Yvette Cooper MP on housing

Below are the responses from Yvette Cooper MP to London Labour Housing Group’s questionnaire to Leader and Deputy Leader candidates on housing.

Yvette-Cooper-portrait 2Britain is only building half of the homes we need annually. What specific measures will you take to increase house building?

When Yvette was housing minster she was the first in years to achieve 200,000 homes a year- and she has talked of the importance of reaching 300,000 homes a year to meet need.

At the election we had a good list of measures to support house building and we should not discard the good work of the Lyons review. But we need to be more ambitious. So we should be looking at ways to prioritise support for councils and housing associations to build housing. Yvette as housing minister set in train the Eco-towns programme which has completely run into the ground since. We should be returning to that kind of ambition with new towns and urban extensions. And we will need comprehensive reform on planning and on the expectations on the Mayor and Boroughs in London on affordable housing.

How would you reform the private rented sector to make it more stable and affordable for tenants? Do you support: a national register of landlords; b. some form of rent regulation?

Yvette does think strong regulation for the Private rented sector is important. We were right to propose some form of rent stability for tenants – and it was ridiculous to attack this as 1970s style rent controls and therefore beyond the pale. There is definitely a need for some kind of register of landlords too. Labour’s support amongst private renters rose sharply at the election – it was one of the things Ed Miliband got very right – a focus on these people who are a large and growing group who wanted more protection from Government and we should continue to speak up for them. We should not simply repeat the offer we had at the last election and should start a conversation with private renters and landlords about how we can be even more ambitious.

Will you support the proposal, backed by former Labour Housing Minister John Healey MP, that we should aim to build 100,000 homes a year for social rent?

John succeeded Yvette as housing minister and was a great housing minister and Yvette is delighted to have his support for this leadership election. Clearly there are always risks in someone who wants to be leader of the opposition promising a specific spending commitment this far from an election. But we have never achieved the kind of level of house building we need without a significantly higher level of house building in the social rented sector, and Yvette has talked of the need for 300,000 homes a year in the UK.

Will you support the removal of the HRA borrowing cap, to allow councils to borrow prudentially for investment in housing?

Yvette believes that the Government has been utterly wrong not to be more flexible in allowing councils to leverage revenues for more house building especially over the last few years when construction sorely needed a boost, interest rates were at record lows and the economic case was unarguable. Clearly councils have the capacity to build more homes and that the HRA cap currently prevents that and that is something that will need to be dealt with if we are going to build the homes we need.

Do you agree that estate regeneration schemes should involve no net reduction in supply of social rented homes?

We need tough requirements on councils and the Mayor to deliver affordable homes – and that should include when estates are regenerated. But we need to be careful not to be too inflexible. Some councils have used regeneration of particular estates to build larger numbers of homes in a different part of the Borough than could be built where the project is happening. Yvette is clear this cannot be an excuse for undermining affordable homes requirements but we shouldn’t be absolutist about it.

Do you support the Right to Buy for council tenants and if so what reforms, if any, would you make to it? Do you support the extension of Right to Buy to Housing Association tenants?

In some circumstances it is right and proper for long term tenants to be able to buy their council homes – but we have to ensure that these are replaced and we need to reform right to buy to ensure that the homes sold are replaced – and that discounts are set at a sensible level that means that the homes can be replaced too.

Yvette is opposed to the extension of Right to Buy to housing associations. The problem with this policy is the Government hasn’t thought it through and can’t deliver. Between 2012 and 2014 there were 2,298 new homes funded by RTB proceeds – 22,899 were sold.The Government are only replacing one in 10 homes. That is a disgrace and makes the policy unworkable. Yvette will oppose this policy. Her plan to build 300 000 more homes will include housing association properties and council homes as well as different housing including homes for the elderly and first time buyers.

Do you support the Chancellor’s decision to cut social rents by 1% per year?

The way the Chancellor announced he would cut rents at the budget was very irresponsible. Clearly affordable rents is important but this is about the Chancellor trying to cut housing benefit costs off the back of housing associations. The OBR confirms it will mean fewer social rented homes are built – and there’s a real risk it will mean the debt of housing associations comes onto balance sheet hitting national debt and undermining housing association’s independence. The real reason for rising Housing Association rents is the Government’s failing affordable rent model – which we must fundamentally review.
Do you support policies to switch resources rapidly from meeting the benefit costs of high rents to investing in new homes at genuinely affordable rents?

When Yvette was housing minster she was the first in years to achieve 200,000 homes a year- and she has talked of the importance of reaching 300,000 homes a year to meet need. We need to get cracking and that will help to get the housing benefit bill down.

Do you agree that affordable housing definition should be based on households not spending more than 30% of net income on housing costs?

Affordable housing should mean affordable and the Government’s definition and affordable housing model means that much of what is called affordable housing is in no way affordable. That needs to change.

Would you relax restrictions on building on the Green Belt?

We need to protect valuable green belt land and ensure that we build the housing we need. We should look at where the balance is right and where it is wrong- but we need to ensure a robust brownfield first approach.

Would you reverse permitted development rights allowing offices, shops, and other employment spaces in dense urban areas to change asset class and be converted into flats without planning permission?

There are clearly changes happening online and to the high street, and to working practices which are changing the nature of the kinds of properties we need in cities. And we do need more housing. But Yvette is worried that the Government’s changes are a blunt instrument that risks economic damage where valuable business and community assets are taken out of use – and substandard housing. So we need to review this policy.

How would you secure more affordable housing contributions from private developers through the planning system? How would you change the current approach to viability?

We need a fundamental look at both affordable housing and planning gain to ensure that we are generating the housing and the infrastructure we need. We need to ensure that there is a robust process to ensure that economic viability is not used as an excuse not to meet developers’ responsibilities for affordable housing or infrastructure.

Would you support devolution to the Greater London Authority and city regions of control over: a. private rented sector regulation; b. Housing Association regulation; c. Right to Buy?

Yvette wants to see greater powers over housing and the rental market for the GLA and Mayor.

Will you commit to restoring the previous Labour Government’s homelessness safety net for priority groups and to improving support for single homeless people?

The last Labour Government virtually eradicated rough sleeping and this has gone backwards under this Government. We need to reverse that and Yvette wants to build on the lessons we learnt from these successful schemes.

