Examination of Witnesses (Questions 120
- 139)
THURSDAY 25 NOVEMBER 2004
DR TIM
BROWN, MR
ALAN WALTER
AND MR
CHRIS WOOD
Q120 Mrs Campbell: Do either of you
want to add anything?
Dr Brown: I would make the point
that certainly in the first district-wide scheme in Harborough
what struck me very early on was that many of the applicants thought
there was far more stock in Harborough than there actually was.
I remember going to a tenants' forum meeting and they said, "Gosh,
the issue in Harborough is not the allocations process, we much
prefer the new system, choice-based lettings, it is the fact that
there is only 23 4-bedroomed properties in Harborough." The
fact that properties are advertised has made the issue much clearer
to tenants.
Q121 Mrs Campbell: I want to take
you back to the choice of who manages the housing stock. Is there
a real choice for tenants or for councils because if councils
are to meet the Decent Homes Standard and the Decent Homes targets
they cannot do it without extra funds? The Government have said
that they will not make funds available directly to councils.
Do councils have any real choice with it? Do they have any choice?
Is this why they are saying to tenants that if they vote no they
will have to come back to them and try again.
Mr Walter: There are many councils
that can. If Decent Homes is the driver—and the ODPM Committee
said it was a Trojan horse—then there are many councils
that can meet the Decent Homes standard using their existing resources
and yet some of those councils, Sedgefield being one of them,
are still trying to stock transfrer. I do not think you can look
at it simply on the basis of economics. There are councils that
can bring homes up to the Decent Homes Standard, that is what
the agenda is meant to be and yet they still want to get rid of
their council homes to a private landlord. That does not make
sense. In that situation there is a choice for council tenants
to stay with the councils, but that choice only means anything
if council tenants understand what those choices are and they
have access to an argument that says the council can meet Decent
Homes and you can remain council tenants. In lots of areas they
never hear that case.
Q122 Mrs Campbell: Can I just put
to you the question that was put to the tenants of Cambridge City
Council who have just had a ballot on the transfer of housing
stock. They are able to meet the Decent Homes Standard without
having to do any public borrowing, but they had set two standards.
Apart from the Decent Homes Standard, they have a higher Cambridge
standard and what they were asking tenants basically was do you
want to go for the higher standard, the Cambridge standard, in
which case it will mean housing stock transfer, or do you want
to go for the lower standard. It seems to me that is offering
choice, is it not?
Mr Walter: As long as tenants
are clear how the different elements fit together. There is a
number of different issues. There is what extra work is involved
in the higher standard, what the benefit is and how much extra
money that will cost and what the timescales are if you either
stock transfer or if the council keeps the stock. There are many
councils that could meet the Decent Homes Standard and retain
their stock using the existing resources but maybe not by 2010,
maybe they could do it by 2011-12. The way it is portrayed to
tenants is that it is a black and white thing: either you stock
transfer, in which case you will get gold taps, or there is going
to be Armageddon. In terms of Decent Homes plus or whatever local
authorities call it, it may be that the extra benefit could be
achieved in 2012-13. What tenants need to weigh up is those different
elements, the amount of work, the amount of improvements they
are going to get and the timescales and how much they stand to
lose by whichever choice. In Grimsby, where the council by its
own admissions can meet the Decent Homes Standard but it said
it wanted to do more than that, the kind of work that was outside
of its ability if it retained the stock were things like putting
in extractor fans or repaving paths. If it had been explained
to tenants that the fundamental improvements to their homes would
be done but maybe some of the more peripheral work might take
longer, that is a very different set of information on which to
make choices than if you are told it is either/or and it is privatisation
or disaster.
Q123 Mrs Campbell: I understand that
you clearly have some difficulty with the ways in which the choices
are being presented to tenants and we could discuss that further.
If a council is not able to reach the Decent Homes Standard except
by extra funds which obviously are not going to be forthcoming,
what choices do councils have if tenants reject the options that
are put forward to them?
