Friday, 18 May 2012

Gesture politics of Grant Shapps - RTB - yet another housing mirage.

Jack Dromey, Labour’s Shadow Housing Minister recently stated that “If we had a home for every press statement issued by Grant Shapps we wouldn’t have a housing crisis”. This sounds like a simple criticism of a career politician who just wants to put out good news about his department, but there is something more profound about this comment.

The latest press release from the ever-positive Housing Minister concerns the “Revamped Right to Buy” scheme, which is intended to allow council house occupants to purchase their house at up to a £75,000 discount, with the money going to a ring fenced part of the Local Authority’s coffers to be spent building new homes.

But in Hyndburn this policy is nothing more than a press release, because it won’t help anyone.Take a cursory glance at the numbers and the unrestrained pride the Minister shows on twitter seems a little misplaced.

The problem is that this does not apply to Councils which transferred their stock into Housing Association ownership in order to meet new minimum standards. In Hyndburn owing to the large amount of houses which didn’t meet the decent homes standard the council took this path and stock transferred. New tenants do not acquire a right to buy – just existing tenants when the stock was transferred. So aside from a very small and dwindling number of people who transferred their Right to Buy rights, this won’t help Hyndburn.

A council spokesperson guessed at 25% churn in tenancies since stock transfer back 2006. Vast swathes of former Council housing now in private housing association hands are excluded from this ‘grand gesture’ of aspirational home ownership.

Rossendale Borough Council has said in no uncertain terms that this policy would have no effect whatsoever. This is housing policy as a blunt instrument. Not thought through, inconsistent and half-baked.

But even where it will apply, it isn’t going be the life-giving solution to the housing crisis. The £75,000 discount is a maximum (up from £50K), and to qualify there must have been a minimum 5 years tenancy with % increases based on years of occupancy. The average sale price in Rossendale in 2010/2011 was £63,000; in Hyndburn just £52,000 with the discount is capped at 60% but is as low as 35% for those with just 5 years tenancy. Shapp’s £75,000 is simply another meaningless press release outside of London.

To put this new big announcement in quantitive perspective – and the Prime Minister himself has waded in with extra loud triumphalism – 6 homes were sold last year in Hyndburn under RTB and in Rossendale which had a good year, just 10.

Shapp’s has made the vacuous political promise of a one for one replacement. Vacuous because it is not a like-for-like but social tenancy with the lowest rent levels being replaced by affordable homes with the higher affordable rent level. The higher discount is effectively being subsidised for by the new tenants paying higher rents. Robbing Peter to pay Paul.

The National Housing Federation stated their concern recently that the revenues from the sales would not be enough to finance a new build. And in areas like Hyndburn where house prices are low, the sales will simply not bring in enough money to cover the cost of a new build. A house always costs about the same to build anywhere in the country, but that is not what its value is based on.

Shapp’s is continuing his one size fits all housing policy which doesn’t reflect the national differences in the housing market.

The National Housing Federation, Shelter and the Chartered Institute of Housing have all said this week that “things are getting worse”, that “much more needs to be done” and that things were “pretty bleak”. The Chirpy attitude of the Housing Minister certainly doesn’t reflect this.

What I want to see is a Housing Minister who is more focused on actually delivering solutions to housing problems instead of chasing headlines and pithy one-liners that he can deliver in the House of Commons. To read one of Mr Shapps’ (numerous) press releases you would think this Government’s record on housing was a huge success based on obvious solutions that he has plucked out of thin air.

Shapp's has a disastrous housing record in Hyndburn. Ending the £9m per year Elevate regeneration programnme. Ending the general £1m pa housing grant. Introducing the unfair New Homes Bonus which takes £millions away from Hyndburn and East Lancashire, not ensuring that LCC support housing in two tier areas, watering down regulations for private landlords.

His successes are thin on the ground. Introducing a empty homes tax after two years vacant and a £2.3m grant for Woodnook.

I realise that this isn’t an original criticism of a career politician – but I don’t think we should have careerist politicians running Government departments based on press releases and spin; especially those as important as Communities and Local Government. Grant Shapp's better sit up and take notice because his department is another one heading for free-fall.