Any politicians who says “There is no magic money tree” is treating the electorate as children and idiots. And now Rachel Reeves is acting like a latterday snake oil saleswoman.

(This item first appeared in the Brighton Argus on 3rd April 2024)

Whenever politicians say “There is no magic money tree”, they are treating the electorate as children and idiots. And all who use this pathetic, empty phrase should forfeit the right to be regarded as serious politicians because it closes down legitimate debate on their political priorities.

The politician who most famously used the phrase was Theresa May in 2017 when attacking Jeremy Corbyn. It has subsequently been used by Rishi Sunak and, most recently, by Sir Keir Starmer and Angela Rayner. Labour is also prone to say that the Conservatives have “maxed out the government’s credit card”, an equally stupid concept. The government does not have a credit card and government finances are not the same as those of a household, itself another simplistic and wrong concept favoured by politicians. Proof of this is that there is always money to fight wars.

The household comparison dates back to Margaret Thatcher who, as far back as the 1979 general election campaign, said: “Any woman who understands the problems of running a home will be nearer to understanding the problems of running a country”. Running a home and running the country are not the same, but what an inspired election slogan! 

There is nothing wrong with a country borrowing for investment, even at times of financial instability. What is not right is to borrow to fund tax cuts or day-to-day spending, at least in the long term. I can think of many occasions when nations, in the wake of economic turmoil, have borrowed to fund huge public investment.  One example, in the wake of the 1929 financial crash, was President Franklin D. Roosevelt’s ‘New Deal’ that promoted economic recovery and put Americans back to work through Federal activism. New Federal agencies controlled agricultural production, stabilised wages and prices, and created a vast public works programme for unemployed people. 

The post-war Labour government, at a time of huge debt, made massive investment in creating the NHS, expansion of state education, the building of council housing, and so on. There was a bipartisan approach, not least in housing. During the 1950s, Churchill’s Conservative government delivered new council housing at a rate not seen before or since. Investment in public housing through subsidising the cost of building new homes pays for itself over the years, with lower rents and less public subsidy to help people meet overblown rents. The economics of investment in housing is actually very simple. Investment in bricks and mortar retains value, whereas rent subsidies do not. This bipartisan approach was broken by Margaret Thatcher who began the dismantling of the social housing sector through the politically popular but economically disastrous Right to Buy programme. 

A new bipartisan consensus in favour of financial austerity has been created following the election of the Cameron government in 2010, and Labour front benchers have meekly performed lemming impersonations by following the Conservatives (and until 2015, the Lib Dems) over the austerity cliff. Historians will look back at this era with astonishment – that the major parties were so economically short-sighted and inept that the wellbeing of the nation was sacrificed in the pursuit of power.

If, as expected, Labour forms the next government, it will have voluntarily tied its own hands by adopting Conservatives financial rules. Labour supporters are not enthused by the wooden and lacklustre Sir Keir Starmer – “Sir Crasharooney Snoozefest, the Human Bollard” as Boris Johnson called him. They are destined to be as disappointed by the failure of Labour in government as they have been appalled by the Conservative’s demolition derby antics. 

Following the 2007-08 global financial crisis, the country needed investment but got austerity. When the country needed “strong and stable Leadership” as promised by Theresa May, we had a succession of circus clowns prime ministers unable and unwilling to invest in public services or to control the privatised monopolies. Successive Conservatives promised growth but had absolutely no idea how to achieve it. Now Rachel Reeves, acting like a latterday snake oil saleswoman, promises growth but rules out investment (not least in housing), promoting a valueless and fraudulent remedy that is destined to fail.

Labour will win the forthcoming general election, not because the electorate has any high hopes that “things can only get better” (to quote the 1997 Blairite strap line) but because voters are sick to the back teeth of the chaos of Conservative ‘rule’. And when Labour inevitably fails in government, it will be responsible for a massive swing to the right, by-passing a Conservative Party in mortal decline, to Reform UK and, even more worryingly, to parties on the extreme right.

The Conservatives are the Lying Party when it comes to housing

If the Conservatives are hoping to inspire people with their latest housing policies, they must be stupid, or at least think that the electorate is stupid. Once again the party is putting forward a policy that would be expensive but that will have little impact on the housing crisis in any meaningful way. How can I say that? Because they previously, repeatedly, promised the same and it hasn’t worked.

