Social careless talk costs

Or, millions now living will never pay inheritance tax. I’m going to do something odd for a second: I’m going to praise the intention behind the most controversial aspect of the 2017 Conservative manifesto. You see, whatever you may think about the politics of the situation, the authors did at least try to do something about paying for social care.

The common wisdom is now that this was a particularly stupid thing to do, but in electoral terms, they thought they had the election in the bag and were trying to use that to lever a manifesto commitment to doing something about social care. They could have said nothing and kicked the can down the road, but at least they tried to get something past the radar that could have increased funds for social care.

Of course, it didn’t work. The manifesto fell apart within days, mostly because of this particular issue and the sudden realisation that, unlike the Dilnot Commission recommendations, there was no plan for an upper limit on contributions from an individual. So a millionaire who lived to an old age and developed very high care needs could lose almost all of their assets before the state started picking up the tab, whereas a “lucky” millionaire could be hit by a truck and pass all of their assets after inheritance tax on to their children or other beneficiaries.

So here was have the latest iteration of the social care farce- everyone accepts more money needs to go into the social care system, but no-one is quite sure how to (or perhaps more accurately “who will”) pay for it. Anyone making a suggestion is shot down in flames. Which it is why I guess the Conservative Party manifesto writers thought it was worth a go. It wasn’t.

Which leads us to the tricky question of how we get out of this mess. The Dilnot Commission tried the slow and steady approach, but that led to it being left on the shelf. The Conservative manifesto tried an “under the radar” approach, but that manifestly failed as well. Labour are currently saying they will seek cross-party consensus, which sounds like they won’t exactly hit the ground running if they get the keys to 10 Downing Street- and we know they have other priorities that they said they will go for straight away.

The key issue is that whatever is decided someone will have to end up paying some more and every party is prepared to use this against any other party that tries to suggest changes. Whether it is Labour’s tax bombshell, the death tax or the Conservative dementia tax, there is enough toxic gas around any social care policy to make any significant changes to social care fees almost impossible.

At the same time the current system rumbles on. Local authorities are finding themselves hard pressed as demand rises (indeed, this is the case for both adult and child social care) and the half-hearted attempts of government to introduce intermediate funding are not covering the additional pressures. Worse still, a significant amount of the press seem to link council tax rises with profligacy rather than a response to rising demand and stinging reductions in grant funding.

So what can we do about it?

I know of precisely zero people who see council tax as a long term sustainable way to fund local authorities, especially relating to rising social care costs. Sure, there is some tinkering to maximums, exemptions, re-rating and additional rates that could make some difference, but these most likely mean those in more expensive homes will have to pay more. The system will still be largely regressive be based on a proxy of wealth rather than wealth itself and is unlikely to cover the extra pressures in the long run.

Another option would be to allow councils their own tax raising powers. This would be devolution in action, with some authorities plumping for a local income tax, others going for some sort of land value tax, some a form of the current council tax arrangements etc. etc. There can be no getting away from the idea that many people would end up paying more, but this could be locally controlled with the best and worst ways showing themselves over time. Of course this would lead to the dreaded postcode lottery, but that is the outcome of living in a multi-tiered democracy. The powers could be given to devolved areas first and they could be the testing ground for the new system. But if we are to believe that the significant pressures also largely affect shire counties (with an ageing, asset-and-housing-rich population) then their time must also come for a different but higher level of taxation.

With much recent talk about intergenerational fairness there also needs to be discussion about how any additional payments are structured across age groups. Increases in taxation for young workers might chafe if they are struggling to find affordable housing. It might be worth looking for the margins around what taxations can impact older or more affluent people.

I think one area ripe for looking into is housing wealth- that is, the wealth a person has in their home *after* their mortgage is taken off. So your home-owning 30 something might have a few grand of “wealth” and your outright-home-owning older person will have hundreds of thousands. This isn’t available money and shouldn’t be taxed as such, but could be used as a proxy for payments. So a tax of 0.5% a year of housing wealth would be a couple of hundred pounds a year for a couple who have paid off a few years of their mortgage but will be higher for those who have paid off more. For no-one will it be higher than their actual repayments. Renters won’t be directly affected, so those who are saving to buy a home will be able to do this without being encumbered by further taxes. An amount could be added to pension credit to cover those who are truly asset rich and cash poor, but I think there is a tendency to overstate this group rather than accept that there are many older people who are both cash and asset rich- especially when the one biggest cost of paying for housing is no longer there.