Mr Walter: Government policy can
be changed. The fundamental responsibility of a local authority
is to represent the interests of its electorate, not to represent
Government policy to tenants. For instance, in areas like Camden
where the Government allocated £283 million of public money
to the council but only if it set up an arm's-length management
organisation is a reasonable thing to do where the council, tenants
and the MPs have joined together to exert pressure on the Government.
That seems to me a normal democratic process. In Birmingham where
they voted two to one against stock transfer and the Government
has said it would write off debt to the tune of £650 million,
I think again MPs and tenants in Birmingham were right to say
that if homes are not sold then that money should be made available
to the council to write off debts if they keep their stocks.
Q124 Mrs Campbell: Basically you
are arguing for choice, are you not? You are saying that the legislation
should be changed so that tenants can have real choices.
Mr Walter: I think there are two
fundamental principles here. The choice depends on there being
a fair and balanced debate, which there is not, and a ballot in
every instance, which there is not. Secondly, all the choices
should be available. We are not asking for the moon here, we are
asking that the money that belongs to council housing is ring-fenced
and re-invested back into council housing. That should be the
parameters of a choice debate.
Q125 Chairman: Are there cases where
it is sensible for tenants to choose to move over?
Mr Walter: I think that would
be for individual tenants to decide. We have no problem whatsoever
with tenants being given the opportunity and given more choices.
All the evidence is that if that was done the vast majority of
tenants would choose to remain with the council and get their
improvements that way, but if tenants voted in those circumstance
for a different landlord then that is democracy. As long as they
have heard the debates then I am absolutely comfortable with that
and it seems to me the Government should be as well.
Mr Wood: I want to offer a contrary
view. I think this is nonsense. This is my personal view. I am
not articulating the policy of Newham Council in any way. I do
not think tenants should collectively be given the choice of landlord.
My belief is that these are the State's assets to provide housing
for the current generation and for generations after. If the State
chooses that it wants to re-mortgage or re-finance in order to
bring this housing up to a standard and it has a responsibility
to do that, then I think who owns the property, whether it is
a housing association or the council, is not something that should
be offered to the tenants by way of choice. The only choice that
the tenants would have would be in the election where they would
choose between one manifesto or another. No one has asked me to
vote on the denationalisation or nationalisation of industry other
than when I go to the ballot box. I do not see why council tenants
are special or peculiar in some way and should be offered the
chance to be balloted or to choose on the ownership of council
housing.
Q126 Mrs Campbell: Would you think
they have a right to be consulted?
Mr Wood: Yes.
Q127 Mrs Campbell: What method of
consultation have you used in Newham?
Mr Wood: I would defend their
right to be consulted absolutely, definitely. In Newham we have
had, we call it, a commission dominated by tenants with some independent
people from housing associations and so on and so forth and they
acted rather like a select committee, calling people to give evidence,
housing associations, Defend Council Housing, and so on and so
forth. We did more traditional things, public meetings, newsletters
and so on, but we also commissioned a survey by MORI to do
a methodologically sound representative sample, as it were, and
the results of that were that people were saying that essentially
they wanted decent homes and their preference, as expressed in
the mechanism, was for the Arm's Length Management Organisation
precisely for the reasons that you have given, because of the
range of choices and options, PFI, arm's length management and
stock transfer, so that was the range they were given and they
chose what they felt to be the best of those three options.
Q128 Chairman: Is there not, Alan,
a logic in this position which says that given the fact that you
are saying that all this choice is bogus anyway, would it not
be much better just not to have it?
