Wednesday 28 July 2010

Ill Fares The Land

In George Orwell's 1984, Winston is given a book:

'[It] fascinated him, or more exactly it reassured him. In a sense it told him nothing that was new, but that was part of the attraction. It said what he would have said, if it had been possible for him to set his scattered thoughts in order. It was the product of a mind similar to his own, but enormously more powerful, more systematic, less fear-ridden. The best books, he perceived, are those that tell you what you know already.'


Last night I finished reading exactly such a book, Ill Fares The Land by Tony Judt. It challenges the largely unspoken assumptions that have dominated economic policy in the Western world since the 1980s. The book brought some thoughts that have been nagging at me into focus. So rather than getting a reasonable amount of sleep last night, I wrote a political diatribe. It isn't polished or structured, but it's a sincere response to that remarkable book.


Why have we stopped imagining any alternative to free market capitalism? This is a question I've long wondered about, now re-awoken in my head. The simplistic communism/unfettered free-market capitalism diochotomy is frankly stupid. Surely humanity can manage more sophisticated thinking? Why haven't the interdependencies between markets and governments been acknowledged and studied?

How did the economic growth become an end in itself rather than a means to an end?

Have we forgotten the original purpose of government and the public sector?

Why are we as a society willing to tolerate huge and growing inequalities? High unemployment? Social exclusion and poverty? All in the name of economic growth and the ubiquitous totem of efficiency.

Why do we now value efficiency above everything else, without even knowing what it means?

Why can't the wealthiest countries in the world afford basic public services any more?

The coalition government are trying to dismantle the state, whilst telling us that we don't need it. If that is indeed the case, why has it persisted in being useful for hundreds of years? Why did our estimation of its value suddenly plummet in the 1980s?

Where has our faith in markets come from? Unregulated markets are as unsuccessful as over-regulated ones, just in a different way. Monopolistic exploitation vs so-called inefficiency - which do you prefer?

Economics has become akin to a religious mystery, with a priesthood of bankers telling us its too complex for us to understand or be included in. That's a lie. The basis of economics, the laws of supply and demand and the concept of markets, are very simple. Deceptively so, as they fail to reflect the ways that human beings, and the institutions and markets in which they interact, actually behave. I remember being taught about models of long term economic growth about six years ago and realising, with some amazement, that none of them stood up to scrutiny. They all made assumptions that are utterly ridiculous - infinite capital, for example. Yet we continue to put our faith in these models, because no-one has stood up and said, 'BUT THAT'S JUST NOT TRUE!' No-one does that because they're afraid of being told, 'Oh, you just aren't clever enough to understand.' (I tried to discredit these models in an undergraduate essay, but that was never going to shake the world to its foundations.)

The goal of a government should not be to promote economic growth above all else. Governments exist to protect their citizens, to create an environment of fairness, justice and equity for all. We are not dismissive of governments because these concepts are no longer relevant in the twenty-first century, but because governments appear to have lost faith in them. All debates on fairness are framed in purely economic terms, as if the only freedom anyone needs is the ability to make as much money as they can.

Public sector workers are increasingly being demonised as meddling, obstructive bureaucrats. At times I have felt guilty that I am paid by the public purse, because my job isn't absolutely essential to the continued functioning of the UK. Now I think, why the hell should I apologise? I do my job to make the world a better place, insofar as I can. The aim of it is to improve life in Cambridgeshire, by planning for the population's future needs now. Why are workers in the private sector being painted as morally superior, for working merely to enrich themselves and the shareholders in their companies? What is wasteful about working to improve the environment and people's lives? How did we as a society get to the point where a public servant is a drain on the country rather than an asset to it?

Why does this feel like a radical thing to question? Because at the moment it is. We have a cabinet minister who fears 'cigar chomping commies', a Prime Minister who thinks the state should retract and let mythical communities provide their own public services. The NHS and education systems are about to be dismantled. Government support in every single sector of society that you can imagine is being scaled back or withdrawn. The overriding goal of this government is to cut public spending, whatever the human cost.

At the moment, I think people feel a mixture of three emotions about this:

  1. Ignorance ('none of this will effect me')

  2. Vague satisfaction ('ha, those wasteful bureaucrats deserve a bit of a shock; after the recession we've had in the private sector, it's their turn to feel some pain')

  3. Vague fear & unsettlement ('there are a lot of changes happening suddenly, I don't remember voting for this')


To 1, oh yes it will.

To 2, when the private sector suffers, private sector employees feel it. When the public sector suffers, everyone feels it. Because everyone uses public services, however much they unknowingly take them for granted.

To 3, now you're actually thinking.

I refuse to apologise for so-called bureaucratic wastefulness any longer. Why is it so much more reprehensible for the public sector to allegedly waste a little than the private sector to waste a lot? Which is better value to society - thousands of people employed doing so-called 'bureaucratic non-jobs' or a vast handout to a bank? The former do not meet economic definitions of efficiency, and their value cannot necessarily be quantified. But that does not mean that they're valueless and less justifiable than bailing out a huge private bank, which will then confirm its commitment to inequality by paying billions in bonuses whilst refusing to lend to small businesses.

The public sector has been on the defensive for thirty years, since it became the norm to measure success in purely economic terms. That is a stupid, wrong-headed way to assess whether services like a rail network, health centre, or environmental protection agency are operating well. We must learn to measure beyond money. There are many things too important to try and quantify so simplistically; health, education, and the environment, for example.

I do not think that the public sector is perfect and the private sector evil, just because I refute the notion that the public sector is always wrong. We need a more intelligent and nuanced view of both sectors, and of their interdependence.

Tony Judt ends with an entreaty that if you agree with him that something has gone very wrong with how we are governed, do something about it. He doesn't specify what, because that's a much harder question. Nonetheless, I feel galvanised and somehow vindicated. It's very frustrating to disagree with so many government policies, dissecting each into tiny pieces so as to describe how they are goes wrong. All current policies start from flawed economic and political assumptions, assumptions that have become so widely accepted since the 1980s that we have almost forgotten how to contradict them. We criticise high train fares, fear the threat of unemployment, feel vaguely guilty about our inefficiencies, and aspire vaguely to wealth as it is is supposed to make us happy. So little in culture or media contradicts this.

My generation needs to read Ill Fares The Land, it's well worth losing sleep over. We need to be reminded that a better world is possible, and that better is not a synonym for richer.

There is no profit in trying to build utopia. Attempting to make the world better for people requires thinking beyond market transactions, it demands imagination of a kind that modern life seems to suppress. The UK is at a turning point, with an anti-government government telling us to go away and govern ourselves. Perhaps this is a chance for our imaginations to awaken, for us to recognise what we really want from the state, and most importantly for us to challenge the notion that human beings exist to produce products and services more efficiently. That is what our economy and our political system are based on.

Does anyone really believe that to be true? Do you?