But then there is also the big daddy of them all. You see, if the debate around social care fees is so toxic then the discussion around inheritance is nuclear. Inheritance tax is truly one of the most reviled but misunderstood taxes out there.

Firstly, barely any estates end up paying it. In 2014/15 (the latest stats we have) the estates of just 1 in 25 people who passed away led to an inheritance tax charge. That’s actually the highest it has been since 2007/8. So whilst there can be a genuine argument about inheritance tax the first thing we need to do is reassure the vast majority of people that they won’t end up paying it. One issue is that the current threshold for payment (£325,000 with £100,000 more for residences) is enough to ensnare people who own property in the south east, which can pitch a large amount of the media and political classes against the policy as they will be adversely affected. Another is that people feel they should be able to pass their assets on to their children, which is potentially another way of saying that the distribution of wealth should be entrenched- the children of the rich should also be rich.

Part of this comes from a desire to ensure your own offspring are protected from the vagrancies of the economy and society. But that misses the point- if housing were more affordable and if extra costs in old age were paid through the state, then there wouldn’t be a need for intergenerational insurance against unfortunate circumstances. In any case and for any estate, there would still be at least £325,000 to share between any benefactors in the current system (and for those with high amounts of assets far more) so we have to move away from this idea that inheritance tax is somehow a social ill or a way of destroying the bonds between parents and their adult children.

Indeed, mild changes to inheritance tax- decreasing the asset threshold, increasing the proportion due and removing the recent addition of the £100,000 residence threshold (which raises to £175,000 in 2020/21) could help provide a significant additional income for the treasury to provide social care costs.

But you won’t get anywhere politically by telling people they are being unreasonable. This is true when you look at increasing social care costs or inheritance tax.

One way to try and cover more of the care costs is wider changes the taxation system, like the devolved taxation system I’ve sketched above. Regions or combined authority areas could be freed to set their own taxes- take their own risks and watch what each other are doing to improve their own regimes. But I’ll be clear about one thing, if government does give powers to smaller areas it has to avoid setting limiting conditions that prevent local decision makers from having the final decision. Anything else would just be a pointless exercise in micro-management.

Another way is to offer people a genuine choice in a consultation. No, I’m not recommending a referendum, but something that makes clear the balance between individuals who go on to need support paying more (as in the Conservative manifesto) or higher taxation as a form of collective insurance. It could outline who would pay more under extended inheritance tax or a housing wealth tax, what that would raise and what it would mean for social care fees. It could then offer these, a mixed system with some other tax changes or a “no tax change” option that meant individuals affected would have to pay more than they are currently.

That would allow a short but meaningful public discussion on what we want to see as a country. And if we could keep the pithy titles and constructive ambiguity to a minimum that would also be appreciated.

Rough sleeping and smooth sailing

I wish I could move on from talking about housing on this blog. But stuff keeps on being proposed that piques my interest. The latest such thing is the Labour announcement on housing for rough sleepers.

This was announced on Sunday, perfectly to fit in with the Sunday newspapers and interview circuit, but I wanted to have a couple of days to have a think about it and what it really means. You see, I cannot imagine anyone would have any issue with more homes for those with recent experience of sleeping rough, in particular as much of the evidence from housing first suggests that this can make a difference in people’s lives.

But it is worth having a look at the policy, because there is something interesting going on. In brief, the wording around the policy announcement looks like it is about housing supply, but in actual fact it is about housing allocations.

So let’s quickly run through what’s been said. Labour is proposing that it will seek to provide 8,000 houses for people with experiencing of sleeping rough, both as part of their existing commitments and as an immediate implementation of the housing first policy.

The government currently have pilots of housing first, which is essence is about providing people with long term accommodation before seeking to overcome any other issues that may be causing homelessness. It has many fans (the author included) but crucially it is about not only providing accommodation but also a significant level of support in order to access services in order to prevent a return to the streets. As Jeremy Swain has recently reiterated, there are factors in returning to homelessness that have to be overcome and experience states that includes intensive work from professional agencies seeking to keep people in the home.

But where are the homes to come from? The Labour press release states quite clearly that instead of building new accommodation, which will take time, they will be seeking agreements with housing associations to provide homes as they become available and replace them with newly built homes from their aspirational social housebuilding programme.

So the homes are existing affordable accommodation (whatever that means!) from registered providers that you would expect to have gone to someone else in need if they were not used as part of this scheme.

