By Jim O'Sullivan
Home ownership is a positive force for social good---good governance promotes it whenever possible. People and families turn houses into homes---which in turn become part of a sustainable, cogent and vibrate community; that is the outcome when housing policy is well intended. When other motives are introduced into the provision of such housing, particularly profit, that process is quickly reversed, not only to the detriment of individual people and families, but for the creation of those cohesive integrated communities as well.
The destruction of sound, well intended housing policy by the previous government, and for the most base of motives, may well be their worst legacy: indications are that the new government intends to simply carry forward that policy. By allowing this malign policy, that is designed around facilitating speculators profit from housing need and highly paid executives of “not for profit” private associations to empire build, it will become embedded over the next 5 years doing further damage to the fabric of society. The current housing policy is a crime against good governance and it is obvious that much of it was written on the back of a beer mat in taverns in and around the head office of the construction industry and/or wherever money shifters, party hacks/supporters and empire builders gather.
The story of social housing in modern times is relatively straight forward. Historically, housing was used by the landed gentry to maintain control over their “tied labourers” who worked their lands. (It was common practise on the large estates in Ireland for such workers to be routinely moved from one cottage to another throughout their lives in order to both emphasis their powerless position and the fact that they had no right to “own” anything of value. A truly heartless action which ensured that the cottage remained merely a shelter from the elements and could never really become a “home”.)
As the industrial revolution took off, workers moved to towns and cities and their housing needs were met initially by landlords. Conditions were generally very poor with large families living in squalid conditions which led to serious health and other problems arising. “Model villages” were built by industrialists such as Titus Salt and George Cadbury to house their workers and provide social amenities. There were often significant restrictions for living in these “model villages” with the possibility of eviction continuously hanging over workers. Charitable organisations also collected money and built social houses in some major cities but the reality was the same for the vast majority---they had no right to a roof over their heads and were beholding to others in order to keep their families housed. In Britain, this situation would not change until the introduction of the “Welfare State”, post WW1, which included housing as a basic right and responsibility for provision moved to local authorities.
Ireland saw movement on the issue slightly ahead of Britain. Land in Ireland was mostly in the hands of protestant, British oriented landlords, while the tenant farmers were Catholic. These small tenant farmers agitated for the right to buy-out their holdings. This was fuelling nationalist sentiment and the British government relented in an effort to counter this. With this development it became necessary to provide social housing locally so as necessary workers could live close to where they were needed. Local government built 45,000 social houses for farm workers up to the outbreak of WW1 and this rural bias continued until the 1932 Housing Act. Social housing output rose significantly over the following decades and the positive impact on the quality of people’s lives was immense.
And there was a further refinement to come in housing policy that was to have arguably an even greater impact, not only on individual lives, but on the community as a whole---the right-to-purchase scheme. By 1990 this scheme saw 171,000 families own their council houses. Right to purchase also created relatively even distribution of home ownership and housing wealth across the social spectrum. The level of home ownership in Ireland was amongst the highest in Europe and this probably stands as the greatest single achievement since independence.
This is more so in that the provision and ownership of homes was identified as being of great social value by a commission set up by the government to investigate this issue. It is clear that the selling off of council houses was driven solely by a policy whose intention was to share wealth and was supported by politicians from the centre left including members of the Labour Party. It is a great testimony to the foresight of politicians of that era as research in modern Social Studies show conclusively that home ownership has positive social, psychological, and civic effects independent of the effects of income and these studies advocate a remodelling of “social welfare” from doling out money to meet immediate needs only to include what is called “asset-based welfare” where those on low incomes are given assistance to acquire “assets” such their homes and to save etc.
But all of this progress was too good to be true----enter stroke politics. The late 1980s saw the arrival of the new social model from the US---reagonomics---low-tax, low-spend economic policy. Social housing was the first casualty. While the government had budgetary difficulties there is no doubt that the attack on the provision of social housing was cheer-led by those in the construction sector who had become very close to political parties---and were their main financial supporters too. Over the term of the last government, this attack intensified to the point where even getting on a housing waiting list required the applicant to show that they were living below the poverty line.
