Housing emergency – bold, socialist measures necessary

Labour’s housing policies: a welcome beginning

photo IDuke/CC

photo IDuke/CC   (Click to enlarge: opens in new window)


Walking through the streets of Britain’s cities, homeless people sleeping rough are hard to miss.

Numbers on the streets are rising, and an estimated 235 homeless people died in the six months up to August this year. Shelter estimates that over 320,000 people are homeless.

Rough sleeping is on the rise, and meanwhile services for single homeless people and rough sleepers have been brutally slashed. Spending on single homeless people has more than halved since 2010, while rough sleeping has risen by at least 165% since 2010.

No one should be surprised that deaths of homeless people have risen by 24% over the last four years. According to the Greater London Authority’s ‘Combined Homelessness and Information Network’ quarterly report, rough sleeping in London rose 31% compared to the same period last year. This is an emergency that directly relates to cuts in funding from local authorities.

Drastic cuts to ‘drop-in’ provision and to the number of hostel beds make matters worse. Labour councils should take a stand against cuts and should fund lifesaving services by using reserves and borrowing powers while building a mass campaign demanding funding from government.

All these figures show just one visible aspect of a crisis that affects many more who live in fear of losing their home or live in inadequate or unaffordable housing.

Socialist housing policies

The housing crisis in Britain deeply impacts the working class and middle class. Housing policies could play a key role in winning the election for Labour if it is prepared to campaign boldly on a radical socialist programme. But Labour’s Blairite shadow housing ministers have resisted such an approach.

If Labour gives a voice to the anger at the crisis and supports struggles happening now, it can make huge gains. But it will need to take the Blairite brakes off.

Jeremy Corbyn has rightly argued that there can be no solution to the housing crisis that does not begin with a mass programme of council house building. He points out that in the 1970s, a total of 350,000 homes were built in a year – while now the figure is below 200,000.

In the 1970s nearly half of these were council houses on truly affordable ‘social rent’. Today hardly any newly built homes are council houses. The private sector has catastrophically failed; not enough homes are being built and they are not affordable.

Labour promises the biggest housebuilding programme for 30 years, but not the money to pay for it. The recent Shelter commission on housing – which even involved Tories – called for an annual spend of over £10 billion on social housing. The Labour Campaign for Council Housing calls for 100,000 council homes per year.

And while Jeremy Corbyn’s general statements point the way, the detail in Labour’s policy does not match up. Labour is committed to spending only £4 billion per year on new homes. That is what Labour was spending in government in 2008 – less in real terms, after inflation is considered.

And this is for ‘affordable housing’, not necessarily publicly owned, secure, truly affordable council housing with social rents.

‘Affordable housing’

The Tories have reduced the term ‘affordable housing’ to meaningless Orwellian Newspeak. Housing at 80% of market rent counts as ‘affordable’ in the government’s language, for example.

But rather than making a clean break from talk of affordable rents and focusing on social rent – the lower rent charged for council homes – Labour is talking about new categories of affordable housing such as ‘living rent’, affordable home ownership.

Instead of councils being given a duty to build council housing, we are told they will be given a legal duty to promote ‘affordable housing’. That means they would be able to fulfil their ‘duty’ without building a single council home.

While Labour’s Blairite shadow housing minister John Healey resists a serious commitment to a mass council house building programme, even the Financial Times wrote in a recent editorial: “The fact is that private developers, left to their own devices, will not build enough to meet demand, when the greatest need is for affordable rented housing in urban areas.

“It is not in their interest to do so, since the result would be lower house prices and land values, eroding their profitability… There can be no resolution of the housing crisis without councils building on a large enough scale to significantly increase the available stock for the first time in a generation.”

Labour has raised the idea of a new ‘English Sovereign Land Trust’ to help councils buy land more cheaply. Rather than trying to beat the market at its own game, the Socialist Party says that development land should be nationalised.

Labour has also raised the idea of creating a national infrastructure bank that could be used to support house building. We believe Labour should go much further: nationalising all the profiteering private banks and casino-capitalist finance houses which wrecked the economy, and consolidating them into a public ‘people’s bank’ under democratic working-class control.

Labour councils should set no-cuts, needs budgets, drawing on reserves and borrowing powers to enable essential housebuilding and repair. They could also begin municipal programmes of mass council house building on that basis. Corbyn and McDonnell should pledge that upon taking power they will reimburse any debts incurred by councils taking this route.

Safe homes now

The terrible fire at Grenfell Tower illustrated the class divide in Britain and the neglect of social housing. The response to the fire has been no better.

A series of fires since Grenfell have highlighted a range of risks, but far too little has been done to ensure safety. For example, Inside Housing magazine has revealed that even now, six out of ten social housing blocks with Grenfell-style ‘ACM’ cladding have not had it removed.

Labour makes good criticisms of the government. But Labour councils should do the vital safety work now and bill the government, rather than waiting on an inadequate drip-feed from the Tories.

At the same time, housing association tenants and residents need a democratic voice. Housing associations must be made subject to ‘freedom of information’ requests, and required to publicise fire risk assessments.

