Housing: No respite for the working class under London’s Labour Mayor

Pin It

Homes for Londoners

In December 2016, London Labour Mayor Sadiq Khan launched ‘Homes for Londoners’ – his much-touted draft of plans to ease the capital’s housing crisis. In May, while running for Mayor, he described the election as ‘a referendum on housing’, and his manifesto promised that 50% of all new builds in London would be what he called ‘genuinely affordable’. The destruction of London’s council housing estates – so-called ‘regeneration’ – would only go ahead, he pledged, with majority resident support, and only where there was no loss of social housing.

These were just some of his lies. His Affordable Homes Programme 2016-2021, and its accompanying Draft good practice guide for estate regeneration, are a hotch-potch of broken promises, weasel words and sops to the middle classes and better-off sections of the working class who aspire to own their own homes and whose votes Labour is desperate to retain. Meanwhile, it will accelerate the dismantling of social housing, making it easier for private developers to push through their plans and harder for residents of working class housing estates threatened with demolition to resist.Cat Wiener reports.

‘Genuinely affordable homes’: a charter for home ownership

This is Sadiq Khan’s vision of how to spend the £3.14bn allotted in the last Budget to build 90,000 ‘affordable’ homes. It sets out three kinds of tenure. In keeping with the Labour Party’s avowed aim to be the party of home ownership, the overwhelming emphasis is on helping better-off working households onto the property ladder.

Khan rightly dismisses the discredited use of ‘affordable’ to refer to properties rented at up to 80% of market rent, but his new definition of ‘genuinely affordable’ housing is equally dishonest. He expects nearly 60,000 such homes to be a mixture of, firstly Shared Ownership (a part-buy, part-rent option available to households earning up to £90,000 a year) or, secondly, available at a ‘London Living Rent’ (for those on up to £60,000 a year). This so-called ‘intermediate’ rent, set at a third of local average income, is designed to enable tenants to save for a deposit as a first step towards Shared Ownership within ten years. Providers are expected to ‘assess the ability and inclination of prospective tenants to save’. This is an option for ‘strivers’, not ‘skivers’, is the subtext.

There is a third option – the ‘London Affordable Rent’. This is the nearest the draft comes to providing anything like housing at a social rent – although this will be flexible and, it is repeatedly emphasised, the priority for builders and developers will be meeting the target for Shared Ownership and London Living Rent. Only 32,000 such homes are envisaged. There are more than 300,000 households on London council waiting lists.

Meanwhile, the promise that 50% of all new builds will be ‘affordable’ has been reduced to 35%. This is already lower than the paper targets for most London councils. In any case, developers have long avoided the drain on their profits from building any kind of home for ‘sub-market’ rent or sale by promising whatever the council asks for at initial planning stages and then arguing it is ‘unviable’. ‘Unviable’, in developer-speak, means anything that would cut into their guaranteed minimum 20% profits. In the £400m redevelopment by Tottenham football club of its Haringey stadium, the developers managed to negotiate with the Labour council to reduce their contribution to local infrastructure from an agreed £16m to just £477,000; the initial demand for 50% affordable housing was abandoned, and the number of flats for private sale increased from 200 to 285. Lend Lease, the preferred private development partner of Southwark Council, saved itself £265m by not building any ‘affordable’ housing in its One The Elephant tower in south London. The Mayor will encourage councils to ‘fast-track’ the applications of developers who promise 35% or more ‘affordable’ housing; none of it will need to be housing at social rents. Such developers will be spared having to submit any kind of viability study to the council at all. It is not clear what penalties, if any, they will face if they subsequently renege on their ‘affordable’ commitments.

‘Estate regeneration’: no say for residents

In his manifesto, Khan pledged that council estates could only be knocked down if the people living in them agreed. In the good practice guide, this requirement is nowhere to be seen. Indeed, behind all its guff about ‘transparency’ and ‘consultation’, the guide warns specifically against balloting estate residents about the future of their homes, suggesting the issues are ‘too complex for a yes/no vote’.

Sadiq Khan has no intention of putting the brakes on the wholesale sell-off of public land. It was Labour’s own Lord Adonis who first categorised London council estates as ‘brownfield’ land, ripe for lucrative development. It is Labour councils which have taken the lead in earmarking social housing for demolition and rebuilding in its place ‘mixed tenure’ developments that are mainly for private sale and rent. Sitting on Sadiq Khan’s Homes for Londoners board, alongside property developers, Transport for London and housing associations, are two Labour council leaders – Haringey’s Claire Kober and Steve Bullock, Mayor of Lewisham.  Claire Kober is leading the attempt by Haringey Council to carry out a mass privatisation of public assets, corralling homes, school buildings and its biggest library into a massive £2bn private fund. Bidders for a 50% share of this ‘Haringey Development Vehicle’ include property vultures like Lend Lease and Galliford Try. If Haringey council pushes through its plans the promised 5,000 new homes will include nothing for social rent; social cleansing will intensify as property consultants, developers and lobbyists get rich (Aditya Chakrabortty, The Guardian 19 January 2017).

Meanwhile, in Lewisham, Mayor Steve Bullock is feeling the heat as the corruption at the heart of the council’s plans for the land around Millwall’s football ground continues to unravel. The scandal has forced Lewisham council to withdraw its compulsory purchase order (CPO) on the land, which it was seeking in order to hand it over to Renewal, a shady offshore company set up by a former council leader. Bullock is a director of the Surrey Canal Sports Foundation – the charitable foundation set up by Renewal which stood to benefit from the CPO. The Foundation also received a £500,000 charitable donation of public money from the council (The Guardian, 20 January 2017). Southwark Labour leader Peter John is also a director of the Foundation. Bullock is now under pressure to resign as mayor of Lewisham (sign the petition at: Steve Bullock, Mayor of Lewisham, must resign over Millwall scandal )

These are, however, only the most obvious charlatans profiting from the bonanza to be made from London’s housing crisis. The fact is that the sell-off of public land and working class homes and their replacement with lucrative homes for sale, the gleeful embrace of market forces and the inevitable social cleansing that results, is at the heart of Labour housing policy. While Party leader Jeremy Corbyn fantasises about building a million council homes, the reality is being built right now in Labour boroughs across London, in steel and glass, to generate profits for developers, construction companies and their friends in power. All Sadiq Khan’s policies do is offer an aspirational few some crumbs from the feast.

Fight Racism! Fight Imperialism! 255 February/March 2017