Monday, 28 December 2015

The Government's double whammy on council housing.

On 5th January the "Housing and Planning Bill" will get its final reading in parliament. It is a complex bill making amendments to several existing acts. It will implement a whole range of policies that will affect council planning. In short it gives the secretary of state a whole new raft of powers that he can use to turn the screws on councils that are not falling into line by approving a local plan with plenty of house building. Here is a link to one summary
But that's not all. There are also lot's of changes to council housing rules that are very controversial and will be the focus of a protest outside parliament on the 5th. One measure is designed to help the old Thatcherite right-to-buy scheme which helps people buy their council house. There's nothing wrong with the principle of right to buy, but the catch is that it gradually reduces the amount of council housing that's available because the money people pay for their council house is not quite enough to buy a whole new one. The government now has a magic solution to this. They will oblige councils to sell high value council houses in desirable locations whenever someone moves out of one, and buy lower value ones in cheaper new developments instead. A few years ago this idea started as a way to increase the amount of social housing but now it is to be used to fund right to buy.

It seems like a clever magic trick but magic always comes at a price. In this case the price is that council houses in places like Brentwood and Billericay will be replaced by council houses in places like Basildon and Dunton Garden Suburb. The social cost takes many forms including a widening of the education attainment gap because more desireable locations like Brentwood and Billericay tend to have better schools.
But that's not all. The right-to-buy scheme now also includes the right-to-buy social mobility fund. This means that the funds raised by selling of high-value council houses is not just used to let people buy the house they lived in for years. It is also used to fund the "cash incentive schemes" run by London councils to move people out of the capital to cheaper places like Basildon. From there they get to commute back into the city on crowded expensive trains. The old houses in London can then be redeveloped as expensive apartments for the super rich. A neat double whammy if ever there was one!

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