Let’s put that a different way. You run the allocations for a housing association. You have a 1 bedroom home become vacant and have to choose between:

  • A rough sleeper.
  • A disabled single person living in an unaffordable privately rented home.
  • A disabled couple living in a privately rented home in severe disrepair.
  • A vulnerable young person living in temporary accommodation who has not slept rough.

Now, each of these households is likely to meet the legal definition of homelessness and indeed for priority need. Exactly who gets the property will depend on the allocations policy of the association or, if the work with a local authority, the council’s own allocations policy.

What Labour are saying is that they will prioritise the rough sleeper over the other households and apply this nationally so that allocation policies will only apply after the need is met for rough sleepers. That’s a policy decision and it isn’t a bad one per se, but it needs to be understood as a decision on allocations. Using that home for a rough sleeper will take it away from someone else who also needs it- someone is going to get it and someone is going to not.

Of course Labour have also made a commitment for a huge increase in the number of affordable homes, but as the press release says, this will take time. So those households will have to wait longer than they might otherwise have done. Again, that’s a policy choice and not an unreasonable one, but moving other households further down the queue has to be understood as a consequence.

What would be a worry is if these policies aren’t tied up together. Any government is used to getting some of its policies through and not others, so I can easily see a situation where the rough sleeper policy comes forward (it is, after all using existing properties) but the policy of building affordable homes stumbles along the way or is delayed. Even governments that are very quick off the blocks (1945 and 1997, I’m looking at you here!) have some things that go on the back-burner or hit unexpected consequences. If you have taken on homes on the guarantee that you will replace them then there is a need to complete both sides of the bargain.

Another comment to make is why this is only housing association homes? The present government almost came unstuck when it tried to introduce right to buy for housing associations. It is unclear why policy makers from different parties see housing association properties -homes built by non-governmental bodies overwhelmingly for the public benefit although often funded by public subsidy- as theirs to dip into when they feel like it. I’m not sure if the sector will be up for another round of tough negotiation, especially to provide a service many of them feel that they do anyway.

As I mentioned above, the key issue will be the level of support that come with rough sleepers into the new homes. There’s no mention of that in the release, or how it will be funded, although it is fair to say that many rough sleepers already receive a significant level of personal support, so this may be that the organisations who currently work with them will continue to do so, hopefully with some level of financial backing from government. The alternative is a replication of what has happened many times previously, where the settled accommodation breaks down and people return to living on the streets.

Another way to provide homes for rough sleepers would be to buy up homes from landlords with buy to let mortgages looking to sell vacant properties (or, even better, empty homes), perhaps on the “we buy any car” approach of a quick sale for a below-market price. The homes could then be improved and made tenant-ready quickly (providing opportunities for local tradespeople or for skills training). This removes the “robbing Peter to pay Paul” aspect of the policy whilst still ensuring a quick turnaround for those who need homes. It’s not a new idea either, it is something quite a few councils, charities and other organisations do, but government backing could make it much larger and more effective.

In his interviews on Sunday Jeremy Corbyn also returned to the idea of compulsory purchase of high value homes “deliberately kept vacant”. Now, he hasn’t provided a number for how many properties he thinks would be involved and I would think it would be very hard to for local authorities to prove mens rea in cases of empty homes. That word “deliberate” sticks out like a sore thumb to me. With a requirement to prove why a home is being kept empty I don’t think it will lead to many compulsory purchases, so it may be an attempt to put the wind up financial speculators rather than a policy that will make a huge difference on the ground. Of course we’d have to see the final policy, it could exclude that difficult word “deliberate” and have some impact on some homes.

So the housing first announcement is another piece in the jigsaw. There are other ways to achieve a quick expansion of homes for housing first, most notably working directly with local authorities or housing associations rather than trying to buy up housing from the latter. If Labour are serious about their affordable housebuilding plans and are willing to put in the resources to pay for it then this may be one small but important cog in the machine. What we must not forget is that providing a home is not sufficient to keep someone off the streets- it is just the first step and the ongoing support that person receives is just as significant as the roof over their head.

The long tail of affordable housing and how it can wag again

How fast do you have to run to stand still? And do you really have to run twice as fast as that to get somewhere else?

It’s a question we’ve been grappling with ever since the Red Queen posed it and none more so than with affordable housing.