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Caroline Flint MP on housing

London Labour Housing Group sent a housing questionnaire to all of the candidates for Leader and Deputy Leader of the Labour Party. Caroline Flint MP has responded in detail to the questions that we posed, and her response is set out unedited below. We will of course publish any other responses received.

Caroline Flint MP answer LLHG’s key questions on housing.

1. Britain is only building half of the homes we need annually. What specific measures will you take to increase house building?

Since 2010 the government has blamed local councils and the planning system for being a block on new homes being built. While some reform to the planning system to make it faster and less bureaucratic is welcome the government failed to acknowledge that the main block to building homes has been money. Housing Associations are starved of grant money to build affordable homes; councils are held back by the HRA debt cap, first-time buyers can’t save for a deposit and so house builders can’t build homes that people can afford to buy.

This situation is being made worse by the government’s changes to housing policy since the election: the loss of income to councils and HAs reduces their capacity to borrow to finance the building of new homes, the forced sale of voids means that councils have a disincentive to build new council homes if the government will force them to be auctioned off before anyone from the waiting list is able to move in.

A Labour government in 2020 should give councils the power to build homes to meet the needs of local people, it must give security to housing associations to be able to borrow on the private market, at no cost to taxpayers, to build homes for rent and affordable home ownership and we must work with private developers to unleash the tens of thousands of homes which have planning permission but which aren’t being built.
As a Housing Minister I promoted Community Land Trusts, to enable communities, particularly rural, to retain new homes for local people. I promoted new Eco-towns, largely abandoned by the Tories in favour of a small number of “Garden Cities” with lower standards. For urban areas, alongside council/social housing co-operative housing could play a bigger role.

2. How would you reform the private rented sector to make it more stable and affordable for tenants? Do you support:

a. a national register of landlords;

Yes, but it would work most effectively if applied where councils need to resolve problems associated with private rented properties.

I spent my childhood in the private rented sector, but those days of secure tenancies and fair rents has disappeared. Today, the Private Rented Sector is not functioning in the way it should.

At the top end of the market professional renters can’t afford to buy and are stuck renting well into their 30s, faced with an array of charges from letting agents at the start and end of tenancies.

At the other end of the market people are forced into overcrowded, dilapidated and overpriced homes because of the lack of decent social and affordable housing.

40% of the Council homes sold off under Thatcher are now privately rented – not what was envisaged. Many of these now represent some of the homes in the worst condition, with the poorest energy ratings. I would take steps to force landlords to improve the condition and warmth of properties in order to qualify for any housing benefit.

In certain towns and cities in order to stop neighbourhood blight, (landlords creating vacant properties, clustered to drive down prices) councils need to introduce registered landlord schemes and ensure that inspections and neighbourhood monitoring was covered by the costs of such schemes – something not permitted at present.

My main concern is over standards: making sure that landlords aren’t putting tenants lives at risk in unsafe homes, that children have a safe and healthy home and that people aren’t ripped off by either landlords or letting agents. This means a much broader approach to the sector than just an excel spreadsheet with a list of landlords on – we need good, enforceable standards, we need to tackle rip off letting fees that see tenants forced to pay through the nose for basic administration or simply to carry on living in a home where they’ve been for years – and most importantly, we need to get building so that there are enough homes to meet the needs of people in London and across the country without having to rely on the private rented sector to pick up the slack.

b. some form of rent regulation?

One of the problems of the PRS is that it’s made up of lots and lots of small landlords, all of whom have different financial situations. I want people to have certainty about their rent and their family budgets but I don’t think that a blanket policy on all rented homes, applied retrospectively, would necessarily work. Instead we need to look at developing a proper set of standards in the PRS and I support councils, housing associations, and private builders who are now bringing forward private rented schemes with longer term tenancies and rent stability as a way of providing security and certainty to private renters.

3. Will you support the proposal, backed by former Labour Housing Minister John Healey MP, that we should aim to build 100,000 homes a year for social rent?

I support building more social housing – but the scale of the challenge is huge. To get back to the level of building that we need we are going to have to train builders, get a huge supply chain ready, assemble the land to accommodate the homes, get planning permission, get finance and get building. If we’re going to increase the number of homes then we’ve got to free councils to build so that they can meet the needs of their local communities as the people best placed to know what their community needs & make it easier for housing associations to build homes for social rent once again. Our language should emphasise a community offer – how many new homes in their area – and be credible to gain people’s confidence.

4. Will you support the removal of the HRA borrowing cap, to allow councils to borrow prudentially for investment in housing?

Yes – this won’t cost taxpayers a penny and by building more homes not only do we give people the security of a home to call their own but by moving people from the private rented sector into social and affordable homes we reduce their rent and the cost of housing benefit going to private landlords.

5. Do you agree that estate regeneration schemes should involve no net reduction in supply of social rented homes?

Yes, but I also know that many councils have significant numbers of homes that still don’t meet the decent homes standard and that estate regeneration is often the only option for councils who want to make sure that their tenants live in decent homes. The lack of sufficient government grant, the government’s changes to social rent and the HRA cap mean that councils will sometimes have to rebuild rather than refurbish and this should always retain the same number of social rented homes.

6. Do you support the Right to Buy for council tenants and if so what reforms, if any, would you make to it? Do you support the extension of Right to Buy to Housing Association tenants?

The RTB is hugely popular with council tenants and we shouldn’t be afraid of backing people’s aspirations to own their own home and have something to pass on to their children. However, the way that RTB works at the moment is making the Housing Crisis worse. Councils don’t keep the receipts from RTB – and can only use part of it if the receipts only form 30% of the cost of a new build property. Put together with the HRA cap and you’re seeing councils having to hand receipts over to the Treasury, who don’t use them for new council house building. The size of the discount needs to be looked at – and the receipts need to be ring-fenced to councils to use to build new homes so that we can actually make good on the rhetoric of one for one replacement. I’m also open to looking at whether local authorities could be given the a first right of refusal, or buy back option, on RTB properties that are being sold.

For Housing Associations, the position is different – they borrow on the open market, against their rental income. I am therefore concerned about the impact of RTB on the ability of housing associations to borrow money and build new homes. Housing Associations already build significant numbers of homes for shared ownership to give people their first step on the housing ladder and I would like us to work with them on developing a way for tenants to move into shared ownership as a way of being able to affordably buy a home. I would also like to see more support given to rent-to-buy schemes.

