The divided social housing sector

The social housing sector is a bit like the Labour party – deeply divided, although not quite so nasty.

On the one side are the pragmatists, those prepared to go with the flow and do the government’s bidding, with its trajectory towards home ownership. Some in this group see a bright future in a more commercial environment, where they build homes for sale and private rent. A tiny few look forward to a future where they can break free from the shackles of state control and become fully private companies.

On the other side are the traditionalists, those who see social rented housing as worth fighting for and who argue the case for public investment to provide low-cost homes for rent, to boost the economy and to cut the £26bn a year spent on housing benefits.

The pragmatists have accused the traditionalists of being dinosaurs, harking back to a golden age of social housing that never was. The traditionalists accuse the pragmatists of selling out the sector for the sake of their own careers. And so it goes on. In truth, as it celebrates National Housing Day on 19 September, the social housing sector is in a dangerous place.
No one who has followed the past five years of Tory policy will be surprised that government wants to scrap the requirement to build affordable homes

The exact legal status of housing associations has been unclear for decades. The National Housing Federation has long argued that they are private, independent, charitable organisations, but last October the Office for National Statistics, swayed by the ability of ministers to appoint board members and managers to associations and by the fact that consent is required before they can dispose of properties, reclassified housing association as public bodies.

That decision means there is an ever-present danger that their assets could be sold off to the private sector. The pragmatists are therefore right to point out that it would be foolish to challenge or annoy the government in any way, and defend last year’s decision to agree with the government a voluntary deal to extend right-to-buy to social housing tenants. For traditionalists, though, that deal is simply an example of a supine approach.

It doesn’t help that the latest analysis of chief executive salaries shows inflation-busting pay increases across the board – something that is bound to annoy the Tory right, given that the bulk of housing association income comes from the taxpayer. An own goal, say the traditionalists.

The only hope of reuniting the sector is if the new government ditches the Cameron/Osborne obsession with home ownership and realises the sense of investing in genuinely affordable homes.

The housing minister, Gavin Barwell, has flagged up a possible change of approach. This week he said that we need “to build more homes of every single type and not focus on one single tenure”. Whether that signals a genuine change of approach remains to be seen.

 

(This piece first appeared in The Guardian on 19th September 2016)

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