Well, that was a question I was going to try and look at in this post. But then I found out that not only are they susceptible to a bit of genial name-calling, Shelter also have access to a time machine and have gone back to 2014 to write essentially the same post.

What’s a naptime blogger to do then? Well, it would be helpful to see what has changed since then and maybe have a think about the current trends in net affordable house building.

But first we have to draw a pretty big distinction between affordable housing and “affordable housing”. You see, in most areas when you think about affordable you consider whether someone’s income can cover the cost of the item. Not so in housing, where the government’s definition of “affordable” relates to the market price- the definition of affordable rent is 80% of the market rent in the same area.

This might not seem like a terrible thing and in some areas it just so happens that 80% of the market price is within an affordable range for a relatively low income family. But in reality that’s more of a happy accident than an outcome of wise policy making.

It didn’t used to be wholly this way. Most social housing rents were traditionally set based on the actual costs of paying for the property and its upkeep, with landlords (local authorities and housing associations, in the main) given very broad parameters to set rents. Whilst in power Labour argued that this led to wildly different rents for what was in effect the same house and, through controlled increases in rent, tried to get all social providers to roughly the same rent for the same property- called a “formula rent”. This equation looked at the price of the house and also the median earnings in the area. But it was only a proxy to allow for equalisation in the medium-run.

And it didn’t get there, because Labour slowed down the process and then the Conservatives came in and chose to increase and then reduce social rents at the same rate for everybody. Only now are they looking to allow authorities to increase rents again. This means rents are still quite divergent between providers and between areas.

So, and I can’t be clear enough about this, neither social rent on older stock nor affordable rent really have any direct connection with affordability built in. Social rents are by and large lower (in many areas far lower) than affordable rents and are therefore more affordable. But there is no real mechanism to ensure that stays the case. New social rented homes (those few that are built) often have rent set at the formula rate, but then affordability is only one consideration among others.

When the new “80% of market” definition came along most providers didn’t immediately switch all of their properties to it when a new tenant moved in. What many did was make newly built homes (usually by developers as part of s106 agreements) available for affordable rent as a way to cross subsidise other, more affordable housing. Indeed, until recently building for affordable rent was required through the government’s affordable homes programme, meaning councils who couldn’t borrow (because of central government limits) had no other choice than to build homes for “affordable rent”. Collectively, although mostly for the legacy reasons, this means that the vast majority of affordable homes available today are at a social rent. That’s the good news.

The bad news is the number of new build social rented homes has fallen year on year, from nearly 40,000 in 2010/11 to 6,800 in 2015/16 (with even fewer provisionally accounted for in 2016/17). The number of right to buy completions has been edging up since 2011/12, both when the financial crisis was bottoming out (and when low income households were more able to get mortgages) and when the government significantly increased the amount of discount a household could receive to buy their home. What’s more, as most new affordable homes won’t yet have a right to buy discount, we can safely assume these were almost all social rent homes sold.

Screenshot 2018-01-23 at 3.28.16 PM

So in 2015/16 more than 3 homes at sold under right to buy for every social rent home that was built. Even if you add affordable rent into the mix there are only 1,358 more homes being built than lost. And what’s more, whilst there should be 1 for 1 replacement of homes sold under right to buy, that has never been the case, looks like it will be a very long time until it is the case and if it does happen it will by and large affordable homes replacing social homes, thus adding little to the mix of truly affordable homes.

Put that another way, since 1991/92 there have been 215,000 more homes sold under right to buy than new social rented homes built.  That’s more homes than there are in Bradford.

This is also the case with affordable housing in parts of new developments. Where “affordable homes” are agreed as part of s106 agreements, they often either become “affordable rent” or an intermediate option that is most likely shared ownership. More councils are starting to accept payments in cash for off site provision in lieu of affordable accommodation, which at least means councils can build what they want but does lead to worries about the ghettoisation of “rich areas” and “poor areas”.

Of course developers are hit and miss when it comes to actually providing affordable homes as part of their developments. As part of the planning process they are able to argue that they cannot make their scheme viable with the level of affordable accommodation set by the local authority. This means they are able to negotiate, often significantly or to zero, the amount of affordable housing on the site. Of course every single site can be just about viable at the same time as the heads of the developments earn £100 million bonuses.

In fact it is fair to say that there is something more than a cottage industry set-up to help developers argue their case for lowering affordable housing requirements through the viability process. Perhaps we could call it a 6 bedroom, triple garage industry?