7. Will you sign up to LLHG, Unite and the GMB’s joint Our Homes Our London campaign against forcing councils to sell off properties in high values areas?

Yes – while I support council tenants’ rights to buy their own home the forced sell-off is completely different. It means that homes will be sold off on the open market to the highest bidder, meaning that families on the waiting list have to wait even longer for a home. Local authorities, especially in high value areas, should have a right to retain a minimum proportion of properties as social housing, just an they are able to protect housing for elderly residents from enforced sale. The Government policy is a direct assault on council housing in London, and I oppose it.

8. Do you support the Chancellor’s decision to cut social rents by 1% per year?

Everyone wants social rents to be as low as possible, but cutting rents by 1% means that councils and housing associations, who had made plans for investment in their tenants’ homes and to build new homes will have to rip those plans up and start again with significantly less money. If the chancellor is doing it to reduce the housing benefit bill then he’d get better results by leaving rents alone and allowing councils and housing associations to build new affordable homes for people to move into, to pay less rent and claim less housing benefit.

9. Do you support policies to switch resources rapidly from meeting the benefit costs of high rents to investing in new homes at genuinely affordable rents?

Over the last thirty years we’ve seen a dramatic shift away from investment in bricks and mortar, and into housing benefit instead. That’s a deeply inefficient and regressive use of public funds. I would like to see the balance altered, although clearly you can’t switch resources, without leaving significant numbers of people out of pocket. But we need to invest in building more homes and this can be done at no cost to the taxpayer by lifting the HRA cap and supporting housing associations so that more genuinely affordable homes should be built.

10. Do you agree that affordable housing definition should be based on households not spending more than 30% of net income on housing costs?

Affordable housing will mean different things to different people – it’s why it’s so hard to talk about affordable housing, everyone argues about the definition. We need a range of products to meet the wide range of housing demand. We need homes that are affordable to the disabled tenant living on benefits and homes that are affordable to the young professional couple looking to get a foot on the ladder. Artificial numbers and percentages won’t mean much to those people – what will matter is actually building homes to start to address the huge disparity between supply and demand.

In Government, I promoted some of the first shared ownership schemes, providing the security of an affordable home, but a ladder to climb to greater ownership. This approach was particularly important for low income but employed first time buyers.

11. Would you relax restrictions on building on the Green Belt?

I think we should keep protections for green belt. My priority would be to re-introduce the brownfield first policy that the Tories have abandoned.

12. Would you reverse permitted development rights allowing offices, shops, and other employment spaces in dense urban areas to change asset class and be converted into flats without planning permission?

We do have to be careful that employers and businesses don’t lose office space or get forced out by landlords who want residential tenants, taking jobs with them. But I do think we could make much better use of the ‘dead space’ above offices. Putting people back into spaces that are currently redundant could regenerate and enhance communities, provide affordable homes, cut crime rates, create employment and reduce pressure on the built and natural environments.

13. How would you secure more affordable housing contributions from private developers through the planning system? How would you change the current approach to viability?

The government changed viability rules so that a 20% developers’ profit comes before affordable housing. That can’t be right.

We should also end the Tories use of so-called viability reports, which enable developers to undo existing planning requirements to include affordable homes within developments. This discreet Tory policy has lost countless affordable homes and undermined what would have been good viable mixed, tenure developments.
14. Would you support devolution to the Greater London Authority and city regions of control over:
a. private rented sector regulation;
b. Housing Association regulation;
c. Right to Buy?

I think you’ve got to look at everything on a case-by-case basis, with a presumption in favour of devolution. But what you don’t want to see is housing associations being faced with hundreds of different regulatory regimes, all of which basically say the same thing in a slightly different way. And a conversation about devolution to London has to look at the boroughs, who mostly have competency for housing, as well as the Mayor.

15. Will you commit to restoring the previous Labour Government’s homelessness safety net for priority groups and to improving support for single homeless people?

The rise in homelessness and in the number of families in temporary accommodation is a real mark of shame on this government. We need to provide the security and stability of a decent home for all families and get back to reducing homelessness in the way that we did when Labour was in government.

 

We really appreciate Caroline taking the time to complete our survey. We hope that members and supporters find it helpful that we have published it. LLHG can be followed @lhglondon and liked through our Facebook page. LLHG can be contacted via the Chair Tom Copley (Tom.Copley@london.gov.uk) or Secretary Steve Hilditch (Steve@hilditchonline.com).

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Quantitative easing and housing investment

One of the issues opened up by the Labour leadership debate is whether and how to boost investment through a new version of quantitative easing. It’s a debate that began in 2012 and to which Red Brick added its voice. Jeremy Corbyn has called for a people’s quantitative easing to be used for infrastructure investment, including housing, while Yvette Cooper has said it would be the wrong time to do it. As in other areas, Corbyn has provoked a lively debate. The FT doesn’t like his policy but has at least looked at it in some detail. (Its assessment concludes with an unfavourable comparison with Venezuela: Corbyn might wish he had that country’s oil revenues, even if they have recently fallen off sharply.)

A form of QE for the people was put forward by three economists in May: their idea is for the Bank of England literally to release money to households. There is a near-precedent for this in the US where tax rebates have been used as an economic stimulus. This isn’t quite what former Federal Reserve chairman Ben Bernanke once suggested – dropping money from helicopters – but it isn’t far short.

As Paul Mason points out, Yvette Cooper’s criticism of Corbyn actually included two advantages of the policy: higher inflation and a weaker pound. In a situation where Britain has a worryingly large trade gap (or at least people used to worry about it, before the media decided that the real economic problem was the deficit), a weak pound would be beneficial. And as Mason says, while inflation may also have been regarded historically as a key economic problem, having none of it at all is actually quite problematic: the value of debt doesn’t decline over time, it stays annoyingly at the value at which you incurred it. Given Britain’s sovereign debt and especially its far more serious levels of personal debt, the fact that debt is not being eroded adds to the economic risks.