The Conservatives intend to repackage the failed and costly Help to Buy scheme. It will probably be called something else, but repackaging this policy once again, having dismally failed with it time and again over the last thirteen years, makes that party a bunch of housing cowboys. I wouldn’t trust the on housing to clear my gutters. They raise the expectations of those who are trapped with expensive private sector rents, yet they deliver next to nothing.

From the 2019 Conservative Manifesto

The 2019 Conservative manifesto, the one on which Rishi Sunak was elected as MPs, contained the promise to build 300,000 homes a year. That was their personal ‘contract’ with the British people. That pledge has been scrapped, with Mr Sunak saying that he does not believe in “arbitrary top-down numbers”.  So he lied when he stood for election, and the Party has lied about what it intended to do.

Sunak’s commitment to the manifesto is about as reliable as an election pledge from Nick Clegg.

He says that he ditched the 300,000 target because of concerns from “thousands” of Conservative Party councillors. What about the concerns of the hundreds of thousands of people caught up in the housing crisis that has been created and exacerbated by failed and dishonest housing policies of the same Conservative Party? 

Conservative lies on housing are nothing new. They have repeated, year after year, a mantra that homes sold through the Right to Buy initiative would be replaced on a one-for-one basis.  All the evidence shows that they haven’t ever delivered on previous promises, yet they continue to lie.  Between 2012 and 2018, more than 66,000 council homes were sold under the Right to Buy scheme, while just 17,911 replacements had been started or acquired.

The Conservatives talk about getting first-time buyers onto the housing ladder. In 2014 they promised to build 200,000 new starter homes to meet the housing needs of young first time buyers, to be sold with a 20% discount.  In a 2019 interview, Liz Truss was asked by Andrew Neil:  “You had a plan in 2014 to build 200,000 new starter homes. That was 5 years ago. How many did you build?”  Liz Truss replied: “I don’t have the exact numbers.”  Andrew Neil helped her out: “It’s easy to remember. It’s zero.”

This initiative has now been withdrawn, but there was no corresponding apology from Conservative ministers for lying to potential young, first time buyers whose hopes had, understandably, been raised. Instead, in June 2021 the government launched First Homes, its latest starter home initiative which will offer 30% discounted homes to local first-time buyers. Just four sites nationwide have been identified for First Homes initiative offering, a currently, just 310 homes. 

First Home properties cannot cost more than £250,000 (or £420,000 in London) after the discount has been applied. Local authorities have the power to reduce these caps in their local area, but not to raise them. This means that the First Homes initiative will never work in Brighton and Hove where house prices are much greater. I would be embarrassed to be a Conservative interested in housing in this City.

On rough sleeping, its 2019 manifesto committed a Conservative government to ending “the blight of rough sleeping by the end of the next Parliament”. Another lie? You can bet your bottom dollar it is.

My message for Rishi Sunak: build hundreds of thousands of Council homes

If there is one thing that should persuade the new Prime Minister, Rishi Sunak, to change course on its housing strategy, it is news that councils spent £1.6 billion between April 2021 March 2022 on temporary accommodation for homeless households in England. A quarter of this bill was spent on emergency bed and breakfast (B&B) and hostel accommodation, with B&B costs alone increasing by 20% in the last five years. The overall increase is 61% compared with five years ago.

There should be another reason to persuade him to change the government’s approach – the human cost of housing people in such accommodation rather than in a home of their own. There is ample research on the long-term impact of accommodating children in temporary accommodation in terms of lower educational attainment, mental ill-health, and the loss of other life opportunities. For adults, there is an increase in mental health problems, alcohol and drug misuse, and break downs in relationships, to mention just three consequences.

I spoke at a conference last week and, in response to a question about what would improve the current situation, I said that the only thing that will begin to address the housing supply and affordability crisis would be to build council houses in their hundreds of thousands, coupled with the abolition of the Right to Buy. 

Come on, Rishi Sunak. Do you want a legacy of which to be proud?

