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26 January 2005Printer-friendly versionEmail a friend

All talk and no bricks
Britain needs new homes - but the government just makes proposals.

by James Heartfield

The government's five-year housing programme promises to help everyone buy their own home. Tens of thousands of new cheap homes are to be built, and housing association tenants will be allowed to buy their homes.

But the proposals are most remarkable for their modest ambitions. Housing completions are running at their lowest since the Second World War - at a time when demand for new homes is climbing. While Tory Harold Macmillan saw 350,000 houses built a year (of which two thirds were council-built), and Labour's Richard Crossman topped 400,000 (half private sector, half council), Blair's administration has bumped along at a dismally low 180,000 (mainly private sector) - not enough to replace the run-down homes, let alone meet growing housing need. Those shortages are pushing prices up.

UK housing completions 1945-2004

UK prime minister Tony Blair's eye-catching reforms are in reality a confusing mess of policy innovations designed to cover up this central failure. The special measures for 'affordable housing' - which are to be built by English Partnerships out of government funds, on surplus National Health Service land - are a way of trying to subsidise the less well off and first-time buyers without impacting on the market overall.

The government is afraid that a more extensive programme of public housing might burst the housing bubble. But the problem is throughout the market, not just at its lower end. The way to make more affordable housing is to increase the supply of new homes overall (whether through public or private development hardly matters), and to revolutionise building methods in the process - as James Woudhuysen persuasively argues in his book, Why is Construction so Backward (1).

The first two terms of Blair's government failed to address the need for new homes. In his first term, Blair contracted out much of his policymaking to lobbying organisations drawn from the professions. Breaking with 'old Labour' meant taking policy away from trade union leaders and the municipally based local Labour Party. Instead, the new clique that had won out in the Blair leadership looked around for the kind of people who were like them, socially and culturally.

People like filmmaker David Puttnam and radical lawyer Helena Kennedy were called upon to help draft new policies (only later did it become apparent that the prejudices of these middle-class campaigners were just too diverse to be worked up into a single political vision, and one by one, they were dumped or sidelined). In the case of housing, the government-recruited architect Richard Rogers, whose Urban Task Force report, Towards an Urban Renaissance stood, by default, as the government's policy throughout the first term.

Architects are not the best people to ask about housing, at the best of times. Having been made the scapegoats for the cheapskate mass housing of the 1960s, architects have reacted by retreating from ambitious modernism into a prissy, craft-dominated conception of their role as artists, rather than planners of buildings. Today, architects dream of making one-off arts centres, rather than mass housing. Richard Rogers' own architecture (Pompidou Centre, 1977; Lloyds Building, 1986, Millennium Dome, 2000) has been very forward-looking. But his views on housing are positively archaic.

Towards an Urban Renaissance is presented as an optimistic book, riding on the coattails of the regeneration of urban areas like Hoxton in London, Bilbao in Spain and other café society hang-outs. But this positive coating is very thin, and Rogers' instinctive distaste for building new homes quickly shows through. In the past Rogers had been more blunt, branding new homes 'the major destroyer of the ecosystem and the greatest threat to mankind's survival on the planet' (2). Towards an Urban Renaissance is more cunning, arguing that we should build densely, because this 'compact urban form highlights the value placed upon proximity and ease of contact between people'.

This is a phantom housing-boom
In fact Rogers' blueprint for the 'compact urban city' is at least 30 years out of date. The great majority of Britons do not live in cities anymore, but in suburbs (3). But still, like King Canute, Rogers set himself the task of holding back the tide. Rogers burdened policy with an outlandish target of building 60 per cent of new homes on derelict land; and policymakers drawing on Rogers' goal of social sustainability burdened developers with additional costs for amenities, such as schools and hospitals. The natural effect of all of these disincentives was that builders stopped building. New starts under New Labour were at their lowest since the Second World War. John Stewart, economist to the House Builder's Federation, calculated that, at the rate that new homes are being built, each existing home would have to stand for 1200 years.

One of the more perverse consequences of the low rate of new building has been a 'housing boom'. Except that this is a phantom housing-boom, because it means that the number of new homes is falling not rising. It is really a housing price boom. These price booms are driven by speculative investment, which moves from one sector to another. Three years ago it was the internet, before that it was emerging markets in East Asia. But even the IT boom led to real investments in cable and wireless internet access. The house-price boom is in danger of passing through without any new homes being built at all.

Two years ago, the luckless deputy prime minister John Prescott called a 'summit' in Birmingham to address the housing shortage. But Prescott's difficulty is that the anti-volume building outlook of the Urban Task Force pervades all the lower rungs of planning and policymaking. One rousing speech from Prescott is no match for the myriad of quangos dedicated to the cause of protesting, tying down and preventing every new development that is proposed. As a consequence, all we ever get is proposals for new building, without any new building.

The new five-year plan is more of the same target-mongering, without making the changes - in policy and in public attitudes - to get the job done. Characteristic of the lack of seriousness that the government has brought to the plan is the concentration on titles of ownership. There is nothing wrong with people buying their housing association homes, but that will only rotate the existing stock, not add to it. Most depressing, is the preoccupation with 'affordable housing'. This sounds very old school socialistic. But all it really means is homes on the cheap (the very problem that sabotaged the tower blocks of the 1960s).

The government has put in place complicated measures to separate these new 'affordable' homes from the stock of privately owned homes, such as putting clauses in the leases giving the government first option on sale. This is like having your cake and eating it: private homes, and public sector housing. But this arcane distinction is of little interest to most people, who would just prefer to have homes that they can live in. Isolating the additional homes from the market will only serve to slow down any market effect from new building. Lots more houses would bring prices down. Better wages, rather than cheaper houses, would address the problems young families face.

Back in 1996 then environment secretary John Gummer identified the number of new homes we need: four million by 2016. He said at the time that it was a conservative estimate. The increased demand is not, as the miserablists say, because everyone is getting divorced. On the contrary, it is because the workforce grew by twenty per cent over the years from 1985 to 2001, which makes for more wage-earners pursuing homes.

The tenth anniversary of Gummer's proposal is approaching, and the New Labour government has failed even to build enough homes to replace the ones that are falling down, let alone made a dent in the targeted increase. With the additional demand put in the system since then, we need five million new homes in the next 10 years.

James Heartfield is a director of Audacity.org.

(1) Why is Construction so Backward, James Woudhuysen, Ian Abley, et al, Wiley-Academy, 2004

(2) Cities for a Small Planet, Richard Rogers, Faber, 1997, p4

(3) 'The Future Of Suburbs And Exurbs', Marcial Echenique and Rob Homewood, in Report for The Independent Transport Commission, Martin Centre for Architectural and Urban Studies, 2003, p6. See Our Towns and Cities: The Future - Delivering an Urban Renaissance, DETR, November 2000, p17

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