Mason also says that a low inflation/low interest rate economy deprives governments or central banks of one of their tools – cutting interest rates – which is probably why Mark Carney is so keen on raising them (so they can be cut if things get more difficult). Mason quotes another economist, Stephen King, as saying that after six years of glacially slow recovery the world economy is like the Titanic with no lifeboats: when it hits the inevitable iceberg, what policy instruments will be available? China has created a lifeboat – devaluing its currency – to stimulate growth, and as Mason points out the effects are not unlike those of QE (but may be more effective than the very large but in the end almost toothless QE created by the Bank of England under the coalition government).

This writer is no economist, but it seems to me that Corbynomics has some distinct advantages. In contrast to dropping fivers from a helicopter, it would lead to long-term assets being created, including housing as well as transport infrastructure. Given that we have a clear investment deficit in housing – whether in building new ones or in bringing the existing ones up to the standards we need to achieve in order to tackle fuel poverty and meet our carbon targets – directing QE into this sector appears to make sound economic sense. The argument looks even stronger if you consider that (unlike consumer spending) building houses doesn’t suck in huge imports and is labour-intensive, so it creates UK jobs and has beneficial effects on the wider economy. In fact, the case has just been set out in the excellent report by Capital Economics for SHOUT and the National Federation of ALMOs. It’s true that there may currently be problems of shortages of labour and building materials, but these obstacles have been faced and dealt with in the past.

Perhaps the biggest advantage of Corbynomics is that it takes the argument onto the Tories’ own ground. They’ve successfully convinced much of Britain that the economy is like a household’s finances, and has to be reined in when times are bad. Doing as Osborne wants, aiming to run a budget surplus, might be sound practice when considering family finances but in a national economy will effectively mean there is less money for people to spend themselves. Corbyn’s case that we need to get the economy moving by investing for the future not only makes far greater economic sense, it starts to look like a plausible argument to convince the man and woman in the street and to challenge Osborne’s self-serving homilies.

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Liz Kendall MP on housing

We have been providing information on the Labour Leadership candidates’ views on housing. Jeremy Corbyn MP replied to a London LHG questionnaire and we published his responses last week. Yesterday we published the housing section of Andy Burnham MP‘s manifesto. We are publishing contributions made to the latest Labour Housing Group newsletter from Yvette Cooper MP (yesterday’s blog) and Liz Kendall MP (below).

We hope this helps members and supporters who put housing high on their list of key issues to make up their mind about who to support.

liz kendall“The lack of decent, affordable housing is a longstanding challenge that must now be addressed.”

Statement on housing by Liz Kendall

Housing is a huge issue in my constituency and across the country.

For people in their 20s or 30s, the prospect of ever being able to afford to buy their own place seems like a pipe dream, even if they’re working really hard. Many young people are still living at home with their parents or struggling to save for a deposit because of the cost of their monthly rent.

Families face real problems, too. Parents often ask for my help because they’ve got mould or damp in their homes that’s causing breathing problems for their young children, or because of overcrowding, which can make it difficult for children to concentrate.

I’ve also helped countless disabled people and their relatives who have been unfairly hit by the bedroom tax – which we must reverse.

The lack of decent, affordable housing is a longstanding challenge that must now be addressed.

We need to build more homes, but we must also improve the way the private rented sector works. In England, over two million children now live in privately rented accommodation. And the number of families in the private rented sector has a knock on impact on the housing benefit bill.

Nearly five million people rely on housing benefit today, and in the last parliament £95 out of every £100 spent by the government went into housing benefit, with just 5% going to bricks and mortar. The next Labour government must begin to reverse that.

Liz Kendall MP

(first published in the Labour Housing Group newsletter @LabourHousing)

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Yvette Cooper MP on housing

We have been providing information on the Labour Leadership candidates’ views on housing. Jeremy Corbyn MP replied to a London LHG questionnaire and we published his responses last week. Yesterday we published the housing section of Andy Burnham MP‘s manifesto. Today we are publishing contributions made to the latest Labour Housing Group newsletter from Yvette Cooper MP (below) and Liz Kendall MP (to follow in the next post).

We hope this helps members and supporters who put housing high on their list of key issues to make up their mind about who to support.

 

Yvette-Cooper-portrait 2

“We should be building 300,000 new homes a year…..  I have shown I can deliver on housing.”

Statement on housing by Yvette Cooper

Britain needs more houses and it needs them now. Governments have been ducking the issue of housebuilding for too long. Every day that we delay, the crisis just gets worse and worse. It is one of the most serious challenges for Britain’s future and we can’t keep putting our heads in the sand.

Last year net housing supply was a pathetic 136,610. This Government has failed on housebuilding.

When I was Labour Housing Minister, we had the highest annual level of net housing supply in the last thirty years – wih over 207,000 net additions. I can build houses. I want to build on this record. We have to be far more ambitious if Britain is to have the homes that families need.

We should be building 300,000 new homes a year – a bolder plan. It will take ambition, determination and tough decisions. Enough with excuses, we’ve got to drive this through and if you stick at it, you can.

Today too many people are simply priced out of the housing market. Everyone wants a secure and affordable home to put down roots or support their family. We need to have clear plans to help first time buyers. Building more houses is cental to this.

The failure in housebuilding is holding back our economy, undermining communities and family life – we need a much bolder plan. I have shown I can deliver on housing.

Yvette Cooper MP

(first published in the Labour Housing Group newsletter @LabourHousing)

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Andy Burnham MP on housing

Recently London Labour Housing Group @lhglondon sent a questionnaire on a range of housing issues to the Labour leadership contenders. The reply from Jeremy Corbyn was published last week. To date, the other three contenders have not replied. However, Yvette Cooper MP and Liz Kendall MP have submitted articles to the Labour Housing Group newsletter, and Andy Burnham MP has a housing policy section in his manifesto. With ballot papers going out imminently, and having published Jeremy’s policy we think it fair to publish a piece by the others, starting today with Andy Burnham

andyburnhamThe whole of Andy’s Manifesto can be read here. It begins with five headline policy commitments, one of which concerns housing. Andy promises

An affordable home for all to rent or own – by freeing councils to build new homes and introducing regulation of the private rented sector

The housing section of the Manifesto is as follows:

An affordable home for all to rent or own

For too many people, the dream of having a place to call their own has faded away. My vision is of a society where everyone has an affordable home to rent or to own – through the most ambitious housing policy since the post-war period.

I will lift the arbitrary central government borrowing caps that prevent local authorities from building more social housing, freeing our councils to deliver good quality homes once more.

