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Social and ‘affordable’ housing in the UK in the 21st century

Introduction

Social and affordable housing has been a concern of successive governments since the late 1990s, when issues of decent homes and rising homelessness became political issues. Since then, governments have passed various laws and made many policies that are concerned with the provision of affordable housing in the form of social housing, for those who cannot afford to buy homes of their own. Recently however, certain austerity measures had to be taken by the government, such as the so called ‘bedroom tax’, in order to balance the rising concerns of a slowing economy with the concerns of affordable housing for all. At the same time, homelessness remains a central issue, which continues to drive the law and policy on social housing.

This essay discusses the concept of social housing in the UK and also critically evaluates the new austerity measures that will undoubtedly restrict the social housing endeavours by the government.

Social Housing under the Coalition and Conservative Governments

Social housing has been a central concern for successive governments since the late 1990s. However, in the recent times, the steps taken by the government will restrict social housing and may even lead to more poverty because there is an interrelation between housing and poverty (Birch, 2015). It is seen that provision of social housing can lead to the alleviation of poverty (Birch, 2015).

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The Housing and Planning Act 2016 has made many changes to housing policy and the planning system. Now the sale of higher value local authority homes is permitted as well as starter homes and "Pay to Stay" homes. The Act also introduces fixed term tenancies in place of secure tenancies. The pay to stay policy increases the rent of certain groups of social tenants, although it would not affect those who were receiving housing benefits.

The abovementioned law has come after a series of other austerity moves by the government, which seek to reign in the benefits that were earlier given to those who were in a low income group. One such measure is the benefit cap that was introduced in 2013. The benefit cap has meant out-of-work families with children cannot claim more than £26,000 in benefits (Schuecker, 2015). The benefit cap applies to those who are of the working age and it is meant to encourage people to either work to make more money or move to more affordable housing (Schuecker, 2015).

The changes made in the recent period of time may be justified on the basis of austerity needs, however, these changes are taking people away from the possible benefits that people had earlier. There is also some support for benefit caps, as these are meant to encourage people of working age to rely less on benefits and more on their self-ability (Defty, 2016). It is worthwhile to consider the benefits especially in terms of social housing that people had earlier and how this has been impacted by the Conservative and Coalition governments. First, it is important to contextualise social housing.

Social housing aims to provide affordable accommodation to people with low incomes, and who cannot afford to buy a home on such low income. Social housing is owned and managed by Registered Providers who are otherwise known as social landlords. The rent is controlled by the law in order to ensure that rents are not increased arbitrarily and kept affordable. Registered providers or social landlords are usually non-commercial organisations, such as local authorities. Registered providers may even be housing associations, which are basically independent and not-for-profit organisations. These organisations use the profit made with rents on financing new social housing.

Home ownership, private rental and social housing trends have changed over a period of time. Home-ownership in the UK has shown a decline of 69 to 64 per cent between 2002 and 2012, where the private rented sector expanded rapidly from 10 to 18 per cent and the social rented sector, has declined from 21 to 16 per cent in the last ten years (Birch, 2015). Also, recent reforms have seen the introduction of higher Affordable Rents for new homes and some re-lets set at up to 80 per cent of market levels. Social landlords have also been given new freedoms to use fixed-term tenancies (Birch, 2015).

Local authorities also now have more flexibility to house homeless families in the private rented sector and to set allocations policies according to local priorities. It is noteworthy that over a period of time, local authorities have been given more powers and authorities with respect to housing. In particular, the Localism Act 2012, has devolved more powers on individuals and communities and given more empowerment to those who are living in social housing (Lund, 2014).

As mentioned earlier, successive governments have been concerned with the issue of social housing. Since the New Labour Government came into power, these trends have been seen in the UK. The 2000 Housing Green Paper, ‘Quality and Choice: A Decent Home for All’ under Tony Blair’s government was one of the first important steps in this direction (Green Paper 2000). Homelessness had really increased in the UK and the New Labour’s manifesto was vociferously in favour of housing policy change. The manifesto was very critical of the Conservative government’s housing policies and increasing homelessness. Therefore, housing policy was very important to the New Labour government. The Green Paper took a proactive approach to two sub sectors, which were low demand areas and houses in multiple occupation (Lund, 2014). Social housing had earlier also suffered from the problem of criminal landlords and the nexus between them and the tenants. This would lead to the destabilisation of the local communities. The other area of concern was the level of participation of tenants living within the social housing system. Consequently, in 1999, the first Tenant Participation Compact was published to give more involvement to tenants in council housing, where the decision making was also done in conjunction between the council and tenants of social housing sector (ODPM, 2005).

