Social Housing: the End?

The graphic is from this week's edition of the housing trade mag, not some alarmist leftist publication. It refers to the end of public subsidy for the capital costs of building social housing. If the Tories really mean what they say, we're in uncharted waters.

Housing finance is notoriously difficult and dull, so let's strip it back to its essentials: to cover the costs of building houses you can either pay a lot upfront to cover the initial costs or borrow that money and pay the loan off by hiring it out on a periodic basis. The smaller amount of money you sink into the scheme upfront the higher the periodic charge. This is not rocket science.

Since the late 1980s, we've not had 100% capital subsidy for social housing - indeed, housing associations have bid for funding partly on the basis of how little capital monies they need to deliver any given project. Naturally, the first result of this system was to send rents - the 'periodic charge' - through the roof in the early 1990s.& high rents do tend to produce very high Housing Benefit bills.

So a decade or so ago the government introduced a system of 'target rents' which apply to both council and housing association rented stock. Basically, this system sets the rent of any given socially rented property, new or existing, in accordance with a formula based on the size and value of the property and relative local manual wage rates. So this reined in the tendency to produce low capital subsidy/high rent schemes.

The Tories have decided to rip this system up: they want rents to be capped at 80% of the local market rate for all incoming tenants, even those going into existing social housing, which has enjoyed past capital subsidy. This is laughably called 'affordable'. Public capital subsidy is being reduced to more or less nothing. The promised 150,000 new 'affordable' social tenancies are supposedly going to be financed primarily from either these higher rental streams or via loans mobilised by big housing associations on existing stock where previous capital subsidy means the debt is now largely paid off.

Wake up at the back there - I know this is boring and detailed and rather more than you perhaps want to know. So let me put this in context: this means that rents for a two bedded socially rented property in Islington would rise from £91pw to £232pw: a three bed social rented house in Cambridge would go up from £93pw to £128pw. I can only assume that the application of the word 'affordable' to such rents is some kind of sick joke.

& what's more this means that the Housing Benefit bill is going to go up, not down. The housing associations' trade body is saying that, in Hackney, you'd have to earn £54,000 to escape HB eligibility and be in a position to keep the bulk of your additional salary and be better off in work.

For all the dull, grey complexity of housing finance it really is that simple: higher rents= deeper benefit traps for wider numbers of people. No amount of huffing and puffing about a Universal Credit is going to change that.

Nor is this simply a problem for the minority of the population who live in social housing. House prices are now such that it is increasingly difficult for people to get their foot on the ladder. A new report from the Home Builders Federation puts this pretty graphically:

"...the average first time buyer (FTB) would have to save every single penny of their earnings for more than two years to have a chance of getting a foot on the housing ladder. In London it would take three years.

Even over five years, young people have to save almost half of their take home pay every month to save a deposit for a house, with some areas even higher."

So rents matter: even if you're in the 70% of people who are currently home owners your children are probably not going to be any time soon if they live in London and the SE.

Addendum: the definitive explanation of the impact of the Housing Benefit changes, found in possibly the most unlikely place on earth for sensible comment, CIF.

The Coming Cuts Chaos: A Small Case Study

Supporting People? It’s the best little government programme you’ve never heard of: according to the CLG’s own study its' £1.6bn of expenditure on preventative support services saves the nation- well, England in this case - a total of £3.4bn. Basically, it saves over £2 for every £1 spent on it. Think of it as the 'stitch in time..' programme.

How does it do this? Very largely by putting in places services which help divert people from more expensive services, or delay their entry into/speed their exit from such services. (We’re talking about how to keep people out of care homes, hospitals, prisons, emergency homelessness facilities and so forth here). Good stuff you might think - surely a priority even for this cost conscious government?

No. They're cutting it by 12% over the next 4 years.

You might feel that's not very much at all if you work in Higher Education which is facing 80% cuts in undergraduate funding, but the cuts themselves are only the most obvious part of the problem. The real problem is that the money is no longer going to be separately identified - it's going to be rolled up into something called Formula Grant paid to local authorities. This, we're told, is cutting down on bureaucracy and giving local councils 'unprecedented freedoms and flexibilities'.

The problem here is that pesky word 'prevention' - it's very hard to give any specific legislative meaning to prevention that impacts on individual circumstances: prevention is not about measuring current need per se, but about stopping that need developing into something worse.If you're successful you've prevented a counter-factual situation developing. There are clever ways of measuring this at a prevalence level, but none that work at the level of the specific individual. So the vulnerable people who benefit from SP funded services have no legislative right to them.

On the other hand, councils do have a legislative duty to provide services for people who meet their increasingly stringent social care criteria, or the criteria which determine the eligibility of homeless people for social housing. So they have no choice but to fund services for these people.

So imagine you're a hard pressed local councillor or Chief Executive. You have to provide services for specific groups in priority need but not specific preventative services. There is nothing now to say you can't provide for those people defined as being in priority need by using monies originally intended for preventative services. & your core funding is going down by 7% a year. You join the dots.

