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Shelter social housing report: a wake-up call for Labour

Not only is Labour still fudging the difference between 'social housing' and council housing proper, but its projected spending will not measure up, writes MARTIN WICKS

RESPONDING to Shelter's social housing report shadow housing minister John Healey said the commission’s target of 3.1 million homes in 20 years was “consistent with the scale of Labour's ambition to build a million new “genuinely low-cost homes” in the first 10 years in power. The report was apparently “a wake-up call” to the Conservatives. I would venture to suggest that it is a wake-up call for Labour as well.

For Mr Healey to suggest that the Shelter report “measures up to Labour's ambition” is disingenuous. Shelter is suggesting 155,000 “social” homes (council and housing association) a year for 20 years, spending £10.7 billion a year. Contrast that with Labour’s policy: £4 billion a year grant for “genuinely low-cost homes” which includes “affordable home ownership” rather than all being devoted to social housing.

Labour is proposing to give councils a duty to promote “affordable housing.” Since this includes “affordable ownership” a council could bid for grant solely to build homes for sell and it would still be fulfilling this duty without building a single council home. That’s why we have suggested that Labour should give councils a duty to build council housing.

When asked how many council homes Labour is committed to fund Mr Healey's office tells us they don't know because it up to councils to decide what they bid for. For all the talk of “the largest council-house building programme for 30 years” Labour has no commitment to build a definite number of council homes, with no grant specifically for council housing. Councils will have to compete with housing associations for grant.

Mr Healey's office has informed me that they do not think they can deliver 100,000 social homes until Labour’s second term.

Hence we can say with some certainty that Shelter's proposals dwarf Labour's commitment.

There are some things in the Shelter report which we would disagree with. Not only does it fail to call for the abolition of Right to Buy (RTB) but it talks as if the policy was positive and it even suggests that the shortage of social housing has prevented more people from being able to buy their homes. Tom Copley, Labour's housing spokesperson on the London Assembly has rightly responded to the Shelter report by saying that it makes no sense to propose to build on such a scale and keep RTB. He says the government should end it. Hopefully Mr Copley will be sending this message to Mr Healey as well for a commitment that Labour will end it, as has been done in Scotland and Wales.

The term “social housing” in effect places an equals sign between council housing and housing association homes. This is mistaken. Housing associations are private businesses, albeit often with charitable status. Even when tenants sit on boards they have a legal duty not to their fellow tenants but to the company.

Since New Labour enabled housing associations to borrow money to build for purposes other than social housing there has been a process of commercialisation taking place. Most of them accepted the end of funding for social housing in the second round of the coalition/Tory government’s affordable homes programme.

This promoted a move towards building homes for sale on the market, supposedly to subsidise social housing. One of the major associations, Genesis, even decided it would no longer build social housing.

When the government proposed to extend RTB to social housing sector, their industry organisation, the National Housing Federation, capitulated. It was content to accept government proposals to force councils to sell off “higher value” stock, with the receipts to be handed over to housing associations to cover the difference between the RTB sale price and its market value.

Council housing is cheaper – the rents are lower – and the landlord (the political group that controls a council) can at least be voted out of office, unlike the board of a housing company. For all these reasons we believe that the emphasis should be on a council-building programme.

Criticisms notwithstanding, the Shelter report is welcome. It recognises that the housing crisis cannot be tackled without a large-scale building programme of homes for rent, albeit social housing. It may help to shift the debate.

Of course, there are obstacles to building on such a scale. Local authorities have built so few homes that they currently do not have the personnel and resources to do so. That's why grants specifically for council housing are crucial, because unless there is a guarantee of such support, annually, then local authorities will not be able to assemble the teams and resources to once again build on a large scale.

Shelter's report is a wake-up call for Labour. It is certainly an opportunity to press for the radicalisation of Labour's housing policy. To do that, however, we must recognise that the current policy appears to preserve New Labour's worship of home ownership. Is the party going to decide that a large-scale council home-building programme is its first housing priority or is it going to maintain the current small c conservative housing policy?

If you agree that council housing should be Labour's first housing priority, if you recognise, even with rudimentary maths, that £4 billion a year does not equal £10.7 billion, then write to John Healey (john.healey.mp@parliament.uk) and your Labour MP if you have one, to demand a fundamental shift in Labour’s policy.

Martin Wicks is the secretary of Swindon Tenants Campaign Group

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