The third area of concern was the living conditions of the Black and Minority Ethnic groups as many of these groups lived in social housing there was a real concern that they be given better opportunities because they face problems such as poor circumstances and living conditions in the public and private houses. Also of concern was the fact that living conditions in social housing suffered due to low funding and therefore, the inability of the local authorities to renovate the housing for the better. The Local Authority Capital Receipts Act 1997, sought to correct that problem by allowing the local authorities to borrow money with which they could renovate and rehabilitate the council houses. The Stock Transfer along with the loans would enable the local authorities to find a solution in repairing the council houses.

Over a period of time, Registered Social Landlords were also given some powers with respect to social housing. At the same time, the relationship which existed between the council and tenants was sought to be replicated with the Registered Social Landlords under the Best Value policy, as per the Local Government Act 1999, which extended the tenant participation compacts to the Registered Social Landlord. Now, there could be consumer evaluation of services been given to council tenants and the Local Government was also required to come up with tenant participation compacts to be formed between the RSL and tenants.

The problem of decent standards in social housing has also been sought to be corrected by the Decent Homes Standard in 2000. As per this the physical look of the social housing is to be enhanced and made more appealing as this was also a cause for concern and under this initiative, all social landlords had to improve their properties and bring these up to the mark of a high standard by 2010 (Great Britain, 2000). At the same time, the cost of the renovation was not allowed to be passed on to the tenants by the local authorities by increasing the rents of the tenants as these tenants were living in social housing meaning that they were low income families and would not be able to afford the added expenses. Recent research also shows that there is a connection between housing and poverty. For instance, a review of the evidence for John Rowntree Fund shows that there is a two-way relationship between housing and poverty. This manifests in mitigation and exacerbation of the experience of poverty with relevance to housing. Housing can lead to rent and mortgage payments, thus a charge on the income, or be a source of income through benefits and rents that the house owner can have (Birch, 2015). People who live on social housing can avoid the former, at least pay lower rents than those who live on private rentals; but have no access to the latter as they are not homeowners. Council Tax Reduction is also applicable to individuals who are on low income (Power et al, 2014). Therefore, the interaction between the two does have an impact on the number of people defined as ‘living in poverty’ and who they are and has significant implications for policy.
Therefore, it is seen that policy changes made by successive governments over the period of time has responded to people living in poverty and their needs.

One such problem for those in social housing has been the problem of social exclusion by those living in social housing. National Strategy for Neighbourhood Renewal policy was introduced due to the increased social exclusion in the disadvantaged locations in 1997, when the Government introduced the Social Exclusion Unit, which was started so that the government could address the issues of the disadvantaged areas (King, 2010). The motivation behind this was the need to resolve the issues of good management in the neighbourhood housing and the unpopular social housing and the development of different policies with respect to both. The socio-segregation of social housing tenants and other social problems and led to integration of new social housing in the established areas. This would give access to benefits to people from lower income groups, such as, access to better schools, better job opportunities and better living conditions (King, 2010). It is said that “the investments made in Decent Homes, in Housing Market Renewal, estate redevelopments, new schools and health centres, and other capital projects meant the Coalition government in 2010 inherited fewer physical and environmental problems than its predecessors. Many poor neighbourhoods had a new stock of fit-for-purpose public buildings. Fewer neighbourhoods were coping with problems of widespread housing abandonment, dereliction and dilapidation, although the financial crash left some housing renewal schemes stalled, with only partial demolition having taken place and no new building” (Lupton, 2013). It is also noteworthy that the policies led to the better and decent standards of 90 per cent of social housing, lowered rates of crime, litter and vandalism and visible narrowing of the differences between deprived and other areas (Lupton, 2013). Also, there was improvement in new childcare and health centres, schools and community buildings in the most deprived areas (Lupton, 2013). Therefore, it can be said that Gordon Brown’s government received an easier task as far as the housing situation was concerned. Still the government added to the work already done by building more houses with the annual target of 200,000 homes. The government has publicly proclaimed that it would aim build three million new houses by the year 2020 (Arden & Dymond, 2012).

