Dangerous 5th Columnist David Orr – You can’t develop if you can’t operate

I asked advice of any grammarians on Twitter last night whether the correct term is Goebbelsesque or Goebbelsian without success though I presume its the latter and it definitely applies to a David Orr interview in the Guardian today with Patrick Butler.

David Orr trots out the NHF line that the reduced benefit cap will hamper housing associations ability to develop while ignoring the much greater financial risk that housing associations will not be able to operate.

If, as the overall housing benefit cap does, housing associations ability to operate is severely financially threatened, which it is, then they won’t be developing in any case.

David Orr is choosing to focus on right to buy and is correct to say this will mean housing associations will struggle to develop.  What he is attempting to downplay is the OHBC is a much greater financial risk that means housing associations won’t be able to function as they do now and this is Goebbelsian on his part and thoroughly disingenuous.

“The benefit cap will reduce housing associations’ ability to borrow and that reduces the number of new homes they can build.” National Housing Federation modelling shows that a lower benefit cap will potentially affect 90,000 additional tenants, around 37,000 of whom will be housing association residents. The impact, currently fiercest in London, will extend to large parts of the country, making three bedroom-plus properties unaffordable for benefit-capped tenants. The housing consultant and blogger Joe Halewood has called the cap “the death of the social housing model”.

The OHBC will only affect 37,000 housing association tenants says Orr which is not a lot of the 2 million plus properties they own and manage, less than 2% in fact 1.8%, and that it how he chooses to present the OHBC as an insignificant matter by using the tenant profile risk to portray the OHBC as insignificant.

YET, the OHBC makes it impossible for housing associations to let a 3 bed or larger sized property to anyone on benefits and 3 bed+ properties account for 36% of all social housing stock.

Using the stock profile risk we see that the OHBC risk is 20 times greater at 36% to 1.8% than Orr wants to admit publicly!

Landlords may change their existing tenant profile and as Orr intimates only allocate to those working (who are still a risk given uncertainty of employment) yet they cannot quickly change their housing stock profile and that it the issue.  The stock profile risk is much greater than the tenant profile risk of the OHBC

Note that while the national figure is social landlords have 36% of their properties about to be made financially toxic products with the reduced OHBC, the percentage is much higher, as high as 80%, in large scale voluntary transfer landlords, the LSVTs who took over the former council housing stock and who are all housing associations.

The housing regulator publishes the Statistical Data Return each year with stock profiles of all housing associations and this SDR reveals that 24 of the top 25 in terms of 3 bed+ stock are all LSVTs with well over 50% of stock being 3 bed or larger and the top ten are all above 66% as that is what council landlords built for decades before stock transfer to housing associations.  So while tenant profiles can be changed and HAs will become so much more risk averse in allocations because of the OHBC, their own stock profiles cannot change quickly and they are effectively stuck with a huge percentage of financailly toxic products – the 3 bed and larger properties.

Orr is using sophistry and Goebbelsian tactics in the hope that housing associations funders will see only the tenant profile risk at 1.8% of all properties and and not the 35 to 40 times higher financial risk when viewed through a stock profile which sees up to 75% of some housing associations having 70% of stock at 3 bed or larger and thus unaffordable to let to anyone on benefit and hence financially toxic. Such housing associations will have no developing intentions at all as they will be too busy trying to operate or to put it bluntly survive and not go bust.

You cant develop if you cant operate!

At one level it is understandable that Orr seeks to hide, disguise or downplay the huge financial and other risks the OHBC poses.  Let’s assume his 37,000 households is accurate, at least this year as it will rise each and every year, that means 37,000 HA households are in the get a job or get evicted position and 37,000 larger households with an average of at least 3 children per household is 111,000 children added to the homeless number!  That’s 111,000 to add to the current 93,000 and so just the children evicted and made homeless from housing associations will double the number of homeless children in the UK and in this first year of the OHBC!

What Alex Hilton was saying yesterday about NHF is a serious understatement of the overly cautious way it is being led by David Orr whose strategy is one of an immediate lurch to the right wing populist agenda of get a job or you will lose the roof over your head and that of your children.

No doubt the sector will also seek to downplay this huge risk and they will attempt to caricature the likes of Tom Murtha who rightly says that housing associations will not house the vulnerable any more.  A case of internal housing games is more important than asking just where the hell will such families live if they cannot afford a housing association property at a social rent level – to which Orr is saying not my problem while not actually saying those words.