Mr Walter: Well, I do not think
the Government can pretend that it is committed to choice in public
services and then either run a choice exercise that is fundamentally
flawed and then when it gets into difficulty the professionals
in the field basically say, "Well, it's better not to have
it at all because we can't guarantee we're going to win it",
which is how this debate has been run. I think there is a fundamental
difference between a commuter on a British Rail train and a council
tenant and one of the fundamental differences is that actually
we have a legal contract called a `secure tenancy' and, particularly
in today's times where the private market is running absolutely
mad and is causing misery to millions of people, actually a secure
tenancy is worth its weight in gold and I do not think that the
Council or the Government should be able to take that away from
us without us agreeing to it. There are comparisons with people
at work. This is a legal agreement and it is up to the Government
to uphold those agreements. Firstly, I think the Government should
be consulting people about public services because they are our
services and we have paid for them, but, secondly, in the specific
case of council tenants, the secure tenancy is a legal contract
and we have a right to defend it.
Q129 Chairman: You say that the alternative
that is being offered is privatisation, but it is surely not,
is it? It is a different form of social initiative, is it not?
Mr Walter: I think this thing
about social ownership is an attempt to fudge. RSLs, registered
social landlords, are private companies. Now, if you turn the
clock back 20 odd years, I think Gerald Kaufman, at one of our
conferences, explained that when he set up the Act which introduced
housing associations, they were, by and large, and this is not
paraphrasing his words, friendly, cuddly, locally based, community-orientated,
specialist housing providers. That is not the case today. They
are multi-million pound, increasingly national organisations dominated
by the private sector and I think to call them "social"
is meaningless. The Government keeps saying that they are not
for profit. BUPA is not for profit, but if BUPA tried to take
over your local hospital, most people would think that was privatisation
and they would think that rightly. I think it is clear that is
what we are talking about at the moment. We have a long tradition,
a proud tradition, which I think has served millions of people
well, of public housing provided by the municipality and there
is a world of difference between that and what the Government
is trying to do. There is also a world of difference in practical
terms because, as we say to tenants when we get the opportunity,
"If you get transferred to an RSL, you lose your secure tenancy,
and this is not an academic issue, it means eviction rates by
RSLs are significantly higher than by local authorities, your
rents go up, and there is a loss of accountability because you
can't hold them to account". These are concrete, practical
issues and I think it absolutely justifies us in saying this is
privatisation.
Q130 Mr Heyes: Why would this be?
You have used words that the Government is false and dishonest,
that it is a charade, it is not real, but what is really underneath
all of this driving it, do you think? Why would the Government
behave in this way to present this as choice when really it is
disguised as something else? What is that other thing and what
is driving it?
Mr Walter: Well, I think they
present it as choice because they try and legitimise something.
Why they are so intent on privatising council housing, I think,
is a bigger question and I suspect it is because they believe
that private is good and public is bad and what used to be, in
many local authorities and for governments nationally, a public
service that politicians were proud of, I think, because of the
legacy of under-investment, has become an embarrassment that politicians
would like to get shot of, but the facts are that the economic
arguments do not stack up. The facts are that if all the money
from tenants' rent, from capital receipts, the money they are
spending on writing off debt and subsidising privatisation, if
that was put into council housing, then council housing would
be financially viable and Decent Homes could be met, so this is
a political debate, not a financial one, and I think the Treasury
has now accepted that.
Q131 Mr Heyes: It is this parallel,
the dogma, against what you say is a very logical and strong economic
argument. It does not make sense, does it, that dogma can dominate
in that way?
Mr Walter: Well, I think if you
look at what has happened with ALMOs, it really does expose the
contradictions because the argument that ministers have put in
the past has been that they need to lever in private money, but
actually increasingly, because they have been losing ballots over
stock transfer, they came up with the ALMO formula and now in
many metropolitan areas that is the only one that they have any
chance of getting through. ALMO expenditure is on balance sheets
and it is no different from the councils borrowing direct, so
it is clear that this is not about levering in public money. The
Government has a commitment to trying to change the way that council
housing is managed and the review that the ODPM is now conducting
into the future of ALMOs, explicitly looking at selling them off,
seems to us to vindicate our analysis that ALMO is two-stage privatisation
and that is the Government's end game.
