Waah, Waah, the Lib Dems are helping the EVIL Tory housing plans!
August 4, 2010
Go and read the comments appended to this article in the Guardian. Go on, go and read them. Do you get the impression that millions of poor aspiring people are about to be pushed out onto the streets? That’s fascinating. It appears from those comments that Cameron’s plan to require every new tenancy to be review every five years will push people out onto the street, and cause a massive breakdown in social cohesion (whatever that means).
Let’s now have a look at some statistics. This report from the National Centre for Social Research demonstrates that only about 22% of the people who live in social housing and/or rent from the Council are actually working full time – the rest are retired, unemployed (3-4% of the total, for those who think social housing is essential to catch people in economic need), working part-time (13%) or economically inactive in some other way. Only 22% of current social renters are likely – at the outside – to even have the chance of losing a tenancy (Edit: Grant Shapps has confirmed that this would only apply to new tenants – so that’s 22% of new tenants, then). To do that, they’d need to get a better job. This does constitute a deterrent to social mobility, so I can only hope that IDS’s proposals will include some form of housing benefit reform to compensate for this.
Now, this report from the House of Commons Library demonstrates that the percentage of people in social housing & local authority housing has been decreasing since the 1980s. Surely this is a good thing, and evidence of social mobility. However, it also demonstrates that housing stock construction has slowed to around 150,000 per year since the 80s too. During this period, the population has increased by about 5 million. This is relatively high historically speaking, matched only during the 60s – which experienced significantly higher levels of house construction.
If supply and demand were working effectively, house building should be on the increase – rather than the decrease. This would lower house prices, and make it more affordable for people to leave social housing. It’s not. Why not?
There are multiple factors here, but perhaps the most significant is planning legislation. Since 1947, if you owned land you couldn’t simply build on it – you had to seek permission from the local authority. The reforms to this legislation by the Thatcher government in 1990 made building housing significantly more costly, and consequently raised house prices. Demand for higher-priced housing is of course lower, resulting in lower levels of construction.
More than anything else, it’s the housing market that’s causing the pressure on social housing. In order to reduce house prices, you need planning reform. The Tories are proposing planning reform – but reform that may yet make building houses more difficult. Cameron’s attempts to reduce the demand for social housing by shifting out people who can afford it is actually good thing, but it’s not the real story – the Tories need to reconsider their planning policy if we’re going to resolve the housing crisis. I look forward to the Guardian’s campaign against green belts.