I will create a new National Housing Commission to drive progress in every area, ensuring new homes are built with affordable rents. I will develop the option of ‘Rent to Own’ – mortgages that require no deposit. These government-backed schemes will help councils and housing associations to provide good quality homes, while helping those who want to get onto the property ladder with a Home Purchase Plan. ‘Rent to Own’ would give aspiring first-time buyers a clear route into home ownership and a way out of the ‘rental trap’.

I will make it easier for councils to crack down on absent landlords who receive Housing Benefit but allow their property to fall below an acceptable standard, blighting the lives of their tenants and the wider neighbourhood. And I want to devolve real power to local communities to regulate the private rented sector, including the power to introduce rent controls.

To follow: Yvette Cooper MP and Liz Kendall MP.

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Jeremy Corbyn MP on Housing

London Labour Housing Group (LLHG): Housing Survey to all Labour Leadership and Deputy Leadership candidates

LLHG recently sent a questionnaire on 15 key housing policy issues to each of the four Labour Leadership Candidates and to each of the Deputy Leadership Candidates. We will publish the responses on Red Brick and on LLHG facebook page as they are received.

The first response comes from Jeremy Corbyn MP.

corbyn
LLHG: 1. Britain is only building half of the homes we need annually. What specific measures will you take to increase house building?

JC: The key is to get local authorities building again. In the post-war decades they used to build approximately half of our homes until they were prevented from doing so – and it was then that we saw the gap between supply and demand opening up and reach its current crisis. Through local councils, regional government in London, devolved administrations and the Homes and Communities Agency a structure already exists that can deliver a large-scale council house building programme. Public investment to make this happen is vital; and would be a social and economic win-win. For every £1 spent on housing construction an extra £2.09 is generated in the economy, and ensuring we have a supply of homes for social rent is the only way in the long run to keep the housing benefit bill down. Lifting the borrowing cap in the Housing Revenue Account would mean local authorities could borrow up to the prudential limits and thereby build more homes. Returning to having regional home building targets is needed to ensure homes are built in every area, so that our rural areas benefit from building social homes as well as our urban centres.

We also need to look at bringing in a Land Value Tax (especially on undeveloped land with planning permission) and other ‘use it or lose it’ measures to act as a strong deterrent against land banking.

LLHG 2. How would you reform the private rented sector to make it more stable and affordable for tenants? Do you support: a. a national register of landlords; b. some form of rent regulation?

JC: Yes, everyone should have a decent home that they can afford. It is currently the case that we have one of least regulated private-rented markets in Europe and spiralling housing costs.

Private landlords should be nationally registered and locally licensed, including a ‘fit and proper’ persons’ test, making sure that tenants’ rights are respected and ensuring that decent homes standards – such as minimum safety standards, and being damp and pest free – are adhered to in the private rental sector. Licensing and registration should be administered and enforced by the relevant local authority. Some London Labour councils have already done some positive work in this area with the powers currently available to them, and it has been effective in moving against some of the worst offender landlords.

Regulation of private rents should be linked to what determines whether something is affordable – average earnings levels and increases, not the local market rate for housing. We need this, alongside large-scale house-building, to stop the social cleansing of London and other major cities. We should cap rents not benefits.

LLHG 3. Will you support the proposal, backed by former Labour Housing Minister John Healey MP, that we should aim to build 100,000 homes a year for social rent?

JC: We should invest in a large scale house building programme. We should be aiming for at least 100,000 homes a year available for social rent. We need to build an additional 240,000 homes a year just to meet current demand – and we know we have a long waiting list for social homes. If we tackle our housing crisis it would help address health, education and other inequalities, strengthen local communities and naturally lead to a fall in Housing Benefit expenditure. The recent report by Capital Economics for SHOUT made the unequivocal economic and financial case for building 100,000 homes a year for social rent. We can and must be ambitious.

LLHG 4. Will you support the removal of the HRA borrowing cap, to allow councils to borrow prudentially for investment in housing?

JC: Yes.

LLHG 5. Do you agree that estate regeneration schemes should involve no net reduction in supply of social rented homes?

JC: Yes. Estate redevelopments have led to an increase in housing units overall, but as your question highlights, those available for social rent have fallen in almost all schemes. Recent research published by Unite highlighted a loss of 8,000 social rented homes already through such schemes in London alone. This, along with Right to Buy eroding our social housing stock, and the government’s plans to force councils to sell ‘high-value’ council homes on the open market when they become vacant, will effectively social cleanse whole areas of London and other cities. Estate redevelopments should instead be done for the benefit of existing and future residents, and local communities.

LLHG 6. Do you support the Right to Buy for council tenants and if so what reforms, if any, would you make to it? Do you support the extension of Right to Buy to Housing Association tenants?

JC: Right to Buy (RTB) has eroded our social housing stock, and directly contributed to the current housing crisis. If we are publicly investing in building much needed social housing then this shouldn’t be converted to private wealth – one-third of all council homes are now owned by private landlords. We need to maintain the public investment in council housing for future tenants. We used to have security of tenure for council home tenants, meaning that despite not owning the property it was very much their home – in many cases for life. We should return to that.

I will vote against extending RTB to housing association properties, and would favour ending RTB full stop.

LLHG 7. Will you sign up to LLHG, Unite and the GMB’s joint Our Homes Our London campaign against forcing councils to sell off properties in high values areas?

JC: Yes. It is important that all those who care about the future of social housing come together to oppose this policy. London needs mixed communities where low and medium paid workers can afford to live too.

LLHG 8. Do you support the Chancellor’s decision to cut social rents by 1% per year?

JC: Cutting social rents by 1% a year will undoubtedly help many with low incomes who are struggling to make ends meet. But I don’t believe that was the motivation for Osborne introducing this policy – otherwise he would impose such a regulation on the private rented sector too. It also is completely at odds with the government presumably continuing its policy of increasing rents for many new tenancies to so-called ‘affordable’ rents at up to 80% of the market rate. The Chancellor’s move is a crude attempt to say they have ‘cut’ Housing Benefit expenditure, and distract from the policy of asking those with household incomes of above £40,000 in London (£30,000 elsewhere) to pay market, or near market rents. This will have a devastating impact on people, particularly in London and other inner city areas – forcing people from their homes just for earning over a certain amount, or possibly giving people a perverse incentive not to earn more if they have the option. It will undoubtedly come at the cost of building more homes for social rent in the current climate. It does nothing to address the underlying cause of the housing crisis.