Monday 26 July 2010

No Comment

This afternoon I've had the interesting experience of emailing a friend to say 'You know that a press release has gone out saying your agency is being abolished, right?' As it turns out, it looks more to be reorganisation, with the term 'abolish' used merely for spin. Still, something of a sign of the times. I have friends working all over the public sector; in teaching, health, central government departments, government agencies and the army. I wonder how many of us will still be thus employed in two years time?


Two interesting links have surfaced today. Firstly, someone has worked out the effects of the housing benefit cuts, area by area. In Cambridge, the changes will result in a reduction of £25.32 per week. That's £113.94 less every month, an unmanageable sum for a pensioner, family on a low income or unemployed person to find elsewhere.

The Guardian continues to cover the story of housing benefits cuts, and the government's response continues to be scandalously offhand. The Department of Work and Pensions stated,

'What these reforms mean is that people receiving housing benefit may not be able to live in expensive city centres, but the same applies to most working families who do not receive benefit'.


That's a vast understatement. Currently most people are priced out of city centres; these reforms will price people receiving housing benefit out of the entire South-East of the country.

The other link is a somewhat surreal interview with Eric Pickles, minister for Communities and Local Government.

For your convenience, I have extracted Mr. Pickles' choice quotes below:

'This building was the Balkans until I arrived.'

'...if we let the system take over before we stop in any way, then the cigar-chomping Commies take over again. The cigar-chomping Commies are not going to take over on my watch.'

'Basically, I'm not mad keen on reports longer than two pages because after that most things are just word processing.'

'You cannot see things in shades of grey. Labour is wrong, the Lib Dems are wrong, we are right.'

'I see myself as a diamond geezer.'


This man is in control of a multibillion pound departmental budget, and the future of local government is in his hands. Words actually fail me.

Friday 23 July 2010

Youthful high spirits

As a distraction from the scary labour market, I've been considering the housing market prospects for me and the rest of today's youth. This is akin to distracting yourself from an earthquake by setting off a small nuclear bomb.


I recently came across an article in the Independent's money section about a young woman called Eloise wanting to buy her own home. Eloise earns £22,350 and has savings of £1,000. She would like to buy a two bedroom flat in London, or maybe Bristol, and wants her financial decisions to be ethical, although I'm not quite sure what that means in this context.

I'm sorry Eloise, but I read this article and burst out laughing. SERIOUSLY? You really think that on those wages and with such paltry savings that you can afford to buy so much as a shed? Wake up and smell the coffee. In Cambridge, which is cheaper than London, I would need to earn £40,000 and have a £50,000 deposit in order to buy a two bedroom flat.


My generation, the twentisomethings renting at the moment and thinking it might be nice to buy one day - we are screwed.


We rent poor quality homes at at high cost, and are treated badly by rental agents and landlords because they can. They will continue to do so, and rents will rise with demand.

We struggle to save for the 25% deposits needed to buy a home. Low interest rates erode the value of our ISAs and our jobs look insecure, if we're lucky enough to find and keep one. Rates are expected to stay low for the next two years.

We attempt to repay our student loans, whilst glowering at our parents who got their degrees with no fees and generous grants. The interest rates of these loans are going up to 4.4% in September from the current 0%, and that's before the student loan company is privatised (as announced in the June budget).

We can't get social housing, because there isn't enough to go around and established families get precedence, reasonably enough. Funding for building more has been slashed and burned, and targets torn up.

We can't get mortgages, as we're seen as too much of a credit risk and don't have vast deposits. Introducing caps on mortgages has been suggested and returning to the era of easy mortgages would be highly unwise, given that unwise lending caused the downturn in the first place.

We can't find housing that fits our needs, because developers are building tiny rabbit hutch flats to store us in, and we're priced out of the few decent-sized houses that exist. UK new builds are the smallest Europe, reports the Commission for Achitecture and the Built Environment. Even the Daily Fail says so!

We simply can't afford to buy, as the gap between wages and property prices continues to gape wider and wider and youth unemployment rises inexorably.

I am not particularly happy about this, and doubt that anyone else in my demographic group is thrilled either. I certainly don't consider myself entitled to own a palace at the age of 25, but do think it reasonable to have a well-maintained home that I can feel secure in for more than six months.

The likely result of the coalition's so-called housing policy is this: the house price bubble will return in South, pushing up rents further. This is at a time when housing benefit has been capped and other benefits decoupled from housing cost inflation. Homelessness will increase. Mortgage availability, especially for first time buyers, is not about to get better. Employment prospects are poor and taxes rising. Last year, 75% of new housing starts had some form of government subsidy. Despite this, very low number of houses were actually delivered. With this support severely cut, the number of new houses built is already falling and will fall further. So prices will continue to rise, supply will continue to lag, ad nauseam, until the whole East of England falls into the sea in 2054.

Things aren't completely hopeless, though. Here are my suggestions for improving the state of the housing market.

  1. If the coalition aren't going to have a housing policy, they should get rid of the post of Housing Minister. This accords with their drive to get rid of bureaucratic non-jobs.

  2. Tenancy law needs to be reformed to make private rental more humane. Look how Germany and much of the rest of continental Europe manage it: longer tenancies, more rights for tenants to match their responsibilities, less of an assumption that home ownership must always take precedence. Implementing the recommendations of the Rugg Review would be a start.

  3. Second homes & buy-to-let should be penalised through the tax system, rather than supported. This may seem unfair to those just trying to invest for their retirement and so forth, but I believe it is necessary. It surely isn't justifiable to have millions of homes standing empty, when so many people are homeless, overcrowded, or housed unsafely.

  4. The planning system is in need of reform, as it cannot achieve what it needs to in the 21st century. However, reform needs to happen in a measured way with full consultation with actual planners, rather than abolishing bits at random and expecting Local Authorities to keep calm and bugger on somehow. (There will doubtless be a future post on planning and its current state of chaos.)

  5. The government needs to investigate and regulate oligopolistic behaviour in big developers and house-builders, including land-banking, with the aim of introducing a bit more competition into this sector. Other countries manage to build more and quicker, in part thanks to a much more dynamic and competitive building sector.

  6. It would be helpful to streamline compulsory purchase powers, which assist Local Authorities in building their own social housing by letting them grab unused land. The major cost of social development is the land, as the public sector is priced out by developers who can realistically expect 25%+ profit margins.

  7. The UK needs a culture change from the tired old adversarial planning system. I'm sure that more competition in the building sector would help with this. We might then be able to follow the Netherlands' good example and try public & private sector joint ventures to build new homes.

  8. Everyone needs to think differently about housing. A roof over your head is a right first and foremost, and an investment second. Likewise, we should stop thinking of a home as synonymous with ownership. If private rental was reformed and social housing more widely available, views should evolve accordingly.

  9. The planning system should make room for different kinds of homes as well as different tenures - canal boats, caravans, yurts, treehouses, old train carriages, hobbit holes, etc. Not everyone wants to live in a brick box, and it certainly isn't positive for the environment to force everyone to do so.