This narrowed the list to those either living on welfare supports or with extenuating circumstances such as health or other needs. These changes meant that for many caught in a no man’s land between minimum welfare supports and the average industrial wage, home ownership was put out of reach in perpetuity. They were to be the permanent cannon fodder to provide a captive customer base for the private speculators and landlords who emerged in their thousands at the time that the infamous “Galway tent” was put in place to “hear confessions”---and do other nixers in return for party donations. While the government was taking people off the waiting lists on the basis that they were deemed capable of looking after themselves, they introduced very generous rent allowances for those in private rented accommodation. It is very obvious who the main beneficiaries of this policy are.
In order to remove the anomaly whereby a person allocated a council house could apply to buy it, while those caught up in the private rented sector could not, the right-to-purchase had also to be dismantled. This was done by the introduction of private housing associations to replace local authorities in the administration and running of social housing. It is important to note that despite the fact that those pushing the new policies repeatedly used the words “housing provision” when discussing these associations, these entities actually brought nothing to the table apart from distancing government from any furore that might erupt when it donned on people that the right-to-purchase was being removed by stealth. All the properties now under the control of these private housing associations were built with state funds---the association collect rents on the one hand while on the other they refuse to offer to their now tenants the right-to-purchase, the right open heretofore to all council tenants. In addition, the estates that they oversee are comprised totally of tenants. This is contrary to good housing policy which advocates a mixture of house type and tenure. Private, unaccountable entities were now to take charge of one of the most vital social policy areas---housing.
And this imperative to deny those on low incomes the right-to-purchase a home continues to impact on polices designed to alleviate the current position where thousands are caught up in negative equity with mortgages that they cannot service. Under a new “Mortgage to Rent” scheme struggling families will give up their home to the bank that holds the mortgage. The bank will then sell this to a private housing association, not the local authority or other state agency, at the current market rate, not the value of the original mortgage. The bank will absorb the loss incurred from selling the property at lower than its original value. There is no mention of allowing the tenant to purchase the house back should they recover from their current economic difficulties. The house it appears will remain the property of the private housing association, as will all the rent received, ad infinitum.
All of which begs the obvious question, why can the banks not offer the right-down to the family directly? If the banks are willing to right-down why is a private housing association being allowed to step in to reap the benefits? In a situation where a government was really concerned with the wider issues involved, and particularly with the known massive benefits to the community in general of home ownership, surely allowing the intervention of private housing associations would be relegated to a highly undesirable last option. Once again we see sectional interests being favoured----and make no mistake, private housing associations have become mayor lobbyists in the whole housing area as they seek to grow their empires with little or no regard for the consequences for the community generally.
On the announcement of the new scheme the head of policy at private housing association Cluid, Simon Brooke, boasted, “Last year the Government placed housing associations at the heart of social housing provision”. They did? I don’t recall any open discussion or consultation with the community on the matter. We need to remind ourselves again that “last year” the Labour Party had control of this vital area which should be central to any overall policy that seeks to make society fairer and more just. Assisting those that cannot, on their own volition, become owners of their own home adds greatly to the whole concept of “asset welfare” and has known huge benefits to society as a whole.
It is no surprise that it is the Mitt Romneys of this world who are currently bad mouthing home ownership, as opposed to renting, and again the reasons are clear----money and self-interest. Profit making is limited in the “buying” scenario, where as renting gives landlords and the like income in perpetuity. Over the life time of the house such landlords will recoup massive profits based on investment made. Romney never enters a discussion based on the benefits to citizens and society of high home ownership rates---probably because home owners turn out in higher numbers to vote---high turnouts do not favour the right wing.
If Cluid, or any of the other private housing associations, had any regard at all for the creation of a cohesive fairer society, they would recognise the malign impact of the only mainstream social housing model that they can deliver; one dimensional estates and dramatically lower rates of home ownership resulting in a community divided along “wealth” lines. They should revert to their only legitimate useful position---fund raising to provide housing for those that need highly specialised accommodation.