LLHG 9. Do you support policies to switch resources rapidly from meeting the benefit costs of high rents to investing in new homes at genuinely affordable rents?

JC: Yes. The majority of spending on housing in this country used to be investment in affordable housing – now the vast majority is spent on housing benefit. We need to reverse this by investing in a large scale council house building programme which will bring rents and therefore housing benefit down overall. This will require upfront investment in new affordable homes – and as the Capital Economics report set out, investment in assets that will reduce housing benefit expenditure in the future is likely to be welcomed by financial markets. . We also need to look at reducing the £14 billion tax breaks going to private landlords, and redirecting that to fund house-building.

LLHG 10. Do you agree that affordable housing definition should be based on households not spending more than 30% of net income on housing costs?

JC: Yes, this links housing costs to what determines if something actually is affordable – peoples’ incomes – rather than the wider market rates.

LLHG 11. Would you relax restrictions on building on the Green Belt?

JC: I would be very cautious about doing so. Developers will nearly always argue for the release of green belt land because it is easier for them compared to developing brownfield sites. But we don’t simply want our towns sprawling outwards with reliance on cars growing – and the green belt has prevented that to a certain extent. Any widespread relaxations would also risk inflating the land values of green belt sites, without careful planning requirements being set in place first.

LLHG 12. Would you reverse permitted development rights allowing offices, shops, and other employment spaces in dense urban areas to change asset class and be converted into flats without planning permission?

JC: Yes. By not needing planning permission there cannot be an assessment and provision for the wider facilities and infrastructure that communities need. In residential conversions this of course includes affordable housing. It also includes transport, education, health facilities, leisure centres, green spaces, community centres, libraries and entertainment – all the things that bring people together in local areas to create sustainable communities.

LLHG 13. How would you secure more affordable housing contributions from private developers through the planning system? How would you change the current approach to viability?

JC: Viability studies are being used by private developers to evade their responsibilities to build more affordable housing. Especially in London these developers and particularly landowners are making extremely large profits from the building and selling of properties. At the moment, local authorities are faced with a large imbalance of power and resources when faced with a private developer who is determined not to include affordable housing in their build. In London, there is a role I believe for the GLA to have a central resource that local councils can call on to support them when faced with a private developer wielding viability studies that say affordable housing renders a whole scheme ‘unviable’. This could include specialist support that is currently out of the reach of local councils.

LLHG 14. Would you support devolution to the Greater London Authority and city regions of control over: a. private rented sector regulation; b. Housing Association regulation; c. Right to Buy?

JC: As outlined above, I think that there needs to be a national framework for regulating our private rented sector, both landlords and rent, our Housing Associations and a national drive to increase house-building; council housing in particular. The implementation and enforcement of these schemes would then have to be done at city region and local council level. On Right to Buy, I think we should end it altogether but I recognise that there is very broad support for ending it as a mandatory right for tenants and instead for local authorities to be given the power to suspend or end Right to Buy in their local areas.

LLHG 15. Will you commit to restoring the previous Labour Government’s homelessness safety net for priority groups and to improving support for single homeless people?

JC: Yes. Rough sleeping has increased by 55% in England since 2010, and by 78% in London. Evictions of private tenants are also at record levels.

There is no excuse for anyone to be homeless in one of the richest countries in the world – and we should restore access to housing benefit for all adults.

 

About London Labour Housing Group

Labour Housing Group is a socialist society affiliated to the Labour Party. Formed in 1981 it represents Labour members interested in housing policy, developing ideas and proposals for inclusion in the Party’s programme at national and local level.

London Labour Housing Group was launched in January 2011 at a meeting at the House of Commons of 200 members of London Labour Party. It produced draft manifestos for the 2012 Mayoral election and the 2014 Borough elections, and worked with the Labour Party to campaign on housing issues during those elections. It has also contributed to a wide range of housing policy discussions including making a detailed submission to the national Labour Party’s review of housebuilding policy. In June it held a Housing Hustings for the Labour candidates to be London mayor, which was attended by 250 people.

LLHG can be followed @lhglondon and liked through our Facebook page. LLHG can be contacted via the Chair Tom Copley (Tom.Copley@london.gov.uk) or Secretary Steve Hilditch (Steve@hilditchonline.com).

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Mr Sad and Mr Angry

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It is hard to know whether to be sad or angry about the Chief Executive of Genesis Neil Hadden’s statement about the future of the association.

To recap, he told Inside Housing’s Pete Apps that the huge housing association will no longer provide affordable and social rented homes and that it will in future only build market and shared ownership homes. Even more shocking, it will review all of its existing general needs rented homes as they become vacant with a view to selling or changing tenure.

When I first went to work in Paddington, 43 years ago, Paddington Churches Housing Association (which amalgamated with others to form Genesis), along with its neighbour Notting Hill Housing Trust, was a beacon of enlightenment, working against terrible odds to bring housing relief to tenants living in the appalling slums of north Paddington and north Kensington, the home of Peter Rachman and his ilk. PCHA’s proud progress, from its formation in 1965, to a single home in 1966 (curiously, given its name, the first few properties were not in Paddington, but in the Queens Park area of Brent where I now live), to becoming a 33,000 home mega organisation, is recorded here.

As an independent charitable organisation, PCHA won the backing of both local Conservative and Labour politicians. Founded by remarkable local clergy it spoke proudly of its ‘Christian concern’ for the poor and homeless. Its first press release was headed: ‘Churches in Paddington form Housing Association to provide homes at low rent for needy Paddington families, irrespective of colour, race or creed.’ Sadly, somewhere along the line it lost its soul and forgot this mission.

Neil Hadden seeks to pin the blame on the Government, and, as we discussed on Red Brick last week, that is almost correct. Almost. He is right that the Government has no interest in providing genuinely affordable rented accommodation. It is only interested in market solutions, throwing money around in a vain attempt to revive home ownership and support private landlordism. And, nasty as they are, they are in turn trying to shuffle blame onto housing providers for failing to deliver enough homes. Inaccurate attacks on housing associations that seem to emanate from No 10 Downing Street have been very well refuted by several commentators, including Kevin Gulliver, Carl Brown, and Colin Wiles, who says that associations need a rebuttal team to defend themselves.