My current preference is for a yurt, after staying in one for a weekend's holiday. It would certainly cost quite a bit less than that elusive two bedroom flat.

Thursday 22 July 2010

Up in Flames

The phrase 'bonfire of the quangos' has had a lot of airing from all political parties in decades past. It seems to be the done thing with a new administration, to condemn all the previous government's quangos and then set up a new quango to investigate the fact that there are too many quangos.


All this proves is that if you read the word quango enough times it loses any meaning it may once have had. It is supposed to stand for quasi-autonomous non-governmental organisation, but is generally used to label any public sector body that isn't a government department, a local council or a hospital. For variety, you can also try a qualgo, or quasi-autonomous local governmental organisation. I might have made that one up, though.

To date, the coalition government have set up the Office for Budget Responsibility, falling into the trap of setting up a new organisation in order to get rid of other ones. This is precisely how quangos proliferate so - ministers say they want to do something, and in order for the new thing to be announced with a fanfare, it must have a new organisation attached. Or an old one which has been renamed and restructured. I've heard this process called re-disorganisation, unsurprisingly.

At the present moment, though, cutting is the order of the day, and public sector organisations are dropping almost daily. I have naturally been taking a particular interest in those with offices in Cambridge.

Today's victim was the Government Office of the East of England, as eight regional government offices were abolished. The London one remains, incidentally, as CLG's accusations of inefficiency, ineffectivity, and unpopularity do not apply there, I can only assume. The Government Office of the East of England (GO-East) employs quite a few people in Cambridge. As does the East of England Regional Development Agency, which has two offices round here and has also been abolished.

In the case of both these organisations, it is not that their functions and thus their jobs are being moved or reorganised. The government has taken the view that their functions are just not needed, and their jobs likewise. Meanwhile, all local authorities are undertaking restructuring exercises; the current polite phrase for trying to shed people faster than natural wastage can achieve.

All this points to a rather worrying situation next year. Many highly-skilled, considerably experienced people will be searching for jobs, and I might well be among them. I've got a healthy CV, but that's not much help if I'm competing with 500 other candidates. Public sector job opportunities simply won't exist, so the private and third sectors will be inundated. On the one hand, I agree that some layers of bureaucracy were in need of slimming back. Moreover, the expertise being lost from the public sector could envigorate and influence the private and voluntary sectors. One the other hand, increased unemployment is inevitable. Where are we going to work?

There is an understandably high level of anxiety amongst local government employees at the moment. Everyone knows someone, who knows someone, who is seconded to someone who works in a government department and tells tales of policy mayhem. Nobody is certain that their job will exist next year, or whether their workload will be made irrelevant by tomorrow's policy announcement. Everyone wonders whether the Big Society means getting fired and then doing the same job as an unpaid volunteer. Confusion about localism abounds.

The fact is, most public sector workers don't really want to work in the private sector. Personally, I just don't care about profit. I want to be paid enough to live on, which I am. The prospect of a bonus won't make me work harder; an interesting new project will. I am motivated by a desire to try and understand how the world works and how to make it a better place. Even if I never make more than the most infinitesimal progress with either, at least it will have been worth getting up in the morning.

That makes me sound naïve and idealistic, but I'm not without pragmatism. I'd take an unsatisfactory job in order to pay the rent; I've been a cleaner before, that definitely lacked intellectual stimulation. Thinking about job opportunities over the next few years, I can imagine a couple...

Big Society Enforcement Officer. Being anti-social is no longer to be allowed; you are part of the Big Society, whether you like it or not. This might not be a paid job, but you'd probably get a uniform and a taser.

Local Opinion Assessor. True localism means understanding what local people think about everything, all the time. Someone needs to measure that opinion, using whatever means necessary.

More seriously, some occupations are needed even if the entire fabric of civilisation collapses. Plumbers, takeaways, bike repairs, doctors, and second hand shops perhaps. Cambridgeshire's high-tech cluster is doing very nicely despite the downturn, which is encouraging. And despite our moribund history in the sector, hopefully the UK can manage a few more jobs in renewable energy and other cleantech.

However it seems that the days of the quangocrat are numbered.

Friday 16 July 2010

Why does this government have a Housing Minister?

The June Budget announced a number of changes to Housing Benefit, aiming to save £1.8 billion from the £21 billion a year spent on it. Yes, that's twenty-one billion pounds every year, between 4.7 million claimants. Why so high, you might wonder. That would be because it rose with housing costs, which have vastly inflated in recent decades as supply fell further and further behind demand. To reduce this burden on the public purse, say the coalition, we will make these changes:


  1. Capping Housing Benefit payments to £250 a week for a one-bedroom flat, £290 for a two bed, £340 for a three bed and £400 a week for a four-bedroom property. This is a maximum, not the amount that most people will get. For much of the UK, the caps are reasonable (at the moment anyway), but in almost all of London rents are far higher than that.

  2. Changing the way that payments are calculated, using the lowest 30% of rents rather than 50% as is currently the case. This amounts to an absolute cut in Housing Benefit.

  3. Adjusting Housing Benefit to inflation using the Consumer Price Index rather than the Retail Price Index. The difference - the former doesn't include housing costs, which have caused the Retail Price Index to be consistently higher. Levels of Housing Benefit will no longer have any connection to rises in actual rents.

  4. Cutting Housing Benefit by 10% for people on Job Seekers Allowance for more than 12 months. Presumably to 'encourage' them to find employment.


The more that I think about these changes, the more outrageously regressive I find them. The reason that the government pays Housing Benefit is that in the UK we supposedly believe that shelter is a human right. The proposed reforms will cause Housing Benefit to trail further and further behind housing costs. It will no longer be a safety net. Homelessness is going to rise, and fast.

If people can't get into social housing, and Housing Benefit isn't sufficient for them to afford private rental, what are they supposed to do? Where are they supposed to go? In effect, those entitled to Housing Benefit (working on a low income, unemployed, retired, or unable to work) will be priced entirely out of the South-East of the United Kingdom.

I am not exaggerating. The Chartered Institute of Housing calculates that these reforms will price Housing Benefit claimants out of all private housing within a decade. They are so concerned that they've started a campaign against the changes.

The National Housing Federation calculates that just the proposal to cut Housing Benefit by 10% for people on Job Seeker's Allowance for more than a year will cause 202,000 people to face almost inevitable homelessness.

And what is the response to this from our Housing Minister, Grant Shapps?

I refer you to the excellent theyworkforyou.com, which keeps track of what our representatives in parliament are talking to each other about.

The Labour MP for Westminster asked Mr Shapps What discussions he has had with the Secretary of State for Work and Pensions on the effect on housing and levels of homelessness of the proposed reduction in housing benefit levels?

His response is that he has set up a cross-ministerial working group and has increased the existing discretionary fund to tackle homelessness.

