Friday, 5 July 2013

Say Yes to Homes

Yesterday, I got a lobby letter from a local resident who had signed up to the National Housing Federation's 'Say Yes to Homes' campaign.
Here is my reply - it is specific to Aycliffe, of course, but the points it makes are applicable to almost any Labour-controlled Council area.

Dear <lobbyist>

Thank you very much for your email regarding housing, which I will try to answer as fully as possible.

May I start by saying that I regard the housing crisis as one of the biggest problems facing this country today. As you read my reply, you will see that both the Councils of which I am a member are actually doing practical things to try to help solve the crisis.

I have to add, however, that I am outraged by the ‘Say Yes to Homes’ video which tells people, simplistically that ‘all they have to do’ is to ‘hold their local councillors to account on building new homes’ and the housing crisis will be solved. One wonders just exactly what this magic wand is that the National Housing Federation think local councils can wave at the problem and why – given that the answer is so ‘simple’ – they have not done so already.

Release of land
One of the things of which local councils are often accused is failing to release land for housing. They are accused of a NIMBY attitude which refuses builders planning permission.
This accusation, of course, is linked to applications to build on Green Belt land. There are basically three categories of land – brownfield sites (which have been built on before), greenfield sites (hitherto undeveloped), and Green Belt land (land outside the cities, and protected from development by law since 1947 to prevent unrestricted urban sprawl into the countryside). Many developers want to build on the Green Belt and, under this Tory government, that demand has become more strident, using the housing shortage as a lever.

The claim that councils are not releasing land is the greatest nonsense I have ever heard.

The Durham County Plan (‘Preferred Options’) identified eight areas for house building in Newton Aycliffe – space for 1869 houses – and far more, actually, than the population is expected to grow in the next 20 years. Most of these sites are within the built area of the town. You may know that I have fought for 20 years to prevent building inside the town – I believe that our town’s health and attractiveness comes from the large areas of green inside the built environment, and that there are plenty of places to build on the outskirts. Nevertheless, I withheld my objections, because I know that houses are so very necessary, and because I judged it worth losing some of our greens to allow housing development. 

The County Plan even envisages the release of Green Belt land, north of the city of Durham – one of the first letters I received as a Councillor this year was a letter from the Campaign for the Protection of Rural England, asking me to support their campaign to prevent this. I did not support that campaign, again, because I believe that, given the housing crisis, homes must for a while take precedence over even the Green Belt.

But in fact, far from being refused planning permission, builders are sitting on thousands of sites across the country, which have planning permission for housing … but which they are not developing.
For example, in Newton Aycliffe, one of the most beautiful natural areas we possess – site ‘O’, just to the west of the Woodham Way roundabout – has planning permission, but sits undeveloped. The Huntsman pub applied for, and was given, planning permission to build three houses on part of its land – that site now stands unkempt and neglected, for sale, undeveloped.

The problem is not that the councils are not releasing land – the problem is that the developers are not developing it.

Council housing
So why don’t the Councils themselves just build more Council houses? The answer is money. As you will be aware, the government is cutting council budgets stringently. Neither can councils borrow money to build houses – the government imposes a strict borrowing cap, and has so far refused lobbying by the Local Government Association to raise that cap so that councils can build more houses.

Indeed, the rules governing Council houses are so deleterious, and the funding opportunities so limited, that councils are finding it impossible even to upgrade the council homes they possess, and most councils have been for some time transferring ownership to Registered Social Landlords (RSLs). You will remember that this happened in Newton Aycliffe some time ago (when Livin took over the Council houses), and DCC announced just this week that it is to transfer its last 19,000 homes to three new RSLs (Dale & Valley Homes, Durham City Homes and East Durham Homes). This – which is against the principles of many Labour councillors such as myself – is simply because RSLs will have a better chance of providing new homes than the council. Again, principle is giving way to pragmatism, and the need for houses.

Commercial developments
At the end of the day, this government is in principle against the growth of public sector housing, and it is looking to the private sector to build the homes. As it turns out, however, an initiative to encourage self-build has collapsed, and the number of new houses being built is at a low and declining.

