How and why has the governance of Social Housing changed since New Labour came to power in 1997? Paper
The New Labour government came into power after a landslide victory at the 1997 election under the leadership of Tony Blair. He stated that the party’s purpose was to give fairness: fair rules, fair chances and a fair say for everyone (Clause IV of the Labour Party’s constitution 1997). New Labour adopted a philosophy called the Third Way; it placed them in the centre between capitalism and socialism, which was a very different point of view from Old Labour. They declared that under the Blair administration citizens of the UK would enjoy both an “active” and an “enabling” state and this approach would achieve a harmonious combination of “prosperity and social justice” for all (1997)
New Labour also took up a more pragmatic approach, and believed evidence-based policy making (EBPM) and partnerships were the way forward and would provide a more joined-up way of thinking. New Labour also adopted a new form of politics which has been labelled “Governance”. They believed doing this would enable them to work in the new global world, be more responsive to bottom-up policy, which would allow them to work closer with “local actors”, and would also place them better to suit the changing needs of the 21st century. However according to Rhodes (1994, 1996a, 1997 cited in Understanding the policy process page 95) this created the “hollowing-out” of the state and led to a more fragmented policy making.
Between 1997 and 1999 New Labour made no major changes to housing policy, until they introduced a green paper which set out their ‘vision for the 21st century’: Quality and Choice: a decent home for all (DETR, 2000a). This focused foremost on the encouragement of sustainable home ownership, secondly on the promotion of a healthy Private Rented Sector, and lastly the provision of a Social Rented Sector for those who ‘need help with the cost of housing’ (DETR, 2000a).
Also set out in the green paper was an agenda for ‘reform’ of the Social Rented Sector, which focused on Choice-based lettings, Decent Homes standards and transferring stock from Local Authorities to Registered Social Landlords (RSL) through Large Scale Voluntary Transfer (LSVT) which New Labour saw as the principal vehicle for improving the quality of the Social Housing stock. (Although the number of transfers has not been as great as government might have hoped, due to tenants’ ballot results.) In promoting LSVT the government believed that tenants having a say on who managed their property would feel more empowered and that decisions made at a local level would enhance social networks, reinvigorate local communities and also ensure that local needs were being met.
Many felt this policy said very little about increasing supply and that the government had set out their stall by the way they had prioritised their agenda, according to Malpass (2007). “This was perhaps the clearest official statement yet made that social housing was seen by government as exclusively a safety net, and no longer a tenure of choice”. He believed that the government were saying if people could access funds by any means then they must take their chances in the housing market.
There were a number of reasons why the government changed their focus from promoting Social Housing as a tenure of choice to a “safety net” for those who need it. For instance, there was the lack of Social Housing Stock (although almost 4 million households in the UK still live within it (Hills, 2007) which had be lost through the Right to Buy, the residualisation of stock, and also the reduction in the number of houses being built by Local Authorities (which fell from approximately 17,000 in 1990 to less than 400 in 2002); this is due to the fact that the government had recast local authorities from housing providers to housing enablers.
In Northern Ireland alone the NIHE stock fell from 141,200 (23.4% of the total housing stock) in 1996 to 93,440 (13.3%) in 2006 (NIHE Conditions survey, 2006).
One of the main transformations the government has made to the governance of the SRS was devolution in Northern Ireland, Wales and Scotland (to varying degrees). In doing this the government were allowing greater powers and resources to devise policies that best suit local needs, however many felt that it was just creating a more “differentiated and fragmented housing policy in the UK” (Hickman and Robinson, 2006). Passing power down to local levels, the government wanted to ensure that a more modern and holistic service was being delivered; therefore a White Paper was introduced, Modern Local Government ‘in touch with the people’ (DETR, 1998). A key element of the modernisation programme was setting out the guidelines for Best Value (BV) (which replaced Compulsory Competitive Tendering); the main aim of BV was to improve local government services through review and inspection.
The government has also introduced a number of other policies that have promoted sustainable communities and created mixed tenure communities. The New Labour government believe that creating mixed communities and prompting community cohesion is the way forward. According to the government, housing policies are only one factor in shaping wider housing systems and housing policy is integral to successfully tackling poverty and environmental issues, therefore should be set within a wider context.
Since New Labour have come into power there have been a number of changes in the social rented sector; stock has reduced in size; and the characteristics of tenants have changed both economically (by 2004-05, 34 per cent of all social tenants were from the poorest fifth of the income distribution) and socially, as fewer people see it as a tenure of choice. Also, New Labour has moved away from bricks and mortar subsidies and has moved more into Housing Benefit as the dominant housing subsidy.
There will be a number of factors that will drive up the demand for SRS, such as the change in household size (it is projected the average household size will fall from 2.55 to 2.47 by 2011). Also, economic effects that the “credit crunch” will have both on a microeconomic and macroeconomic scale, which many believe will lead to a greater need for Social Housing due to the rising number of repossessions predicted for the coming year, according to the Council of Mortgage Lenders (CML) (2008) which estimates that 45,000 properties will be repossessed this year, up from 26,200 last year.
Due to the fact that demand will continue to grow, the government will need to increase supply of the SRS by continuing to build. In Northern Ireland alone it is estimated that 6,000 new homes are needed each year whereas the DSD have planned and funded 2,500 per year for the next 5 years. Many, including the Chartered Institute of Housing Northern Ireland, believe that will only exacerbate the housing crisis and that there is a need for more social housing to be built.
Overall, from New Labour have come into power not only has the governance of Social Housing changed a great deal but also the sector itself has altered enormously, from the decline in stock to the change in its tenants and how it is funded. Many believe the financial and economic changes that are taking place not only in the UK but worldwide at the present time will have a huge effect on the increasing need for social housing and that the sector will see more changes in the future.