BUILD ‘EM, BUILD ‘EM, BUILD ‘EM

End of the second home discount?
The Tory Libdem government’s consultative proposal to give local councils the power to remove the council tax discount for second homes is on balance right. After all, the council has to provide infrastructure and all-the-year round services.

Cornwall Council will gain £1.6 million – or will it?
I suppose Cornwall Council looks forward to gaining the extra revenue from the abolished discount, about £1.6 million. However, it is not likely to be that straightforward. Tax changes are not static but dynamic; taxpayers’ behaviour often changes when tax rates and arrangements change. For example, I expect that some second home owners will seek to legally minimise their tax by changing the status of their second home and the basis on which they pay tax on it. Thus any gain for Cornwall Council may be reduced.

Second homes
Along with the discount changes, the Tory Libdem government has been urged to give councils powers to limit the numbers of second and holiday homes but the government, like Labour before it, has dismissed those suggestions: see Hansard 31 October 2011 column 585. I think such moves on second houses are pointless; these houses are a separate issue from the provision of affordable homes and restrictions today will probably not provide a single additional affordable house for purchase; it’s a price question.

Focus
We certainly have a serious problem in Cornwall, a shortage of affordable houses for local people to rent or buy. It isn’t down only to the present reactionary government; the previous Labour government had a shameful affordable housing record as I have said before on the blog. In round terms the county housing waiting list is around 20 000 and last financial year only 700 new affordable houses of all types were completed. This is a battle we have been losing, are losing, and candidly look likely to go on losing.

I have explored affordable housing in several posts (for example here) and I am dispirited to see the blurring of focus, the trips down housing by-lanes. If we want affordable homes, there is only one effective way to provide them: build’em, build’em, build’em. That should be the focus.

I have set out in previous posts the mixed tenure and size arrangements, for example, that should apply to affordable housing. As well as those and planning and construction issues,there are three practical barriers to overcome: people, sites, and funds.

Nimbies
There are often successful objections from some local people to proposals for affordable houses in their patch of Cornwall whatever they may approve in theory. I have previously pointed out that localism, involving a local veto over the building of affordable homes, has undesirable aspects and I think we need a central authority removed from local nimbyism to insist on the approval of appropriate proposals for the building of affordable housing for locals.

Sites
There are few if any ideal sites left so we have to build on less than perfect sites, including some managed building on fields at the edge of towns and villages. Cue wailing; cue that rational housing authority.

Funds
Lastly, affordable houses need funding. The Tory Libdem government has cut the direct funding and developer subsidy funds, while important, are insufficient to make serious inroads into the problem. It is down to the government massively to fund affordable housing, to see that it matters enough to prioritise it.

King’s ransom
Okay, we are in a time of austerity and abundant funds for affordable housing are unlikely. However, housing should be pushed up the list of practical priorities, the things that get done not the things that get talked about. Government should be pressed and pressed on the need for funds and getting the houses built.

Nevertheless, the money needed for effect is a king’s ransom. I wouldn’t start from here but here we are.

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HOUSING DATA FOR CORNWALL

Shelter, the housing charity, has an excellent free online databank of housing for England.

Click here to access the Cornwall data (via the South West). There are four sectors of data including affordability and housing need. There is also housing data for the old county council Cornwall.

Altogether a very useful resource for keeping on top of local housing data.

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CORNWALL: BUILD AND GROW

Jude Robinson, the only Labour member of Cornwall unitary council, has written a good post about housing in Cornwall, delineating well the range of arguments. She cites to effect Robin Teverson’s comment that people who have their own roof over their head should think carefully about making decisions that affect people who don’t. Read her post: there is a progressive intelligence at work, it is pointing in the right direction, and there is nothing in it of the wretched isolationism that besets much of the discussion of housing and the economy in Cornwall.

A good start then, but I hope Labour, acknowledging its dismal failure as a government on housing, will quickly go on to develop a fully fleshed out pragmatic and realistic housing policy that avoids fudge and diversions and can command support among progressives.

Local housing for local people
Focusing on affordable housing for rent and purchase, I have set out over several posts what I think. We need many more houses for local people on local wages; look at the thousands registered on the imperfect county waiting list. If we are serious about meeting the need, and meeting it while the people are still alive, we must strive to ensure the houses are built. Apart from difficulties with funding, building affordable houses means sites and there are insufficient easy urban sites left so that means building in semi-rural settings.

If we are to avoid the monotenurial estates of the past, and I think we certainly should, and take advantage of housing cross-subsidy, and meet people’s aspirations, we should support market housing.