That is a shockingly brief, offhand, weak, and ineffectual answer. It is clear that the Housing Minister has no conception of the disasterous effects that Housing Benefit reforms will have. Those on low incomes will be excluded from London and much of the South-East, effectively forced to migrate North-West, where lower employment and economic stagnation have kept house prices low. Keyworkers like nurses, carers and firefighters will be priced out of half the country.

Has there been any consultation on these changes? No.

Has the government conducted an assessment of the impacts? No. I can't find it, and I've got a lot of experience locating things on government websites. In any case, the month between election and budget was insufficient to properly examine the impacts of huge changes like this.

Undoubtedly the Housing Benefit system inherited by the coalition was in need of reform, to reduce costs and make it fairer. These reforms, however, will penalise the most vulnerable people in society, worsen poverty, and further entrench regional wealth disparities. They mark a return to Victorian notions of the undeserving poor, who are merely lazy rather than trapped by economic circumstances. The changes will increase the number of homeless people and drive others to crime in order to pay their rent.

4.7 million people are going to struggle to keep a roof over their heads. I am enraged that a Housing Minister who claims to be a long-term campaigner for the homeless is so unconcerned about this that he thinks setting up a working group is an adequate response.

Why does this government have a housing minister? I honestly don't know. At the moment the post looks like a complete waste of public money.

Thursday 15 July 2010

Sociable Homes

Social housing can be a rather emotive topic, and is strongly linked in many people's minds with feckless unemployment and teenage single mothers. For what its worth, this is what I know about it.


  • Social housing is not free; tenants pay rent. The level of rent is lower than in the private rental market, by approximately 50% in Cambridgeshire.

  • On average, social housing is of higher quality than private rented (see this post). It is also much more secure, as the landlord is not profit motivated.

  • Some social housing is managed directly by local councils, some by not-for-profit 'registered providers'. These are usually charities.

  • Thanks to the 1980s 'Right to Buy' policy, the level of social housing in the UK is far below that needed. The result is that many people in poverty are living in overcrowded, poor quality private rented accommodation supported by Housing Benefit. Right to Buy allowed many people to purchase a home, but also removed the better quality social housing stock.

  • Social housing is allocated on the basis of need, using a waiting list system. Anyone can be added to the list. In my area, those on the list then receive details of available properties and 'bid' for them if interested. The bidder judged to be in the greatest need gets the home. Levels of need are expressed in four bands, A to D, of which A is most acute.

  • On the 1st July 2010, Cambridge's waiting list had 6299 people on it, of which 147 were in band A. The total population of Cambridge is approximately 117,700 (including around 16,000 students). The most recent figure I can find for total social housing stock in Cambridge is 11,049 (2007-8). That same year turnover was 4%, which is typical. Once in social housing, tenants are understandably reluctant to leave.

  • In Cambridge and the surrounding districts, 40% of social renting households have at least one person in work. 11% are retired and another 11% unable to work due to ill-health or disability. A quarter are not seeking work; the majority of single parents understandably fall into this category.

  • The total number of people on waiting lists for social housing in England stands at 1,800,000, the longest the list has ever been.

  • Although some still call it 'council housing', councils haven't built social housing for decades. Recently there have been some efforts to get local authorities back into social housebuilding, but these have had very limited impact. For the most part, new social housing is provided through private housebuilding. Local councils have planning policies requiring developers to make a percentage of their housing 'affordable'. This definition includes but is not limited to social housing. As a result, when housebuilding slows down as it has on the back of the credit crunch, social housing is hit too. In Cambridge and its environs, the affordable housing target is 40%.

  • Central government supports and subsidises social housing through grants. When the credit crunch arrived, the then government introduced a range of new schemes to encourage housebuilding in general and social housing in particular. As a result, 75% of new housing starts in 2009 received some sort of public subsidy. Although it would be foolish to assume that none of them would have gone ahead without support, it's fair to say that most wouldn't. For all their faults, the Labour government put significant effort and money into social housing. Not enough, but significant amounts.


What changes is the Age of Austerity bringing?

The coalition are saying that there is no more money for affordable housing. Without government subsidy, social housing will not be built. Registered Providers could borrow money to build, except for the little problem that we're in a credit crunch. Loan availability for housebuilders is limited and not improving. Meanwhile, unemployment is increasing the number of households unable to afford to own or privately rent a home. There is already a shortage of social housing, and it will get worse.

The Department of Work and Pensions (DWP) are also mooting the idea of somehow encouraging jobless social tenants to move in order to find work. This seems to me an extraordinary misunderstanding of the nature of 21st century poverty. If I lived in a socially rented house, I wouldn't want to move to find work! Social housing is hugely difficult to get and extremely sought-after. Why would you want to move from such a preferable tenure into vastly more expensive private rental, with only the potential of a job as an incentive? If the DWP think that people will just be able to move from one social home to another in a more sought-after area, they clearly haven't seen the waiting list numbers recently. Nor have they seen that many social tenants either already work or cannot.

The problem at issue here is that economically successful areas of the UK have huge shortages of owned, rented and social housing. This has made them fundamentally unaffordable to live in unless you already have a reasonably-paid job. The DWP's tacit assumption is that people in social housing are choosing not to move to find work, because they are lazy, feckless, etc. There's no choice about it; the unemployed cannot afford to move. The government seems to think that social housing = appalling poverty ghetto. Not a helpful assumption.

Diane Abbot, the Labour leadership candidate, has written an excellent critique of this policy here. She picks up on the human cost - loss of social capital through splitting families and breaking up support networks.

Sorry, this is not the end of the woeful tale of housing. Still to consider is Housing Benefit reform, plus my suggestions for trying to fix this mess.

(Meanwhile at the Department of Communities and Local Government, regional targets for house-building have been abolished. Again. This has been announced at least four times now. How much more abolished can they get?)

Monday 12 July 2010

Items

As I had insomnia last night then meetings all day, I'm not feeling up to coherent analysis. Instead, I recommend some items of note:


The Secret Diary of a Senior Civil Servant

Although I think this slightly over-eggs the horror of shaking up the civil service, which need not be an entirely bad thing, it's still scary. The piece also echoes a feeling at the local level too, that public sector employees are confused by policy making at random, worried both for their jobs and more widely for the future of the public sector, and generally low on morale.

A National Housing Federation report into the effect of the recession on housing need

Predictably, it concludes that the recession has increased the need for affordable housing and exacerbated existing problems in the market. Alarmingly, it is out of date as it was compiled in September 2009. The coalition government is doing exactly the opposite of its recommendations. It is not putting housing 'at the heart of efforts to achieve economic recovery', has slashed investment in affordable housing, and is dismantling the planning system.

I was also dismayed but not surprised to learn that squatters in effect have a more secure tenure than private renters.

It takes a court order to evict squatters. After the initial 6 months of an assured shorthold tenancy, tenants can be given notice at any time with no pretext.

