Posted by: Jules Birch13/06/2012
Everywhere I’ve been in Manchester this week it’s hard to avoid falling into the gap between good intentions and cold reality.
It’s there in the underlying theme of the CIH conference (a decade of sector-led solutions) and attempts to find ways forward under continuing austerity as outside the conference chamber the underlying problems just keep getting worse.
It was there in the differing reactions to the affordable housing figures published as the conference opened. As I forecast yesterday, for Grant Shapps they showed a ‘rapid and dramatic increase’ while for Jack Dromey they were ‘disastrous’. In a sense they were both right: they were an improvement on the numbers six months ago but only because they were so catastrophic. Listen again to this morning’s Today programme for more (at about 8.10).
It was there in the call from Louise Casey for the housing sector to take a lead in the troubled families programme even as she dismissed objections to its dubious origins (more detail on that on my other blog here).
As if all that were not enough, Peter Schofield, the new director-general of the DCLG, was on hand to make it clear that the reality gap is going to be here for some time to come. He candidly admitted that housing had barely been considered in last year’s plan for growth, when he was at the Treasury. Now at least it is on the agenda, but he warned that the next spending review would see even less money and that the sector had to ask itself some hard questions.
His hope, with a bit of help from institutional investors, is that the 2010s could come to be seen as a decade of housebuilding in the same way as the 1930s and 1950s. However, given that we are already 25 per cent into the decade and building is still stuck at the lowest level since the war, the reality gap on this is starting to turn into a chasm.
None of which is to argue against the need for sector-led solutions. After two years of relentless cuts and new legislation, there is now some precious time to think, try to get ahead of the curve and map out how the future might look. The government at least looks open to new ideas (provided they don’t involve spending any money and provided they fit within its political framework). Local authorities and housing associations do at least have more freedom to work with (even though they need more). Institutional investors may at last be taking housing seriously again (though I wish I had £10 for every time I have written that).
However, that still leaves the reality gap. All of this would be daunting enough in a stable environment but all the evidence suggests that the underlying housing crisis is getting worse all the time.
A report out today from the Joseph Rowntree Foundation on the housing crisis facing young people that makes the point only too clearly.
A team from Cardiff University forecasts that the number of home owners aged under 30 will halve to just 1.3 million by 2020. An extra 1.8 million 18 to 30-year olds will be forced into private renting and another 500,000 will have to stay with their parents well into their 30s.
All of which is bad enough, and further confirmation of the depressing situation facing Generation Rent (also revealed in a study by the National Centre for Social Research yesterday).
The really bad news though lies in the knock-on effects of that. Private renting will be taking all of the pressure from declining home ownership and austerity-bound social housing. The influx of young people will mean even fiercer competition for a limited number of tenancies and the report warns of a three-tier market developing between young professionals who can afford the rent at the top, young families struggling to afford it in the middle and a bottom run of 400,000 people who could be excluded completely. As Kathleen Kelly of the JRF points out, ‘we need to avoid turning a housing crisis into a homelessness disaster’.
Sector-led solutions can lead to innovation on the ground and slow the pace at which things get worse. Making things better requires government-led solutions too.
As if on cue Lord Freud is in Manchester today and Grant Shapps tomorrow. Time to enter their reality distortion fields.
From Inside edge
Housing commentator Jules Birch puts the latest news in context