The subject of housing is never far from the headlines as chronic shortages and high costs conspire to cause problems across the country, not least in Greenwich borough. Jeremy Corbyn weighed in last week with strong views against how some regeneration plans have been undertaken.
After Corby’s interjection last week, Greenwich Council’s Deputy Leader Danny Thorpe (Labour – Shooter’s Hill ) popped up to proclaim the work Greenwich Council are doing with Woolwich estate regeneration.
It was pointed out there has been a big reduction in social housing. Nearly 1000 social homes are going with just over 500 “affordable” homes (35% of 1600) for replacement, and “affordable” cost levels are much higher than social home levels. His reply was concerning:
He is wrong when he says there isn’t a loss in social housing.
It’s a big mistake to make. If someone in charge of regeneration at Southwark or Haringey made such a howler, given the prominent coverage of schemes there, it would probably make the national press.
Social v Affordable
It helps here to differentiate between “affordable” and social rent and why the difference is so important. “Affordable” is placed in quotation marks when used in relation to housing as quite simply it isn’t, for many at least. “Affordable” rents are usually far more expensive than social rents. “Affordable” homes to buy are beyond the reach of many. The Guardian wrote a piece highlighting the differences.
Social rent levels are sometimes around 50% of the “market” rate, though often 33%. “Affordable” is based at 80% of market levels.
And when that “market” rate is at bubble levels due to continual government intervention to push up rents and house prices (so it’s hardly an actual fair market rate), the 80% total can be very high.
The BBC’s rent tracker has low cost “market” rents in Greenwich borough at £1,100 a month. That’d cover a poor quality one-bedroom flat, meaning social rent levels based on that “market” rate would be £550 a month if using the 50% measure. Slightly less than £400 if we take the 1/3 level.
Someone on minimum wage, working 40 hours, will earn £300 a week and £1200 a month before tax. A social rent level at £550 is still taking a hefty chunk of their wages.
Now with “affordable” at 80% of “market” rents a one bed “affordable” flat would cost £880. Someone on £1,200 a month full time work cannot afford that. People bringing home £20k a year would struggle, and remember that’s just at the low end.
Hence the difference between someone being able to afford to live off their wages or not. The gap between social and so-called affordable rent levels is crucial.
There’s little excuse for confusing the two tenures especially in such a role. To state that there hasn’t been a reduction in social housing with the “One Woolwich” plan is wrong.
It’s such a basic difference in housing that anyone even slightly involved in housing should know.
If someone doesn’t know then it could mean much truly affordable housing, aka social housing, not being built.
But this follows similar recent patterns from Greenwich council. It’s telling that a Cabinet report from last month saw the council pat themselves on the back about “affordable” housing and do not mention social housing levels provided.
Maybe that’s because numbers are so low. The union GMB researched numbers across London and Greenwich Council came out very badly. Just 8% of new homes were social housing last year. The seventh lowest out of 33 London authorities.
And so that brings us back to Woolwich. The “One Woolwich” scheme is demolishing 1000 mostly social homes at three estates – Connaught (now rebranded as Trinity Walk), Morris Walk, and Maryon Road.
Once again, it’s important to remember that 1000 mostly social-rent homes are being replaced with around 1,600 new homes, of which just 35% are “affordable”.
Basic maths should tell you that’s a net loss of lower cost homes even before looking into the difference between social and “affordable”. When social is factored in it’s a huge loss.
Other means to provide housing not being used
Are the Labour party and councillors in Greenwich generally aware? Are they trying to avoid questions by focusing on “affordable” numbers and hoping people don’t see the social home loss?
Whatever it is, housing provision that the low-paid can afford (and even those on average wages is minimal and shrinking further with these schemes. Greenwich Council’s hands are tied by central government on directly borrowing to build new homes (though they can use Meridian Homes to bypass restrictions) but that doesn’t excuse approving big reductions in social housing nor claiming it hasn’t gone down.
And they’ve hardly tried to use alternative measures to get around central government caps such as using their arms-length development company Meridian Homes since its creation in 2011.
There’s also the issue of how Greenwich Council are using millions of right-to-buy income which is exacerbating the problem by buying homes off the market at three times the cost of providing homes via Housing Associations or Meridian Homes. And buying off the market does not increase housing stock numbers with knock-on effects.
Central government are at fault for many housing problems however Greenwich Council are exacerbating the issue. To have the council’s deputy leader, in charge of regeneration, state no reduction in social homes when there is whilst possibly confusing social and “affordable” housing levels gives an insight into why things are going as they are.
The council then compound the issue by not using alternative ways to improve social housing provision. Will the right wing in the local party win out or those who support more genuinely affordable housing?
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