Memorandum by the Merseyside Civic Society
(MCS) (AH 75)
The material set out below is submitted on behalf
of the Merseyside Civic Society (MCS).
MCS is a charitable body with aims that include
the protection and preservation of the architectural and built-form
heritage and public amenity features of the Merseyside area, the
promotion of high standards of town planning, architecture and
design within the area and the safeguarding of areas and structures
of historic and/or public interest.
The submission includes an Executive Summary
plus a total of 66 numbered paragraphs in that contain substantive
evidence and expressions of judgement and opinion for consideration
by the Committee, together with two short appendices.
It is our view that a number the government's
policies are failing disastrously in Liverpool. We believe that
the failing policies include those that are aimed at the promotion
of access to affordable housing, the encouragement of stake-holding
through owner occupation, the regeneration of housing markets
via Housing Market Renewal and the creation of sustainable communities.
We further contend that much of this failure can be ascribed to
the wilful acts and omissions of publicly funded authorities and
The results have been described by the Government
Minister for Health, Jane Kennedy MP, in a statement in support
of residents fighting a Compulsory Purchase Order at an Inquiry,
as tantamount to "social cleansing".
1. Affordable Housing policy and funding
in Liverpool is directed towards the eradication of conditions
supposedly representing housing market failure, as allegedly evidenced
by reports commissioned by the local authority and HMR Pathfinder,
and accepted by the ODPM as the basis for providing major tranches
of public funding.
2. These conditions include high void and
vacancy levels, high stock turnover and large numbers of housing
units for which it is alleged that there is low demand.
3. On the face of it, the latest ODPM figures,
showing that Liverpool has the highest number of empty properties
of any major city (7.6% of total stock or approximately 16,000
homes), appear to support claims that these conditions pertain
and demonstrate a market failure to which a major public sector
intervention is required in response.
4. This level of empty homes is, after all,
grotesquely anomalous, being well over twice the national average
proportion of empty stock.
5. Furthermore, these empty homes are spatially
concentrated in the inner core of the city, hence the designation
by the government of Pathfinder status and the in-principle allocation
of hundreds of millions of pounds in public funding over a 15
year period. To date, the tens of millions of taxpayers' money
already given have mainly been used for the acquisition and demolition
of stock, often by agreement, but ultimately backed with the threat
of resort to compulsory purchase.
6. However, the figures that show Liverpool
to be blighted by high levels of empty housing only tell part
of the story.
7. They mask what appears to be an orchestrated
attempt by the local authority and registered social landlords
(RSLs) to engineer, or exacerbate, signs of market failure, in
order to assert eligibility for major government grant funding,
and to justify the acquisition and demolition of people's homes
against their will.
8. This is having many negative impacts
that are not intended by government policy, including a failure
to address rising problems of overcrowding and affordability.
9. The striking fact is that, of Liverpool's
15,964 empty homes, some 34% are owned by publicly funded bodies
(ODPM/Halifax/Empty Homes Agency Audit 2005).
10. Precise figures show that 5,426 empty
homes were in public ownership, either via the local authority,
registered social landlords (RSLs) or other agencies (Pathfinder,
11. As a comparator, Manchester, an equivalent
sized northern metropolitan authority (2001 Census population:
439,476 in Liverpool, 392,819 in Manchester), has only 16% of
its empty homes in public ownership, ie less than half the proportion
recorded in Liverpool.
12. The above audit reveals that the number
of voids in Liverpool City Council ownership is 80% higher than
that owned by the local authority in Manchester, at 1,877 compared
13. The level of voids in RSL ownership,
which are a mere 991 in Manchester, should be compared with the
figure of 2,530 in Liverpool. This is over 250% higher.
14. We would also ask the Committee to note
that, in Manchester, "Other Public Bodies" hold only
20 homes empty, whereas in Liverpool the number is 1,019. This
is a baffling 5000% difference. The identities of these property-holding
bodies are not specified in the data, but are thought to include
the New Heartlands Housing Market Renewal Pathfinder.
15. We would suggest that market differences,
though significant, are not enough to account for such vast disparities
between the levels of empty publicly owned housing stock observed
in the two cities. We contend that public policy differences at
local level must be playing a part.
16. There is a clear spatial correlation
between concentrations of empty property and high levels of RSL
ownership. In the Liverpool 8 district, which is blighted by large
numbers of substantial Victorian terraces and villas remaining
in a derelict condition, over 70% of all homes are owned by RSLs.
