Socialist Worker

Housing plan is little more than sticking plaster

The government was set to unveil a series of new housing policies as Socialist Worker went to press this week. Housing activist Glyn Robbins picks apart what is likely to be on offer

Issue No. 2117

I’m writing this before the final announcement of the government’s plans to “revive the housing market” – but I’m already confident in predicting they won’t work.

As with most New Labour policy initiatives, they have been heavily trailed. But more than that, they are going to flow from precisely the same flawed thinking that got us into this mess in the first place.

The government is in a peculiar state of neurosis. A lot of energy has been spent trying to convince us that the economic storm is a passing squall and that Captain Gordon Brown can steer us through it.

Second Mate Alistair Darling blew that fantasy away at the weekend with his honest assessment of the state we’re in. As one commentator put it – you know things are bad when politicians start telling the truth!

From the vantage point of the construction industry, where I work, there’s little room for optimism. Redundancies, projects being mothballed and cuts in design standards are already a daily reality.

The government’s hopes of three million new homes by 2020 – relying on the private sector to build them – are little more than pie in the sky.

Taken together with the wider state of the economy, the consequences of this are disastrous. House prices are crashing as job losses and repossessions are soaring, along with the cost of living.

Waiting

There are already 1.6 million families on the waiting list for social housing – and this figure could easily double.

But the factor that could make this recession much worse than others is personal debt. This currently averages £23,000 per household – a staggering £1.3 trillion in total.

The government doesn’t like to mention this because it deliberately – and negligently – allowed cheap credit to inflate the economy, until the “credit crunch” came and pricked the bubble.

New Labour’s housing market recovery plan will be, at best, a sticking plaster.

Some people faced with losing their home may be helped, but only by using public money that will be siphoned away from the budget for building more affordable housing.

Attempts to help first time buyers risk repeating mistakes of the past by encouraging people to buy at the limit of what they can afford.

The housing market hasn’t hit bottom yet, so “shared equity” could quickly become shared negative equity.

The notion that a partial cut in stamp duty – which amounts to only 1 percent of a property sale – will revive the market is just laughable.

If there are any winners from the government plans, it will be property developers and their kissing cousins – housing associations.

These associations have been at the core of housing policy for two decades and have failed to provide the homes the country needs. But they, like Northern Rock, will now be bailed out using public money.

Thousands of new homes now stand empty, thanks to short term speculative development. These could now be added to the asset registers of private housing associations – at public expense.

Hinted

The government has hinted that local councils may also be enabled to buy empty homes, although they haven’t yet said where the money will come from. They have also talked about allowing councils to build new homes.

Herein lies the answer. Calling for a new generation of council housing is not just a slogan – it’s the real solution to the current crisis.

The money the government is set to squander could be spent on building homes that people really need, with affordable rents and security of tenure, while keeping the construction industry alive and thousands in work.

With every failed policy gimmick, the argument for real investment in real council housing gets stronger.


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Tue 2 Sep 2008, 18:37 BST
Issue No. 2117
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