Hubris and Nemesis

If you have been following the fortunes of certain local authorities in recent years you will know that some have been struggling to stay afloat. The most extreme example is Northamptonshire County Council, which was declared bankrupt in 2018 with debts of £1bn. It was twice forced to file a section 114 notice, effectively forcing it to spend no money on anything but essential services.

The minister sent in Max Caller, former chief executive of the London Borough of Barnet, to review the chaos, and appointed two commissioners, Tony McArdle and Brian Roberts, to run the authority. Between them they pronounced that the council was dysfunctional and bankrupt and should be abolished, to be replaced by two unitary authorities, West and North Northamptonshire, that would absorb the seven existing district councils. The new councils are about to go live.

We all know that local authority spending has been cut in recent years, but Northamptonshire was a Conservative-led administration, supposedly fiscally prudent and well run. So, what went wrong? Well, the commissioners have just issued a report concluding that the council was guilty of multiple failings but that hubris (dangerous over-confidence) was mostly to blame for the crisis. It makes for interesting reading, and the lessons learned can be applicable to any organisation, including housing providers.

Back in 2015 Northamptonshire was a council driven by ideology. It prided itself on its low council tax and came up with a big strategic idea: the “Next Generation Model”, where almost all services would be outsourced, including its child protection and adult services. Services would also be shared with other councils (I have a pension from Cambridge City Council – it is managed as a shared service with Northamptonshire).

Although technically owned by the council, these outsourced bodies would be paid a fixed fee, with the council retaining only around 200 employees (other councils of a similar size have around 1000 employees). Nicholas Ridley, minister for the environment in the eighties (and architect of the poll tax), had a vision of an ideal council that employed almost nobody and met once a year to dole out contracts to private firms. A few councils have gone down this route, but few as far as Northamptonshire

The council believed it would benefit from savings of £96.7m as a result of outsourcing. In fact, the plan was a disaster. Lack of oversight and scrutiny meant it was actually being charged more than for inhouse services. Its children’s services failed repeated OFSTED inspections, for “failing to keep children safe”. Social worker salaries were lower than average, and the council struggled to recruit staff, so they brought in agency staff at a much higher cost. It was a vicious circle.

Northamptonshire responded by blaming the government for its problems and started selling off assets to plug the gaps in revenue, which is like selling your house and living on the proceeds. They sold off their headquarters and then faced an annual rent charge of £2m. By 2018/19 the council had a deficit of £41.5m, with shortfalls of £30m predicted for 2018-19 and £60m for 2019-20. No amount of asset sales will cover such gaps. By the end of 2017/18, it had debts of more than £1bn.

The commissioners describe Northamptonshire as a council that had been “hollowed out, with many of its inhouse services and its out-sourced services neither efficient nor effective”; and “… if the council at that time could be identified with one word, that word would be hubris.”

To summarise, the commissioners report this hubris was characterised by:

  • A complete failure of leadership: they failed to tackle issues and sought to blame others for problems
  • No strategic direction: the plans were unrealistic and exotic. The council was obsessed with far-fetched experiments and ill-thought through solutions
  • Outsourcing was done badly and left the council without a sense of corporate direction. Governance was poor
  • Financial management was weak or non-existent. The commissioners were unable to obtain answers about the revenue position
  • Service failures: some services had been well funded but without any planning; others had been starved of resources
  • Lack of challenge: groupthink had taken hold, dissenting voices were ignored. Everything was the government’s fault
  • Cultural malaise: failure was expected, depression set in and aspiration for improvement was weak.The commissioners’ report includes a helpful summary setting out what a well-run authority should aspire to. For me, one of the most important lessons of the Northamptonshire debacle is the groupthink issue. The leadership was absolutely convinced that they were right, and any critics or dissenters were side-lined or silenced. In 2015, the former finance director Matt Bowmer warned that the council had “…a culture and behaviour where overspending is acceptable”. He was ignored.We have seen aspects of this emerging in the Grenfell Inquiry where critics of the council and the TMO were also silenced.In Greek mythology Icarus, son of Daedalus, makes wings of wax and feathers and ignores all warnings about flying close to the sun. Lacking in self-doubt, his wings melt, and he topples to earth. Hubris begets nemesis.

A little humility goes a long way, and self-doubt should be the hallmark of any good leader. Being open to challenge and alternative ideas likewise. The ability to speak truth to power and to challenge groupthink should be embedded within any organisation, otherwise autocracy sets in and that inevitably leads to disaster. This is a topic I hope to return to in a briefing for HQN.