This lurch to the right wing agenda of get a job you lazy scrounger that Orr is cosying-up to, is inept short-termism from the NHF and its members who are equally inept and dangerously so if they also adopt this virulent right wing line of only accommodate those who are working and not on housing benefit as over 80% of social tenants are.

The doubling of homelessness and the cost of that as such families will have to be housed in extremely costly hotels and B&Bs and on a much longer basis is going to cost the country and the individual national and local taxpayer an absolute fortune in housing benefit. It was encouraging yesterday to see the Blairite IFS think tank admit that all of the welfare reforms to date aimed at reducing housing benefit and therefore taxpayer cost have failed as they cost the taxpayer more as I have been saying for over a year.

ifs hb real terms

The largely high rent area impact of the OHBC to date will spread nationwide with the reduced cap figure and so the housing benefit cost will only increase further as homeless HB costs will soar as housing associations have to evict the OHBC tenants which they will do on top of the huge number of evictions that private landlords will evict and make homeless due to the OHBC.

Let’s go back to Orr’s NHF figures of 90,000 ADDITIONAL households which will see 53,000 private tenant households evicted and a 3 children per household that is a further 160,000 or so homeless children that local councils have an absolute duty in law to accommodate.  The additional 90,000 households in general will see the number of homeless children go from 93,000 now to 360,000 this year.

Those local councils who then turn to housing associations to provide a permanent rehousing option and to reduce the massive financial burden these homeless families give will be told by housing associations to bugger off because they cannot afford such tenant households because of the OHBC.

Get a job or lose your home.  Lose a job and lose your home – and by the by cost the taxpayer an absolute bloody fortune is precisely what Orr is seeking to avoid commenting upon and seeking to downplay.  Instead he focuses upon his members ability to develop more stock rather than fight for the fact that his members are unable to operate.

Housing associations will have to evict tens of thousands more social tenants each year because of the OHBC so they will suffer huge operational costs of eviction that will run into 5 figures for each case.  Their ‘communities’ are they call them will suffer far more community blight as so many more properties will lie empty and costs of maintaining will increase as will cost of advertising to working only tenants as will increased cost of background checks on them and of course this is far higher in the affordable (sic) rent or AR model which is dead as a Dodo because of the OHBC yet Orr still wishes to promote!

This is madness by Orr and his NHF and financial madness to the taxpayer, and you can bet your life when housing associations refuse to accommodate the vulnerable and the increasing number who can’t afford to buy or rent privately, the Tory government will then ask why the hell are we subsidising social landlords in any case!  In refusing to highlight the death of the social housing model and failing to tell government and the public that the OHBC will cost them far more the NHF is signing its own death warrant and by extensions signing the death warrant for all social landlords.

But hey the Guardian article reminds us that Orr is nearing retirement so he will shortly be sharing very expensive biscuits with Pickles in the House of Lords and he will be just another example of the Tories rewarding failure with a gong and the more incompetent you are the higher the gong so a knighthood for Orr is assured as Orr will have done so much more than anyone else to ensure the social housing model dies and all property goes to private ownership which is the government intention.

Now where have we heard before of a Scottish public school £11,106 basic fees per year educated person shaft the vulnerable and adopt a closet very right wing agenda while claiming to have the founding ethos of the purported left wing organisation he leads all to heart?

Social housing is dead and boy oh boy is the country going to pay out hugely for this knighthood for the Goebbelsian figure who tells a very different story rather than face up to and fight.

Housing associations will of course carry on in their charade of fighting against RTB, the fur coat and nae knickers campaign which is a bit more catchy title and correctly describes the hugely costly and failed Homes for Britain campaign, a campaign that is not worthy of support.  Rather its time to bring all alleged social housing back into public ownership as council housing as that is the ONLY way the vulnerable and their children can ever be housed and by far, the only way the taxpayer can afford to house the vulnerable and the ONLY way that UK low wage paying employers can afford to employ as in-work HB rose from £2.8 billion per year in May 2010 to over £5.3 billion per year at the latest February 2015 official figures.

Social housing provides a huge economic boon to UK plc and saves the taxpayer circa £5 billion per year through reduced rents that allow social tenants to take up low paid employment.  Take the meagre £1.1 billion per year subsidy it gets, which is precisely what will happen when housing associations refuse to house the vulnerable and this Goebbelsian government will kill off the social housing model once and for all and within a parliament.  Good for the Tories to know they have a fifth columnist heading up the largest social housing lobby to make that task so so much easier!