The Conservative government also established the Homes and Communities Agency (HCA) under the Housing and Regeneration Act 2008 for the purpose of social housing. However, the collapse of the global financial market in 2008 led to reverses in the social housing policy, which has not recovered the lost ground brought on by austerity measures that have also impacted the housing benefits. As a result of the crashing of the financial market, the central government not able to live up to its earlier commitment for building more houses. The government tried to solve that problem by encouraging self-financing for the councils.

The Housing And Regeneration Act 2008 encouraged the provision for self- financing for the councils and also allowed the housing council to use the tenant's rent in the new housing sector and try to keep the already existing homes (Arden & Dymond, 2012). Gordon Brown tried to increase the supply of low-cost rented housing. The Independent Social Housing Regulator was also introduced to replace the Tenants Services Authority (TSA), who was the former regulator of the registered providers of social housing in the UK. It has generally been seen that social housing regulation has a tendency to focus on providers rather than tenants. But the establishment of the Independent Social Housing Regulator is meant to bring the focus to the tenants in the social housing sector.

Despite the measures taken by Gordon Brown’s government, the Coalition government has passed many measures, such as the benefit cap and the bedroom tax (Housing Benefit Size Criteria) that has attracted criticism because these measures are seen to reverse the earlier policies and their good impacts on the social housing sector. The measure that has caused the most controversy in recent times in the social housing sector is the under-occupation penalty, or Housing Benefit size criteria, which is popularly termed as the ‘bedroom tax’. The bedroom tax, is meant to target people of working age who live in council housing and have a spare room. The idea is that a person can claim for a certain number of bedrooms, only based on the number of people living in the house. If there are lesser number of people as compared to the rooms, then the person cannot claim housing benefit for the unoccupied room. This has attracted a lot of criticism from those who believe that these cuts will impact those on social housing adversely (Birch, 2015). The Disability Benefit Universal Credit is a single monthly payment that will combine the benefits for the recipients. The social landlords are concerned that this will increase the arrears for rent (Power, 2014). Affordable Rent appears to be the new form of social housing, and critics are pointing out that this would lead to low rent properties to be replaced by more expensive and less secure properties (Hodgkinson & Robbins, 2012).

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To conclude, social housing has been an important concern of successive governments since the late 1990s when Tony Blair raised the issue of growing homelessness in the run up to the 1997 elections. Since the New Labour government made many new changes to the housing sector, it is generally considered that these changes and policies impacted the housing sector for the better and led to many positive impacts on the lives of those who lived in social housing. Gordon Brown added to these measures until the financial crash of 2008 forced tighter measures that also affected the social housing sector. The Coalition government also passed stricter norms like the bedroom tax and benefit cuts that have been criticized for their impact on the social housing sector and the perceived reverses of the earlier policies. Finally, it can be said that the social housing sector is directly related to the economic situation that prevails. At the same time, it is directly related to poverty. It is only those who cannot afford to buy houses, who stay in social housing. Housing helps people to save money that they would have paid on rent and mortgages, and use that money to fund better education for their children or a house in the future.

References

  • Arden, A. & Dymond, A., 2012. Manual of Housing Law. London: Sweet and Maxwell.
  • Birch, J., 2015. Housing and Poverty, York: Joseph Rowntree Association.
  • Defty, A., 2016. The Coalition, Social Policy and Public Opinion. In: H. Bochel & M. Powell, eds. The coalition government and social policy: Restructuring the welfare state . London: Policy Press.
  • Hodgkinson, S. & Robbins, G., 2012. The return of class war conservatism? Housing under the UK Coalition Government. Critical Social Policy, 33(1).
  • Lund, B., 2014. Understanding housing policy (second edition). London: Polity Press.
  • Lupton, R., 2013. Labour’s record on Neighbourhood Renewal in England, Summary Working Paper 6, London: London School of Economics.
  • ODPM, 2005. National Framework for Tenant Participation Compacts, London: ODPM Publications .
  • Power, A., 2014. The impact of welfare reform on social landlords and tenants, s.l.: Joseph Rowntree Foundation.
  • Schuecker, K., 2015. Benefit cap is failing to tackle the cause of high benefits, York: Joseph Rowntree Foundation.

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