Not the harrowing of Cornwall
Be clear. This approach to housing is not the harrowing of Cornwall. This is not concreting Cornwall; it is not in order to line the pockets of developers; it is not about roughly anglifying Cornwall: those hobgoblins are overwrought tosh. It is about providing homes for locals and about Cornwall also playing its part in meeting the housing needs and aspirations of the people of Britain. We are part of Britain, we should not try to opt out of our responsibility for providing a share of its houses.

We, and every area, can reasonably put in caveats, we can put in rigorous environmental and social requirements, and we should – but we have to build many more houses if we wish to build enough houses for local people and provide a share of the UK’s.

The Tory Libdem government has made this building more difficult as I have tried to explain in earlier posts: it has cut funding; it is handing a veto to nimby locals, but has a contradictory national policy of a presumption in favour of development and I do not know how this incoherence will work out. The Tory-Libdems are also handing a rent rise and insecurity of tenure to housing association tenants. Frankly, I think the outlook is poor but hope I’m wrong.

Not dreckly but now
We should support building many more houses because in a civilised and prosperous country everyone, yes, everyone, should have a decent roof over their head and all children, yes, all children, should have a stable and decent physical base. Not dreckly but now.

We should also support rational economic growth in Cornwall, support the circumstances that make prosperous companies possible, another strand in the real pro-Cornish agenda. Such growth brings jobs and competitive wages and tax revenue and is the only feasible way of empowering the poor and middling to become better off. Without growth the material living standards of people in Cornwall, and their opportunities for fuller lives, will not stand still but comparatively decline.

Related posts

Bleak outlook for affordable housing in Cornwall 25 November 2010. This leads to other posts on affordable housing on this blog.

One hand clapping for Stephen Gilbert 8 July 2011

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ONE HAND CLAPPING FOR STEPHEN GILBERT

Stephen Gilbert, the Libdem MP for St Austell and Newquay, has written a brief article on housing – and got it half right.

He nods in passing to empty houses and second homes but recognises that dealing with those won’t solve the crucial issue of a serious and growing shortage of homes. Gilbert is unambiguous and wholly right about the central problem: “We don’t have enough homes and we need to build more”. Exactly so. This sensible understanding contrasts well with the luddism and with the misfocus on second homes we sometimes hear in Cornwall.

I’m afraid Gilbert’s arguments do falter too and show the unresolved contradictions of the Libdem outlook. There is the usual Libdem romantic mantra about localism not centralism and bottom-up rather than top-down – and he acknowledges, without solving, the disabling difficulties that such an approach brings in housing. He recognises the danger that localism will empower nimbyism but says emptily that “we will have to face up to that”. I fear that without sharp central elbows it will come down at the last, after friendly persuasion has failed, to accepting nimby vetoes – impeccably local – on more houses.

He adds rightly that government should ensure that “everyone can access decent and stable accommodation at a price they can afford”, but does not explain how that can be done if absolute decisions to build or not to build are taken locally.

Gilbert has made an important point: many people need homes, we must build more. He, and the Libdems, need to think through the difficulties of localism and nimbyism, and how in the face of those central government can deliver the affordable houses he rightly says is its “duty” to do. It would be good to hear more of his thinking and practical ideas on these points. I’d like to make it both hands clapping.

Related posts

Bleak outlook for affordable housing in Cornwall 25 November 2010. This leads to other posts on affordable housing on this blog.

Two cheers for Cornwall Libdem MPs 6 June 2011

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TWO CHEERS FOR CORNWALL LIBDEM MPs

Tenancy changes
Last month the Tory Libdem government passed through the Commons changes in council and housing association tenancies. Two particularly destructive changes, which will impact adversely upon tenants in Cornwall as well as elsewhere, were challenged heavily by Labour – and Cornwall Libdem MPs. Yes, you read that right.

The Tory Libdem government is introducing flexible tenure. Future tenants may find themselves being given only a time-limited tenancy, which could be as short as two years, by a council or housing association. The idea is enable councils to make many future tenancies not for-life ones but ‘flexible’ tenancies of defined length; and thus to enable the council/association to end a flexible tenancy and acquire a house for letting to someone else on their waiting list; and also to empower a council/association to assess any changes in the income and occupation and family circumstances of the tenant to see if they point to a move into private rented or mortgage housing or a smaller house. I think the prime motivation is that the Tory Libdems expect to continue Labour’s dismal failure to build anything like enough houses for people on waiting lists; shifting tenants out makes houses available. Andrew Stunnell, the Libdem minister, said that flexible tenancies are a “step towards dealing with” the “ever-growing waiting lists” (Hansard 18 May 2011 column 460).

