Earlier this month Boris Johnson gave a speech in Blackpool where he said he would “turn benefits to bricks“ by allowing people on benefits to put that money towards the cost of a mortgage.
At the time I was not particularly complimentary, saying that the proposals were “stupid, ill-thought through, and harmful.” (Note to self: I must stop sitting on the fence on issues such as this!)
Has the government learned anything from recent history? I draw your attention to policy disasters in housing over recent decades, not least in the two years before the 2008 banking collapse when the most popular banks sold over 200,000 sub-prime mortgages.
Last week in parliament it was revealed that most people in receipt of housing benefit will not be able to take advantage of Johnson’s ‘benefit to bricks’ plan. Who would have thought? David Rutley, a minister in the Department for Work and Pensions, admitted that the plan will likely impact on just a limited number of people. He said: “There are five million in receipt of housing support, and though we know that it is likely most will not be in a position to take up the new policy, it removes a barrier that currently prevents thousands of families from buying their own home.”
That is a most optimistic spin on a ridiculous policy and damns it by faint praise. It must be excruciating for intelligent, thoughtful ministers required to defend policies dreamt up in the playground that is the Prime Minister’s mind.
Experts have said that in areas where house prices are high, such as Brighton and Hove, it is unlikely that universal credit payments will be enough to allow anyone at all on benefits to buy a home. There is also a deafening silence from lenders as to whether they would be willing to be part of this scheme.
This is a policy that raises hopes only to see them dashed on the rocks of reality.
There have been other government housing proposals in recent weeks, including the extension of the Right to Buy to housing association tenants that are, frankly, ludicrous and unachievable. Housing associations are not public bodies. Their house building programmes are backed by billions of Pounds of private borrowing with loan covenants based on rental income forecasts over thirty or forty years. Financial institutions have a charge on the very homes that the government wants to be sold off cheaply.
The commitment to extend the Right to Buy is likely to be as hollow as previous promises to do this. The National Housing Federation has raised concerns with ministers while the Housing Secretary, Michael Gove, has said that he wants to ‘seduce’ housing associations to take part, but has said that no organisation will be forced to comply with the proposal.
As someone who works for a housing association, it is unlikely that I will allow myself to be seduced by the delectable Michael Gove, tempting though that might be. I won’t let him have his wicked way with me because selling social housing is wicked. We already have an affordability and supply crisis on an unprecedented scale. The selling off of housing association homes will only make this situation even worse.
Over 40% of council houses that have been sold are now let out in the private rented sector with rents four or five times the level of previous social rents. This has been a major contributing factor to the spiralling cost of housing benefit – an all-too-predictable consequence of the failure of successive governments, of all colours, to build council housing.
There used to be a bi-partisan approach to house building. Let’s not forget that it was a Conservative government in the 1950s, with Winston Churchill as Prime Minister and Harold MacMillan as Housing Minister, that built a record 350,000 home a year.
I have seen nothing in Boris Johnson’s statement, nor in the housing measures in the Queen’s Speech, that gives me any confidence whatsoever that the government is serious about addressing housing’s affordability and supply crisis that has bedevilled this country for far too long.
Housing policy should not be a short-term, vote-grabbing activity designed to appease restless backbenchers.
Appeasing backbenchers and tinkering around with failed housing policies is no way for a government to behave. It is far too important for the country and for people in housing need. Housing should be where people live, not a political football, nor seen merely as an investment opportunity.
A serious solution to the housing crisis requires long-term strategic planning and, if we are going to get truly affordable homes, a massive investment in the building of social housing and an end to the Right to Buy.
In short, we need a return to grown-up housing policies.
Andy Winter's Blog 