Sometimes looking on the bright side is really quite a challenge.

Friday 9 July 2010

Greenpieces

The constant stream of demagoguery coming out of the Department of Communities and Local Government has been getting me down; slogan of the day is 'Accountability to the people not the Government machine'. I therefore decided to take a look at what the Department of Energy and Climate Change was up to.


This, you might recall, is headed by Chris Huhne, a Liberal Democrat who was a candidate for the leadership of the party back in the day. The tone coming from his department, DECC, is refreshingly sensible and un-clichéd. Policy announcements so far are a mixed bag, though.

A scheme will be launched to insulate 3.5 million homes from 2012. It seems to be sensibly structured - the energy company pays the up-front cost of insulation then recoups it through the household's subsequent bills. As the household will be using less energy as a result of the insulation, they shouldn't really notice this. It would be even more effective if energy was priced more sensibly, so that the more you use the higher the unit price, but still.

The development of a new North Sea oil and gas field has been given the go ahead. They got the Conservative Energy Minister to announce this one, I notice. I'm deeply unimpressed. Talk of energy security is all very well, but the level of renewables in the UK is disgracefully low, the lowest in Europe. Prioritising North Sea oil and gas isn't going to change that.

On the other hand, the law that prevents local councils from selling renewable energy to the grid is being axed. Maybe the rule somehow made sense in 1975? Hopefully this will encourage more neighbourhood-scale renewable energy projects.

I also rather like Chris Huhne's speech to the Local Government Association. It couldn't be more different to Eric Pickles' mishmash of references to Tom Cruise films, the Cold War, and the World Cup, garnished with bureaucrat-bashing.

Sample of Huhne's speech:


But at the same time everyone here understands the over-riding urgency of tackling climate change. We have, through the Climate Change Act, a legally binding requirement to reduce the UK’s carbon emissions by 80 per cent by 2050. What we need to do now is to construct a new partnership between local and central government, which enables us to meet these goals in the fastest and most cost-effective manner possible.


Simple as that. The previous government passed the Climate Change Act, then ignored the urgency of actually doing anything to make that 80% cut.

One major environmental opportunity seems to have been missed by the coalition. I was disappointed not to see a carbon tax in the budget, which could have gradually replaced Value Added Tax (a very blunt instrument for taxing consumption). As well as raising much-needed revenue and not being as intrinsically regressive as VAT, this would have boosted the low carbon economy. Which a new report tells us is one of the few sectors of the economy growing and creating jobs during the economic doldrums. Of course, the decision to reform VAT in this way would have to come from the Treasury, which has no remit or apparent interest in the environment.

Sadly, I also suspect that a carbon tax could fall foul of the World Trade Organisation's paranoia about protectionist trade barriers. Horrifying but true, the WTO does not accept that countries should be able to set their own environmental standards.

To digress a bit, I have long thought that environmental policy is dealt with oddly in the current central government departmental structure. On the one hand, environmental impact and in particular climate change should be consistently embedded in policy across all departments - especially you, Department for Transport. On the other, policies specifically to mitigate and adapt to climate change should really be concentrated in one department, to avoid duplication. I think DECC is intended to do this, but its remit overlaps somewhat with DEFRA (the Department for Environment, Food and Rural Affairs, which includes the Environment Agency), CLG (Communities and Local Government) and BIS (Business, Innovation and Skills).

Shorter post today as its Friday and so hot that my brain has slowed right down. Have good weekend. Coming up next week... Social housing! The Big Society! Transport policy! And so much more.

Thursday 8 July 2010

Age of Asperity

David Cameron says we are entering an Age of Austerity. Grant Shapps, our Housing Minister, says we are entering an Age of Aspiration.


Austerity + Aspiration = Asperity, defined by dictionary.com thus:

1. harshness or sharpness of tone, temper, or manner; severity; acrimony: The cause of her anger did not warrant such asperity.
2. hardship; difficulty; rigor: the asperities of polar weather.


That seems very appropriate. Mr. Shapps' speech deserves further comment, as it was the first that he made after being appointed, and offers a helpful insight into the government's attitude to home ownership.


Now, my predecessor famously said that falling levels of home ownership were 'not such a bad thing'. I've asked RICS to host this event to make clear from the outset that I believe that home ownership is a very good thing. In fact I will work every day to help people achieve their aspirations to own their home.

Of course I am not arguing that everyone should somehow aspire to home ownership. Renting a home can be a positive and flexible choice. And social housing provides a sense of security for millions of families. I am simply saying to those who aspire to own their own home -

This Government will support you
You will not be ignored
The age of aspiration is back!


Does this sound familiar to anyone? Say, from the last Conservative government? Is it really the case that homeowners have been 'ignored' by policy-makers recently? And, in the aftermath of a house price bubble that nearly brought down the world economy, is it really sensible to announce that the 'age of aspiration' is back?

But wait, there's more! An explanation of how the new minister will support these aspirants, perhaps....


The best thing we can do for the all-important First Time Buyer is to get the economy back onto a sound footing... [cuts, cuts, cuts]

Borrowers will need to demonstrate financial responsibility and show that they can sustain homeownership.

In return lenders will need to support creditworthy homeowners. I know the housing market is still fragile but we in Government will do all we can to help.


Here we hit a contradiction. At the moment, banks aren't providing many mortgages, because they lent too easily before and the resulting mayhem nearly brought them down. The levels of mortgage lending pre-September 2008 were unsustainable, and should not be repeated. Of course, this means that some people who might want to buy a house cannot borrow money in order to do so. Likewise, the comment about financial responsibility is all very well, but in an environment of rising taxes, job insecurity, and extremely low interest rates on savings, that's much easier said than done.


In case of worry that the government is doing nothing:

The Coalition Government has also agreed to promote shared ownership schemes and help social tenants and others to own or part-own their home.


Since the new government got in, hundreds of millions of pounds has been cut from the very budgets that pay for shared ownership and social housing, for this year alone. Indeed, after making this very speech, Grant Shapps ad-libbed 'the cash for affordable housing has run out'.


You can't square this circle. The government is saying that as many people as possible should aspire to buy a home, but it won't help them do so. Aspiration without any ability to realise your wishes just leads to frustration. I can scarcely think of a less appropriate time, except perhaps November 1929, to deliberately raise people's expectations in this way. This speech also supports my previous comment that the new regime is entirely indifferent to private renters.


Now, a quick tour of owner-occupation at the moment. About 70% of households own their home. This proportion had been rising for the past few decades, but now seems to have peaked and is starting to fall.


The world of house prices is a mysterious and murky one. Pre-credit crunch, commentators agreed that they were rising, and by roughly how much (a lot). When the crunch hit in September 2008, housing transactions fell by more than half and have yet to recover. This has shown up the previously not noticable differences between the way mortgage lenders, government and independent organisations measure price changes. I won't go into the details, because they're very dull, but there's wide confusion about whether prices are going up or down.