One of the biggest problems is that housing developers do not want to build the kind of houses people need (so-called ‘affordable’ houses, bungalows etc.) because these kind of developments do not make enough profit. The developers want to build four-bed detached houses. Consequently, in Newton Aycliffe, the market is awash with four-bed detached houses … which are not selling (which is why further development has ground to a halt).
For a number of years, one of the ways the council tried to encourage private developers to build ‘affordable’ houses was by inserting provisos into planning applications that – to build the houses they wanted – they had to build so many ‘affordable’ houses. What we are finding, however, is that, now, a number of those developers are coming back to the council and arguing that they cannot deliver those affordable houses because the cost makes the business model unviable; they are therefore seeking permission to not build the affordable houses. Planning rules mean that those applications are often being agreed.

So we are not getting the ‘kind of houses we need’ … and, actually, the private housing estates are still not being built even then.

Affordable homes
What about the RSLs/Housing Associations? Could the council not help them to build/acquire and rent houses?

Actually, we are. DCC has granted Livin permission to build houses on garage sites, and the former Greenfield Home site. Even the little Town Council has got in on the act, coming to an agreement to release some of its land to Livin, to allow Livin to turn a small site into a much larger one to build bungalows (and, I have to say, the new Livin houses are of an excellent standard). Recently, also, the County Council began an ‘Empty Homes Cluster Programme’, a £4.4m scheme to bring 120 uninhabited houses back into use – the Council will purchase empty properties and do them up, so they can be rented out; the areas which will benefit in south-west Durham are Chilton, Coundon and Ferryhill.

But why are the RSLs not doing more? And is this the fault of the Councils?
Again, the problem is money. Livin’s business model, when I last heard, was to build about 150 houses a year – a drop in the ocean against the 7000 families on the waiting list. Recently, a developer who genuinely wanted to include affordable properties-for-rent in a small village housing development was unable to do so because they could not find an RSL prepared to buy and take them over.

The key institution with the kind of funding available to build the millions of homes needed is the government and, at the moment, they are pumping quantitative easing into the banking sector, rather than house-building and, until the government changes its policies for funding housing, we will not see any significant growth in the RSL sector.

Indeed, the government’s so-called ‘bedroom tax’ is severely damaging RSLs. At the one end, it is hitting RSLs’ rents because the poorer people, trapped in houses with spare bedrooms and unable to get out, are having their housing benefit cut … and are rapidly falling into arrears. In the meantime, at the other end, RSLs are finding that – for fear of the bedroom tax – people are not renting larger 3- and 4-bedroomed houses which are, for the first time, standing unoccupied. Thus, in two ways, the ‘bedroom tax’ is destroying the RSLs’ revenue stream, and wrecking their plans to provide more social housing.

There are conspiracy theorists who suggest that the bedroom tax is not aimed at people on welfare at all, but is an attempt to wreck the financial viability of the RSLs. Large financial institutions have had their eye on housing for some time and, if the RSLs were to collapse, they could be acquired very cheaply by big investors. Even if this is not true, the effect of the bedroom tax threatens to be disastrous for the RSLs’ building plans.

In conclusion
I am not very hopeful that we have a chance of solving the housing crisis under this present government.

At the risk of getting all political on you, what housing needs is a massive publicly-funded programme of council house-building, such as under the socialist Labour government after the war. This government (as, to be fair, the New Labour government before it) will never undertake such a programme, and the market-led model it favours is never going to produce millions of new homes, which will slash prices and the developers’ profits.

My biggest worry is for affordable rented housing. The government has defined ‘affordable’ rents, not as what people can afford, but at 80% of the private market rent. Therefore, it suits business to keep the housing market restricted, so that rents are forced up. Eventually, even ‘affordable’ rents are going to hit the Welfare Cap … and then how are poorer people going to afford somewhere to live? We are not even heading in the right direction to solve the housing crisis.

I am so grateful to you for raising this issue, and for caring enough to lobby me about it. I put housing as an issue on both my manifestos, and I hope this letter assures you that, both I personally, and the councils on which I sit, are actively seeking ways to help address the housing crisis.

What can you do?

The Labour Party recently held a consultation, asking people to comment on the housing policies it should adopt when it gets elected into power. Although the consultation is officially ended, the website is still open to comments here.  At least you will be able to see the kind of things Labour is talking about doing.

I know that your Labour MP is as anxious as I to overturn current government policies and to address the housing issue, but there is no reason why you can’t contact him.

And if you wanted to get involved at a local level yourself, you could go along to your local Labour Party Branch meetings and put your comments and questions..

I hope this reply is satisfactory – please email me back if there is anything else I can do or tell you.

John D Clare
County Councillor, Aycliffe North and Middridge

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