But let’s return to the NHF figures on the reduced overall HOUSING benefit cap that David Orr is so blase about and let’s accept his figures that this policy will see 90,000 MORE households being hit by the benefit cap. The current latest figure is 23,000 affected so this will rise to 113,000 households affected a 491% increase!!

So ceteris paribus this will see a huge increase right across the country and using LA data provided by the DWP last year here is a table of what that means!

obc-reduced

David Orr is clearly ok with his home city of Edinburgh seeing 1,798 households there affected by the reduced OHBC rather than the 366 figure from 2014 DWP figures. I wonder if any of his fellow Jambo supporters will like the 1,432 additional households in and around Gorgie evicted as a direct consequence of the reduced benefit cap?

I wonder how Tom Murtha will feel about this going from 324 families to 1592 families in Leicester or how the ebullient Joe Anderson the Mayor of my fair city of Liverpool who says homelessness is not a problem will cope with an increase from 244 families to 1209 families being made homeless there.  Perhaps he will turn the former Bank of England building occupied by the Love Activists into a homeless provision after all, though of course that building won’t be able to accommodate the additional 3000 or so children made homeless in Liverpool – this year alone – as a direct result of the reduced benefit cap.

Liverpool would rise to 4th in the table above for 2014 which shows how the current cap is hugely biased towards high rent London boroughs yet still affects low rent Liverpool and is about to explode there just as it will in every town and city across the UK.

Yet it will affect high rent areas such as London of course and the increase from 1096 to 5385 in LB Westminster is a very good example of what I mean by cost increases.  There is the BBC London TV video from 2012 which shows Westminster paying out £153k per year in housing benefit to those very grateful hotels used to accommodate homeless families after the LHA cap as introduced.  Yes that is not a typo I did say £153k per year in HB as a direct result of another Tory cap which has the exact same effect.  The same Westminster council who was forced to but back former council properties it sold under RTB for millions and millions more as reported here.

These were largely isolated examples as London councils cleansed the capital of its huge homeless costs by sending families to the back of beyond.  Yet thanks to the Nzolameso case in which the Supreme Court said London councils can’t do this, then the 32 London councils homeless HB costs are going to increase massively and cost the national taxpayer more to pay for this and the local taxpayer more to pay for the HB their councils pay out yet can’t recover from central government.  Oh and by the way Rachmann landlords are going to cash in like crazy all around the country as homeless families are herded twelve to a room in dingy unsafe B&B HMOs that make Rigsby’s Rising Damp look like a palace.

I thought reader I would throw in the 12 families per room bit above just so the likes of David Orr and all the other 5th column apologists could accuse me of over-egging the pudding and hyperbole so they can sleep at night!

This is what the reduced OHBC does and will do in practice and as I have stated before I wonder how easy landlords will sleep at night having to evict CHILDREN? For that is what the benefit cap does as opposed to largely adults in the bedroom tax, it deliberately targets children and directly evicts CHILDREN and damages their life chances irreparably.  We have seen many examples of rings of steel around bedroom tax evictions of adults becoming popular now how do you suppose that will change when CHILDREN are evicted and how will tenants perceive allegedly social landlords for doing that?

But hey don’t worry all you genuinely social landlords who are housing associations David Orr is perfectly happy with this and sees the reduced overall HOUSING benefit cap as a mere irritant and trifling issue for housing associations.  he is not worried that your funders and financiers will see the whole of the social housing model as financially toxic which the reduced OHBC means and also means you can’t operate  – Development constraints with RTB for HA’s?  You are having a laugh aren’t you David!

Still I hear your soon to be best mate Eric has an exquisite taste in biscuits so enjoy your retirement…and hey why not bring it forward now the Jambos are back in the SPL?!

 

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3 thoughts on “Dangerous 5th Columnist David Orr – You can’t develop if you can’t operate

  1. How big is the HA+LSVT debt? Is it enough to start the banks slide down into meltdown again? It was the Fanny Mae debts that started it all in the USA.

  2. Joe, I’m a linguist and here’s a tip for you: to find out whether to use “Goebbelsian” or “Goebbelsesque”, google each one quickly and run your eye down the results. It’s very quick but to save you time, “Goebbelsesque” is used and so is “Goebbels-esque” with a hyphen. The suffix “-esque” means “resembling or suggesting the style of”. Goebbelsian is also used, as you know.

    My parents fought in WWII for our freedom, but today it’s threatened again, so let’s keep up the fight!

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