The recent government consultation on viability (amongst other things) goes some way to address this, effectively saying that the local plan is the place to be clear about viability of individual sites and once agreed there is little reason to change it. There are however a couple of issues with this. This first is that councils will take time to update their local plans (remember it is a process that is measured in years) so the current system will remain in each area until they have (or are at least approaching) a replacement plan. The second is that there will still be flexibility in the system (for example by judicial review on the reasonableness of individual decisions) for developers to tease open a loophole or two that they can then drive a bus through. Followed inevitably by bus lane markings and an open highway. Perhaps this is the world-weary cynic in me, but I fear the approach laid out there will lead us back to the same situation in 3-5 years.

Given that developers see having lawyers on a retainer as part and parcel of the industry, I would rather something that looks more like a hard to avoid tax than an easy to evade agreement. Yes, that might mess with their business case and yes, that will meant hey might have to change their modus operandi to suit the new circumstances. Given that might have as many positives and negatives it is a risk I’m willing to pay.

So councils are at the limits of what they can build, when they and housing associations do build they often choose (when they have a choice) to go for affordable rent. When developers build they often try to limit their affordable accommodation and when they do build it what is made is usually “affordable rent” or another type of intermediate accommodation. So where does that leave those who genuinely need truly affordable accommodation?

I fear trying to create a new type of rent level will just lead to another competing layer in the market. Removing “affordable rent” from what counts as affordable rented accommodation, especially under s106, would help restore some sense. Whilst councils are free to set terms in their local plan I think it would make sense for discussion on affordable accommodation to be based on what proportion of people in the local area could afford to live in the agreed accommodation. So if “affordable rent” stays, it could be renamed “rent that X% of people locally could afford to pay”.

Local authorities and most housing associations truly do want to build genuinely affordable homes, so giving them the powers to do borrow and build will make a huge difference in building of new affordable homes. Central government continuing the move away from “affordable rent” will allow councils and housing associations to build homes at a rent they think is appropriate and needed in their local area.

Finally, without wanting to sound like a scratched record, the bath will only fill if you put the plug in. Right to buy is leeching away truly affordable housing, giving some households a cash injection (when they sell the homes) and giving a number of private landlords an unearned field day as they swoop in, buy a former council home on the cheap and move in tenants paying market price. In a way, it would be better to give the tenants the discount to buy another house, at least then the landlord wouldn’t have to go through the cost of building a new property, although it wouldn’t help take the steam out of the wider housing market.

It would take many years for the total supply of social housing to dry up, but if we don’t look to do something more about it now then it could still happen. Given the need that clearly exists for affordable accommodation, that would be a huge mistake.

Empty homes, vacant stats and a bugbear

Happy new year! And don’t the Liberal Democrats know how to celebrate, with a widely reported press release calling the number of empty homes in the UK a “scandal”.

Now, I’m not party political in this blog. Yes, I spend a fair amount of time critiquing the government, but that is because they are the government. They are the ones able to see their policies come to fruition on a national scale, so it shouldn’t be too surprising that I want to look at that. But something caught my eye in the Lib Dem release, something that gets my goat every time I see it, no matter which organisation it comes from.

Let’s get on the same page first- using some simple language. Empty homes aren’t great and bringing them back into use is a good thing. I don’t disagree with the main conclusion of the release, that Councils need further powers to bring empty homes -the vast majority of which are privately held- back into use. However, when you actually dig into the data, there is some richness that has been missed and indeed some uncomfortable truths about where empty homes are that means policy directed only at solving this may not be completely successful.

Others have quite rightly pointed out that the numbers seem large, until you compare them with the total national housing stock, or indeed the numbers of new net homes the country actually requires. I’m not going to repeat those unnecessarily, but they are important points to make. Every single long term empty home could be brought back into use without making a really significant dent in the ongoing housing need for the country.

What I really want to talk about is the relative size of local authorities and why it makes comparing overall numbers particularly pointless. The press release goes into detail of the areas with the highest number of empty homes, citing Durham, Leeds, Bradford and Cornwall as the areas with the most empty homes. That may be true, of the places that replied. But what that doesn’t understand is that local authorities have huge differences in population and numbers of dwellings. So comparing absolutes for these areas is bound to lead to larger areas having more of a wide variety of variables.