For private renters, Labour promises controls on rent rises, more secure tenancies, landlord licensing and new consumer rights for renters.

Labour points out that renters are spending £9.6 billion a year on homes that even the government classes as ‘non-decent’. Around a quarter of this is paid by housing benefit. This is a huge subsidy for substandard housing.

Yet some Labour councils have failed to prosecute any landlords for years. This reflects years of cuts. Councils should move now to use the powers they already have, including compulsory landlord registration, while fully funding housing departments to employ inspectors and advisors.

Private renting

And Labour’s rent control proposals will be welcome to renters, but fall well short of the protections offered in the past before Margret Thatcher deregulated renting. There is a big difference between controlling the rate at which landlords can jack up rent and ensuring that rents are set at a fair level.

In the past, tenants could take their rents to a tribunal to test whether the rent was fair. The tribunal could insist on lowering the rent. This system should be restored, under democratic control.

Labour also pledges to increase housing security by creating three-year tenancies. Before Thatcher’s changes there were secure tenancies for private renters that gave permanent security.

Labour should campaign to reverse all the damage done by Thatcher. It will be argued that this will reduce provision by the private rented sector – but if it will not provide secure homes, that is just another argument for more council housing.

Internationally there has been a rise in mass campaigns on housing issues in recent years, calling for rent control and renationalising privatised housing, and opposing evictions and gentrification. That reflects a wider move against neoliberal policies and the injustice and inequality of capitalism. Labour must break with the big business policies of the Blair years and base itself on radical socialist policies.

The fight for rent caps in Berlin

40,000 march in Berlin on 6 April against high rents, photo Sol- CWI Germany

40,000 march in Berlin on 6 April against high rents, photo Sol- CWI Germany   (Click to enlarge: opens in new window)

René Arnsburg, Sozialistische Organisation Solidarität (Sol – CWI Germany)

It is clear that rents are a primary social issue in Berlin. Wage ‘increases’ in recent decades have been so low they have meant a loss of real wages. But between 2009 and 2019 rents doubled in the city.

Berliners now spend up to 46% of their income on rent. Unfortunately, the 2015 rent control law did not stop rent hikes.

After the Berlin state elections in 2016, die Linke (the Left party) entered a coalition with the ex-social-democratic SPD and the Greens. It was clear it was entering an irreconcilable contradiction. For a long time the SPD has represented the interests of landlords and developers, and the Greens operate purely pro-capitalist politics.

Die Linke claims to be the party of the social movements, but has often acted against their interests. That has showed up most clearly in the discussion around rent control.

This summer, a draft bill from die Linke senator Katrin Lompscher proposed freezing rents for five years. The maximum rent was to be fixed at €7.97 per square metre, plus operating and heating costs – or or between €5.64 and €7.51 for older flats.

The current average price is around €7 per square metre. The law would have meant rent cuts for up to 1.5 million Berliners.

The real estate lobby and capitalist press let loose a storm. One headline was “The left is setting Berlin on fire.” The share price of one of the largest real estate groups, Deutsche Wohnen, fell several percent.

The working class in the city was very enthusiastic about this measure. On 6 April, 40,000 people took to the streets to protest against excessively high rents and initiate the first stage of a campaign for the expropriation of big landlords. This was followed by a nationwide debate on the expropriation of real estate companies.

Die Linke had to choose between standing on the side of the mass of the population and withdrawing from government, or capitulating to the landlords and developers.

Initial legislation in June promised some further controls on rent, but the bill for an actual cap on rents is not due till October. The united pressure of the capitalist media, the real estate owners – and die Linke’s coalition partners, the Greens and SPD – has so far been successful.

By the end of August, a new draft of the rent cap bill raised the proposed cap to €9.80 per square metre – plus €1.50 if the flat has been renovated within the last 15 years. This will allow substantial rent hikes in poorer neighbourhoods.

Even this cap only applies for tenants who prove they spend more than 30% of gross income on rent – excluding sky-high utility bills. And the SPD and Greens have made clear they intend to dilute these controls even further.

The fight against high rents in Berlin is like a boxing match. The last round dealt with the question of expropriating all real estate companies that own more than 3,000 apartments in the city.

An alliance called ‘Deutsche Wohnen und Co enteignen’ (Expropriate Deutsche Wohnen and Co) formed to force a referendum for an expropriation law. Constitutionally, this is possible – if hundreds of thousands of signatures are collected in a multi-stage procedure.

In surveys, up to 60% of Berliners agreed with the demand. In Germany as a whole it was 40%. The Berlin-Brandenburg region of service workers’ union Verdi supports the campaign.

The trade unions are central if the tenants’ movement is to succeed. The aim must be to address the employees in the real estate companies who are also tenants. The question of low wages and high rents are directly related.

The alliance has called for a demonstration at the beginning of October under the slogan ‘Cap correctly, then expropriate’, and makes it clear that a rent cap alone will not solve the basic issues.

Even the nationalisation of real estate companies alone is not enough to ensure the interests of the majority. This requires that these companies be democratically controlled and managed by the employees and residents in order to finally end the housing shortage in the city.