17. The raw number of empty homes is used
by the ODPM to assess the amount of stock deemed as being in "low
demand". It is not clear that this assessment takes proper
account of the power of public authorities to distort or manipulate
this figure by withholding their own stock from the market.
18. This is important. In a Parliamentary
Question, tabled by Louise Ellman MP, the Government was questioned
as to how it would know when market failure had been reversed
and the Pathfinder had succeeded. Its answer was simplesuccess
will be achieved when void levels reduce by about one third relative
to the regional averages. (See Appendix 1, Ministerial answer
by Keith Hill, 21 March 2005)
19. With a third of voids already in public
ownership, it is clearly within the power of the local authorities
and RSLs to play a large role in influencing when, or if, this
threshold is reached. As the Minister has set a target date of
2010 for achievement of this "success", there is no
immediate pressure to reduce void levels until then. For as long
as high void levels attract funding, and little scrutiny is made
(or demanded) of the provenance of these voids, the incentive
is not to release them.
20. In the past, the oversupply of empty
stock has been explained as a simple function of low market demand
in the city. Such conditions did, indeed, pertain in certain areas
until around five years ago, when the research undertaken to justify
calls for HMR took place.
21. However, as a result of many factors,
the housing market has been radically transformed. The factors
that have contributed to this transformation include steady economic
growth, European structural funding, a shift in planning policy
to favour brownfield development, the White Paper on Urban Renaissance,
the expansion of universities and retention of students, the conferment
of European Capital Culture status in 2008, the inscription as
a UNESCO World Heritage City, and the resulting growth of confidence
in the city's employment prospects.
22. The housing market now exhibits clear
signs of strong demand and undersupply. However, public housing
policy continues to be geared to low demand and oversupply.
23. This mis-match is now damaging the sustainable
renewal of areas such as Liverpool 8, where healthy market demand
and investment is being thwarted by the high level of RSL and
city owned empty homes, which are being withheld from the market
in the face of continued verbal and written requests by local
people and refurbishment specialists for their sale.
24. It is also damaging the ability of people
in need to access affordable accommodation.
25. The holding, by the public sector, of
large numbers of empty houses in such a situation is, thus, increasingly
unjustifiable. However, local and national policy has so far failed
to respond to this new market paradigm.
26. It is unarguable that there is an explosion
of acute housing need. Affordability and adequacy of supply is
once again a major challenge in Liverpool.
27. According to a recent report by homelessness
charity SHELTER, there are now 7,100 households living in unacceptably
cramped conditions in the city, to the detriment of these people's
health, education and life chances. SHELTER noted that racial
minorities were twice as likely to be affected by problems associated
with cramped conditions than the average for the population as
a whole. The report found children sleeping in kitchens, teenage
siblings of different sex sharing the same room, gross overcrowding
and other manifestations of undersupply affecting most acutely
the most vulnerable groups in society.
28. The housing authority accepts that there
is an acute shortage of larger homes being offered for affordable
rent or purchase. Only 1% of the available city council stock
is of four or more bedrooms. There are few of five, six or more
29. Booming house prices (rising by 22.5%
pa as opposed to a national rise of 12% pa in the last year, according
to the Halifax), have put previously affordable homes far beyond
the reach of people on average or low incomes. They have also
encouraged landlords to evict tenants and sell their properties,
or convert them to owner occupation, or refurbish them for offer
to higher value rental market segments.
30. As a result, there are now over 18,000
households on the City Council and RSL joint waiting list, the
consequence of a substantial increase in recent years.
31. Housing need is a major contributor
to deprivation in the poorest neighbourhoods of the city. For
instance, a recent report has shown the Princes Park district
to have nationally high levels of child poverty. Venmore Street
in Anfield is the most deprived "Super Output Area"
in England, number one out of over 33,000 SOAs on the latest government
Index of Multiple Deprivation.
32. Both these neighbourhoods are subject
to very high levels of void properties owned by the local authority
and registered social landlords. Both are subject to Pathfinder
funded compulsory purchase and clearance proposals.
33. As revealed on 5 October, in comments
made during a BBC TV interview by the Chief Executive of one of
the largest RSLs in Liverpool, David Bebb of the Liverpool Housing
Trust, the excessive level of empty housing held by the public
sector has arisen in part due to a "deal" done between
the local authority and housing associat-ions. The central feature
of this "deal" was to leave property empty, un-maintained
and boarded up, in anticipation of Neighbourhood Renewal Assessments,
which tend to identify streets with high void levels as unsustainable
and subject to market failure.