Housing: a failure of Conservative Party policy with no hope offered for the future

(This item first appeared in my ‘Brighton and Beyond’ column in the Brighton Argus on 10th August 2022)

Over the last year, homes sold in Brighton and Hove had an average price of £461,980.  The majority of sales in the city were flats, selling for an average price of £324,909. Terraced properties sold for an average of £538,078, with semi-detached properties fetching £562,707.  Overall, prices are up 12% on the 2019 when the average price was £413,964.

The median monthly rent for a one-bed flat in Brighton and Hove is £1,189 and a two-bed flat £1,750. We need a brave housing vision from our national leaders more than ever before.

Since 2010 the housing crisis has worsened – twelve years of abject failure of government housing policy by twelve transient housing ministers.  

I don’t know about you but I have found the ‘debate’ between the two final candidates for the leadership of the Conservative Party, and thus the next Prime Minister, thoroughly disappointing and depressing, not least on housing policy.

Both contenders seem to be focused on appealing to the Conservative base, trying to outdo each other on who will cut taxes, by how much and how quickly.

What I object to is how Ms Truss and Mr Sunak are jettisoning the manifesto policies on which they were elected.  Take housing: both were elected on the promise, contained in their manifesto, to build 300,000 homes a year.

Rishi Sunak has told the Housing Today website that he will not support the government’s 300,000 homes manifesto pledge if elected prime minister.   Mr Sunak does not believe in “arbitrary top-down numbers”.   Liz Truss has said she plans to scrap national housebuilding targets. 

Given they both stood for election in 2019 on this commitment, I have to ask: can you trust anything the Conservatives say on housing? Truss and Sunak clearly don’t believe in the commitments they made when standing for election and have no intention of implementing them. Their commitment to their manifesto is about as reliable as a pledge from Nick Clegg.

Since 2010, the Conservatives have failed to deliver on housing, making the crisis we are experiencing much, much worse. The sale of council housing through a tenant’s Right to Buy, might be politically popular, as discovered by  Margaret Thatcher in the 1980s. However, from a housing perspective it is a disaster. 

The Right to Buy sees homes built with public subsidy, sold with discounts paid for by the public purse, then reappearing in the private sector with rents four or five times those charged when they were council houses. These rents are often subsidised by the public through housing benefit.

No politician who claims to being careful with public money would touch such a policy with a barge poll.

The Right to Buy doesn’t produce more homes in spite of government promises that all homes sold would be replaced on a one-for-one basis.

The Conservatives have repeated this one-for-one mantra every time they have relaunched this failed initiative, and each time all the evidence shows that they haven’t delivered on previous promises.  Between 2012 and 2018, more than 66,000 council homes were sold under the Right to Buy scheme, while just 17,911 replacements had been started or acquired.

The Conservatives talk about getting first-time buyers onto the housing ladder. In 2014 they promised to build 200,000 new starter homes to meet the housing needs of young first time buyers, to be sold with a 20% discount.  In a 2019 interview, Liz Truss was asked by Andrew Neil:  “You had a plan in 2014 to build 200,000 new starter homes. That was 5 years ago. How many did you build?”  Liz Truss, looking like a rabbit caught in the headlights of an oncoming car, replied: “I don’t have the exact numbers.”  Andrew Neil helped her out: “It’s easy to remember. It’s zero.”  Ouch!

This initiative has now been officially withdrawn, but there has been no corresponding apology from Conservative ministers for misleading young, first time buyers whose hopes had, understandably, been raised. Instead, in June 2021 the government launched First Homes, its latest starter home initiative which will offer 30% discounted homes to local first-time buyers. But the government cannot say when it will deliver the first properties for purchase.

The only way we will begin to tackle the housing crisis is through a massive programme of council house building and the ending of the Right to Buy. As a country we must stop seeing housing as an investment opportunity but rather a place where people live.

If Ms Truss and Mr Sunak will not pledge to build hundreds of thousands of council houses, which they will not, I would prefer that they be truthful, that they have no answer to the housing crisis. Just please don’t pretend that your housing plans will make any difference to those in desperate housing need.

Please, Prime Minister, can we have some grown-up housing policies?

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.

Michael Gove is out to seduce and have his wicked way with me

To say that housing associations are not enthusiastic about the government’s plan to extend the Right to Buy to housing associations would be an understatement.

