The last time it was a handful of dissidents who made a powerful economic case for social housing, but it fell on deaf ears; now the NHF and Shelter are echoing those old demands with fresh evidence, writes Mark Cantrell – will it share the same fate?
Stick around long enough, and you get to hear the echo; whether anybody listens is another matter entirely.
The National Housing Federation (NHF), along with the homelessness charity Shelter, launched a new report this week, extolling the societal and economic virtues of embracing social housing – and building more.
Much more; like 90,000 new homes a year more.
The impact would be far-reaching and profound, the two organisations argue. Delivering a massive boost to the provision of social housing would go a long way towards addressing the nation’s chronic housing crisis, and help tackle local authority-busting levels of homelessness.
It would also be the right thing to do; to help hard-pressed communities gain a stable and secure home, build the foundation of a good life, and empower people in their everyday life. But it’s not simply about doing the right thing so that we can feel all warm and gooey inside.
Ministers – the ones in a position to mobilise the machinery required to make things happen – tend not to be stirred by such appeals to the better angels of our nature. Theirs is a calculating trade, so naturally they want something harder on the nose. The report aims to deliver.
The Economic Impact of Building Social Housing presents research conducted by CEBR, and it serves – you might say – as a business proposal for investing an initial £11.8bn in social housing. There’s huge scope to realise significant returns on such investment, the report argues; society will benefit, but so too will the economy.
According to the report, the next government could add £51.2bn to the economy, for instance; including £12bn ‘profit’ to the taxpayer by investing in the annual construction of those 90,000 social homes.
Kate Henderson, the NHF’s chief executive, said: “This research shows not only that the housing crisis can be solved, but that this can be done in a way that will save the taxpayer money, boost jobs, and bring huge benefits to the wider economy.
“Right now, we are in the midst of a housing emergency. Millions of children are being pushed into homelessness, families are being forced into impossible choices to keep a roof over their heads, and people in every community in the country are seeing life chances harmed by inadequate housing.
“Building more social homes is a win-win solution. It will immediately boost the construction industry, supporting thousands of jobs, and will save the government and taxpayer money over the longer term.
“It also brings huge benefits to people affected by the housing crisis through reducing homelessness, increasing employment and boosting children’s life chances.”
Making its case
The report sets out to demonstrate that building 90,000 social homes would provide both immediate and long-term value for money for the government and the economy.
It would directly support nearly 140,000 jobs in the first year alone. Within three years, it argues, the wider economic benefits of building the homes would break even and return £37.8bn back to the economy.
Alongside this, the report claims that new social homes would generate huge savings for the taxpayer across multiple departments. These would include: £4.5bn savings on housing benefit; £2.5bn income from construction taxes; £3.8bn income from employment taxes; £5.2bn savings to the NHS; £4.5bn savings from reduction in homelessness; and £3.3bn savings to Universal Credit.
Combined with these savings, the additional tax revenue would mean that initial government funding required to build the homes would be fully paid back in 11 years. Over the 30 year period, building these homes will add £12bn net (£24bn gross) in benefits to the taxpayer.
“All political parties must make the choice to ending the housing emergency – they must fully commit to building 90,000 new genuinely affordable social rent homes a year for 10 years.”
Polly Neate
Then there’s the ‘softer’ side, if we can put it in such terms; although the impact itself is far-reaching too, and beneficial for the economic well-being of UK plc.
As the NHF argues via the report, social homes are more stable than private renting, as tenancies are secure, giving social tenants stronger rights and greater protection from eviction, and are generally of better quality (current well-documented issues within the sector notwithstanding, but that’s another lengthy story).
As a result, it goes on, the socioeconomic benefits of building 90,000 social homes are “significant”, and include better education outcomes, savings to the NHS, increasing rates of employment and reduced crime. The total economic and social benefits of building the homes would generate £51.2bn net over 30 years (£86.5bn gross), it claims.
In many ways, the UK today is paying the price of yesterday’s choices; we might add, it’s suffering the accumulated collateral damage of decisions made for short-term advantage in bygone days.
For decades, successive governments have failed to build enough social homes; a wilful failure, it must be said. Every year, the number lost through right-to-buy sales and demolitions, continues to outpace construction of replacements.
Last year alone, the report points out, there was a net loss of nearly 11,700 social homes, while 1.3 million households are stuck on social housing waiting lists in England.
Meanwhile, the report adds, one in six children are living in an overcrowded home, and a record 140,000 children are homeless and living in damaging temporary accommodation, such as one-room hostels and B&Bs, often miles away from their schools. Thousands more people are forced to sleep on the street.
Political choices
But it doesn’t have to be this way; that’s the gist of it. The report seeks to lay bare the facts and figures that you might expect would make a government minister – even a chancellor of the exchequer – sit up and take notice.
Bait to encourage them to make the moral decision, you might say, or the socially just position, if you prefer; all in the name of economic rationality. The choice is theirs to make; as it always has been.
As Polly Neate, chief executive of Shelter, points out, homelessness is a “political choice” with a “simple solution”. We might add, the wider housing crisis – and its resolution – is rooted in political choices too.
“Building 90,000 social homes a year will not only end the housing emergency, but due to the wider economic benefits it brings, it will pay for itself within just three years,” Neate added.
“Day after day our frontline services are inundated with calls from people who are being tipped into homelessness because there are no genuinely affordable homes available, and private renting is just too expensive. Communities are being torn apart as people are priced out of their local areas – leaving behind their jobs, children’s schools and support networks.
“It doesn’t have to be this way. A safe and secure social home will give people a place to thrive – improving their health and access to work and education.