34. A transcript of the interview in which
the RSL Chief Executive admits to making a deal with the local
authority to leave viable homes empty and without maintenance
is attached as an appendix to this submission. The link is very
clear between this "deal" and the existence of ODPM
funded HMR demolition plans and the "uncertainty" thereby
35. We share the response of the interviewer,
Max Hutchison, former President of the Royal Institute of British
Architects, that it is "a national disgrace" to leave
five to six bedroom properties empty and decaying when public
funds are putting homeless families up in cramped bed and breakfast
36. A similar sentiment was echoed by respected
cross-bench peer, the Noble Lord Alton of Liverpool, when he wrote
to the Liverpool Daily Post to say "I visited the Lodge Lane
Regeneration Group in Toxteth, and their representatives showed
me, on the ground, publicly owned properties that have been allowed
to stand empty and decay. This is an absolute disgrace."
37. The NRAs commissioned by the local authority
appear to have taken no account of the ownership of these void
properties, or when they became void, and also over-looked the
level of investor interest from people making formal requests
to public sector owners to buy, refurbish and re-occupy these
38. These factors would have led to a different
conclusion regarding the sustainability of the stock and the viability
of the market than the NRA's reached. It is hard to avoid the
conclusion that a blind eye has been turned to the some of the
real influences that have been driving the decline of neighbourhoods.
39. The process through which public bodies
attempt to suspend and, consequentially, undermine the housing
market of an area, whose current tenure and type they seek to
define as "unsustainable", has been termed "managed
decline". Its main tools are eviction, dereliction and demolition.
40. Affecting the appearance of a failed
market serves certain interests of the local authority if ODPM
funding rewards failed markets. It is also in the interests of
the RSLs to collude in this affectation, providing they negotiate
a "deal" that is beneficial to them.
41. This is because an NRA that apparently
reveals market failure provides the grounds for the local authority
to activate additional compulsory purchase powers and funding
eligibility by declaring areas with high levels of vacant housing
"Renewal Areas", subject to, amongst other measures,
42. Justified on the basis of an NRA, substantial
ODPM funding via the local authority controlled Pathfinder is
then available to carry out acquisition, relocation, demolition
and site assembly, for redevelopment by Joint Venture delivery
vehicles that consist of the acquiring authorities, favoured RSLs
and selected national private developers.
43. The financial incentive is clear for
the partners that are set to benefit from grant funding and receipts
from new development on cleared sites close to the city centre.
44. What is less clear is the extent to
which the public interest is served in rewarding tax subsidised
housing providers to collude in leaving desirable, valuable public
housing assets empty and blighting otherwise sustainable streets,
while housing need grows ever more acute.
45. Furthermore, well tended, much loved
family homes are being acquired, emptied and demolished against
the will of their owners, at rapidly increasing public expense.
46. There a numerous grounds for concern
over the level of clearance relative to refurbishment that is
proposed on Merseyside and elsewhere. The Committee has already
heard these in detail and made clear its view in the Report on
Low Demand Housing earlier this year.
47. We will not rehearse them again here,
except to say that we warmly welcomed the Committee's balanced
and measured advice that the Pathfinders must be flexible and
responsive to market conditions, community views, historic value
and environmental resources, and must avoid the scheme becoming
seen as a repeat of the mistakes of the mass clearance programmes
of the 1960s.
48. But one headline that we would draw
to the attention of the committee, in addition to the fact that
Liverpool has more empty homes than any other city in England,
and over twice as many more in public ownership, is that an extraordinary
67.1% of its previously developed area is classed as derelict
land, according to the Audit Commission website, using ODPM figures.
The national average is 22.3%.
49. It is worth reflecting on whether mass
decanting and clearance of inhabited properties, and the holding
of others empty for many years pending demolition, is a good use
of land when so many already cleared sites exist and are in urgent
need of re-use, and, meanwhile, so much demand now exists for
50. The acquisition of private property
against the will of the owner is a serious invasion of individual
rights in a democracy that places great store on the defence of
such inalienable protections. It can only be justified by an utterly
compelling public interest justification.
51. The Public Inquiry into a Merseyside
Pathfinder funded intervention has just taken place (October 2005),
into the clearance of 367 homes in the Holt and Edge Hill district
in central Liverpool. As the Minister of Health, Jane Kennedy
MP, contended in her evidence to the Inquiry on 14 October 2005,
"there is no compelling case to demolish the area" selected.