Scaremongering? Not really. The Isle of Wight has led the way on this front and put through a massive SP cut last year. 8 months on, the results seem to be:

• That more tenancies are at risk
• Anti-social behaviour has generally increased
• The lack of support available has deterred some landlords from providing accommodation
• Accommodation placements are breaking down sooner
• There is evidence of increased homelessness, offending, self harm, substance misuse, increased health issues and financial problems
• Issues are becoming more difficult and long term to overcome and therefore more expensive.

Thoughts on Spending 31 Hours in a NHS A&E with a 87 year old

What, I wonder, would the various denizens of the blogosphere have been saying if they were sitting there with me and my ailing Mum?

The rabid right-wingers would have blamed the incentive-free state bureaucracy I suppose. But they would be wrong there; I really don’t think it had anything to do with the governance arrangements or lack of a direct profit motive. The people, from the consultants down to the porters and cleaners , did seem genuinely open, friendly and willing to help.

Most of my comrades on the left might have muttered about still catching up with years of underfunding, and there were certainly evident staff shortages , though mainly, as far as I could see, unpredictable ones as at least two nurses went off sick in that 31 hours. It’s hard for any organisation to deal with that.

My blogroll’s resident HR expert might have had something to say about the composition of the staff team though; to be frank I thought there were too many doctors and not enough nurses. This may seem an unusual complaint. It only makes sense when one realises that the doctors appear to operate in separate little kingdoms of medical specialism. About a third of our wait was simply down to the A&E team referring some x-rays to the orthopaedic surgeons for a second opinion on whether there had been a fracture. And whilst we waited for that second opinion nothing else happened, no temporary admission could be made because the separate specialist kingdoms hadn’t decided whose kingdom (i.e. what kind of ward) Mum was going to be admitted into. I believe this is called silo working in management speak. Meanwhile the nurses on A&E were doing their A&E thing which, when it comes down to it, is basically triage. So if someone is marked as awaiting a second opinion they just move onto the next case unless there is some urgent call from the bed which has been parked in this triage operation. No thought beyond basic feeding and toileting is given to the cases not identified as urgent. If there had been more nurses the various doctors’ instructions might have taken effect rather quicker – and more holistic care might have actually been provided. Also, I’m not certain why it would have been such a great disaster to get Mum somewhere comfortable, even if it did prove to be the wrong ward and meant her having to be moved the next day.

My blogroll’s representative Spiked-influenced commentator and general enemy of the risk adverse culture would also have passed a few harrumphs about the reason for the final section of our wait – the seeming impossibility of assembling two spare members of staff to push the bloody bed containing my Mum to the ward. First we got a single porter; then we got a cleaner but no porter, and finally, 4 hours after the consultant had instructed an early transfer to a ward, we got both. Of course I pleaded and pleaded to be allowed to help to push the bed myself – but, no it was ‘against the rules’, 'not procedure' there were Health and Safety concerns and so on. So Mum sat waiting, immobile and in semi-public view, in A&E till two people could be assembled, one to push the bed and one to simply open the doors and push the lift button.

But most of all I reckon Boffy will be slowly and sympathetically nodding his head and biting back the urge to say, "I told you so - the left has got to be about more than just knee jerk defence of the NHS" . & so he did. Several times.

A Question

The Problem

My mother is very old and very frail. She has various chronic medical problems which mean that she has severely restricted mobility and stability, so there have been a number of recent falls. She has lost the effective use of her right hand which means that she can’t cook or even cut her own food up. I call these problems ‘medical’ in the sense they each have at least one medical name – but, truth be told, I don’t really see them as separate ‘medical’ problems. Mum is just old. & she lives alone. She's also poor: she lives in a ground floor privately rented flat and gets full Housing Benefit.

She is now in a care home for a spot of respite care after her most recent fall, and I'm trying to sort out the necessary services to allow her to return to her flat - aids, adaptations, meals on wheels and so on. As a woman who was 8 on the formal abolition of the workhouse - and only 26 when they really ended - she views residence in any kind of institutional 'care', from hospitals down, as a sort of shaming personal disgrace. And I live two hours drive away in a house with no downstairs bathroom or spare bedroom. My only sibling lives abroad and Dad is dead.

The Question

Mum is going to die at some point in the probably not-too-distance future I know. But it is her chassis and wheels that are failing, not the basic engine - her heart and lungs - so this might take a number of years. I want her to have a good ending.

I invite all all you lefty - or even perhaps not so lefty - bloggers to explain how your particular take on politics and the world might help achieve this. Or are there things about the nature of welfare and old age which are just beyond politics as we currently understand it?

& it's OK, I'm not asking you to solve my problem let alone my Mum's. It's not that personal. I just want to see how the left can attempt to connect its formal politics to lived experience. I don't want to 'tag' anyone formally, but I'd be interested in responses from anyone, especially anyone on my blogroll.