But it would be wrong to shift all the blame away from the big associations themselves. Large associations like Genesis and NHHT and others have been shifting their focus, as a matter of strategy, for many years. They have moved from providing social rented homes for homeless and badly housed people towards shared ownership and the intermediate market, then towards general market homes for sale or rent. The changing balance was the central struggle of my time as a Board member of NHHT in the 2000s, and maximising social rented provision was a big part of my pitch to become chair of Genesis in 2002. I failed in that bid, reaching the play offs against the distinguished winning candidate, Adrian Bell. I’m not sure what difference it would have made if I had done the job. The debate centred on pragmatic finance but what was changing underneath was the culture. Put slightly less than delicately, a brilliant developer who was a member of the NHHT board would say ‘Let’s make shed loads of money from market development, then we can spend it on what you want’. The problem was that the ‘developer’ mind-set took over, the board discussed little other than high finance and new schemes. And the money for social rented homes never seemed to come out at the other end.

By fingering the Tory Government and the associations themselves, I’m not allowing the Labour Government to get away scot-free. The continuous squeeze on grant, chasing what seemed like a good objective of getting more output for the money put in, pushed associations along the road of being more commercial, looking to make surpluses from other activities to make up for lost subsidy.

Realising where it would lead, some associations kicked up a fuss and retained their commitment to meeting the needs of homeless and badly-housed people. They deserve great credit for keeping to their principles against the odds. Pete Apps quotes Tony Stacey, chief executive of South Yorkshire Housing Association and chair of Placeshapers, who responded to Neil Hadden by saying: ‘It depends what you’re about as an organisation, and it depends on your ethics as an organisation’. That is exactly it.

Over the years, and not just recently, some of the big players gave the clear impression that they didn’t want to have to deal with the difficulties posed by building and managing social rented housing with very fine margins. Nor did they want to deal with the issues that emerge from crass poverty. I learned that the flowery language around their concept of ‘mixed communities’ really just meant having fewer social rented tenants and more home owners. Much nicer to spend your time in exciting meetings in the City, doing big land deals, juggling hundreds of millions of pounds, playing with gleaming models of shiny new developments, complaining about councils dumping difficult families through nominations, and telling the world that housing associations should cater for ‘aspiring people’.

Far from being victims pushed out forcibly into the cold commercial world by the decisions of Governments, they were instrumental in creating the policies we now suffer from. Just looking at the two associations mentioned so far, Kate Davies of Notting Hill was influential in the development of Tory policy before the 2010 election through the Localis and Centre for Social Justice think tanks, which proposed the core set of policies that have been pursued in Government. Neil Hadden worked with Policy Exchange on last year’s ‘freedoms’ report.

For years some of the larger associations have been angling for a trade-off between reducing the requirement for grant and something they like to call ‘freedoms’ – to do what they like, to be fully commercial, to set their own rents, to select their own tenants, to set the terms of their own tenancies. One response to the recent rent cut has been for some associations to look to deregister as social landlords, another destination some have been preparing for.

One argument that has emerged from amongst associations is that councils should be given a new lease of life so that they can be responsible for meeting housing need whilst  housing associations concentrate on providing market-related homes in the middle ground. Some have sold homes on the open market and ‘converted’ homes from low rents to high rents – well beyond what is required by funders – to get more money for development. Some support the right to buy for the same reason.

Although not just a London issue, there is an opportunity for a new London mayor to get tough. My angry self will argue that associations that have lost interest in meeting housing need should not get a penny in grant. They should be banned from selling, or converting to a different form of tenancy, any home provided with public grant. If they want to play developer, let them go off and do it properly without public support. My sad self would prefer the mayor to do a full audit of the activities of big associations and require them to focus on meeting housing needs again. There should be a full review of board membership – I am not against people with private sector skills being involved but they should be properly balanced with people who know something about social housing  and housing need, including tenants and residents. I would also support the mayor becoming responsible for the regulation as well as the financing of housing associations.

 

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Crumbs from the tables of the rich

The Guardian’s Dave Hill is an astute commentator on the London scene, and chaired the London Labour Housing Group’s mayoral housing hustings with aplomb. Recently he has  written a couple of challenging (indeed provocative) pieces about Labour politicians and London development – here and here.

His central point is that we should stop and think before condemning the investment of billions of pounds in London property by rich foreigners. Dave likes a good argument, so he pulls no punches: ‘No spectacle of pious impotence is more complete than that of London’s Labour politicians railing against the global super rich. Their indignation about the power of City privilege, Mayfair billionaires and “rich foreign investors” buying “off plan” property from marketing suites in Hong Kong is dwarfed by their helplessness in the face of it.’

He argues that denouncing ‘Monopoly board London’ raises a cheer but ignores the fact that ‘without the flow of filthy lucre down the Thames much of their vision for the city will disappear into a funding gap that nothing else will fill.’  His dismissal of the Labour mayoral candidates’ ‘wish lists’ is based on his very pragmatic view that ‘politicians and planners must increasingly turn to private finance to pay for the things the public purse will not.’ He points to the evidence that one third of new affordable homes come from planning gain created by commercial development, often funded by off-plan sales abroad. Things shouldn’t be this way, he says, but this process is ‘one of the most fruitful proxies for a tax’. His challenge: do we want some extra sub-market homes, new transport infrastructure, or don’t we?

Of course Dave is right that many of the candidates’ ‘wish list’ items won’t come to pass because this Government is wholly opposed to them. It is, after all, only interested in devolution on its own terms. But I think he misses several big points.

First, some London boroughs achieve much more than others because they have the policies and determination to get more out of the system. It follows that more boroughs could also get more, and the total benefit would rise.

Secondly, some boroughs, Islington particularly, do manage to use their planning powers to get developers to behave in a more enlightened way. It is possible to negotiate away ‘poor doors’, it is possible to get new properties sold locally first, it is possible to get some homes at social rent and not just the so-called ‘affordable rent’ which often isn’t affordable at all. But, crucially, you have to want to do it, and some boroughs don’t.