The easiest answer is both. As usual, the South of the country is recovering faster than the North. Overall, prices seem to be creeping up again slightly. My guess is that property is seen as a safe investment in risky economic times, with reason given the long-term structural undersupply of housing. Incidentally, the average age of a first time buyer is currently 37.


The affordability of buying a house is measured by taking the ratio of average earnings to average house prices. The benchmark for affordability is generally 3.5 or 4:1. It's still realistic to get a mortgage at that level now, provided you have a deposit of 20-25% of the purchase price of your new home and an impeccable credit record, of course.


Ratios are well above this throughout the South of the country, despite falling since September 2008. Take Cambridgeshire. The least expensive district in this county to buy a house is Fenland, with a ratio of 4.7: 1 (February 2010). Almost affordable. The most expensive, unsurprisingly, is Cambridge, with a ratio of 8.7:1. In the very centre of the city, where the most sought-after housing can be found, the ratio exceeds 12:1. Remember, average earnings in Cambridge are much higher than in Fenland, but the ratios show that house prices are an order of magnitude greater still.


The Cambridge News recently led with the following headline: City house prices soar £60,000 in just a year. The vastness of this increase, 26% up on 2009, conceals the fact that transactions have fallen by more than half. The people still shopping for houses are not first time buyers, and they're purchasing high-end. Whilst one-bed flat transactions are down by about two thirds in two years, four bed houses are showing only a quarter fall in the same period.


In short, if you live in the South of England, especially Cambridge, and don't already own a home, the chances are that you won't be able to afford to buy one. But don't forget to aspire.

Wednesday 7 July 2010

Localism: the new L word

The government mantra is not just 'localism', but 'local control by local people of local issues, locally'. Constant repetition of the word is erasing any discernable meaning. So far the record for most uses of the word 'local' in a sentence goes to this CLG pronouncement, 'End statutory guidance on local economic assessments which will free up local authorities to decide locally how they monitor their local economy'. Even the League of Gentlemen never took it quite that far.


However I do feel rather unfairly pedantic about this. In principle, localism is a great thing and a breath of fresh air. Government in the UK is highly centralised and local government carries a huge burden of reporting and target-meeting that doesn't seem to achieve much. For instance, I wonder how many people have heard of Local Area Agreements (LAAs)?


These were introduced under Labour, and are three year contracts between local councils and government to meet targets in return for money. Central government provides a list of about two hundred (yes, 200) targets to choose from, and counties pick some. By my count, Cambridgeshire chose fifty-four. The county-wide target for each of these was negotiated, then regularly monitored and reported to local councillors and the Government Office of the East of England. This is an extremely time-consuming, complicated and tedious process involving multifarious meetings, reports, and spreadsheets.


The advantage of Local Area Agreements is that they bring public sector organisations together and encourage joint working, hopefully avoiding duplication. Their disadvantage is that they are a very inefficient way of measuring whether local authorities are successful. Most of the targets are meaningless due to excessive specificity (obesity among primary school children in year 6 - why just that year?) or excessive generality (adaptation to climate change - can this really be reduced to a single number?).


Despite having 'local' in the title, LAAs are a method of central government micromanagement, and when the coalition gets rid of them I doubt that there will much weeping. Councils will keep any useful bits and ditch the onerous reporting. However, this is just one example of our new overlords sweeping away that which they consider unlocal.


Regional development agencies and their associated flotilla of regional plans have also bitten the dust. (In fact, the word 'regional' has become taboo.) Again, I must say that I agree with this decision. I've worked with people at the East of England Regional Development Agency and they certainly mean well and work hard, but Regional Development Agencies (RDAs) were originally set up to try and close the North-South economic divide. By any measure, they have spectacularly failed to do this; the divide has widened considerably. Regional interventions weren't enough to fill a deep historical and economic gulf. The idea when John Prescott came up with RDAs was that they'd come with democratically elected regional assemblies. These did not catch on, leaving the agencies with considerable planning and funding responsibilities but no local accountability. No wonder they faced constant accusations of being unelected quangos. And now they've gone, or rather will be gone next year.


So, the government's approach to localism has thus far been based on abolishing structures - as well as the LAAs & RDAs, say farewell to Leader's Boards, CAAs, the RSS, RES, RIP, IPC, etc etc. This has been combined with much talk of transparency and accountability to the public. I think these deserve a cautious yay, but the other thread of the localism rhetoric is a bit worrying. I've noticed a trend for local authorities to be simultaniously blamed for everything and told to accept more responsibilities. Witness talk of town hall non-jobs, propaganda on the rates, and supermarket sized budgets with a cornershop mentality.


Localism is mere fauxcalism when national government can say 'No, you're being the wrong kind of local' or when it doesn't come with meaningful financial freedom. If the government are genuinely committed to devolving power, they must be willing to let local councils decide to privatise schools, libraries, and community centres then spend their entire resources on flowers for parks & play areas. Assuming that's what the local population want, naturally.


At the moment, the Department of Communites and Local Government seems to be offering localism-with-strings. There should be no building on green belts, no building on gardens, weekly bin collections, and no local government newsletters. That sounds more like micro meddling to me. It's stupid to assume that if given the chance local councils and their populations will all agree completely with Eric Pickles. I also find touting of the cap on council tax being removed a bit hard to swallow, given the Treasury just unilaterally froze council tax for a year in the budget.


What I suspect is partly behind the enthusiasm for localism is blame-shifting. Local authorities are just starting to make huge cuts, which will mean closing community facilities and charging more for services. People will notice and resent this, especially as it coincides with tax rises. The government are giving local councils the freedom to struggle with service provision in the face of cuts and take the blame locally. The cuts are resolutely top-down, but by talking of localism the bad feeling they'll inevitably provoke might be contained at least partially at the bottom.


Perhaps I'm being unduly cynical. I also wonder where this leaves MPs - presumably, with even less impact on their constituency but a queue of enraged voters asking why the library has closed, what about the shortage of teachers, do you realise the roads are full of holes, and so forth.


In a way, it's a pity that local government is being given this great opportunity to show what it can do now, at a time of funding crisis. Unless localism is made to work despite constrained resources, job cuts and policy confusion, public confidence in local government could collapse and take a long time to recover. I think Cambridge has an appetite for localism; it might even go for being an independent city-state given the choice. I'll be keeping an eye out for evidence of the L word on the ground.


As an aside, you may have noticed that local government involves a certain amount of acronyms. Mindblowing amounts of the damn things. If we are moving towards truly transparent government, there should be a searchable masterlist of them online. Maybe I should suggest it? More on housing tomorrow.

Tuesday 6 July 2010

Landlord of the manor

The private rental sector is the black sheep of housing.


It is seen as a last resort for those who can't afford to buy and aren't needy enough, or just too far down the lengthy waiting list, for social housing. There are good reasons for this perception. According to the last English House Condition Survey, 45% of private rented home fail to meet the Decent Homes standard. Compare that to social and owner-occupied homes:

Photobucket


This survey also reveals that privately rented homes have the highest incidence of serious hazards, damp problems and need for urgent repairs. Noticing a pattern?


