Mind the gap: why do we still have distance between housing rhetoric and reality?

Mind the gap: why do we still have distance between housing rhetoric and reality?

If we measured progress by press releases, these would be heady days for the housing sector. Every other week for the past few years has brought with it a string of announcements from the top of government aimed at tackling the housing crisis and the shortage of homes.

Many of the changes won have been genuine and important. Letting fees banned; the affordable housing budget trebled since 2011; borrowing caps raised; all homes to be made fit for human habitation; new money for social rent for the first time in eight years, the first time under the Conservatives for over twenty.  These kind of interventions will make a genuine difference.

Words vs deeds

And yet the pace and scale of change can still feel frustrating, with government rhetoric still running ahead of reality. The £1bn a year or so for new social rent homes is really welcome, but some way short of the “council house revolution” briefed beforehand. Vital reforms to Compulsory Purchase powers were in the government’s manifesto, and have cross-party consensus, but have not been forthcoming. Every initiative is announced on homelessness except the one that will make a real difference: ending the freeze on housing benefit for private renters.

What accounts for this gap? Some of it is just the nature of politics. Government spinners over-brief, journalists exaggerate; the best possible gloss is put on things. Some of it may also be Brexit sucking up bandwidth.

But in some ways it also speaks to a slight identity crisis within government. Really big reform has big pay offs, but it also carries trade-offs: in housing, it requires either spending a decent chunk of money or upsetting vested interests (developers, landlords, landowners, NIMBYs). In short, there seems to be no settled view inside government on which – if any – of these trade-offs they are willing to bear, and to what extent. Where one pocket of government is radical on an issue the other is cautious, and vice versa, and so the effect is they tend to cancel each other out.

All there is consensus on is the political imperative, and the need to be seen to do something.

This dynamic matters because it appears to be blunting the force of the government’s reform agenda, and undermining decent intentions.

A case study: NPPF and the viability loophole

A great practical example of this comes from our campaign around ending the ‘viability loophole’ – the regulations that allow developers to wriggle out of affordable housing commitments on spurious viability grounds.

Government consulted on these concerns last year, and we hoped the first draft of the National Planning Policy Framework (NPPF) would close this loophole for good. The document contains some strong language with a clear and progressive policy intent: ensure the cost of affordable housing is baked into the price of development land from the start, rather than something seen as optional extra to be discarded later.

But then, woven through the very same document are passages and paragraphs that directly contradict this, giving landowners a right to ever-escalating returns based on actual prices paid for land recently in a broken market. These contradictions re-open the door to abuse of the system.

Our briefing note explains in more detail what they are. But essentially they risk re-creating the problems – developers over-bidding for land on the expectation they can cut back on affordable housing to make up the costs – that government is trying to address. Some practitioners even think they might make things worse.

It’s a consultation so we will press these points with Ministry of Housing, Communities and Local Government (MHCLG). But the question has to be asked why the document gives with one hand then takes away with another like this.

It could well just be vague drafting. But it also feels a bit like some parts of government (not all) have got nervous at the last minute about anything that might unsettle interests that benefit from the status quo.

It may also be competing schools of ideological thought – lingering sympathy that de-regulation of planning will solve everything. But this has been tested to destruction.  We have had endless rounds of planning liberalisation and they have solved very little.

Here is the basic rub: getting the homes we need – especially affordable homes – and maintaining the status quo in the housebuilding and land markets are mutually incompatible objectives. Trying to triangulate between them won’t work.

The need for political bravery

We pointed towards a better way in our New Civic Housebuilding (NCH) vision: large scale reform that will bring down the cost of land and increase the quality, quantity and affordability of the homes we build. On top of that, smart state investment in a new wave of high quality public homes at low rents.

There is growing consensus on the need for these things, including among Conservatives.

But the missing ingredient, as the NPPF shows, is the political bravery to make it all happen.

This is one for the Prime Minister, her new advisers and indeed her new Secretary of State for Housing James Brokenshire to ponder.

The ‘three steps forward, two steps back’ approach which prevails at the moment has the benefit of getting the government through a 24-hour news cycle. But it comes at the cost of limiting the positive impact on the actual lived experience of voters and communities.  And it is that which her party will ultimately be judged on at the ballot box.

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