Drawbacks to the changes
There are very obvious drawbacks to the Tory Libdem measures. There is a loss of the security that a for-life council or housing association tenancy gives and the loss of incentive to maintain a for-life house well. What happens if a tenant’s circumstances change again after he and his family have been forced to rent privately or start to buy or move to a smaller house? Another destabilising move? Andrew Percy, the Conservative MP for Brigg and Goole, pointed out a reality of modern families which the government’s policy disregards: “family members frequently move out and back in again” (column 424).

If getting a better job and income will result in the involuntary loss of your council/association house, that is likely to be a powerful disincentive for people to advance.

A house is not just a shelter. It is a home and one in a community too. People settle, put down roots, children go to school and, like their parents, build friendships and a support group. Stephen Gilbert, Libdem MP for St Austell and Newquay well said, “The government cannot create a big society and increase community cohesion if we continue to move people around” (column 424). Martin Vickers, the Conservative MP for Cleethorpes, asked, “How will shorter tenancies help to achieve stable communities?” (column 440). Andrew Percy explained in vain how settled people came to look after a house and invest in their community. He gave the solution: “We should build more council houses” (column 425).

The government of course say a two year flexible tenancy is the minimum and should not be the typical length. Dan Rogerson, Libdem MP for North Cornwall, raised the telling doubt that two years would be not only the minimum but also the norm (column 438).

Cornwall Libdem votes
At the end of the report-stage debate there were two votes. One on Labour amendment 13 was to remove the enablement of flexible tenancies from the bill. Andrew George and Dan Rogerson voted for that amendment but they were the only Libdems doing so. No vote is recorded for Stephen Gilbert. On Labour amendment 271 which guaranteed all existing secure tenants continuing security if they moved to another council/association house, all of the Cornwall Libdem MPs, George, Rogerson, Gilbert, voted for the amendment but they were the only Libdems doing so. Both amendments were defeated by the combined Tory Libdem votes.

Andrew George and Dan Rogerson got it right on May 18th though they are in a party that got it badly wrong; the damaging tenancy measures were presented by the Libdem minister and voted for by the bulk of Libdem MPs who resisted the civilising amendments. If the bulk of Libdem MPs continue to vote for reactionary policies, a genuine dissent by a Cornwall MP or even all three of them won’t even ripple the waters. The Liberal Democrat party sustains and is part of a socially and economically incompetent and reactionary government. Occasional progressive votes from Cornwall, alas, don’t change anything. Nevertheless, two cheers for George and Rogerson, not quite two for Gilbert. The lads did well.

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CORNWALL UNAFFORDABLE BY 2019 ?

I have explored in the post LHA recipients in Cornwall lose out the changes in the June 2010 Tory Libdem budget to the local housing allowance (LHA), the housing benefit for tenants in the private sector.

As part of those changes from October this year the percentile of local rents used to set LHA rates will be the 30th rather than the 50th as at present. Using local rents in the private sector to set rent support in the local housing benefit for private tenants means that the benefit received is linked to the rent to be paid. The Welfare Reform bill changes this by restricting the uprating of LHA rates from 2013/14 to increases in the Consumer Price Index (CPI). Over the last decade private rents have increased more than CPI inflation has. Thus from 2013/14 people will each year probably receive less of their housing costs and will eventually be unable to afford the rent.

Research for Shelter suggests that these changes will probably reduce the numbers of suitable affordable houses available for renting with local housing benefit.

Research also suggests that most of Cornwall will become unaffordable by 2019 to those seeking private rented accommodation with local housing benefit (download all data, the data for local authorities).

The areas where rents are increasing more slowly tend to be areas of more unemployment. Will people be forced from their homes in the unaffordable areas like Cornwall and migrate to more affordable areas where work is scarce?

Is this a sensible policy?

Is there any chance our Libdem Cornwall MPs will say it isn’t?

Note
For informed and considered views about housing see the blog of Alex Marsh, professor of public policy at Bristol University. His post Taxpayers and ‘the right to the city’: alternative narratives on cuts to housing benefit of 25 April 2011 looks inter alia at the Tory Libdem government’s LHA policy.
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CORNWALL’S TRIPLE WHAMMY

Two affordable housing stories for January.

At Porthleven there are 528 applications for 26 social-rent houses.

At St Ives there are 561 applications for 44 social-rent houses.

