Coffee and cake for housing?

There are a number of consistent themes in my blogs over the years which I am told make the millions who read them per year think. This contrasts starkly to the antithesis of thought I have seen in housing over the last 20 years and especially since 2010 and what I call housing-think.

The we have always done in this way or more correctly when it comes to thought NOT done it any way at all

I do not set out to be controversial for its sake and often get wrongly labelled as being too political or too confrontational, everything is political and especially the nature of social housing and welfare policy and those subjects have been confrontational over the past few years.

20 years ago at every housing meeting all you would hear was the 4 ‘C’s of Best Value and one of those was “challenge” which is precisely what housing-think never allows.  Nor does “housing-think” yet see the Conservatives welfare and housing reforms for what they were from the beginning and still are, confrontational.

Regrettably, ‘housing’ has been far too apathetic and – the biggest regret of all and it pains me to say this – but Grant Shapps was 100% right when he said social housing was a lazy consensus which is epitomised by housing-think.

I have often said welfare reforms are radical and require a radical response from housing yet been repeatedly pilloried for saying government is attacking social housing which is now the universal view of all who work within it.

Nobody now doubts that social housing is being attacked by the Conservatives and severely attacked and, true to form, the minute one social landlord in Genesis adopts a radical response then Genesis get pilloried by the purveyors of housing-think!

Genesis gets vitriol for doing precisely what they should be doing and what any business in any other sector would be doing in saying no, not on those terms government.

It is perverse that the social housing sector is attacking Genesis for doing what they should be doing and if any social landlord continues to develop despite ever-reducing grant and despite ever worse circumstances and despite ever greater financial risk, then government having taken the inch will take the proverbial mile.

What ‘housing think’ misses in the Genesis argument is that government housing policy is as confrontational as it gets and all the welfare reforms have always been confrontational attacks on the social housing model from the outset.

The problem is that housing-think failed to accept this government confrontational line and, for example, were ‘paid off’ with affordable (sic) rent which increased income by more than the bedroom tax put at risk – a classic example of non confrontational housing-think in following the latest funding bandwagon with little regard for later consequence.

Rather than confront government, which housing never does, and challenge it, housing just tugs its forelock and carries on regardless as the complicit and easy target for whatever morsel government is prepared to throw at them.  It’s the classic Thomas Paine posit when he wrote in the introduction to Common Sense in 1776 that

“a long habit of not thinking a thing wrong, gives it a superficial appearance of being right.”

Housing-think has been it is right NOT to challenge government and so when someone does, as Genesis is doing by refusing to develop social or affordable rent products, it attracts vitriol from the meek, mild, mute majority of housing people who see having the temerity to challenge government as a greater sin than using Ground 8 evictions.

Housing-think is also highly perverse in its emotiveness.  If you can develop then you should being stated almost as a mantra ever since the Genesis announcement and without any consideration of the mantra and regardless of carrying on developing is further complicity and a further non-confrontational response to the repeated confrontational attacks from this government.

Even the most recent Times / Spectator / Channel 4 government inspired attack which blamed social housing for the housing crisis (and spectacularly well too) only elicited a response of we need a rapid-response unit rather than any proactive one leading on the agenda in which they are the experts! Housing-think simply does not pay any regard to the first-move advantage and people will always believe there is no smoke without fire posits and so housing blithely ignores what individual people in housing take as read in any other aspect of their lives.

kipling dice      kipling dice kipling dice

One of the freedoms I enjoy is that I can challenge social landlords as I only have myself to answer to which sees my receiving hundreds of offline emails and calls from housing professionals to keep saying it as it is and saying what they don’t have the freedom to say.

My latest bugbear is the real biggie however and of course is the benefit cap that will fundamentally rewrite the social housing model.

Meanwhile housing-think is fixated only on right to buy and once again will miss the boat as it DOES have the opportunity to raise awareness of what this policy means and it needs to make known the inevitable impacts of the cap not just to whichever select committee of MPs is calling for views on, but it needs to make then direct to the general public.

Here’s what I mean and this non-inclusive excerpt comes from a piece of research I am doing hence the numbering.

The Benefit Cap problems

The problems for social landlords are numerous

  • They cannot afford the benefit tenant household if they have 2 or more children

  • The tenant household with 2 or more children cannot afford the typical 3 bed property even when let at a social rent level

  • Affordable Rent properties are much more financially toxic than social rent and even more unaffordable

  • A high percentage of existing tenant households who are on non-exempt welfare benefit and we will have no option but to evict

  • Little choice but to use Ground 8 to evict with all the negative connotations that holds

  • The evicted households will contain many children which is very different matter to evicting adults only in the bedroom tax and has very adverse reputational risks

  • The benefit cap and other so called reforms means we are unable to accommodate the tenants we have always had as our broad target market

  • The pay (more) to stay policy means we cannot simply replace the evicted benefit households with working self-paying tenants as that merely obviates RTB

  • The void loss is likely to be far greater than it is now and creates a significant financial risk due to every more stringent allocation policies

  • Future allocations will see the inevitable tightening of allocation criteria and cost more (existing nomination agreements also need to be ripped up)

  • Just who can we house becomes the question and we need to rip up our entire business plan and start again from the simplest who is our customer

Note: All the above excludes RTB, direct and monthly payments and ongoing bedroom tax and other related issues and they highlights just how radical and confrontational the benefit cap reduction policy is. It FORCES a fundamental rethink of the entire business model for social landlords and is a case of rip up the exiting business plans we have and go right back to the beginning and ask just who the hell CAN we house!