(This blog was first published by the Housing Quality Network on 10th June 2021)

The great housing divide

I suspect that when this pandemic is finally put to bed (if it ever is) then bad housing will be fully exposed as one of the key villains in the spread of the virus and the wider collateral damage caused by lockdowns.

I have a written a few blogs and articles about the deepening inequalities caused by Covid- 19, but the latest English Housing Survey’s household resilience study provides further exposure of the harm caused by poor housing and the growing divide between different tenures.

One of the most shocking findings of the study is that the percentage of private renters living in overcrowded properties has doubled over the course of the last year, from 7% to 15%. In December 2020, one in seven private renters were overcrowded compared to only one in 50 homeowners. Almost a fifth (17%) of private rented households had increased in size by at least one person since 2019, compared to only 9% of owner-occupiers and 10% of social renters. This was the result of mass population movements as people switched locations to cope with lockdown. (A home is defined as overcrowded if there are not enough bedrooms to avoid undesirable sharing, given the ages and relationships of those using them.)

Many scientists believe that transmission of the virus within households is a primary spreader of Covid-19, and this is exacerbated within overcrowded and multi-generational households. The Health Foundation found that, even before the pandemic, people living in poor housing experienced worse health outcomes, with the triangle of quality, affordability and security linking together to determine physical and mental wellbeing.

Obviously, families living in overcrowded rental homes and young people in shared housing are impacted more by the triple whammy of these three factors. But the pandemic has made them even more significant in causing bad health outcomes for those affected. Last year the Health Foundation also pointed to worsening housing conditions – overcrowding and poor quality housing – being associated with higher risks of mortality from Covid-19. They pointed out that mortality rates were higher in deprived areas and among groups with lower incomes.

Overall, the English Housing survey shows that the pandemic caused overcrowding to increase across all tenures from 829,000 to 1.3 million, but private renters were the most affected.

BAME communities were particularly badly affected by overcrowding, with almost a quarter (23%) of ethnic minority households being overcrowded, compared with 3% of white households. A whopping 35% of Pakistani and Bangladeshi households were overcrowded. Death rates among some of these groups have been much higher than for white populations (as much as double in some cases) and you have to recognise that overcrowded housing conditions must be playing a significant part in this. Some ethnic groups have also had their livelihoods disrupted to a much greater extent, being much more likely than the population as a whole to work in locked-down sectors or to be self-employed, and to suffer from job insecurity and loss of income.

There is also an intergenerational aspect to this since younger households are more likely to be overcrowded than older households.

On top of this, the survey reveals big differences between tenures in terms of anxiety, unhappiness and loneliness. 14% of private renters and 16% of social renters reported feeling lonely often or always, compared to only 5% of owners. During the pandemic overall satisfaction with life declined across all tenures, but at the end of 2020 owner occupiers had higher happiness scores than renters (a score of 7.2 for outright owners, compared to 6.3 and 6.4 for private and social renters respectively). Similar differences exist for anxiety and scores for the question ‘is life worth living?’ with renters faring worse in all cases. But these differences also existed between people on different incomes, with people in the lower income quartiles reporting higher levels of anxiety and unhappiness.

To sum up, those living in the worst, overcrowded properties – many of them in the private sector – and often experiencing job uncertainty and low incomes have suffered the most during this pandemic, not just from mortality but also from the anxiety and stress a caused by living in overcrowded conditions without access to outdoor or indoor space.

But the big picture is that our distorted housing system has forced millions of unwilling households into the private rented sector where overcrowded conditions, high rents and insecurity are causing, at the very least, higher levels of unhappiness, and, at the very worst, death.

I have said it before but I do hope that the post-pandemic public inquiry into the handling of the crisis will shine a massive spotlight on the multiple harms caused by poor housing. We really need a Royal Commission, along the lines of the big nineteenth century commissions that exposed the death and disease caused by unsanitary and overcrowded housing. As ever, one of the key answers must lie in the need to invest in genuinely affordable homes, so that, in the future, everyone has the space they need to work and self-isolate in their home and stay safe. Surely that should be recognised as a basic human right?

(This blog was first published by HQN on the 29th April 2021)

Allan Brigham: Housing friend

I doubt many of you will have heard of Allan Brigham but he was one of the most remarkable people I have ever known. Allan died last September after a long illness. Last week, over 200 people gathered on Zoom to celebrate his life.