It is not possible to get anyone in the relevant government department to explain what is the benefit to the country of having these associations stuck between citizens and mainstream social housing---because there is none. It is purely an arrangement of convenience to assist the government get its new housing policy into operation---a policy that is totally designed to benefit the speculators, maintain the disastrous “low-tax, low-spend” fiscal model and which shows zero regard for the serious damage that is being done as we revert back to the one dimensional housing estates overseen by unaccountable private housing associations. This policy is nothing less than social vandalism and will carry a huge price for many citizens in the short and long term.
Another scheme which shows clearly that sound housing policy has been abandoned for sectional interest--- the “Rent to Lease Scheme”. In a pamphlet setting out the aims and details of the scheme, issued by the laughably named “Housing & Sustainable Communities Agency”, the preamble states;
“This arrangement will suit property owners and landlords who want to retain property as a long-term investment and have a long-term security of income, but who do not wish to retain responsibility for the day-to-day requirements of managing a residential property”
Clearly the department forgets what its primary responsibility is here, providing good quality housing and creating sustainable communities, as this mission statement is all about the interests of the property owners and the landlords. The pamphlet goes on to outline the extraordinary deal cobbled together for property owners having difficulty selling or renting empty houses that they had speculated on.
“Suitable properties can be leased to the local authority for periods of between 10 and 20 years. During the term of the lease:
• The local authority will guarantee payments to the owner;
• Payment will continue regardless of vacancy periods;
• The local authority will be responsible for day-today property maintenance;
• The local authority will be the landlord to tenants.
In addition, property owners who have leased their properties to a local authority will:
• Have no rent collection or rent arrears obligations;
• Not incur advertising or administrative overheads;
• Not be liable for the Non Principle Private Residence (NPPR) charge;
• Have no Private Residential Tenancies Board”
What a deal----for the party hacks and supporters. And what of the tenants? Well here’s what they get.
I met a family a few weeks ago and they related their story. This family, comprising parents and two very young children, are surviving on Jobseekers Allowance supplemented by a few hours part-time work. They were living in a one bed-roomed apartment and had been on the Council waiting list for a number of years. The local authority contacted them and offered them a house under the Rent to Lease Scheme. Initially they were delighted with the offer until, at interview, it was explained to them that the house in question is on a 15 year lease and after that period the property will be returned, “vacant-possession”, to the property owner---in short they will be evicted.
Here we have a young family who will raise their children in their new neighbourhood, send them to the local school, make friends and neighbours, in short become part and parcel of that community, and after 15 years they will be evicted and forced to move to gods knows where to start all over again. How can such a house be turned into a home? Can’t you just see Rachman and his political servants in that Tavern jotting down the details of this little scheme that totally disregards the impact that it carries for the families involved---not to mention the impact on the so called efforts to create “Sustainable Communities”--- all to protect their interests? It matters not to what lengths must be gone to, protecting the interests of the golden circle is paramount it seems. Is it possible that politicians signed this scheme into law without even a blush to the cheek?
What this does tell us at least is that Housing Policy is now not about the interests of those in need of housing support or in creating sustainable communities---look up the fate of Part V of the 2000 Act following sustained lobbying from the vested interests---it is about bailing out speculators and landlords. And the “new” government has indicated that it intends to carry forward this so called “housing policy” It should be noted here again that the Labour Party has this portfolio now, initially in the hands of Willie Penrose---who failed to even answer correspondence on the matter--- and now by Jan O’Sullivan---who at least has replied via her assistant but who has given zero indication that either she or Labour have any problem with the existing policies.
We have now come full circle only this time it is not interloper’s treating people like serfs. But a government in a so-called republic segregating and discriminating against citizens along money lines. Like the laisse-fare ideology that guided Victorian values, the populous are regarded as nothing other than being there to be exploited and used.
I’m away now to have a root around the thatch---I like to be ready.
P.S. As mentioned heretofore, I have entered correspondence with new Junior Minister Jan O’Sullivan on this issue and will copy this article to her and invite a response to the points raised. It is long past time that the community, not just speculators, developers and others, had the opportunity to engage in a discussion on this vital matter. A copy will also be sent to Cluid.