The two places are more attractive than some others in Cornwall but the oversubscription shows well the demand for affordable housing for rent in Cornwall. There are about 18 000 on the county waiting list. It shows too how Cornwall district councils and the UK/England governments of the last thirty years failed utterly to advance public housing sufficiently. Labour’s failure here is grievous: after its thirteen years scarcely a dent was discernible in the waiting lists for affordable housing in England. There was no political will and not enough money was provided. In Cornwall, as elsewhere, the voices of the opponents were loud and listened to.

It is going to get worse. The Tory Libdem government’s decision to remove central government housing targets, the modest pressure to provide affordable housing, to cut funds, and to hand a veto to local people already comfortably housed in the neighbourhood – a triple whammy – is likely to mean fewer affordable houses built.

I have in the affordable housing posts looked at some of the issues and diversions and suggested what to do. I think second homes are a largely irrelevant issue in the provision of affordable homes, empty houses can have only a minor input, and diversions include reasons from the vast menu of nonsense which boil down to Not here where I live. I want simply to say again that the primary way to deal with the shortage of affordable houses is to build more of them. We should focus on that relentlessly.

NOTES

See here for Porthleven and see the Cornishman 20 January 2011 for St Ives.

A bleak outlook for affordable housing in Cornwall This post also explores these issues
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DEVONWALL, COUNCIL HOUSING, STUDENT FEES – AND PARLIAMENT

It will be an interesting time next week in parliament.

Monday 6 December: the Lords have their second committee day on the Parliamentary voting system and constituencies (PVSC) bill.

Wednesday 8 December: the Lords have their third committee day on the PVSC bill. In the Commons Sarah Newton (Conservative MP for Truro and Falmouth) introduces a ten-minute-rule bill “to require the secretary of state to begin negotiations with certain local authorities with a view to those local authorities leaving the current national housing subsidy system and becoming Council Housing (Local Financing Pathfinders) by April 2011”. The “certain local authorities” include Cornwall Council. [Added 9 December 2010: You can read her introduction of the bill in the Commons here, Hansard 8 December 2010 column 320]

Thursday 9 December: the Commons decide about raising the tuition fees cap to £9000 a year.
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BLEAK OUTLOOK FOR AFFORDABLE HOUSING IN CORNWALL

After the Second World War we began the long haul of rehousing people. By the 1950s we were, under Harold Macmillan, a Tory minister, building around 300 000 houses a year. By the 1980s it was going seriously wrong. The Thatcher Tories introduced the right-to-buy, rightly, but failed to ensure the stock of public housing was kept up, wrongly. They also introduced what Labour intended, lifelong tenancies for social/council housing tenants. (From this point I shall write social to include housing for rent described as social and housing association and council housing; and affordable to include such housing for rent and also lowcost housing for purchase under various schemes.)

Labour’s failure
Housing slipped down the priorities. The nadir was reached under Labour. Private houses as bubble assets flourished but public housing as homes for people was neglected. Labour has an abysmal record on the provision of affordable housing though it tried to improve in its last years in office.

Today, 1997+13, we have nearly two million on the housing waiting lists of England and many have no chance at all of getting social housing. There are around 17 000 on the
waiting list in Cornwall at present, although the list presents problems as a measure of need.

Labour’s years of inaction and ineffectiveness on affordable housing are done with. I hope too we have done with suggestions that a focus on second homes is the answer.

Tory Libdem proposals
Now today we have the Conservatives and Liberal Democrats in government. There are now two ways in which we can meet the public housing needs of people. We can build more affordable houses or we can fiddle with the deckchairs. I am for building more but the Tory-Libdems have chosen the latter, rearranging those deckchairs.

They have announced proposals to change social housing rules and I wish to look at three which are especially problematic. They apply to new tenancies not present tenants.

The proposed rules say that social housing landlords will have the power to give new social tenants lifelong or limited tenancies; the latter can be for as little as two years. Additionally, the landlord will have the powers to evict, if they wish, tenants whose financial circumstances improve. The intention is to push them – I suppose encourage is the Tory Libdem term – into lowcost owner occupation or private rented property. Furthermore, councils and housing associations will have the power to raise, if they wish, their subsidised rents up to 80 percent of the local market rents. These higher rents are drolly named called “affordable”.

The government believes that the new rents and the £4.5 billion of central government funds (half the funding that was previously intended) will enable the provision of 150 000 additional social houses over the next four years. Iceberg? What iceberg?