For much of his working life Allan was a road sweeper in Cambridge, but that only tells a small part of his story. He was also a local historian, a blue badge guide, a housing and planning activist, an educator, and in 2009 he was awarded an
honorary degree by Cambridge University, alongside Bill and Melinda Gates and Shirley Williams. A group of his friends assembled outside The Senate House on that day with a big banner reading Allan Brigham MA, Roads Scholar.

For the purpose of this blog he was also a firm friend of our sector, an “outsider” who could spread our concerns to a much wider audience. We need more people like him.

I first met Allan in 1988 when we moved into his road. He had moved to the city over a decade earlier and could only find work as a road sweeper, but it was a job he kept for over three decades, often rising at 4.30am. He was also a union activist, fighting for better pay and conditions for his colleagues. This experience informed his views about housing. He would regularly talk about his workmates who could no longer live in the city and often had to commute in from distant villages. He wanted Cambridge to work for everyone, rich and poor.

Early in the century a few of us set up a group in Romsey Town, our neighbourhood in Cambridge, to campaign on planning and housing issues. We fought against developers who sought to evade their responsibilities to provide mixed communities, and we highlighted shoddy developments – we even made it to the pages of The Daily Mail!

In his activism, Allan was very much for Town over Gown. He was always reminding us that the town of Cambridge pre-dated the university. Its royal charter was granted at least 80 years before the university. His tours had a focus on the town side of Cambridge, its industrial past, the coming of the railway, the poverty and struggles of working people.

He was anti-nimby and very much in favour of growth, but growth that worked for the people and not for developers and their shareholders. You can see an example of his views in this speech at Great St Mary’s, the university church. He repeatedly pointed out that Cambridge had always been growing, and had grown at a much faster rate in the nineteenth and early twentieth centuries. Everyone, he said, lived in a place that had once been open countryside, and that it was pointless to push growth beyond the green belt as this just caused traffic problems. The key was to make Cambridge a compact, walkable and liveable city.

In 2006 I was involved in organising the CIH Eastern conference. I asked Allan to contribute to a book we produced to tie in the with the conference, called Bringing it all Back Home. His half of the book was a social history of Romsey Town, the area where we lived. It had been built for railway workers in the nineteenth century and is a closely packed area of terraced houses. He interviewed a number of local people and charted the social, physical and social changes that had affected the area over the previous 40 years. In his summing up he wrote:

“Romsey looks very similar today to the way it looked in the sixties. But the social composition of the area has changed dramatically. The last forty years have seen the traditional working-class residents in retreat. But those living in council houses have a security of tenure that gives them stability and they remain a significant part of the community. Ironically the successful regeneration of the area has made owner-occupation unaffordable on manual wages while the ‘right to buy’, although benefiting those who took it up, leaves a diminished number of family houses to rent.

“(Romsey) has a clear physical identity and many points of contact – pubs, clubs, two community centres, allotments, two primary schools, pre-school nurseries and after- school clubs. One of the most important meeting places remains the ‘Rec’, where dog walkers, joggers and basketball players rub shoulders with teenagers ‘hanging out’ or playing football. On the route to and from the primary school it is also where parents and children pause to chat.”

The importance of ‘chatting’ as a means of gluing communities together was evident on his tours. At the outset he asked everyone to talk to each other and to make friends. Even when he was sweeping the streets he could often be seen chatting to residents and tourists. I always said that the city council should have employed him to chat all day. It would probably have done more for community cohesion than almost any other form of spending. No one left an encounter with Allan feeling more miserable than they did at the outset.

This sociability made Allan stand out as a human being. He was always smiling, always cheerful. Being out with him was a challenge because people would be stopping him every few minutes. He was also full of energy, always busy with a new project – writing, campaigning, lecturing. He would go into schools to educate kids about litter and he sat on the board of the Cambridge museum for 30 years.

Another quality was his stoicism. He was in pain for many years and yet never showed it, never complained. I last met him in July 2019 when we walked around Romsey and visited the new mosque and his allotment. As we parted I went to embrace him but he flinched. He could not touch anyone because of the pain. As I said at the outset, he was a remarkable human being and a friend of affordable housing. May he rest in peace.

(This blog was first published by the Housing Quality Network on 8th April 2021)

Space Matters

After the Russian revolution in 1917 most housing was nationalised by the Soviet government and living space was allocated according to need, with a fixed quota of space for each person.