Q132 Mr Heyes: Our inquiry is entitled,
"Choice and Voice". What does all of this do for tenant
voice? My thinking behind that question is that in my area where
the stock transfer took place very early, it seems to me that
tenant voice has been damaged by that because, remember, Chris
Wood referred to the democratic process and the bottom line is
that if you do not like the way the council is running the housing
stock, you can have change, and the removal of that and, alongside
it, the removal of the councillor advocacy role in dealing with
individual cases or collective cases of problems, all of that
has been taken way. To be frank, my view is that has damaged tenant
voice and I am interested in your thoughts on that.
Mr Walter: Personally, I happen
to be the chair of a tenants' association on my estate and I think
most tenants' associations know their ward councillors and most
ward councillors know their tenants' associations and you know,
when there is a problem, who to get hold of and, by and large,
there is a relationship, regardless of political party, that works.
I think, as you say, after stock transfer, and I think the same
is becoming true of ALMOs, the politicians hold their hands up
and say, "This has got nothing to do with us anymore. It
is a separate organisation". It was interesting, I think,
that the Health Secretary, John Reid, when he was asked about
the deficit for the Bradford Foundation Hospital, where I think
there are parallels, said, "This is a foundation hospital.
It's not my responsibility anymore", so I think that experience
is general. It is a way that local politicians can wash their
hands of what has been a major part of their responsibility. What
we would argue and what we would ask the Committee to do is, one,
that there should be some proper research into actually what has
happened with privatisation of council housing, what the experience
has been, and that research should be made available to tenants
who are having the question posed to them today in order to make
the choice more real, and, two, there needs to be some very clear
guidelines on the obligation of local authorities when conducting
these options of how they conduct it. It cannot be right, and
maybe the parallel with the Ukraine is a bit overstretched, the
idea that one side of the debate controls when the election is
going to be held. The Leopold Estate in Tower Hamlets, we expected
that the ballot would start this weekend, but we do not know,
and the Council will determine it and they will use MORI or other
professional firms to gauge not the right time democratically,
but when they think is the optimum time for them to win their
position. They can spend public money, unlimited amounts of public
money, and they have access to the names and addresses of electors,
whereas the opponents do not, even local MPs. David Drew in Stroud
tried to get a list of council tenants who were being balloted
over a stock transfer so that he, as their elected Member of Parliament,
could communicate with them, and other MPs have tried to do the
same thing and have been refused. Where local councillors have
asked for that information, they are democratically elected politicians,
and when they have attempted to express a view in areas like Stroud
and other areas, they have been threatened with the Standards
Committee. Now, that is happening more and more as the Government
becomes more and more desperate and it is clear that the strategy
is advice coming down from the ODPM to the Housing Task Force,
so I think for this Committee to say that choice means that there
has to be very clear guidelines as to how stock options and consultations
are carried out and there has to be a ballot in all cases, not
just using a MORI poll which one side can manipulate, but there
has to be a proper formal vote and a clear period when two sides
can debate and resources for both sides to debate and access to
the electors and access to public halls and translation facilities,
that would be a very helpful contribution. Also I think there
needs to be some research. We do not have any full-time workers,
so this is nonsense. One side has untold numbers of professionals
and the other side is fits it in between taking annual leave on
jobs, between taking the kids to school, caring for relatives
and doing the shopping, so this is a nonsense in terms of any
definition of choice, whether it is a British one, a Ukrainian
one or somewhere in between.
Q133 Chairman: Is Chris's argument
not the one though which says that both this Government and the
last one actually believe that councils should not run housing
directly anymore and that is what their policy is? Would it not
be just more honest just to implement that rather than go through
this game about choice and balance because we know what it is
all about?
