APPENDIX 12
Memorandum submitted by Professor Alan
Murie, School of Public Policy, University of Birmingham
PUBLIC AND
SOCIAL RENTED
HOUSING IN
ENGLAND, AND
ITS RELEVANCE
TO NORTHERN
IRELAND
The history of public and social rented housing
in England differs from that in Northern Ireland in important
ways. There was a much more active investment in public sector
housing in the inter-war years and local authorities remain the
key players in the provision of public sector housing although
in the mid-1980s housing associations developed the key roles
in the provision of new housing. There are housing associations
which had something of the role of the old Northern Ireland Housing
Trust, but never had as clear a role as the NIHT. However, there
are a large number of longer established housing associations
dating from different periods in the development of government
policy.
The public sector housing stock in England is
generally of a more mixed age, quality and design than in Northern
Ireland. There are more systems built properties and medium and
high rise flats, and a greater proportion of the housing stock
is older. These factors are important taken in conjunction with
the more recent history of public sector housing from the 1980s
onwards. In this period investment in Northern Ireland was significantly
protected from cuts and there was a consistently high level of
investment in new house building, and in maintaining the quality
of the housing stock. In England the new build programme was largely
eliminated and repairs and maintenance budgets were not sufficient
to prevent a decline in the quality and condition of the housing
stock.
Against this background public sector housing
in England has experienced a long-term decline in quality and
status. It has increasingly become identified with households
which are not able to access the owner occupied sector, with concentrations
of deprivation, and with management problems. The residualisation
of the sector is often referred to meaning a narrowing of the
social base of the tenure. The Right to Buy in England has contributed
to that process, and has disproportionately affected the better
quality properties.
The final element in the changing face of public
and social rented housing in England is the changing demographic
structure, with a shift from being a sector housing families with
children and providing long-term lifetime housing towards one
of housing smaller households, older childless couples, young
single people and couples with or without small families. Two
groups among the population are over represented in council housing,
young people under 25 and elderly people over 65. There is a discussion
of a demographic wave which has had an impact on the rate of which
properties become available for re-letting and is likely to continue
to have an impact in the future. Stable estates become less stable
because of a changing demography.
Taking all of these factors together the council
housing sector is much less stable and aspirational than it was.
It is more likely to be used for short-term coping strategies
in peoples housing careers and management problems associated
with higher turnover and vacancy generation have become important.
Rising affluence and the advantages associated with home ownership
have left the council housing sector as a second best tenure.
Changes in the private rented sector, also mean that for some
households that sector provides more choice than the council housing
sector does.
As a consequence of all of these developments
we are having to recognise that the dynamics of the council housing
sector are different than in the past. There are a number of alternatives.
The sector could decline in size and continue to develop as a
residual sector. This would acknowledge different management and
other challenges. Alternatively there is a need for significant
restructuring of the sector with a greater attention to quality
and investment levels, and with more concern for what households
want and what would make council housing competitive with other
tenures. The current debate about housing market renewal and the
actions taken in relation to stock transfers are more strongly
influenced by a view that public sector housing can be reinvented
as a high quality sector of choice, but that this is only achievable
with considerable investment.
The issues for Northern Ireland from this debate
are significant. Northern Ireland starts off from a better position
with a more modern, better quality public sector housing stock,
and without the same erosion of confidence in the sector that
has been experienced in parts of England. Nevertheless, it must
be assumed that some of the demographic and housing market changes
affecting council housing in England are also affecting Northern
Ireland. There is residualisation, demographic structure, and
the aspirations of more affluent households for home ownership
is important.
The advantages in terms of quality and condition
will only be maintained with consistent investment, and the need
to rethink and restructure the tenure will also be relevant planning
to take account of changing demographics and the demographic wave.
Recognising the competitive challenge from other tenures implies
continuing to invest in high quality public sector housing and
adopting policies that provide people with choice. Some of the
debate in England about pathways of choice to enable people to
adjust their housing circumstances without having to relocate
maybe particularly relevant in this context.