I’ll put it another way. Let’s say I run a cat charity. I want to put out a press release saying which area is the “most cat loving”. So I write to the cat department of every local authority asking them how many homes have cats in the area. I dutifully get the answers back, put them in a spreadsheet and what do you know, the “most cat loving areas” are Birmingham, Leeds, Glasgow, Edinburgh and Liverpool. Why is that? Because they are the local authority areas with the biggest populations and number of households.

So one area has a higher number of empty homes than another, but what does that mean? Are we to expect to see more empty homes if we take a walk around the streets? Of course not, if there are 3 times the number of empty homes, but the authority is 10 times as large, then it looks to me like public policy is better focused on the smaller area.

So, in my opinion, what the authors of the press release should have done is work out the proportion of empty homes compared to the number of dwellings in the area. I don’t know why they didn’t; the figures are freely available for England, Scotland and Wales. I do know it takes about 2 hours to manually copy and paste them across into the spreadsheet, because that’s exactly what I did.

Here’s my version of the press release statistics, with sheets reordering the list of local authorities based on the proportion of vacant homes and the proportions of 5 year and 10 year vacant homes. This makes for some much more interesting and frankly depressing reading.

The 10 areas with the highest proportion of empty homes are:

Screenshot 2018-01-04 at 2.12.52 PM

And here is the proportion at 5 years:

Screenshot 2018-01-04 at 2.13.30 PM

And here it is at 10 years:

Screenshot 2018-01-04 at 2.14.10 PM

I’m not quite sure what is happening in Wycombe and Chiltern (this might be related to the law of small numbers), but the rest of the list looks somewhat familiar. All the original “big four” have dropped out apart from Durham and that looks in keeping with what could be an actual issue. Scottish, Northern, Welsh, Midlands, former strong working communities now de-industrialised, towns not cities, with relatively low house prices dominate the lists.

It is almost like the proportion of empty homes is a symptom of another problem rather than something that can be solved in isolation. So going on about empty homes in isolation might not be the best thing to do, when the issue might well be depopulation and corresponding low house prices.

The other thing to repeat is look at how small those figures are. Outside of Shetland (which will be an outlier due to its tiny overall size and living conditions) the areas with the highest proportion of empty homes after 10 years is less than one in 300. Yes, people get very upset if that one in 300 (or less) happens to be next door to them, but we do need a bit of perspective when thinking about policy.

This puts the over-simplified conclusion of the Lib Dem release under some doubt. If empty homes are a blight and a waste (and they are!) then the areas with the highest proportion of them must be the areas with the biggest proportions of blight and waste. But perhaps what is required is not just Councils taking over empty homes, but wider and more thoughtful approaches to improve the economy of those areas and give empty homeowners a reason to want to bring them back into use.

There’s a couple of other flaws with the release, the most major being that a large number of Councils aren’t included. Both Manchester and Birmingham (Councils, not the whole conurbations) manage to not be included in the release, most likely as a result of not getting the FOI response back before the Lib Dems wanted to issue it. Sure, that can only increase the overall number of empty homes, but it can change the overall proportion of homes and looking at the government’s figures suggests that Manchester especially has an interesting (and positive) story to tell about bringing empty homes back into use.

Which brings me onto the final point of concern about the release, which is the over-reliance on looking at Empty Dwelling Management Orders (EDMOs) on bringing empty homes back into use. The Lib Dems have actually asked Councils how many homes have been brought back and how many EDMOs they have used. The only thing that they have reported is the proportion of Councils using EDMOs. When you actually look at their own figures, what you see is that areas like Leeds (although be careful about proportions rather than overall numbers!) and Newcastle are bringing the most empty homes back into use and they are doing it without significant use of EDMOs!

Clearly, if the press release authors wanted to look at bringing empty homes back into use, if they really wanted to understand what worked and what didn’t then they might have asked the areas doing best what was happening. I’m sure (in fact, I know) both of the Councils in these cities have been trying very hard to bring down the numbers. But at least part of the answer might lie in the fact that both these cities have inward investment, public and private and improving economies.

Which takes us back to the earlier point- perhaps what this data is showing us is the solution to empty homes is found in improving the wider economy of de-industrialised areas, particularly towns, as well as individual measures on housing.

Assessed need and its objectification

It must be Christmas because I’m talking about planning again! Not only that, but going back to the topics of one of my first posts– the attempts to estimate of how many houses we need.

Reading Inside Housing the other day I came across a slightly strange article title: ‘More than 30,000 new homes were in areas where they were not needed, according to government formula’. Is that true, I thought to myself and, frankly, what could it possibly mean? Follow me on a little circle and I’ll try and explain, hopefully trying to demystify quite a lot of planning-speak as we do so.