Closer to home, 10.7% of Cambridge's privately rented stock is classified as unfit for human habitation. I certainly wouldn't recommend the last place I lived in as a residence suitable for any mammal. Amphibians, yes.


13% of UK households were private renters in 2008, and the recession is increasing this. Owner-occupation is falling as new mortgages are harder to get and unemployment increases arrears amongst existing loans. Geographically, private renting is more popular in economically successful areas with high house prices. London and Cambridge are the examples that I'm familiar with; both have more than 20% of households renting privately. Although the sector is diverse, it's fairly youthful. The proportion of 25-29 year olds in private rented accommodation has nearly doubled over the past 14 years, from 19 per cent in 1993 to 36 per cent in 2007.


What are the coalition's policies on private renting?


Although the government don't seem to care about housing as a whole, they go out their way to be particularly uncaring about private tenants. To wit, No More Red Tape for Private Landlords.


Quote from our Housing Minister:

With the vast majority of England's three million private tenants happy with the service they receive, I am satisfied that the current system strikes the right balance between the rights and responsibilities of tenants and landlords.


I could not disagree more. This announcement rejects a review into the sector, which recommended more regulation. What particularly astounds me is that even landlords groups welcomed the review and the light touch regulation proposed.


The private rental sector includes the most vulnerable households, is almost entirely unregulated, and contains much of the worst quality, most dangerous housing in the country. Yet its apparently burdened with red tape!


Another recent release from CLG on this topic gave More power to councils to solve local problems with shared houses.


The implication here is that, as a house-sharer, I am automatically a social problem. Thank you, Mr. Shapps. I'm sure my household of professional females is bringing the neighbourhood right down.


This is a classic example of trying to solve the wrong problem. Rather than regulating shared houses, think about why they exist in the first place. Because other options are unaffordable. And why are they rented on short leases? Because tenants are not given any other choice. An assured shorthold tenancy of six months is what you are given when you rent a property. Take it or leave it. And considering the poor quality of much rental property, is it any wonder that a lot of people move on once the lease is up?


I can't help thinking that if the allegedly needless red tape dismissed in the first announcement was introduced, the seemingly needful red tape in the second announcement would not need to be!


It will not surprise you to learn that my personal experiences of private renting have not been positive.


I've lived in an informally sublet room found on gumtree, when I needed somewhere to live quickly in order to start a new job. I had no written contract and no right to ask for one. My rent was increased without notice and I had no way to challenge it. When I moved out, one of my housemates kept my security deposit. Repeated requests resulted in some of it being sent, but the rest was deducted because another housemate had apparently left without paying his rent. That's not what a security deposit is for, and moreover my housemate had given me no reason to assume that their story was even true. My attempts to get the remaining amount (several hundred pounds) back were fruitless, as the ex-housemate had not provided a forwarding address. Without that, according the Citizens Advice Bureau, there was absolutely nothing I could do.


I've lived in a shared house managed by the most incompetent rental agency in the world. They were unable to perform even the most elementary repairs. A leaky shower made the whole house damp, leaving my housemates & I constantly prey to colds and infections. It was still not fixed after three years. When the gas boiler depressurised I was told to deal with it myself, despite the manual saying 'consult a qualified engineer'. The fridge-freezer broke and we were without a replacement for a month. There is no legal recourse in these situations. Moreover, once the standard 6 month assured shorthold tenancy ends, the rental agency has the right to give you notice to leave at any time with no need for a reason. They abused this power punitively in response to questions on seemingly unfair contractual terms.


The most secure I have ever felt whilst renting was when I shared a flat owned by a friend, and that was because I knew where her parents lived in case she ran off with my money. Even in better rental situations, there is still a huge sense of insecurity, no freedom to change anything about your home, and many responsibilities with few rights in return.


I am also well aware that my position is a privileged one. I've got a job and can now afford to rent in a more formal way. The most vulnerable private renters rely on housing benefit and have kids to support.


What effects will the Age of Austerity have on the private rented sector?


Housing ownership and social housing are going to get less accessible, as I will describe in subsequent posts. This will push more people into private rental and drive up rents. With no sign of regulation and rising demand, quality is likely to deteriorate and overcrowding increase. This will be worst in areas that already have tight rental markets, like Cambridge and London. It's bad, and looks like it isn't going to get any better.


I will eventually finish my barrage of criticism and start suggesting some possible solutions to these problems, incidentally. Although the situation is pretty dire, it's not hopeless. For more commentary on the exciting experience of being a private tenant in the UK, I thoroughly recommend Rentergirl's blog.


In other news, the latest earth-shattering announcement from CLG: The internet age will help end the town hall 'non-job'. Yes ladies and gentlemen, in this new age of coalition government, Local Authorities will have to post their job vacancies on this innovation called the internet. Vive la revolution!


...Except Local Authorities are all doing this already - that's how I found my job more than two years ago. Moreover, given the scale of cuts, most won't be doing any recruiting until about 2018. I think Eric Pickles MP may have published a piece from the Taxpayer's Alliance by mistake. If he's trying to make a serious point about there being unnecessary jobs within local government, he's doing it wrong.

Monday 5 July 2010

No place like it

The extent to which the new regime fails to understand the UK housing crisis is mind-blowing.


Crisis is not too strong a word. The UK housing market is extremely dysfunctional, and has been for a long time. It doesn't really deserve to be called a market, as supply and demand divorced quite some time ago. The roots of this are multifarious and deep, going all the way back to the feudal system. The royal family still own a ridiculous amount of land on this island.


I have a strong interest in housing, and have been made increasingly despondent by the coalition's pronouncements and lack of actual policy on the subject. Fundamentally, the new government does not consider housing to be any kind of priority. I keep an eye on the department responsible for housing, planning and local government, Communities and Local Government (CLG). First of all, the housing minister, Grant Shapps, is not a member of the cabinet, as previously was the case under Labour. Secondly, CLG has shouldered a disproportionate share of thus year's (2010/11) budget cuts - £1.2bn of the £7bn total. It will undoubtedly face much greater cuts in the coming years.


Thirdly, CLG has put out the following ground-breaking press releases in the past month, under the leadership of Eric Pickles MP:


Eric Pickles to stop 'propaganda on the rates' killing off local newspapers


Call to arms in battle against red tape (Critiqued very effectively here )


Councils pledge to raise bar on procurement, which includes this classic:


The National Audit Office found that in some cases there are huge differences in the prices parts of the public sector, including councils, are paying for goods and services. The cost of envelopes varied between £2.04 and £9.13, and paper costs varied across councils from £6.84 to £14.79.


