We need your support to keep TheyWorkForYou running and make sure people across the UK can continue to hold their elected representatives to account.Donate to our crowdfunder
My Lords, I welcome the noble Baroness, Lady Osamor, to this House, and wish her a long and happy sojourn here.
I have arrived at this issue as a relative newcomer, and now realise how fiendishly complicated it is. To state the obvious, the final objective of social housing policy is to reduce, and eventually abolish, the terrible scourge of homelessness. This requires the provision of enough housing to give everyone a roof over their head.
However, the path towards this nirvana is not straightforward. Simply building hundreds of thousands of houses all over the country is not feasible. Who will pay? The local taxpayer or the central authorities? What happens if local inhabitants object? What happens if building houses conflicts with other objectives, such as protecting wildlife or rural amenities?
Various schemes have been adopted. Council tenants have been encouraged to buy their own house, liberating cash that can be recycled into building new homes. Builders of commercial or free-market housing estates have been told to earmark a proportion to be sold cheaply to provide social housing.
Housing associations and non-profit organisations have also been very active. Families have even been parked in hotels and hostels. None of this completely solves the problem. In areas near this House there are at least three such hostels—but of course they only provide temporary accommodation.
In practice, a buoyant economy has meant that house prices have risen and rents have gone up, but the money available from the state has remained static. This is particularly true in London and the south-east. As an aside, social housing in London and in the south-east typically comprises 30% to 40% of any new houses built. In other areas, where social housing is often more needed, the total may be between 15% and 20%.
There is a paradox here. While the softening of house prices in London has helped the aspirational, just-managing classes, those dependent on social housing have suffered. This occurs because the profit margin on free-market housing estates has fallen, allowing less for the social sector.
The private sector does not have much incentive to understand or deal with poverty. It regards this as the domain of the local authorities. While universal credit could respond to this challenge, there are the issues of the first five weeks of the scheme before a payment arrives, and of the regulation that payment will normally go to the individual tenant, rather than direct to the landlord—a disincentive to the private sector.
Help, however, is at hand. Tackling homelessness has become a government priority. This has taken several forms. First, planning regulations have been simplified and, perhaps more importantly, enforced; secondly, the cap on local authority borrowing—as many have mentioned—is being lifted; and, thirdly, technology has become increasingly involved. The proper technology is available, which can map, price and plan for the outbreak of poverty and its consequences. Administrative data, which is beginning to bear down on these issues, both in the private and in the public sector, can now prevent rather than cure the problem—and, as we all know, prevention is better than cure.
The combination of the high priority put by the Government on the abolition of homelessness and the increasing role of technology can and should improve the productivity of the sector and, naturally, the lives of those affected.