to be accrued both at a national government level – through retaining housing benefit payments within the public sector and utilising such to create and sustain assets (council and social homes) – and local government, in reduced costs associated with temporary accommodation and discretionary housing payment costs and housing rough sleepers, accruing rental income, establishing an asset base and reducing associated issues such as poor mental health, addictions, crime, public disorder and poor health associated with inadequate housing.
“Moreover, it’s worth noting that in addition to housing benefit payments, which often find their way in to the private rented and social housing sectors, national government also significantly subsidises the private and social housing markets through the affordable homes funding routed through Homes England… which could alternatively be used to support the delivery of council housing – assets owned by local government.”
Greater Manchester social housing decline
The fact that there are strong economic and social arguments for this tenure type has not stopped the decline of social housing across the UK and Greater Manchester. The Thatcherite political and social arguments against public housing has been the dominant narrative over the last four decades. A narrative that has been embraced by segments of the media to demonise social housing and the tenants living in it, and allowed the demise of social housing to continue, despite the increasing need for it.
Data from the Ministry of Housing Communities and local Government – presented in the interactive infographics above – shows that across Greater Manchester there has been a loss of 203,000 (-77%) public houses, AKA council houses, between 1994 and 2019.
Much of this loss is due to public housing being transferred to registered social landlords such as housing associations. However adding together the two types of housing (both commonly referred to as social housing) shows that between 1997 and 2019 there has been a loss of 47,000 (-16%) social homes across Greater Manchester.
The housing waiting lists of local authorities across GM have grown as social housing declines. There has been an increase of 49,000 (98%) households on the waiting list between 1997 and 2019. Private rented homes are also on the increase with a rise of 62,000 (5%) in private rented homes between 2009-19.
Private rented homes are more expensive (social housing rents are around 60% of the market rate) less secure and often in worse condition than social housing. A report by Shelter showed that 33% of private rented homes failed to meet the Decent Homes Standard compared to only 15% not meeting the standard in social housing.
Another major loss of public housing is due to the right-to-buy policy, which was responsible for 5,000 council houses being sold off across Greater Manchester, with no replacements built, between 2012-18. An investigation in 2017 showed that four in ten right-to-buy homes were owned by private landlords, often charging up to twice the price of the rents charged by local councils.
Dennett has called for the right-to-buy policy to be suspended in GM to stop this attrition of a vital housing resource and says that this policy makes it uneconomical to build council housing through traditional routes as, “a council has no guarantee that they will not lose their investment in several years time when tenants decide to purchase their home at a knock-down rate. Similarly, significant proceeds from right-to-buy sales are returned to national government – with local councils not retaining the full capital receipt.”
Increasing need for social housing
As the visible to all homelessness crisis has grown during the austerity years that followed the economic crash of 2008, there has slowly been an increase in the public discourse telling positive stories of social housing. The homelessness charity Shelter, spurred on by the tragedy at Grenfell, put together a comprehensive commission setting out “how to build a better future for social housing”. The commission called for a historic renewal of social housing, and produced data (see graph below) that showed the huge decline of social house building, beginning around 1980 shortly after Margaret Thatcher came to power, and the subsequent lack of private house building to replace that loss.
Polly Neate, chief executive of Shelter, is in no doubt that social housing is key to alleviating the housing and homelessness crisis. This is the response she gave to the government’s Budget housing announcement in March this year:
“The big question is how much of this money will be put into the social homes we desperately need to end the housing emergency, and transform the lives of millions… Building social homes is the only solution and voices right across the political spectrum agree.”
The budget promised £12.2bn for the Affordable Homes Programme, the same programme that led to the Persimmon scandal over its record profits for a UK housebuilder of £1.1bn in 2018 and saw its chief executive pocket a £75m bonus. The budget was not so generous to social housing which saw a 1% interest cut for loans taken out by councils or RSLs from the Public Works Loan Board to build social housing.
Is the planning system the problem?
A commonly made claim is that it’s the planning system to blame for the UK not building enough housing of any kind. Once again Boris Johnson is rolling out this tried and tested narrative, claiming that: “Newt-counting delays” are a reason for building delays (a claim refuted by the LGA), and that the government will be continuing its campaign of reducing red-tape, i.e. planning regulations and legislation.
Johnson’s remarks paved the way for the government announcement last week of substantial proposed changes to the planning system, which they say will cut the red tape that makes building slow. A claim refuted again by the LGA who showed that one million homes given permission to be built in last ten years have not been built. The plans described as an “absolute sham” by a Manchester councillor will also strip council planning committees of some of their powers to decide on building projects, and reduce the contributions developers need to make to affordable and social housing.