Regrettably, housing-think is currently OMG RTB is going to ruin us!  The above short bullet list of benefit cap impacts affects 100% of all social landlords and 100% of all social landlord operations.

The benefit cap when seen in the context of pay (more) to stay and in the context that a mum with a new born baby has to seek work when she is ordinarily not expected to seek work until the baby reaches school age are radical impacts on the social housing model and far more radical in consequence than RTB

The original business plan of ALL social landlords is ripped up and out of the window as the benefit cap massively reduces the household types a social landlord can afford to let a property too. However, housing-think is all focussed on oh we could lose 10% of stock to RTB over the next ten years and fails to consider just how radical and extremely confrontational the benefit cap is as a policy which is far more damaging than RTB.

The benefit cap has been a bugbear for many a year and I first presented its horrors back in October 2012 and a few months after I developed the systemic flaw in the policy which would then take 20 years to materialise and now takes 8 months due to the 23% reduction in the cap from £500 pw down to £384.62 pw.  The platitudes of we will always house the vulnerable this is our ethos the systemic flaw received can be explained away by the it wouldn’t really affect social landlords for years truism and be a very slow burner indeed.  Yet now it has the shortest fuse and an average £73 pw reduction and fundamentally changes the social housing model for ever.

The benefit cap since its late introduction in September 2013 has also been seen as just a high rent area issue and even then just for private landlords.  Yet it will see more social tenant households evicted than private tenant households in many places across the country

For example, Newcastle, Gateshead, Halton, Trafford, York, Sheffield, Lichfield, Stafford, Sandwell, Cambridge, Harlow, Stevenage, Welwyn, Maidenhead, Winchester, Guildford, Sevenoaks and Norwich are just a few of the areas that will see more SRS households evicted than PRS households directly due to the benefit cap. 

There’s a few notable and prominent housing CEO’s working in those areas too yet does anyone see any challenge coming from them about the benefit cap? There is not and why not?

Housing-think is how can this be as there must be more PRS affected than SRS because of higher rent levels?  Yet housing-think is too lazy to find out the very relevant local facts of each housing area and local housing conditions and factors vary considerably as we have 350 different housing markets.

The above areas reveal this happens all over England in low, medium and high rent areas to and Scotland will also see more SRS benefit cap evictions than PRS ones too.  Wales only sees Wrexham and Torfaen likely to have more SRS than PRS benefit cap evictions.

Housing-think advocates shout about evidenced-based policy and quite rightly yet they only see housing fact from their own silos and fail to realise we have huge inter, intra and sub regional differences in every area of England and somewhat lesser differences in Scotland and Wales.

This is why the benefit cap will have radically different impacts in all of these areas despite the overall GB picture which shows 40% SRS to 60% PRS benefit capped households as a national average.  Blackpool may only see 11% of benefit cap evictions being in the SRS while Welwyn or Cambridge could see 69% of all benefit cap evictions being SRS households.

So, housing colleagues, next time you read a CIH or NHF or IH or other purportedly definitive article which says the benefit cap will do x, y or z, take it with a huge pinch of salt as the impacts of all welfare reforms will impact in massively different ways in every area of the country.

If you want to then add to that by looking at individual landlords then if a social landlords has more than the national average of 35.7% of all stock being 3 bed or larger – the financially toxic benefit cap properties – then they are more at risk than a social landlord with less than this 35.% figure.  Some social landlords have over 70% of stock being 3 bed or larger properties and have a huge financial risk from the benefit cap yet still see only RTB and the 1% per year rent cut.

It is time that housing for once did think and have a cake when you smell the coffee

I KEEP six honest serving-men
(They taught me all I knew);
Their names are What and Why and When
And How and Where and Who.

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5 thoughts on “Coffee and cake for housing?

  1. I’m really confused, genuinely not in a sarcastic way, how long term the approach Genesis have taken will be a positive thing. For them as an organisation, yes of course I understand that adapting is the right business decision for them and the way in which they can continue to be viable but if all Housing Associations adapt their approach and change the tenure of social properties to market rent properties as they become vacant what happens to those tenant who have been evicted as a result of the bedroom cap and what happens to low income families who are on waiting lists waiting to be housed. As things stands it is increasingly difficult to secure a PRS tenancy if you require housing benefit whether you are in work or not. If the social housing sector is depleted where will these people be housed? Seriously?
    Because it seems the upshot of this situation would be that all rental accommodation accept the very poorest quality will only be available to people on a median income/ those able to afford market rents.

  2. Bath hasn’t stopped – the Mail’s publicity wrt the most expensive HA flat has been ignored as they continue to “do up” Council Properties for High End holiday rentals.

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