But wait? What have we here? Michael Gove, the Secretary of State for Housing, has set out to “seduce” housing associations so that they take part.

I’m not sure what I find less palatable: selling my soul by signing up to the Right to Buy or being seduced by the delectable Michael Gove.

Mr Gove has said that housing associations “quite rightly have a number of questions, (but) they’re not opposed in principle, quite the opposite.”

No, Mr Gove, many if not most of us are opposed in principle. Your predecessors have lied and lied over the one-for-one replacement of homes sold. Boris Johnson has freshly promised to work with housing associations to devise a scheme that would see a one-for-one replacement. However, when he announced that he hadn’t yet spoken to any housing associations.

My level of confidence in commitments made by the prime minister, be they £350 million per week for the NHS, a ready-made deal for Northern Ireland, the Millennium Bridge across the Thames, the Thames Estuary Airport, the bridge from Scotland to Ireland, the lies he told to his former editor and his former party leader, the assurances he has given to all his former wives, tends to make me think that his word cannot always be relied on 100% …

So seduce away, Mr Gove. I’m sure that there will be those, for the right price, who will be allow you to have your wicked way with them. And wicked it is, the sale of council houses and housing association homes is wicked in my opinion.

My views on the government’s ludicrous, unachievable and ridiculous housing proposals

Please, please, please, can government ministers be more honest about their housing proposals. Michael Gove has, in interviews today, made a comparison between the cost of renting against the cost of servicing a mortgage as the incentive to help people buy their homes.

This is not helpful. It is disingenuous and dishonest. The true comparison is the cost of renting against the cost of servicing a mortgage, a deposit, possible ground rent and service charge, day-to-day repairs, and major works.

Today’s proposals are not about getting people on the housing ladder. Allowing housing association tenants to buy their homes isn’t getting them on the housing ladder. They are already on it. The government is talking about getting them on the home ownership ladder.

I won’t even begin to say how ludicrous and unachievable this ridiculous proposal is – I extending the right to buy to housing association tenants had been floated several times in the past, pilots have failed miserably, and it just cannot be delivered.  What sort of government persists with a policy that evidence shows is so broken? (Answers on a postcard and addressed to 10 Downing Street).

I have seen nothing in today’s proposals that gives me any confidence whatsoever that the government is truly serious about addressing housing’s affordability and supply crisis that has bedevilled our country for far too long. Housing policy should not be a short term, vote grabbing activity designed to appease restless backbenchers. It requires long-term strategic planning and, if we are going to get truly affordable homes, a massive investment in the building of social housing.

Today’s announcements will exacerbate the problem as similar announcements have done in the past. Nobody with an ounce of knowledge about housing or basic common sense will be convinced or enthusiastic about these proposals. They are stupid, ill thought through, and harmful. 

I am retiring in January and I look forward to then being free to say what I really think …

Join me playing Fantasy Queen’s Speech

Each football season some newspapers run a Fantasy Football League where participants ‘manage’ a group of players, gathering points for goals scored, clean sheets and, of course, wins and draws.

I thought, in preparation for the Queen’s Speech tomorrow, it would be fun to play Fantasy Queen’s Speech where you get points for each of five policies that the government includes in the Gracious Address.

Here are my five housing policies:

• “In the interest of sensible housing policy, My Government will finally consign the Right to Buy to the dustbin of history and abandon the idiotic plan to extend this policy to housing associations”

• “My Government will be proactive in ensuring the homelessness crisis does not worsen by abolitishing Section 21 ‘No Fault’ evictions for renters”

• “In order to finally tackle the affordability and supply crisis in housing, My Government will invest in the building of council housing on a scale greater than at its height under the Conservative government in the 1950s”

• “My Government will ensure that the cladding scandal is resolved with the necessary financial support being given to leaseholders, recoverable from developers and freeholders”

• “To tackle the cost of living crisis, My Government will ensure that Local Housing Allowance returns to reflecting the true cost of renting in the private rented sector”

I suspect that, surprisingly, I somehow might not win Fantasy Queen’s Speech this year. Nor in the forthcoming reshuffle will I be appointed as the 137th Housing Minister since last Tuesday.

