Liberal Democrats

Vince Cable, for the Liberal party, was the first mainstream political leader to warn of the coming recession. He proposed reductions in government spending, suggested that tax rises might be necessary and condemned the rise in house prices as unsustainable. His comments were universally criticised as alarmist - even by members of his own party and failed to win support at the Liberal Party Conference. The party manifesto reads well, calling for freedom and fair trade, suggesting that the economy should serve the interests of the people. Short on specifics strong on worthy statements, there is no mention of the difficult decisions that must be taken if the UK is to emerge from recession.

Does the Liberal lack of clear policies really matter? No longer strong even in the party heartland of the West Country, out of favour at local elections but still recording support of 15-17 per cent of the electorate in opinion polls, success in a general election would seem as far away as ever. There are vain hopes of a deal to be done if the next election produces a hung parliament, but will the remaining true Liberals sell their souls for the illusion of power? Perhaps the best that can be hoped for is a continuing moderating voice that may prevent wider excesses of power by the other two parties.


Sarah Teather: "I can't tell the people who come to my surgery that a Liberal Democrat Government will wave a magic wand and fix everything. But I can tell them, that step by step, brick by brick, we will rebuild this country's housing stock."

The Liberal Shadow Housing Minister is Sarah Teather, MP for Brent East (pictured right). Sarah rarely speaks about housing matters, doesn't answer emails requesting information and in their ‘Pocket Guide to Liberal Democrat Policies' they do not have a section on housing - the word ‘housing' is mentioned just four times. In her 3500 word speech at the LibDem Conference she criticised Labour and Tory policies and actions but offered no specific solutions or plans.

In general, the LibDems have said that they would:

• Provide more homes by increasing councils' planning powers over second homes and promoting schemes such as Equity Mortgage affordable homes and ‘Home on the Farm' which encourage farmers to convert existing building into affordable housing.
• Release public sector land to Community Land Trusts, so they can build ‘thousands of affordable homes'.
• End the tax on Council tenants' rent, allowing local councils to reinvest rent in building new social homes.
• Cut VAT on repair and renovation to encourage developers to repair and re-use empty buildings and brownfield land.
• Scrap bureaucratic quangos like Regional Development Agencies that Labour has allowed to take crucial decisions about where new houses should be built and give the power back to local communities.

Labour

Labour may be accused of bringing the country to its knees. The Prime Minister and the Chancellor rarely speak with one voice, both cabinet and party are divided on the causes of and the cures for recession and on how to tackle the mountain of public debt. Even the language is confused, there is no understanding that expenditure and investment do not mean the same thing. Using the NHS as an example, building a new hospital and purchasing the latest equipment is an investment.  Increasing the number of managers, nurses and support staff and paying them better may be worthy, even essential, but it is expenditure.

Equally words are used to disguise policies and avoid the truth. Building houses with public money supported by Section 164 Agreements and letting them at rents that do not provide a proper rate of return to cover interest, maintenance and administration charges is subsidised housing, not social housing.

The Housing Minister, John Healey (left), spoke in November at the Council of Mortgage Lenders (CML) conference. Some found his speech somewhat patronising - not only in reference to the lenders but also to members of the public who are in financial straits as a result of the recession:

"I think you could claim to have confounded Mark Twain's comment on bankers as ‘a fellow who lends you his umbrella when the sun is shining and wants it back the minute it begins to rain'. And this social conscience brings home to me what we're really doing - and reminds me of some of the human stories behind the repossession statistics. One of the saddest stories I've heard was from a couple who we couldn't reach in time. They pretended to their friends and families that they had sold their home - they were so ashamed of being repossessed. Borrowers are our friends, relatives, colleagues, neighbours. And houses aren't simply assets, they are homes for us all. I always find it salutary to look beyond policy to the people I'm aiming to serve. So I am asking you today not to lose sight of the human stories behind the statistics."

However, in spite of talking the talk, the noble promises given on the meeting targets for new houses and support for the unemployed and those who may be repossessed are very unlikely to be met. Quietly without the flourish of policy announcements savings are already being made, primarily through reducing the government payroll and avoiding virtually every new investment.

The Labour Party states the successes achieved through its housing policy:

• The Decent Homes scheme helped to deliver a £20 billion investment for major improvements in social housing conditions - lifting over one million households out of poor housing and turning round the £19 billion maintenance backlog left by the Tories in 1997.
• Over three quarters of all new homes now built on brownfield land, up from 56 per cent in 1997.
• Rough sleeping down by over two thirds and homelessness is at its lowest level since the early 1980s.
• Abolished stamp duty for people buying houses through one of the existing shared ownership schemes.
• Allocated government funding to buy up unsold properties to use as affordable housing.
• Establishing Local Authority Housing Companies, giving local authorities a greater role in building new affordable housing.  
• Announced a £1 billion package of support to help first time buyers get onto the housing ladder, help homeowners in difficulty, support the house-building industry and bring forward £400 million of government spending to deliver up to 5,500 new social rented homes over the next eighteen months..
• Extended the stamp duty holiday on properties under £175,000 to the end of 2009.
• Set a goal that from 2016 all new homes should be zero carbon.
• Making arrangements to allow local authorities and housing associations to start delivering a new generation of social housing.
• Announced a £600 million funding package to build more homes through unlocking sites currently sitting dormant.

