The Great Housing Giveaway

Ian Duncan Smith's latest housing policy idea proposes giving social housing away for free as a reward for finding work. Here's the Top Five Reasons this is the WORST IDEA EVER.

Ian Duncan Smith’s latest idea proposes giving social housing away for free as a reward for finding work. Here are five reasons why this is THE WORST housing policy proposal EVER.

The Story

There have been quite a few bad housing policies in recent memory. Bedroom tax (more on that here) and wrong-to-buy (more on that here) spring immediately to mind, and if it ever gets off the ground and starts addressing anything but the most basic of cases Universal Credit might well join their ranks.

There is a new villain in town, though, and it threatens to devour social housing as Galactus might consume a world. (Which would make Ian Duncan Smith the Silver Surfer? Well, he’s already bald, I suppose…)

The proposal being considered, in brief, would ‘gift’ social tenants their home after a year in work; tenants would stop being eligible for housing benefit and would have to pay 35% of the sale proceeds in tax if they sold their property within three years.

The housing sector, naturally, has reacted with uproarious incredulity…but if you are not possessed of common sense and cannot immediately perceive how truly awful this idea is, I have taken the liberty of highlighting the top five reasons why this is THE WORST housing policy proposal EVER.

  1. Contemptuous Disregard for the Past

Social housing did not spring up overnight; it has been built, literally and metaphorically, over years and decades, and represents a significant public investment.

We all pay into the welfare state and we all benefit from it, from the NHS to education to pensions and, yes, direct and indirect benefits of housing, all of which we pay for.

To simply ‘give away’ social housing is to give away one of our country’s greatest, most enduring, and most vital and necessary assets with no hope or plan for replacement or substitution. It is to cut up a safety net that generations past have spent weaving so that future generations might have the opportunity to thrive and prosper and not know the indignity of living – and dying – in slums and back alleys having suffered the arbitrary slings and arrows of outrageous fortune.

It is to throw decades of hard work and uncountable social value away for, quite literally, nothing.

  1. Financially Ruinous

To quote The Times re: the policy:

“Proponents argue that the saving in housing benefit and the sales tax receipts, boosted by housing inflation, would almost outweigh the cost.”

Wait…almost outweigh the cost? Even if there were a saving in housing benefit (there won’t be – see Reason Five for why), proponents of the policy admit the policy won’t pay for itself. This is evidence that the reason for floating this idea is not for financial or logistical reasons, but a continuing dogmatic crusade (perhaps, even, genocide?) against social housing.

More than that, housing associations have borrowed billions of pounds to build new homes, borrowing that is being paid back in part by the income stream provided by rent on and the asset value of social rented properties. The policy would kick the financial legs out from many housing associations, and seriously undermine the sector.

  1. Contemptuous Disregard for the Present

The policy would not only threaten housing associations ability to pay off current borrowing – it would also threaten to make the current housing crisis unsalvageable.

The crisis is not one of home ownership – at least, not entirely. What it is is a crisis of supply, and as I’ve said before you don’t solve a supply crisis by reducing supply.

The idea that recouped sales proceeds would be reinvested into the housing market is a nonsense. As David Orr (@natfedDavid), chief executive of the National Housing Federation correctly points out, the government’s promise one-for-one replacement of right-to-buy properties is a ‘hollow joke’, with receipts from sales nowhere near adequate to cover a new build replacement. If RTB isn’t being replaced on a one-for-one basis at the moment – and it isn’t – then don’t expect money reaped from sales of gifted homes to replenish available stock either.

We need more housing, not less. We need more social housing, not less.

  1. Divisive, Arbitrary, and Insulting

Speaking of social housing, what about the great many social tenants who are already in work? Will they automatically be ‘gifted’ their home, or will they miss out?

Facetious Scenario 1: “Honey, listen to this idea: first I quit my job and start claiming benefits, then get re-hired, work for a year, and BOOM – free house! Let’s blow our savings on a holiday to celebrate free property!”

What about working social tenants living in flats? Do they become ‘free’ leaseholders…

Facetious Scenario 2: “Good news, social tenants in flats! You can now get stung for bills of tens-of-thousands of pounds when the landlord who still owns the structure of your home decides to perform maintenance work to the block! Oh, and you still have to pay a service charge – it’s just like the rent you pay us now! You’re welcome!”