The extension of the right to buy to housing association tenants is likely to be just a hollow election promise

The decision by Margaret Thatcher in 1980 to give council tenants the right to buy their homes was, politically, a clever idea. But from a housing policy perspective there was no moral justification, and it was not economically sensible. 

How was it acceptable for a public asset (council housing), created through public investment, to be lost and at the same time a huge financial asset created for someone whose only contribution was once being in housing need and unable to afford to rent or buy a home in the private sector?

The Right to Buy does nothing to meet housing need, doesn’t create a single new home, doesn’t help those in the private rented sector, doesn’t address overcrowding, and denies tax payers a proper return on their investment.

At least four out of every ten homes bought under the Right to Buy are now being rented out to private tenants. Typically, rents for these homes are three or four times higher than the rents charged when they were let by councils.

In 2015 the government promised the Right to Buy to housing association tenants. A pilot was set up in the West Midlands to see how it might work. It was a disaster and government ministers quietly buried the idea. Some of us could have told them when the policy was first announced that it was stupid and would not work.

An idea that is stupid and will not work has not deterred the prime minister, Boris Johnson, from announcing … wait for it .. the same policy! 

Why announce it now? Could it be that there are council elections this coming Thursday and the government is expecting to incur a heavy defeat? This is likely to be no more than a hollow election promise.

This latest announcement is likely to go the same way as the Thames Estuary Airport, the Garden Bridge over the Thames, and the Boris Bridge from Northern Ireland to Scotland, all vanity projects on which our prime minister has failed to deliver.

While Margaret Thatcher’s original Right to Buy was a political success (and she actually delivered it), it sowed many of the seeds for today’s housing crisis.  Extending it to housing associations remains a disaster waiting to happen.

Housing associations are not public bodies. Most of the homes built in the last 20 years or so have been funded largely by private borrowing. This debt is being repaid over decades from the rents charged to tenants. The sale of these homes at a hugely subsidised rate would capsize the business plans of these organisations and totally freak out the financial institutions making future borrowing unlikely.

Rather than the policy bringing hope for tenants, it is actually cruel hoax. The hope of buying ones home will come to nothing. 

In 2015, within a day of the government announcing it intended to extend the right to buy to housing associations, I was approached by a tenant of one of BHT Sussex’s nicest properties saying that she wished to buy her home. While I advised her to get independent advice, I also told her that the policy announcement was likely to be little more than a hollow promise. And so it turned out to be.  

The UK has a housing crisis. Suggesting that something is being done by speculating on who might have ownership of a home does not address this crisis at all. To address the supply and affordability crisis we need more homes that people can truly afford; we need council housing; and we need to abolish the Right to Buy as they have already done in Scotland and Wales.

 

My Hopes for Rishi Sunak’s Spring Statement

I am hoping that the Chancellor of the Exchequer, Rishi Sunak, will announce (23rd March 2022) measures that will have an immediate impact on alleviating the cost-of-living crisis, and long-term changes to housing policy to overcome the supply and affordability crisis.

There is a temptation to see the very many challenges facing the country are due to the crisis in Ukraine and the consequences of the Covid-19 pandemic. The reality is that the seeds for both the cost-of-living and housing crises go back many years.

Housing policies of successive governments, not least the continuation and extension of the Right to Buy, has fuelled rental costs and reduced the availability of social housing with rents that people can afford.

The fuel crisis is the latest, albeit very significant, factor that has driven people into poverty. We have heard this week, following the publication of a very disturbing report, Swimming with Sharks, by the Centre for Social Justice, of the very desperate lengths that people will go to in order to provide for their households, and how they become vulnerable to physical, emotional and sexual exploitation.

I hope that the Chancellor will do at least three things to deal with the cost of living crisis: first, reinstate the £20 enhancement for those on Universal Credit, second, introduce an annual fuel grant (not a loan) of £350 each year for all those on benefits and those in low wage employment, and third, abandon the social care levy for anyone earning less than £25,000.

Regarding housing, I’m not calling for any additional funding but to abolish the Right to Buy and use current spend on subsidising the Right to Buy to invest in the building of social housing with rents that people can truly afford.

Am I confident that Mr Sunak will do this? I won’t hold my breath but I look forward to be proved wrong.