Mr Walter: I think some politicians
have trouble being honest, so I think playing the choice game
is a fig leaf. I think also this Government has a problem which
is a legacy from the last Conservative Government which is that
the Conservative Government, for whatever reasons, made the mistake,
and I am sure everybody thinks it is a mistake, of giving tenants
a vote with stock transfer, so, unlike other areas of public services
where maybe majorities or minorities of users of those services
are for or against privatisation, council tenants today on stock
transfer, not on ALMOs and PFI, but on stock transfer do have
a vote. I can well understand why politicians want to remove that
right and where they are having trouble doing it, they want to
use every other advantage that they have to try and circumvent
democracy and rig the outcome, but it seems to me that what this
Committee is considering is whether it is right that tenants have
a choice. If it is right, then it seems to me that you have to
make sure that choice is real and not just a paper one.
Mr Wood: I just want to make two
points, one on finance and then the issue about the voice. I think
in Newham we cannot meet the Decent Homes Standard without one
of these options, but I would go further than that. Even if we
could, if we were awash with money that meant we could meet Decent
Homes in Newham without pursuing one of the three options available,
and I do not only want decent homes, but I want decent schools,
I want a decent environment, decent hospitals and so on, I think
that the Council could quite legitimately say, "Well, we
could meet the Decent Homes, but actually we want to put our investment
into schools" or some other service, "and there is a
means here available to us, stock transfer, PFI, whatever it is,
that is going to deal with our housing problem, so we can use
the resources available to us to deal with some of these other
problems". To me, that would be a legitimate choice to make
and on the macrocosm I guess that is the choice that the Government
is making about where it chooses to put its investment and I do
not have a problem with that; it is an eminently sensible thing
to be doing. On the question of voice, what has happened to the
tenant voice, I absolutely agree with David Heyes and I think
this has damaged the tenant voice. I think organisations like
Defend Council Housing have become very dogmatic and they have
become pernicious in some instances. We were talking before, and
I do not know the particular example of Tower Hamlets that was
quoted last night, but there are clear examples where Defend Council
Housing have simply scared people and they have raised concerns
that are not legitimately there, and people have been frightened
by some of the publicity and by some of the antagonistic nature
of the debate and the dogma that has infiltrated the discussion
and I think that has been damaging.
Chairman: David's point was a rather
different one, I thought, that the relationship between councillors
and the people that they represent has been damaged. On the one
hand, you are saying, unless I have got this wrong, that you are
in favour of the policy, you are acknowledging this is a consequence
and it is a problem, but I do not quite see how you have taken
David's point on that. Once stock is transferred, people cannot
go to their councillor and say, "I've got these problems
about housing. What are you going to do about it?" because
the councillor will say, "Not me, guv".
Q134 Mr Heyes: And that is what housing
managers, in my experience, now say to councillors and increasingly
to MPs because MPs are mopping up the problems that used to go
to councillors. "It's not your business, guv. We're an independent
arm's length organisation. We're not going to be as responsive
as we used to be when you had some power over us through the democratic
process".
Mr Wood: I do not accept that.
My expectation is that housing associations, for example, operating
in my borough have a responsibility to provide good-quality and
decent services and, if they do not, then I want to know why not.
I do get councillors coming to me and saying, "I have had
a constituent in my surgery, and housing association X are not
doing their job properly", and we sort it out.
Q135 Mr Heyes: How do you sort it
out?
Mr Wood: It depends on the issue,
but with associations, the basis of the relationship is that they
want to be in the favour of the local authority and there is a
partnership arrangement there. I write letters, I pick up the
telephone, I talk to their managers, and housing associations
are not driven by a desire to provide poor services. Generally
speaking, they all want to provide good services and they are
committed to the same ethics and principles that the Council have.
Q136 Brian White: So you have no
direct way of influencing them apart from the fact that your powers
of persuasion are that good, like an MP talking to a housing association
has the same powers available and they cannot force them to do
anything, but only persuade them?
Mr Wood: Yes, but how can a councillor
force something to happen in the Council. If a councillor rings
me up and says that there is a problem with a council tenancy,
then I solve it, but I cannot do them special favours because
they are councillors.