“All political parties must make the choice to ending the housing emergency – they must fully commit to building 90,000 new genuinely affordable social rent homes a year for 10 years.”
The NHF says the new report is the first to show the “massive economic and social benefits” of building way more social homes. The founders of the Social Housing Under Threat (SHOUT) campaign, a decade ago, might well beg to differ.
Back then, the NHF – and the sector’s wider leadership – were making political choices of their own, and it’s fair to say they ran contrary to the case for social housing. Indeed, those were the days of a deafening silence in its defence.
Industry conferences would feature earnest discussions questioning whether social housing was a ‘failed brand’. Whether intended or not, by implication, such talk raised the unspoken question: Are social tenants bad for our image?
In those days, it seemed, the sector was eager to bend over backwards to appease a hostile government, and ingratiate itself to an all-consuming focus on home ownership, to the detriment of its supposed core product and ‘brand’.
In 2014, spurred on by all this, SHOUT released its report detailing the social and economic case for social housing. It fell on deaf ears.
Since then, as the NHF’s new report makes clear, the collateral damage has only worsened, but the solution hasn’t gone away. The case for social housing – once invoked by a handful of dissidents – is now being declared by the industry’s establishment. That’s surely got to count for something, but will it make any difference?
Future flux
Politicians can be notoriously cloth-eared when it comes to evidence that points away from favoured policy tropes, and despite a recent thawing of attitudes towards the tenure, social housing has long been disfavoured. But these are strange days, so maybe its time will finally come.
We currently occupy that liminal space between regimes; a strange place occupied by the echoes of the desperate and the outrageous. An election is yet to be formally called, but we know that one is imminent, and that exerts its influence. The ‘big beasts’ of UK politics are squaring up, but (so far) it all lacks the vigour of past contests.
An exhausted Tory administration evidently fully expects to lose, but flails around looking for a lifeline to cling to power. Labour, meanwhile, anticipates its ascent to government, but is seemingly so fearful of a last minute upset that it plays its cards close to its chest; so close, in fact, you have to wonder if even the party’s top leaders know the hand they’re playing.
Given all this, you have to wonder whether the report’s case is likely going to be heard within the fractious cacophony of these times. Like its predecessor report issued by SHOUT, might its resolute case for more social housing also fall on deaf ears?
Both the NHF and Shelter hope not, but all we can do is wait – and see. Maybe, just maybe, the politicians are finally ready to listen.
Reaction: “Strong wake up call”
Hugh Owen, director of strategy and public affairs at Riverside, said: “Good quality affordable housing is a fundamental building block which enables people to thrive at work and school and to live a happier and more productive life.
“This research confirms that there is an overwhelmingly positive business case for investing in more social housing too.
“Funding more social housing is a long-term investment which boosts the economy, creates thousands of new jobs, and delivers long-term benefits for the Treasury by reducing pressure on the NHS, criminal justice system, and social care system.
“We now have record numbers of households living in temporary accommodation and council spending on temporary accommodation has more than doubled in seven years to reach more than £1.7bn a year in the last financial year.
“Ahead of the next general election we urge all political parties to read this report and engage with housing associations on how we can work together to fund and deliver more social housing in the decades to come.”
Ian McDermott, chief executive of Peabody, said: “With one in 50 Londoners and one child in every classroom effectively homeless and in temporary accommodation, the growing housing emergency needs to be addressed now.
“With its spring budget just around the corner, the government has the power to put forward a plan that addresses growing homelessness while simultaneously providing a much-needed boost to the economy.
“Building such a huge number of social homes will be a challenge but it’s one we and our partners can rise to – but only if increased public investment is available.
“Without the investment and delivery of not-for-profit housing associations in the past decade, the problem would be even worse. But despite our best efforts, the housing emergency has intensified.
“Rising costs, high interest rates, chronic public underinvestment and an urgent need to spend money on our existing homes has taken funding away from building new social homes.
“More money from the government would help fund more social rented homes and be transformative in a number of ways, addressing a range of social and economic issues. It would also ultimately be cheaper for the taxpayer, saving councils vast sums on temporary accommodation, and reducing the amount of housing benefit that goes directly to private landlords.
“We could begin to tackle the housing crisis, taking people out of poverty, boosting health and stimulating supply chains, while driving sustainable growth. The whole country would benefit from tens of thousands of new jobs and billions more pumped into the economy.
“An affordable home that is safe and comfortable is the foundation of good health and well-being, and I think the single best way of alleviating poverty and improving social mobility.
“This report, along with a housing crisis that’s getting worse by the day, should be yet another stark wake up call for the government to take decisive action.”
Andy Hulme, chief executive of The Hyde Group, said: “This report proves investing in the most affordable homes makes economic sense as well as being the right thing to do to help solve an acute housing crisis.
“The research is well timed as new data shows that the number of affordable homes expected to be started in London is on track to fall by more than three-quarters this year.
“We started over 2,100 new homes last year, and are determined to keep building. While we have no plans to cut our housebuilding programme, things are being made harder for the wider sector without a clear long-term plan from government for affordable homes.
“Research shows that London’s largest housing associations lost £19bn of funding when social housing rents were reduced for four years and later capped. For Hyde this meant we had almost £10,000 less available to spend on each of our social homes.
“Ahead of next week’s budget, we want to challenge this government to live up its promise on long-term decisions by making a 10-year plan for both rents and the Affordable Housing Programme, which will leverage in billions of pounds of additional private sector investment to build more of the social and affordable homes which people need.”
Image credit: PHOTOCREO Michal Bednarek/Shutterstock
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