What is a house for?
A house is not only a volatile financial asset, it is a home. It gives people a chance to settle and work in security, to become part of a community, to have a stake in our country and its safe and just prosperity. It gives children not just a roof but a place where their family, orthodox or otherwise, shelter them, love them, and bring them up in stability. This isn’t sentimentality, it isn’t even merely liberal sentiment, there are also excellent pragmatic reasons for wishing these things. It is in all our interests to have people with a stake in our community and country, and thus much more likely to help us succeed as a country and much less likely to cause mayhem for us, and children, the future of us all, happy and secure.

Impact of the proposals
How do the three Tory Libdem proposals impact upon these desiderata?

The move to limited tenancies will introduce uncertainty into lives many of which are uncertain already, with periodic unemployment and shifting benefits and income. The threat of losing your house if you get on financially is likely for some to be a deterrent to ambition and financial improvement and even finding a job. I think these two proposals, and the moving of people they will involve, do not help community cohesion; breaking local ties with family and friends and perhaps school is damaging. The increase in rents adds in more uncertainty without saving much as many tenants will claim housing benefit for new higher rents they cannot pay.

These proposals are foolish and damaging as they stand.

Fiddling waiting lists and more woes
As for the claim that 150 000 affordable houses will be built in the next four years, I doubt that very mean ambition will be realised. However, the waiting lists will reduce. The Tory-Libdems have hit on a wheeze. Local authorities faced with large and increasing waiting lists will have the power to change the qualifications required to get on the list. Another deckchair moved.

Two other Tory Libdem changes add to these woes.

Housing organisations have signalled their serious concern about cuts to the house building funds and programs. See here and here. These cuts will reduce planned affordable houses in Cornwall.

The housing proposals will empower local communities. What it means in practice is giving a veto to every nimby. I asked in this post back in early 2008 whether, if left to a decision by the neighbourhood as the Tory-Libdems now propose, any affordable housing would be built anywhere in England. Until the Tory Libdem changes, central government was able to act for the whole country and able to limit the power of local self-interest. I am dispirited about likely local objections to affordable housing in many places in Cornwall.

I believe these last two changes will drastically reduce the number of affordable houses built in Cornwall.

Taken together the Tory Libdem plans for affordable housing gives us an outlook for Cornwall and the rest of the country that is bleak, grim,and dire.

Previous posts on affordable housing in Cornwall

Affordable housing and Cornwall Part 4 16 August 2010
Affordable housing and Cornwall Part 3 18 March 2010
Affordable housing and Cornwall Part 2 8 March 2010
Affordable housing and Cornwall Part 1 24 February 2010
Housing 21 June 2009
Housing the people in Cornwall 29 September 2009
Goldilocks and Cornwall 11 March 2008
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LHA RECIPIENTS IN CORNWALL LOSE OUT

The department for work and pensions (DWP) has published an impact assessment of the changes to the local housing allowance (LHA) in different local authorities (for the local details scroll to the tables link at the very bottom of the DWP page). This is the housing benefit paid to people in private rented accommodation not council or housing association accommodation.

The LHA proposals in Labour’s March 2010 budget would have produced 4610 losers in 2011/12 in Cornwall, that is recipients whose LHA money would have been reduced. This was largely because of the removal of the £15 excess (see below).

Those proposals were variously kept, changed, and added to in the Tory Libdem budget of June 2010. In that budget there are 8450 LHA losers in 2011/12 in Cornwall. That’s an increase of 83 percent over Labour’s proposals.

The details are in table 3 and table 26 here again and payments are in adjoining tables 4 and 27 – scroll to the tables at the very bottom of the DWP page.

NOTES

There is an introduction to the changes here.

£15 excess
If a recipient found accommodation with a rent below what was allowed for in LHA, he could keep the first £15 of the difference. This was meant to encourage people to seek out accommodation with lower rents.

June 2010 budget: major LHA changes for effect in 2011/12
-Removing the £15 excess (proposed by Labour for 2011/12, confirmed by June budget)
-Imposing an absolute maximum cap on the amount of LHA payable for each size property (this replaces the March budget proposal to take the top 1 percent of national rents out of rent calculations for LHA)
-Using the 30th percentile as the benchmark for area market rents rather than the median (50th percentile)
-Limiting the maximum of the size bands to four-bedroom properties rather than five bedrooms
-An additional bedroom allowed for an overnight non-resident carer (an improvement to LHA provision)

-From 2013/14 LHA uprates will be based on the consumer prices index (CPI) not local rents.
-From 2013/14 LHA recipients of jobseekers allowance will lose ten percent of their LHA if they are unemployed for more than twelve months.
These are explained in the documents above.
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