Yesterday marked the close of the consultation on the Mayor of London’s draft London Housing Strategy, and so Z2K was been hard at work finalising our response. Overall, our view is that this strategy is a big disappointment. There’s just no way the very limited set of actions contained within it will address the Capital’s escalating housing crisis. That’s why we are calling on the Mayor to strengthen it in several key areas before he submits it to the Secretary of State for approval.
The strategy has a long and convoluted history. Boris finally published his first housing strategy in February 2010 – nearly two years after becoming Mayor. However, before the ink was dry, he decided the Coalition Government’s cuts to capital investment and policy reforms meant it needed updating and he published some “initial proposals” for consultation with the London Assembly. A “Revised” London Housing Strategy was published for public consultation in 2011, followed by another 18 months’ deafening silence.
The Mayor has argued that the delay this time was the result of the Government’s more welcome decision to devolve further powers to City Hall. But the suspicion lingers that the Mayor has been a little too pre-occupied with his political ambitions in Westminster to spare the time necessary to drive through the change of mind-set needed among his political advisors to come up with some real and lasting solutions to London’s housing crisis.
Because the truth is that the Draft London Housing Strategy is a very mediocre document. To be fair it makes a decent stab at describing the extent of the crisis, although even here it seems queasy at setting out honestly just how miserable are the conditions those at the sharp end are living in. But the only real solution it proposes is more housing for sale on the open market. No doubt, more homes are needed – possibly even the 42,000 a year the strategy suggests. But there is little recognition such an overheated property market doesn’t serve the interests of ordinary Londoners.
His refusal to join those calling on Government for a meaningful intervention in the housing market leaves the Mayor simply promising to spend even more tax payers’ money enabling the lucky few to get their foot on the property ladder through his “First Steps” scheme. Eligibility for that scheme will now be extended to those households on a joint income of up to £80,000 a year (up from £65,000 at the moment).
More worryingly for us at Z2K, is the intense pressure this puts on the Mayor’s remaining housing budget to deliver affordable housing for rent. The Government’s “Affordable Rent” policy just doesn’t work in inner-London. The rent levels are too high for most low income households to be able to sustain, at least without the help of Housing Benefit and that simply shifts the cost from his own budget to the DWP. The Mayor’s suggestion of “capped” and “discounted” versions of the Affordable Rent model simply adds even greater complexity to the regime.
Z2K’s response argues for a return to the “Target” rents used in the successful 2008-11 National Affordable Housing Programme. Obviously, that would require a big increase in capital funding for new housing and we argue the Boris should be making that case loudly and unequivocally, instead of pontificating on the merits of hypothecating property taxes back to London. The reality is that HM Treasury would never let a Chancellor countenance such a move. Whereas it would have no objections in principle to increased capital investment in new housing.
An even bigger failing in this strategy, however, is that it offers little or nothing to those trapped in the private rented sector, and not just those vulnerable single people and homeless families our advisors help. The end of this consultation coincides with news that average weekly rents are more than half of average weekly wages in 17 of the 32 London Boroughs and on average they rose by 7.9 per cent across the capital in 2012/13. Despite this evidence of the growing burden experienced by tenants in the private rented sector, this draft strategy sets the Mayor’s face against any restrictions on rents – even of the modest kind suggested by Shelter.
Z2K is a small voice in a big debate, but we will be lobbying hard to make sure the Mayor and his team know our clients and millions of other ordinary Londoners need a much better Housing Strategy than this one. You can read our full response to the consultation here.