Hodkinson believes that the planning system is not the problem and that the government is using this argument as a “spectacle form of politics” to get people to focus on the wrong thing rather than the real underlying issues responsible:
“The system has been reformed, reregulated, cutback, liberalised, deregulated every time a Tory government gets in. They take another chunk of the planning system away, making it far easier for developers to build housing and make loads of profit.
“No, the planning system is not the problem. The problem is who owns land and who controls development. What we need is more planning regulations and laws and controls to actually plan the housing we need, where we need it, and we need planning powers on behalf of the state or the local government, and also on behalf of communities to be able to intervene in those areas, and to ensure we get that housing built… When there was no planning system, we had slums.”
The government also announced last month that it is to extend permitted development (PD) rights, that allow commercial premises to be converted into housing with out planning permission. A UCL professor Ben Clifford researching this issue said “we could see even more poor-quality, tiny flats being crammed into commercial buildings lacking amenities and green space” and went on to refer to them as ”slums of the future.”
The top ten building companies dominating 50% of housing production in the UK, Hodkinson says is the real problem, as they hoard land and only release building site when they can maximise profit. The current planning system also fails to build affordable housing or social housing due to the introduction of viability assessments which allow developers to argue that they won’t make enough profit if they include a benchmark 20% of properties as affordable. Hodkinson says the current planning system has been “corrupted” and needs reforming, but:
“It needs reforming in entirely the diametrically opposite way to which the government is going. I regard [Boris Johnson’s] announcements as just another kind of land, property and wealth grab by the government on behalf of the people that fund it. The propertied class, the transnational investors, that are backing and bankrolling the party. And the individual billionaires who are depositing their ill-gotten gains from different countries into the London property market.”
Greater Manchester Spatial Framework
In his housing role for the GMCA Dennett has already launched a GM wide housing strategy which emphasises the importance of delivering social housing to create a balanced housing market. Those commitments to delivering social housing are to be repeated in the soon to be released, updated GM Spatial Framework , that will provide a housing template for the region over the next 20 years, Dennett says:
“Greater Manchester is committed to delivering 50,000 affordable homes (30,000 for social rent) in the draft plan for Homes, Jobs and the Environment (draft-GMSF) and interest made on Greater Manchester’s Housing Investment Loans Fund is to be used to support truly affordable housing, tackling poor standards within the private rented sector, bringing back into use empty homes and supporting town centre revival.
“But ultimately, there are huge numbers of obstacles to local authorities building council homes, and ingenious measures need to be introduced to circumvent obstacles placed in the way by national government. Local Authorities have been hit with 10 years of austerity, during which over 50% of our core funding has been taken from us in cuts to the central government grant and unfunded budget pressures. Assets like land and properties have been sold off, often compensating for a lack of investment, especially in northern local authorities…
“From my position, I can continue to argue the case for savings from council housing – and I can continue to make sure whatever resources possible are committed to delivering it. But beyond this, we need to be realistic. For council homes to be built on the scale they need to be, serious reforms from government must be undertaken.”
Building a movement for social housing
Ultimately we are not building or replacing social housing because the Thatcherite neo-liberal narrative that council housing is bad and full of tenants “scrounging” off the state is still the dominant one and has been across successive governments since Thatcher, both Tory and Labour.
But that narrative is beginning to crack. The Conservative party ideal of everyone owning their own home is being revealed as a pipe dream, as home ownership by younger people continues on a downward trend and the number in private rented accommodation soars. The increasing number of people enduring expensive and poorly maintained properties are beginning to see that social housing is an important part of the answer to the housing crisis and are getting organised.
Number one on Hodkinson’s list of things needed to enable a mass building of social housing was a “completely different government” and few would argue with that given the government’s recent proposed planning system changes. Hodkinson had other suggestions about what needed to happen for a new wave of social housing to begin, but he said “none of this can happen without a big mobilisation around housing and other social justice issues” and although we are not at the critical mass where change can occur “good shoots are forming”.
Housing and homeless campaigns from Shelter, Tenants Union UK, Greater Manchester Housing Action and Manchester ACORN are championing the cause of social housing, backed by the substantial evidence that it is crucial to alleviating the suffering caused by poor housing and homelessness in the UK.
The conditions are now ripe for that critical mass of public support to develop. It was the combined crises of two world wars that kickstarted public house building in the early 20th century. We now face two concurrent global crises in Covid-19 and climate change that could provide the extra stimulus for that change to occur. The Green New Deal is a policy that could help alleviate both crises and the mass building of social housing to carbon neutral standards would rationally be an essential component of any GND in the UK.
By Conrad Bower
This article is part of the ‘Raising the Roof on Housing‘ series. The housing investigation theme for this series was voted as the winner of a shortlist by Meteor Community Members. To find out more about becoming a member – click here
Feature image: Google Maps (Baguley, Wythenshawe)