News Shorts and Other Busyness

Housing Bill
- Papering Over The Housing Problem

Squall 12, Spring 1996, pg. 8.

The Housing Bill - the latest government onslaught on cheap housing, the homeless, and the vulnerable - is currently wending its way through parliament.

Despite 15,000 housing organisations advising the government that the bill does not address the country’s chronic housing shortage, and that it makes neither economic nor social sense, it is expected to become law by June.

The bill is likely to ignore the problem of homelessness by pretending the homeless do not exist. It is likely to drive up rents, and further ghettoise the poor and homeless.

The new legislation will remove a local council’s obligation to provide permanent housing for the homeless.

Instead they will only have to provide temporary accommodation for 12 months; that means B&Bs. After 12 months a family will have to move to another B&B, causing untold stress and difficulties for schooling and work.

Even though a family will be homeless, they will not be classified as homeless.

Mick Sweeney, chief executive of one of the country’s biggest housing associations, the Community Housing Association based in North London, says: “The government will be able to say that there isn’t a homelessness

The legislation will also attack housing associations, once called the “third arm” of the housing sector.

Sandwiched between private houses and council housing, they sprang up during the chronic housing shortage of the sixties in order to provide cheap and decent accommodation.

Until five years ago they were heavily subsidised by the government - to the tune of 90 per cent of the money they needed to build new homes.

Because they had very little outlay, housing associations could charge very little rent. Three quarters of those living in housing associations receive housing benefit, so the government’s own benefits bill was kept down.

The country needs 100,000 affordable homes each year. Only 40,000 are built.

Five years ago the government cut the grant to only fifty per cent. In order to build new houses the HAs had to borrow money from the City, with interest, and pay it back. Their major source of income is rent - so rents shot up.

The “right to buy” will be given to housing association tenants, along with a £16,000 sweetener to help with the mortgage.

In practice this will deplete a HAs stock, and they will have little money to replenish it.

Local councils lost twenty per cent of their housing stock through the “right to buy scheme”. According to Mr Sweeney, most sold were those in most demand - three and four bedroomed family homes with gardens.

HAs will, unlike councils, be able to re-invest the money in housing stock. But they will only be able to afford replacement houses in poor, run down areas - so ghettoising social housing.

The bill will allow construction firms such as Barrett and Wimpey, to compete for HA grants, along with new housing companies which will take over council house provision.

The housing bill does not address the real issues of the housing problems,” says Mr Sweeney, “which is sheer shortage.”

In Camden, where the CHA is based, the population is about 140,000. In 1994 2,339 homeless families asked the council for accommodation. Almost 7000 people were on the waiting list. Eight thousand people live in overcrowded conditions. Yet out of a stock of 25,000 homes only 2000 became available.

Putting people into B&Bs is less economic than building new houses,” says Mr Sweeney. ‘The government is paying out huge sums in housing benefit because landlords can charge what they want. The country needs 100,000 new affordable homes each year. Only 40,000 are built. There is too much demand and not enough supply. It would make more sense to keep housing benefit down and our grants up. Half a million construction workers are unemployed. For every £1.00 spent on social housing the treasury would get back 50p in paying less dole and housing benefit.

There is no economic sense for this legislation. 15,000 housing organisations have told the government so on the issue of homelessness alone. There is no credibility in the consultation process. The bill is being driven by ideology.”