Pickles calls time on town hall quango forcing councils into bin cuts


Bin collection, envelopes, and council newsletters. Does this strike you as a department that has got to grip with the vital areas of policy that it covers: housing, planning, local government, and regeneration? Or does it seem to be adrift, unsure of its purpose, and run by ministers oblivious to the bigger picture?


Here is my attempt at the bigger picture of housing.


There are massive economic, social, environmental & quality of life interdependencies with housing, and shortages thereof.


  • Economic.


    High housing costs lead to reduced competitiveness, more difficulty in companies attracting new employees, upward pressure on wages, across-the-board inflation, congestion & associated spillover effects, time-wastage due to commuting, reduced labour market flexibility. Lest we forget, the popping of the last house price bubble was enough to throw most of the world into recession. In the more economically successful South of the UK, house prices are now recovering. The areas of lowest supply and highest demand, notably central London & Cambridge, have already exceeded their pre-recession price peak.


  • Social.


    Housing shortages lead to overcrowding, pressure on household budgets, unemployment ghettos, and insecurity of tenure. Housing and poverty are have always been related, and this self-perpetuates. Whereas historically food & energy took up the largest proportion of household outgoings, housing costs have overtaken them. 21% of household income goes on housing costs (median percentage, 2007/8 figures). For private renters this is 30% and mortgagees 29%. This also puts pressure on Local Authorities, who have a duty to house the homeless, and central government, which pays Housing Benefit.


  • Environmental.


    The UK housing stock is hugely energy inefficient. Much of it dates to a time when building standards were minimal or non-existent and 'energy efficiency' was just two words that contain many instances of the letter e. To date, efforts to deal with this have largely focussed on social housing, which has to adhere to much higher quality standards than private. However funding for these refits is drying up with CLG cuts. Weak incentives have also been provided for owner-occupiers, but require benefit receipt and have not been well publicised or widely taken up. Private rental property has been totally ignored, as ever. Beyond energy, most housing can't cope with the weather extremes that climate change will bring. Plenty of it is situated in flood plains and most has poor water efficiency. Standards for new housing are ambitious; zero carbon by 2016, if a decision is made on what that means. But new stock is a tiny percentage of total housing, as we're building so little of it.


  • Health & quality of life.


    Poor quality housing leads to illness. I experienced this a month ago; having a badly bodged shower leaking into your bedroom causes persistent colds, funnily enough. Underplanned communities entrench unhealthy habits, particularly when car travel is assumed and healthy food practically impossible to find (the picturesquely named 'food deserts'). Lack of space & privacy are also terrible for quality of life, as is worry about unaffordable housing costs, be it rent or mortgage, and/or insecurity due to risk of eviction.



A simplified model of how housing gets built in this country would look like this:


Planners vs Developers


Overly complex, incoherent and obfuscating layers of bureaucracy
vs
Oligopoly of entirely profit-motivated human sharks



Land ownership in the UK is highly concentrated and even England isn't particularly urbanised. The majority of non-urban land is protected from housing development and has been for decades, despite hysterical media stories about concreting the countryside. 13% of UK land is green belt, for instance, and the majority still agricultural.


It is very very (very) slow to get planning permission and build housing in the UK. Whilst this has it upsides, as planners take many important factors into account when assessing whether to grant permission, it's also expensive, in money and time. I think it can and should be streamlined, and quality could be increased in the process.


But the slow pace of new housing isn't just red tape, one of the coalition's favourite buzzphrases. I went on a work visit to a new community in the Netherlands a couple of years ago, and discovered that over there they build at twice the rate we do. That's two new houses completed in the time it takes us to build one, consistently. Why? Because in the Netherlands house-builders compete with each other to come up with innovative new building methods and designs. In the UK, construction companies are few, very large and deeply conservative. They still build in much the same style as a century ago. Because its what they're used to, and trying new methods could potentially be expensive and risky, especially in a dodgy market with scarce credit. I don't know whether you've noticed this, but large conservative (note the small c) organisations resist change.


Although that's an overview of the most serious problems as I see them, each tenure - owner-occupied, private rental and social rental - has its own particular issues. I'll go through each in subsequent posts, covering the coalition's policy impact on them so far. CLG has issued the odd housing related pronouncement; unfortunately they've made relatively little sense. I'll start with private rental, which I have the most (bitter) personal experience of.


To conclude, here are some statements of the obvious.


Supply Rise Fails To Cut House Prices. Because the suppliers are setting the prices and huge unmet demand keeping them high.


House Prices Are Recovering in South East Despite Economic Downturn. Because of the lack of supply and pressure of demand.


We Are Building Fewer Houses Than We Need. And this has been the case for decades.


Affordability Is More Than Just A Housing Problem. This document is from the CLG website, produced by a unit that the coalition are scrapping. If you don't click any other links in this post, I recommend reading this. It presents an excellent and succinct snapshot of housing affordability problems right now.


When you consider that CLG is shutting down this area of research, it is pretty clear how much importance the government attaches to housing as a subject.

Sunday 4 July 2010

Please allow me to introduce myself

I'm not a man, not of wealth, and of dubious taste (in films and food).

I am a 25 year old woman working in local government. I live in Cambridge, which in my view is the best place in the world. Being something of an idealist, and thus wanting to spend my career trying to make the world a better place, led me to the public sector when I graduated a few years ago. At that time, a government job was seen as secure choice; you wouldn't earn the big bucks of the City, but you'd get a comfortable living.

That security has now vanished. It is more than likely that this time next year I will have been handed redundancy, and given the scale of jobs being cut from the public sector, finding something new will probably be very difficult. Overall, I am ambivalent about this. But that's because I'm lucky enough to have no dependents and inexpensive habits. Part-time work, a masters degree and a life of crime are some of the options I'm thinking about.

I'm starting this blog to record my opinions and analysis of the 21st century Age of Austerity in which the UK now finds itself. I think that day to day life in the UK is going to be changed significantly over the next few years by the deficit-cutting policies of the coalition government, and am not sure that this has really entered the popular consciousness yet. This is partly because the cuts seem like a coup be grace - during the electioneering of Spring 2010 the main parties deliberately ignored the extent of cuts that would be needed.

A word on my politics. I don't support any specific party. According to Vote for Policies, the Green Party's policies fit my opinions best, which is fair. I consider that tackling climate change should be the top priority of any and all governments. A friend once accused me of being 'frighteningly left-wing', but then she's a great fan of Mrs. Thatcher. I'm an optimist, as being fatalistic never seems to achieve anything except spreading gloom.

I should also say that I'm not fundamentally anti-cuts. During my time in the public sector I've encountered much unnecessary bureacracy, although plenty of under-resourcing too. There are areas of public sector intervention that are historical relics and can't be justified. But the suddenness of the cuts seems very risky. Totally reconsidering the role of the public sector is not something to be worked out on the back on an envelope in five days (*ahem* coalition agreement *ahem*).

My intention therefore is to blog about the effects of the new Age of Austerity, as I observe them. I'd be very interested to hear your views too.