All posts from: December 2011
It didn’t escape the attention of the housing world’s twitterati that Grant Shapps was unusually reticent over one particular policy initiative yesterday.
Unlike his boss, the housing minister is a great fan of micro blogging, racking up more than 3,000 tweets from his Westminster bunker. Indeed, nary an announcement goes by without being trailed, revealed and dissected in rapier-like 140-character missives.
So why, when the long-awaited right to buy consultation finally emerged yesterday morning, did Mr Shapps wait until well beyond the watershed to tell his followers about it?
A few hours may not seem like much, but it’s an age in the instant gratification world of social media.
Could the delayed reaction be caused by embarrassment? The proposed £50,000 cap on discounts sounds impressive, but is well short of the 50 per cent figure that was being bandied about when the housing strategy was published last month.
In fact, word from the councils is that, ever since the right to buy renaissance was brought to the attention of an unsuspecting public back in September at the Tory conference, officials at the Communities and Local Government department have been scratching their heads about how it will work.
The problem, in a nutshell, is that making the discounts attractive enough to encourage the kind of mass take up the government wants will leave councils unable to afford to build the one for one replacement homes that it has also promised.
Of course, this is still in the consultation phase. But the feedback being received over at Inside Housing towers is that, even with a limited increase in the available discount, the figures won’t allow for a replacement to be built without significant capital input from councils.
Indeed, Hometrack was quick to release a report that claimed as many as 1.4 sales would be required for every new build. That wasn’t something that Mr Shapps flagged up on Twitter.
At this time of year, it might be apposite to misquote the Good Book: If you live by the tweet, you die by the tweet too….
Poor old Danny Alexander.
In his private moments, when he’s not acting as George Osborne’s flak jacket or coalition peacemaker, he’d probably admit that he never thought his political career would see him forced to shoulder the burden of government.
But this ‘new politics’ lark is a strange beast, and so there he was this week, giving the ministerial address at the Local Government Association’s housing finance conference.
‘It’s nice not to be talking about Europe today,’ quipped the chief secretary to the Treasury through gritted teeth. But even without grassroots Lib Dems spitting venom at him, Mr Alexander was not in for an easy ride.
Of the nine questions from council representatives that followed a speech which contained little other than a summary of the vague promises of the housing strategy, five of them were on the same subject.
It seems that the right-to-buy is still exercising the minds of local authority purse string guardians more than any other issue.
Next week sees the launch of a consultation on the reinvigoration of the iron lady’s pet social policy. Apparently, more detail of how it all works is likely to come out. But we’ve heard that before haven’t we?
When the PM first mentioned the right-to-buy at the Tory party conference back in September, us media types were told to cool our guns until the detail was revealed in the housing strategy, a document that turned out to be full somewhat lacking in anything that could be described as ‘detail’.
The reaction among delegates at the GLA did not suggest that they thought all their questions would be answered next week. And yet they need answers pretty sharpish, given the potential impact on councils’ revenue streams at a time when they are grappling with how to service the debt they’ll be taking on as a result of the housing revenue account reforms.
Politics and comedy have plenty in common. Not least that, in both, timing is crucial. Right-to-buy may well work. But to try to relaunch it at a time when councils’ financial management is as delicately balanced as ever seems to be high folly.
In a nutshell, local authorities just want reassurance that receipts from right-to-buy can be kept locally for reinvestment in stock. The more times that question is asked – and the more times that ministers demur – the less confident they are that they will get their way.
On Wednesday, it’s fair to say that Danny Alexander was left floundering on a subject that is only really on the fringes of his portfolio. The crumb of comfort for delegates was that he promised that the government was at least listening to what they had to say.
But, to paraphrase Wesley Snipes, they may be listening, but are they hearing?
Anyone who frequented top flight football matches in the 1980s – and indulged in the essential reading that was the matchday programme – will be aware of the popularity of Dire Straits among players of a certain vintage.
But any love for the Mark Knopfler back catalogue is not shared down at the Communities and Local Government department. Because the CLG, it would appear, is not in the habit of giving away money for nothing.
What seemed like a generous gift of £400 million to British builders to help them get projects that had fallen foul of the current financial malaise (to describe it in gentler terms than usual), is in fact likely to be a series of loans.
Social landlords might not mind too much that for-profit developers aren’t getting a gratis slice of limited government funds. But that doesn’t change the fact that, when the windfall was presented to the world as part of the housing strategy, it was widely understood to be a form of grant, or at least a mixture of grants and loans similar to the erstwhile Kick-Start fund.
While no one is likely to turn their noses up at the prospect of a new form of development finance, the new money, trumpeted repeatedly during the media circuses around both the housing strategy and last week’s autumn statement, is likely to be just a drop in the ocean.
To put this into some sort of context, the amount of private capital required to meet the social housing needs in London alone over the next four years has been estimated at £14 billion.
And it’s a drop that will have to be repaid, it now seems. And at commercial rates to boot. So, as Mr Knoplfer says, the kicks could be for free.
But maybe the government’s chosen pop act from that particular decade is the original boy band, Bros. After all, the mood music coming from CLG to the housing sector sounds very much like ‘I owe you nothing…’
On Thursday, the former chairman of the Financial Services Authority Sir Howard Davies was on the Today programme expressing bemusement about the apparently irrational behaviour of the stock market.
Sir Howard was reacting to the surge in the markets that followed US Federal Reserve’s decision to start the January sales a little early by offering dollars at knockdown prices. But he might have had the same thoughts if he had been monitoring the stock of house builders this week.
Some of the country’s biggest contractors – including Persimmon, Barratt, Taylor Wimpey and Bellway – saw share prices rise by up to 4 per cent on Tuesday following George Osborne’s autumn statement to parliament. They were cheered by the government’s announcement that it would help 100,000 families access mortgages while providing a £400 million boost to stalled building projects.
Good news indeed, especially if we forget the caveats about another six years of austerity, an extra £15 billion of spending and the prospect of half a million further job losses. But, good news or not, it does sound slightly familiar.
Now, cast your mind back, if you can, all of a week to the majestic unveiling of the long-awaited – and equally underwhelming – housing strategy.
In that modern-day Magna Carta of a document, you will find reference to… a scheme to help 100,000 families access mortgages and a £400 million fund for stalled building projects.
A week, as they say, is a long time in politics. And apparently, for those masters of the universe on the trading floor, it’s enough time to develop short-term amnesia. Or maybe, if you’re in government these days, you have to tell people something twice before they believe you.
However, the Groundhog Day feel of this week’s news does give a nice picture of how politics works.
The Communities and Local Government department has spent months telling us to wait for the housing strategy for clarification on everything from the right to buy to what Grant Shapps had for breakfast. The strategy itself then turned out to be a hotchpotch of former policy announcements, coupled with the launch of another slew of consultations.
Fast forward a week, and the housing section of Osborne’s statement appears to be a regurgitation of the aforementioned strategy. But maybe that’s the art of politics: say nothing, promise less.
Either way, the City didn’t seem to notice. Roll on next week’s Finance Bill, I say.