But it's not al good news. Unemployment always continues to rise after recession has ended. It is likely to reach 4 million, including 1 million of school leavers and jobless graduates; how will they pay for housing? Smaller businesses, including many estate and letting agents and all the associated businesses will continue to suffer as consumers become even more cautious because they have even less income and less employment security.

Difficulties already extend to the commercial property sector where demand remains weak, vacancies are still rising and rents under pressure. Landlords are struggling to maintain occupancy, upward rent reviews are almost impossible to achieve, with the cost threat of rates payable on empty commercial property being a great incentive to nurture tenants.

Retail vacancies average 10% across the country but there are whole blocks of office and retail units vacant in the old industrial heartlands.


Conservative

There have been some interesting policy announcements by Grant Shapps, the Shadow Housing Minister. He agrees with the Government that the country needs more houses but is highly critical of course of much of Labour's actions and promises:

"Their big stick approach is failing:

• Home ownership is falling for the first time since records began.
• Mortgage repossessions and the number of people living in temporary accommodation have doubled since Labour came to power.
• 300,000 families with children live in cramped, unhealthy conditions and half a million homes are overcrowded.
• In 1997 the government announced that it would build 9,000 eco-homes - but they've managed just 900.
• Labour said they'd help those on lower incomes and yet they've built less social housing than we did ever year under both Thatcher and Major. As result the number of households on waiting lists has gone up by 60% under New Labour.
• This government said it would build 200,000 houses every year. But it fell well short and rather than addressing the reasons, they simply dreamt up an even bigger numbers - which they have no chance of delivering."

Grant Shapps has some strong plans. He proposes to dismantle centralised and regional planning authorities in favour of local decisions. He may well consider the over blown social housing quangos as an unnecessary cost with a reduced level of duties returned to democratically elected local authorities who face a local electorate rather than central government. Asked for his plans for the Private Rented Sector, his response was succinct - "Why interfere with investors who provide close to 2 million homes in England at no cost to the tax payer?"

At the Conservative Party Conference he said:

"We can do better:

• We're going to re-empower local communities to build more homes than this government can deliver.
• We're going to recast the relationship between target-obsessed central government and bring power back to local people.
• We'll incentivise local communities; so it's in their interest to create exciting new developments, built as a result of greater local democracy, not by crushing the very spirit of the democratic process.
• We'll start with an understanding that people have very real concerns, but that if we put the right incentives in place then they will act to improve their communities by creating more homes - for their children and their grandchildren.
• We'll engage local residents directly so they are instrumental in the ‘look and feel' of their new community, and they'll decide how the planning gain should be used to benefit of all.
• We'll scrap the government's flawed density targets which force people to live on top of one another and have resulted in a shortage of family homes - with all the resulting social consequences.
• The Government wanted to streamline the home-buying process, making it less bureaucratic and fairer. They forced HIPS upon us. They didn't listen when we said that HIPS are clumsy, ineffective and useless. And they had to bypass democracy to force them through Parliament. The experts ridiculed them, the industry doesn't want them; the market doesn't need them; the next Conservative Government - will scrap them!
• We'll abolish Stamp Duty for first-time buyers on homes under £250,000. 9 out of 10 first-time buyers will no longer pay any Stamp Duty and will help 200,000 young people realise their dream of owning their first home.
• Introduce innovative schemes to reward 5 years of good tenant behaviour with an equity share in their social housing.
• We will seek to extend the Right To Buy to those in Housing Associations and introduce measures to get the replenishment of our housing stock moving once again."

The Election

As Propertydrum goes to press we await the announcement of the Election date but we'll continue to report on what the parties say and we invite you to comment on current views and likely outcomes. We also invite any of the parties to talk to Propertydrum about their housing policies.

Email the editor: Sheila@propertydrum.com or telephone 01825 733843.

The likelihood of one of the smaller parties forming a government is miniscule right now but it pays to be aware of minority party policies - and they can be interesting.

The Green Party say they would:

• Increase the availability of affordable housing through the development of more social housing.
• Ensure that everyone is provided with housing suitable for their needs.
• Provide extra support to enable the homeless to get off the streets and into safe, comfortable and environmentally sustainable accommodation.
• Ensure that all new homes are built to high environmental standards and make the most of renewable energy sources, and ensure that more support is available for existing homes to be properly insulated.
• Give greater support to Housing Co-operatives and Co-Housing Schemes, through measures, including easier access to finance, to enable those on lower incomes to live fulfilled lives in their communities.
• Give greater protection to tenants by tightening the rules on unscrupulous landlords.

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