Thirdly, ‘viability assessments’, the device used by developers to reduce their planning obligations (encouraged by Government and the current (alleged) mayor), can be much more effectively challenged and they can be made transparent and open for public scrutiny. Developers are making a mint on sites all over London, especially towards the centre, and it’s a farce for them to be saying a bit more planning gain makes their schemes unviable. But they will always try, it is the responsibility of public authorities to get a better deal for the community.

Linked to that point, fourthly, the recession is now over. Planning obligations were supposedly reduced to ancourage developers to keep developing despite the straightened times. If there is growth and expanding profits, it is reasonable to expect more.

Fifthly, it is vital that the Labour candidates set out their stall on policies like this. The winner has a very good chance of becoming mayor next year. They will be able to start implementing a raft of new policies that will make a difference. Johnson has rolled over for the developers and a new mayor with a different attitude will be able to achieve much more. It is not all about wish lists that will not be achievable: there are specific devolved powers that the mayor controls. In my view developers will be able and willing to pay a larger price – and they will still make lots of money.

Sixthly, the new mayor will control budgets as well as policy, including the (admittedly small) housing investment programme. This can be reprioritised to achieve more social rent, and the mayor will be able to push London’s housing associations into producing more homes for people on low incomes. Especially on public land, housing association-led development should be producing a much better result for the community.

Of course there are issues, like controlling or taxing foreign investment or taxing ‘buy to leave’ properties or penalising unreasonable land banking, that depend on Government action, and this Government is disinclined to interfere in the market. But a shift in policy is more likely if there is a Labour mayor making the case strongly, backed by Londoners. Since Dave wrote his articles, even David Cameron has expressed distaste for the dodgy provenance of some of the foreign money coming into London property and indicates support for the proposals of Transparency International. Having made this first good step, the Prime Minister could be pushed into more dynamic policies by an effective mayor.

Councils like Islington have already shown that it is possible to do much more and to achieve much more for Londoners. Of course you can’t reverse the flow of international capital but you can mitigate some of its worst effects. That’s why the mayoral race is so important.

It is also reasonable for candidates to make comment on trends and activities in London that they may not be able to directly control but can influence. It is called debate and it is important that the public in London knows what is going on and how it impacts on them.

And never forget that grabbing a few crumbs off the tables of the rich might be (just) worth doing for the moment, but trickle down will never solve the housing crisis.

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So housing associations are the ‘true villains’ of the property crisis, are they?

There is much that Red Brick would criticise about housing associations – their acceptance of higher (‘affordable’) rents and low grant rates would come top of the list. But the sweeping attack they have been subjected to this week is really an attack on social housing as a whole.

The pieces in the Spectator and The Times both launch into the inflated salaries which are paid to some of the sector’s chief executives, and Red Brick is certainly not going to defend those (although notes in passing that public and social sector salaries get far more scrutiny than those in private firms). But the Spectator in particular accuses associations of being the main cause of our housing problems: that compared to the private sector they are failing to build, they are over-provided with grant and even so are building more expensively than private developers. In short, it is associations, not the private sector or the government, who have ‘no answer’ to the housing crisis.

Inside Housing has already done a fact check of the Spectator piece and there is no need here to list all the things it gets wrong. Apart from their misuse of statistics, the magazine’s language in deriding social housing is what stands out. Housing associations are supposedly ‘managing the remnants of social housing left behind after Mrs Thatcher’. Their stock is really ‘a pile of ex-council houses given to them on a plate and which were once managed by a clerk of works and a team of rent-collectors on no more than £30,000 a year’. As well as being based on a fundamental misunderstanding about where housing association stock comes from (only around half is from transfers), the Spectator clearly has an even lower opinion of council housing than it does of associations.

Let’s be clear that these attacks are all part of a softening up process in which social housing is recast as a contributor to the housing crisis rather than part of its solution. Why throw more money at housing associations when they are incompetent in comparison with the private sector? Why maintain council housing when both the people who run it and those living in it are beneath contempt? In the world inhabited by those who write for the Spectator and The Times, it’s assumed that all sensible people want to be home owners, and social housing is just getting in their way. Sell it off as quickly as possible and perhaps the stalled growth in owner-occupation, which is the real housing problem the country is facing, will be put back on track.

In quick succession the government has presented us with the breaking of a ‘ten-year’ commitment on social housing rents, a simultaneous breach of the three-year old settlement of council housing finances, the extension of right to buy to associations, enforced sales of high-value council houses, a plan to penalise tenants on modestly decent salaries if they don’t move out, and yet another threat to secure tenancies.

Insiders are making clear (if it wasn’t in any case obvious) that this is all part of a deliberate plan. This government is only interested in home ownership and doesn’t give a stuff about tenants, whichever sector they are in. Within this overall perspective, its attitude to housing associations is not unlike its approach to the BBC: like the Corporation, associations are difficult to get rid of, but by cutting their income and having them ridiculed in the right-wing press we can persuade them to sing from our song sheet, or else… . The message is: kick up a fuss about right to buy, especially if you challenge the legislation in the courts, and you’ll see what happens next. Already the DCLG has been told to reappraise its spending programmes to concentrate far more on promoting home ownership: how long before there is an announcement that the Affordable Homes Programme’s rental output is to be suspended?

Even this government will find it difficult to eradicate social housing by 2020, but we can already see that what happened to council housing in the 1980s is being dished up again, with a few differences, for what the Spectator calls the ‘remnants’ of the sector. Investment cuts, enforced sales, jeopardised business plans, falling credit ratings and – of course – lampooning of chief executives, are all on the menu. People who live in social housing will be branded even more as failures than they have been so far and, of course, by implication those who work in the sector (the ‘clerks’ and ‘rent collectors’) will be seen as losers too. How soon before Cameron dusts off the plans he started to form under the coalition, to reintroduce the disastrous and totally ineffective ‘compulsory competitive tendering’ for housing management that Margaret Thatcher tried and failed to implement?

This week it was confirmed that, because of his new policies, the Chancellor is faced with the threat that housing association borrowing might be brought into the public sector. Having £60 billion added to the national debt will be mightily inconvenient. But, if it happens, won’t the quid pro quo be even more severe attacks on housing associations? Won’t they get the blame (rather than Osborne) for having the temerity to disrupt the government’s ‘long-term economic plan,’ and be made to pay the price for their insouciance?

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