Q137 Mr Heyes: The question about
voice though, and councillors have an important role, in my view,
of advocacy on behalf of that third, on your admission, of people
who are not capable of using the Internet or using other modern
methods and they need someone to speak for them or to support
them and they have a very important role, but it seems to me that
that has been stripped out and that is an element of reducing
the amount of voice that tenants have. It might suit housing managers
to make this argument because the people who really get the freedom
and the choice and the voice in this new arrangement are the housing
professionals, the housing managers, are they not?
Mr Walter: And the pay rises!
Mr Wood: Well, the housing professionals,
I guess, yes, we are making recommendations and we are making
judgments, but the motivation for that is, as I said before, we
want decent homes. I am committed to people in the housing sector
having high-quality homes and high-quality services. Now, there
is a financial paradox here and the most sensible way to resolve
that is to pursue one of the options. My councillors are sitting
in judgment on my recommendation and I have not thought it out
of leftfield, but there has been a good deal of preparation, consideration
and consultation and it is a reasoned judgment, so I do not see
how in some way it turns housing professionals into Dr Strangelove.
Dr Brown: I think it is very easy
to have a debate around the Decent Homes Standard and a separate
one about choice-based lettings, but I think that the two are
linked. Choice-based lettings are leading to tenants and applicants
saying that the services that local authorities run are improving
no end. They then get told, because of a lack of a level playing
field over the Decent Homes Standard, "Your options are these",
and one of them often is not to remain with the council, yet you
get some very perplexed tenants and applicants, saying, "Well,
hang on a minute. You've introduced choice-based lettings and
you have done other things to introduce choice in the service.
Your services are improving and now you are asking us to move
away from the council", and there are a lot of tenants out
there who get very confused about the fact that services are improving.
Certainly one example I can think of is a group of tenants who
approached me who said, "Well, we don't want to go into a
debate about whether we go down the ALMO route or stock transfer
because the council has improved its services through things like
choice-based lettings in a massive way over a period of time",
so I think the issues are linked. The other point that I think
comes out from choice-based lettings, and I think it is both a
point that Chris and Alan have alluded to, is that applicants
and tenants are not just concerned about the Decent Homes Standard,
and I think there was the issue about what the standard is, but
when they are making decisions about where they want to live,
it is the quality of the area, it is the quality of the schools,
the quality of the healthcare and what the public transport is
like. We really need a decent neighbourhood standard as well and
that is what comes over very strongly in talking to applicants
about where they want to live, so I think the issue is of choice
and it is not a series of separate debates, but the debates overlap.
Q138 Mr Hopkins: Just taking up a
few points which Chris made, I used to be vice chair of a housing
committee 30 years ago and, in my experience, which may be old-fashioned,
local authority councillors ultimately took decisions and officers
gave advice, with officers there implementing those decisions.
Therefore, if a constituent had come to me with a problem and
I raised this with a council officer who said, "I'm sorry,
I'm not going to bother", I would say that the officer is
in serious trouble because we are elected and the officer is supposed
to do his job. Is there no difference, therefore, between that
kind of relationship and a housing association where, at best,
you can write them a rude letter?
Mr Wood: I think there is a difference,
there is obviously a difference, but I do not think that necessarily
means that you cannot get good services from housing associations
and you cannot resolve problems that tenants encounter. Levels
of satisfaction with housing associations, generally speaking,
are higher than levels of satisfaction with councils as landlords.
Q139 Mr Hopkins: There is no suggestion
then that we should forget about democracy and public services
and really let independent companies run everything because they
can provide just as good a service? Tenants have public accountability
through democratic elections. Are you saying that Government should
stay out of all these affairs?
Mr Wood: Well, I think that is
a debate for you guys and it is not for me. That is a political
question and this Government, and the previous Government, as
I said before, has set out its stall about public ownership and
management of housing services. Now, I am working within the parameters
which have been set by government policy. I have got to achieve
Decent Homes by 2010 and I am being offered three options. I am
consulting with my tenants and we are pursuing one that is going
to deliver quality homes.
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