Yet another downward twist in the anguished saga of social housing. For the last 2 decades there have been between 1-2 million households on Council waiting lists (the number is currently 1.8 million), yet the number of social housing units built has been continually and drastically reduced and is now no more than a trickle. Under Thatcher the number of houses built by local authorities fell from nearly 100,000 a year to just 13,000 in 1990, driven by the concept of a home-owning democracy and right-to-buy sales. Under Major the sharp decline continued, down to just 450 in 1996-7. Under the Blair regime, the fall tailed off to a trickle, no more than an average of 160 a year over the decade and down to just 63 social houses built in 2001. This virtual elimination of Council house-building was then accompanied by measures to try to force tenants out of Council estates by refusing to carry out repairs and maintenance unless there was a transfer to a private landlord, a housing association, or an ALMO (an arms length management organisation, which managed the houses separately from the Council). This systematic and largely unreported-on campaign against Council housing has now been called off, or has it?
In 2008 the Government issued the Green Paper ‘Homes for the Future: More Sustainable, More Affordable’ which proposed a target of 240,000 new homes a year by 2016 and a total number of new homes of 3 million homes by 2020. It also included a commitment from 2010-11 to building 70,000 affordable houses and a goal of 50,000 social homes a year. However, the credit crunch then changed the housing market dramatically. Repossessions doubled from the early part of the decade to 50,000 in 2008 and have risen further this year. Many Councils wanted to build more affordable homes, but the system provided little incentive to do so. Less than 45,000 new affordable homes have been built each year on average since 2004, and clearly the 70,000 target was nowhere near being met. Equally only 29,000 social homes were built in 2007-8, scarcely more than half the target.
This huge failure forced a re-think. Right-to-buy had continued to shrink the local authority housing stock, with more than a seventh of Council homes being sold off under this scheme since 1997, and the housing finance system had redistributed across the country most of the capital receipts from right-to-buy rather than re-investing the proceeds locally. The Government therefore decided to allow local authorities to retain rental income and capital receipts (from subsequent right-to-buy) for all new affordable housing – but not for existing affordable housing which obviously constitutes the vast majority. These proposals are clearly welcome, but they hardly even begin to counter the size of the shortfalls.
The Government could, and should, do much more. Specifically, the Homes and Communities Agency (HCA) set up by the Government should release social housing grant to Councils directly to bridge the funding gap and allow sufficient capital investment Council house building. It would also help a lot if there were speedier processing of claims for exempt properties or automatic exemption if schemes started before 2010. And in line with other European countries, Council house borrowing should be removed from the measure of public sector debt.
Then on 22 July it was announced that the Government’s £1.5bn social housing programme would be funded by transfers from other existing housing programmes, including plans to refurbish Council and provate rented homes. Some 42% of the capital allocations fund for areas designated by the Government as needing new homes has now been cut. First it was ideological hostility to Council housing in the 1980-2000s that choked off social housing for the poorest quarter of the population, and now it is low priority in the current financially stringent conditions. How much longer will the poorest families be trapped in damp, inadequate, deteriorated housing which nobody should be forced to put up with?