…or do social housing tenants in flats miss out based on the type of property they happen to live in?

What about those former social tenants who purchased their home through RTB? Now, look, I’m no advocate of RTB, but buying your home when you could have just waited and had it given to you…that must sting.

What about those living in the private-rented-sector? No free homes for them, I guess, working or not. Sorry guys – keep dreaming of security.

What about those people who worked and saved for years – not just one – to be able to purchase their first property. The policy must be like a kick in the teeth.

Regardless of the actual caveats and policy minutiae, the suggestion of gifting social tenants their homes for finding work is divisive, arbitrary and insulting, a cheap and nasty gesture designed to win equally cheap and nasty votes in the run-up to this year’s general election.

  1. Contemptuous Disregard for the Future

As well as being deeply patronising, my greatest worry with this proposal is that it utterly ignores the long-term future of housing in this country. As mentioned above, it is a desperate clutching for votes – as fellow housing blogger Neil Goodrich (@ngoodrich87) summarised to me on Twitter, “populist politics at its finest.” – that completely ignores the fact that the social homes we have at the moment have been many peoples’ homes in the past and will continue to be homes that people need in the future. Indeed, the many people stuck on waiting lists are relying on a future where social housing is an option.

Social rented stock has already been decimated; as Michelle Reid (@MichReid2014), chief executive of Cynon Taf Housing, tweeted: “So once we’ve given all the houses away, what next?”

What next is no more safety net for people most in need. What next is thousands being forced into ‘affordable’ housing (which is not affordable) or into an unregulated private rented sector – both of which will increase the housing benefit bill – or worse…left with no safe housing options at all. What next is thousands of people with nowhere to go.

The end of social housing…just as intended.

Conclusion

There you go: my top five reasons why this is THE WORST housing policy proposal EVER. There are other reasons, of course. Many other commentators have already sunk their teeth into this morsel and shook their heads – if you’re reading my gnashing, you’ve almost certainly read theirs.

Is this policy likely to make it into manifesto, let alone reality? Maybe not – Mike Haw (@MikeHaw) suggested on Twitter that it’s more likely a way of softening the blow re: extending right-to-buy to housing associations (another bad policy idea being proposed.) However, we must remain vigilant – the world is full of terrible and stupid ideas that came to pass because people trusted that common sense would prevail over dogmatic crusades, ulterior motives, or simple ignorance. We can’t trust to incredulity as a shield against idiocy.

Tom Murtha (@tomemurtha) has recently blogged that the light of social housing is being extinguished, and that we must rage against the dying of the light. It doesn’t matter whether this proposed policy is likely to transpire or not – this is precisely the kind of idea we should be raging about.

References

A Greek Call To Arms, Tom Murtha (WordPress), Online: https://tommurtha.wordpress.com/2015/01/29/a-greek-call-to-arms/, Available: February 2015

Extending Right to Buy to housing associations and other distractions, National Housing Federation, Online: http://www.housing.org.uk/media/blog/extending-right-to-buy-to-housing-associations-and-other-distractions/, Available: February 2015

Get a free council house for coming off benefits, The Times, Online: http://www.thetimes.co.uk/tto/news/politics/article4351595.ece, Available: February 2014

Opinion: Another day, another bonkers plan for social housing from IDS, 24Dash, Online: http://www.24dash.com/news/housing/2015-02-12-Opinion-Another-day-another-bonkers-plan-for-social-housing-from-IDS, Available: February 2015

Opinion: Right to buy isn’t right and it needs to be scrapped. 24Dash, Online: http://www.24dash.com/news/housing/2014-05-22-Opinion-Right-to-buy-isn-t-right-and-it-needs-to-be-scrapped, Available: February 2015

Opinion: Roll up for IDS’s Great Social Housing Giveaway!, 24Dash, Online: http://www.24dash.com/news/housing/2015-02-12-Opinion-Roll-up-for-IDS-s-Great-Social-Housing-Giveaway, Available: February 2015

Sector ‘speechless’ over Tory plan to give away millions of social homes, 24Dash, Online: http://www.24dash.com/news/central_government/2015-02-12-Sector-speechless-after-Tory-plan-to-give-away-millions-of-social-homes?utm_source=dlvr.it&utm_medium=twitter, Available: February 2015

Advertisements

One comment

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s