Two of the government’s highest priority policies related to housing are suffering most from spending cuts: housing welfare support and planning and development.
Over the five years of this parliament, spending by local authorities on housing-related services will have fallen in real terms by a third. This doesn’t include council housing, which is now self-financing. But the remaining housing services have seen a far bigger cut than applies to council spending overall. Excluding housing benefit payments, English councils will spend 16% less in real terms in 2014/15 than they did in 2010/11, but housing’s cut is more than twice that, at 34%.
Housing welfare support has been cut by nearly half in real terms over the past five years (46%). This was what housing professionals warned would happen when the government ended the ring-fence that protected Supporting People funds. Given that welfare spending uses up half of councils’ housing expenditure, it was bound to take a big hit. The consequences, however, have been seen in more rough sleeping, the closure of women’s refuges and a host of other impacts on the most vulnerable.
The budget for planning and development has also been cut by 46%. We don’t know where the cuts have fallen, but it’s very likely that both strategic planning and development control (which deals with planning applications) have been cut substantially. This carries two messages for government: one is that developers may be at least partially right when they point to delays in the planning system for holding up new housing development; the other is that it’s unfair to blame local authorities when the cuts are imposed by central government. It also raises a question: shouldn’t more of the cost of planning services be borne by fees for planning applications?
Three other priority areas of housing-related work have been better protected over the past five years. Homelessness has suffered only modest cuts, no doubt because of the sheer pressure of demand and the extra cost of temporary accommodation that’s provided by private landlords (placements in private temporary accommodation and in bed and breakfast hotels have both more than doubled since April 2010). Another area that has been cut at about the average rate is strategic housing work. But within this there has been a big shift away from private sector housing renovation towards housing advice and housing strategy.
Meanwhile, work on monitoring standards in the private rented sector has actually seen a small increase. This may reflect the increased use of licensing and accreditation schemes for which councils can charge a fee, as well as the fact that private renting has doubled in the last decade. But at only £40m a year this increase is tiny given the growth in the sector (it works out at less than £10 per year per tenant household).
None of the figures above relates to council housing, which has seen a reversal in its fortunes over the past five years. The 167 councils that still have their own housing stocks saw expenditure fall by 19% in real terms over the three years to 2012/13, when self-financing began. But during 2014/15 they plan to spend £600m more than they did two years earlier, now that they can keep and reuse all the income from their rents. It would be surprising if this modest growth didn’t continue into the next parliament, at the same time as spending on councils’ other housing services is likely to fall even further given the general cuts in government support grants.
After five years of a coalition government, the outcome for councils’ housing services is very mixed, but the biggest cuts are certainly in welfare spending and in planning and development. Both are crucial to other high priority areas of government policy – health care and private housebuilding. Surely any objective assessment would judge these to be among the most unwise cuts of all?
Original post and comments: The Guardian Housing Network