These points provide the background to responses
to some of the specific issues which may arise in examining the
effectiveness of current housing provision in Northern Ireland,
and especially questions in relation to social housing. In my
view the issues about quality of social housing are of enormous
importance, and Northern Ireland has an advantage at the outset,
but it needs to be very careful to continue to invest at sufficiently
high levels to maintain a quality which will make the sector as
attractive, not just to households with no choice. In a period
of rising affluence and with a preference for owner occupation
it may be that we should not anticipate a significant further
expansion of the social rented sector, but it is important that
any additions to the stock are of high quality and that the management
and maintenance of housing is organised in a coherent way.
In my view Northern Ireland has had an advantage
in having a strong single housing authority, and I am not convinced
that a large number of small housing associations is advantageous.
However, some degree of choice and diversity within the social
rented sector is an advantage. It does not seem to me to be desirable
that one part of the social rented sector has no knew properties
in it, and consequently the profile of the stock over time will
become increasingly older, and could become less attractive.
I would also have doubts about this approach
if housing associations tasked with achieving new building targets
are either failing to do so, or are doing this through the acquisition
of existing housing, rather than adding to the housing stock.
The pattern in England currently is to concentrate investment
through housing associations on an increasingly limited number
of associations that have large development programmes where there
are real economies of scale and a capacity for innovation. I suspect
that if this approach was adopted in Northern Ireland the concentration
of resources would be purely upon the Northern Ireland Housing
Executive. While this might be undesirable, it could be appropriate
to have a greater degree of focus and to include the NIHE within
the recipients of funds for new building.
The issues of low and changing demand in England
have called into question the standard methodologies for estimating
housing need. A new approach to housing market assessment introduces
different considerations. My view is that it would be appropriate
to pay more attention to evidence about how the market is currently
working, and to adopt an approach which is more vision based—What
kind of housing and what kinds of neighbourhoods it is intended
to create in Northern Ireland, rather than being projection based.
The projection based stock and flow methodologies have disadvantages
because they assume a continuity in trends, and secondly because
some of the quantification rests upon limited data or assumptions
which may not prove reliable.
A considerable amount of interest is taken in
the House Sales Scheme. Across the UK the impact of house sales
is lagged rather than immediate because purchases are by sitting
tenants, who would not have moved anyway. This means that the
impact of house sales may not be felt until 20 or more years later.
The decline in re-lets in Northern Ireland may impact particularly
heavily over the next few years. In this context it is important
to maintain a level of building which would keep the flow of lets
available at a level linked to demand. However, in reality this
would not be achieved by restricting the Sales Scheme because
the properties that then would be taken out of the House Sales
Scheme or the lower level of sales would not have generated vacancies
anyway. The key to balancing the impact of the Sales Scheme is
an appropriate level of new building.
In my view it is important to recognise that
the receipts generated by sales can be crucial in enabling this
level of new building to be achieved. The sale of a property that
would not have generated a vacancy for twenty years, could provide
a receipt which enables half of a property to be built within
the next five years. The impact of this on the flow of letable
properties could then be positive. We would also need to be sure
that the locations and types of property that were being generated
through this route were adequate. Essentially, the action that
is crucial is about the level of investment rather than the operation
of the Sales Scheme alone.
In England shared ownership schemes are seen
as an important way of bridging a middle-market between the mainstream
home ownership sector and social rented housing. The problems
with shared ownership in England are partly to do with the diversity
of providers and the complexity with detailed differences between
different providers. In this sense again Northern Ireland has
a great advantage in having a single co-ownership scheme which
is tried and tested and presents no problems to lenders and others.
It also appears to have been successfully targeted and can be
used to achieve mobility within the social rented sector. It would
seem reasonable to incur some level of expenditure on this scheme
in excess of that covered by receipts from the Scheme.
Finally in relation to decent homes, the decent
homes standard has been particularly important in England in demonstrating
a commitment to address the quality and condition problems in
the social rented sector. I do not believe that there are such
severe problems in Northern Ireland, but that should mean it is
easier to meet the decent homes standard in the public sector,
and this is a guarantee to tenants. The major hesitation in relation
to the decent homes standard is if it leads to properties which
might within a relatively short time become the target for demolition,
and it leads to short-term decisions to improve the condition
for which there is underlying demand. It would be important to
link the decent homes standard to a strategy for housing development
in the public sector, and to extend the approach to the private
sector in relation to the later. There may be difficulties especially
in rural areas and care would need to be taken that the standard
was an appropriate one for Northern Ireland.
June 2004
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