As the country industrialised, millions of people flooded into the cities; large apartments and houses were subdivided into smaller spaces with families sharing kitchens and bathrooms. Commissars billeted people together and enforced the rules, ensuring that no one had too much or too little space. By the 1950s it’s estimated that the living space for each person was five square metres. After Stalin’s death in 1953 the Politburo determined to end the housing crisis and embarked on a mass housebuilding programme. By the 1970s this had increased to nine square metres.

In the UK we rarely talk about the space occupied by each person. It’s a bit like discussing salaries, and the notion of local bureaucrats sniffing out spare bedrooms and billeting people into unused space would be anathema to the British public.

But there’s a debate to be had about the way we use existing housing space. There are wide disparities in the amount of living space we occupy; between rich and poor, and between older and younger people. Our housing and taxation systems encourage people to under- occupy their homes and to buy more space than they need. What’s more, these disparities are worsening, with well-off owners occupying more space and renters becoming more overcrowded.

According to the English Housing Survey it’s estimated that 52% of owners now under- occupy their homes, up from 48.7% in 2011 – that means they have two or more bedrooms than they technically need. By contrast, the percentage of social and private renters who under-occupy their homes went down over the last decade – from 10.3% and 16.6% to 8.7% and 14.4% respectively. Renters also became more overcrowded – around 7% of renters live in overcrowded properties, compared to only 1% of owners. We’ve also seen significant increases in second homes and investment properties over the last two decades, with baby boomers being the main beneficiaries.

Research by the GLA also shows that floorspace per person has been increasing for owners and decreasing for renters. In 2018, households that owned their home outright (mostly older people) occupied an average of 53.9m2 per person, compared to 35.9m2 for those with a mortgage, 28.6 m2 for private renters, and 27.5 m2 for social housing tenants. Since 1996, floorspace per person has increased for all owners, whereas the average floorspace enjoyed by social housing residents fell from 28.4m2 in 1996 to 27.5m2 in 2018, and from 34.1m2 to 28.6m2 for private sector tenants.

The pandemic has highlighted these inequalities in living space, with renters suffering disproportionately from Covid-19 deaths, hospitalisations, and the wider impacts of lockdown. Renters have less access to open space, are more likely to suffer depression and anxiety, and to have lost their jobs or been furloughed. Furthermore, owners, and particularly older owners, have been buying up more space over the past year. The demand for country and coastal properties has increased; Londoners have been on a spending spree, buying up country and coastal properties; and larger, more expensive properties have been disproportionately bought by older buyers.

Some of the factors that encourage under-occupation, and discourage downsizing, include, firstly, the council tax system. It is regressive (people in smaller properties pay proportionately more) and there are wide disparities across the country. For example, a Band H property in Dover district, where I live, pays almost £4,000 a year, whereas in Westminster the charge is only £1,561 a year. For an oligarch living in a multi-million-pound penthouse that’s barely small change. The single person discount also encourages people to under-occupy. (Whenever this is raised there are cries of protest from older people who are asset rich and cash poor – but why can’t they downsize?)

The stamp duty system also discourages people from downsizing and is a major barrier within the secondary housing market. Although the current stamp duty holiday is misguided, it’d make sense to scrap the duty for people who downsize from larger to smaller properties.

But the lack of suitable retirement properties is also a major factor. It’s estimated that only 3% of the nation’s housing comprises bespoke retirement properties, yet almost a quarter of the UK population will be over 65 within a couple of decades. Tweaks to the planning system could address this. For example, could the NPPF put a duty on local authorities to assess the level of under-occupation within their areas and set targets for retirement homes? Another policy change could be to put retirement housing on a par with affordable housing when looking at rural exception sites. But this could also be extended to urban areas, with marginal and infill sites receiving permission for retirement homes alone.

Of course we need to build many more homes, but according to Les Mayhew of the Cass Business School if “people lived in homes more suited to their needs, 50,000 fewer homes would need to be built each year”. However, I’d not want vocal nimbys to jump on this as an excuse for failing to build the homes we need, just as they jump on the ‘brownfield first’ myth. We need to do both in tandem.

It would, of course, be wrong to use coercion against people who are under-occupying their homes, but there’s much more we could do to encourage and incentivise under-occupying owners to downsize, and also to make them believe that it’s the ‘right’ and ‘moral’ thing to do.

All of these issues and more are addressed in a report I’ve just produced for the Intergenerational Foundation called Stockpiling Space. It’ll be out soon.

(This blog was first published by the Housing Quality Network on the 25th March 2021)