52. She goes further and describes the policy
as one of "social cleansing". "Unfortunately, someone
has decided that the Holt area and the people who live there are
a blot on the landscape and need to be removed. In my opinion
the road realignment scheme has been widened into a scheme of
53. The abuse of legitimate powers for the
illegitimate purpose of "social cleansing" will undermine
rather than uphold the status of owner occupation, against the
express intent of government policy. It brings well-intentioned
initiatives into disrepute. It cannot be a good way of implementing
government housing policy.
54. Finally, it is becoming clear that replacement
homes being built under HMR are no longer within affordable reach
of the local communities they have displaced. The cheapest homes
in Clevedon Street, Liverpool 8, one of the first new build develop-ments
to result from HMR intervention, will cost £75,000 to buy
outright (for over 55s only). The next cheapest, for general sale,
are priced at £120,000.
55. The equity from homes purchased for
clearance will rarely cover this without incurring further debt,
not always a viable or desirable option for elderly or low-income
owners. There is no equivalent replacement for the large five
bedroom and above townhouses proposed for demolition nearby, in
spite of the acknowledged demand for, and lack of sufficient supply
of, such big family housing.
56. The situation for tenants "decanted"
or displaced is even more disturbing. Lacking equity to transfer,
earning power to borrow or rights conferred by ownership, they
are faced with a reduction in their housing choice and have little
leverage with which to oppose the policies of those (often RSLs)
upon whom they depend for housing. This throws them further upon
the mercies of social landlords with an increasingly dubious record
in upholding the interests of their tenants and neighbourhoods.
57. The ability of the local authority to
deliver such projects on a large scale in Liverpool is also in
grave doubt. An internal inquiry into to a failed demolition and
rebuild project in an area known as the Boot Estate described
the five year delay in re-housing residents displaced by demolition
as a "disaster", caused by officers having "insufficient
experience" in delivering major clearance and redevelopment
schemes. The final number of homes available for affordable social
rent in this development is a mere 70 out of 300-400, far below
that required to fulfil pledges of re-housing displaced tenants
back in their own neighbourhood.
58. There is understandable fear and uncertainty
amongst residents in areas undergoing Pathfinder funded "decanting"
and clearance that they, too, will be mistreated in a similar
way. Generating fear and uncertainty in vulnerable individuals
is not a desirable outcome of government policy.
59. Of course, the market cannot be suspended,
only distorted. The presence of the Pathfinder has led to entirely
foreseeable, but apparently unplanned for, increases in land prices
on the basis of unscrupulous speculation. This has inflated further
the genuine and desirable uplift caused by the city's wider economic
60. The Pathfinder has, thus, been forced
to radically reduce the number of acquisitions and demolitions
that it can currently expect to fund over the 15 year period,
from 18,000 to 11,000.
61. However, there has been no acceptance
that the original clearance programme, and the land packages of
which it hoped to acquire control was excessive and damaging.
Thus, empty homes already acquired are not being sold off, but
held in stasis in the desperate hope that funding will increase
even further, or the market will again contract. Blight is reinforced
and communities are left in Limbo.
62. The irrationality of a body set up to
aid market renewal continuing to hold on to property in the hope
that prices will fall will be clear to the Committee.
63. The fact is that homes in areas proposed
for demolition are now regularly valued independently at between
£60,000 and £180,000, even with the "scheme"
hanging over them. In a "no scheme world", the situation
required in law to be accounted for in CPO valuations, where the
blighting effects of the "scheme" are discounted, the
values can be expected to go up by around 30-40%.
64. Deliverability and value for money of
the Pathfinder vision is in serious doubt, but its damaging unintended
consequences are incontestable, and must be averted as a matter
65. As it stands, government policy will
inadvertently reward the agents of an artificially maintained
market failure, and is now leading to acute market distortions
that are making Liverpool's problems of homelessness, cramped
housing conditions, dereliction and neighbourhood decay worse
rather than better, at great cost to the public purse, and causing
lasting damage to the communities that the government wished to
66. In order to avoid further contradiction
of worthwhile government housing policy aims, we recommend that
the operations of the Merseyside HMR Pathfinder should be suspended
forthwith, pending a detailed review by nominees of the Committee,
with a view to effecting a controlled refurbishment and release
onto the market of thousands of publicly owned homes that are
currently being withheld from productive use.