First off it is worth reminding ourselves where we are. For a longer explanation, feel free to look at my earlier post. Under the current rules, local authorities have to investigate their own housing need and convince an inspector that the methodology they have used to calculate housing need (and the answers that follow from this) are accurate. Some authorities convince inspectors, some don’t. There are very few hard and fast rules to this, other than bring as much evidence as you can and explain why you did or didn’t include everything you can think of. The total amount for the country is therefore an accumulation of what each local authority has decided.

The government are proposing a new methodology that is consistent across England and can be worked out fairly quickly and easily. Crucially, instead of accumulation, the government has effectively sought out a way to distribute a national figure for housing growth (between 225,000 and 275,000 a year, more on this below) and then worked out a methodology that achieves this and spreads the national figure over the country.

So the first and absolutely clunkingly obvious thing to point out is that these methodologies are different. They may try and measure the same thing, but they go about it in completely different ways and we shouldn’t be surprised if they come to different national and local conclusions. One seeks to try and make each local area right, probably with a bit of leeway and then accumulate them nationally to something possibly right-ish with lots of leeway. The other tries to take a national view and then spread it about the country, using a crude (but therefore easy to understand) measure of affordability to do so. It is consistent and easy to understand, but as a consequence of being crude, more likely to be wrong for each individual local authority area.

Is there one that is more right and one that is more wrong? Well, in terms of trying to work out how many households there will be in, say, 15 years time, there probably is. Indeed, you only need to look at the work of Andrew Lainton to see an impressive attempt to try and find an even better, consistent, relatively easy to understand methodology.

But even the most spreadsheet happy statistician would have to accept that all they can try to achieve is a good estimate. Frankly, we may only know which was more right when we get there and even then the outcome is likely to be predicated on the actions taken until that point (because creating homes can also create households!).

Let’s put that another way- the numbers the government are using are a little bit fudgey. To begin with, the 225,000 to 275,000 range is quite large; 50,000 homes a year difference between them! The figures come from February’s white paper, with a footnote stating where these numbers come from. This includes the 13 year old Barker Report, which even Kate Barker herself has incredulously commented upon it still being used.

I’m not saying these numbers are wrong, I’m saying there is a 22% difference between 225,000 and 275,000. But what matters isn’t that the number is exactly right, but that local authorities have an idea about the housing need in their area that is seen as required and are actively doing something to meet it in a reasonable and plan-led way.

I’d much rather a good but not perfect guess now, rather than an exact answer some time in the future. And yes, that goes for distribution across areas as well as well as for the national figure.

The alternative approach, the one we have had for the last few years, is to have argument on top of argument about what the actual number, down to the last digit, should be. Local plans have been kept in a form of hiatus for years as these arguments progress. What this has meant, as I’ve detailed in my previous post, isn’t no development, but development where housebuilders want (apart from the green belt) at a rate that suits them.

But what about these 30,000 homes that “weren’t needed”? What the report goes on to say is that this is the difference between the additions to housing stock in the last year and what the same local authorities would have as their targets under the proposed new methodology. Hopefully, you’ll be able to see where the mistake (known or otherwise) is there.

Firstly, the new methodology hasn’t been implemented yet (the government are looking at the consultation responses) and even if they were almost all local authorities haven’t had enough time to update their plans based on the new proposals. Secondly, these were almost certainly homes that were needed in one sense or another not least because the housebuilders, who effectively control the market for new completions, knew they could sell them. Thirdly, the targets are really minimums, with a reasonable amount of over-supply having the potential to offset other years that might be leaner. An area that only just meets its target every year is in for a shock in a low year!

So I can’t quite see what the issue is with the fact that in some authorities some homes are being built. There is much to be critical of the government for in strategic planning. Most notably, making local authorities wholly responsible for builders failing to deliver new homes whilst denying (or at least kicking the can down the road of giving) them the powers to actually do anything about this. Such powers inevitably include letting councils actually build new social homes for rent at a scale that would help alleviate some pressure.

In essence the long discussions about housing numbers have got in the way of delivering homes and taken up a lot of conversation time that could have been spent looking at what could actually help deliver homes, particularly affordable homes (for sale or rent), where they are needed most.

But hopefully what I’ve gone some way to showing is that whilst assessments of need are more or less arbitrary -and the government’s proposals are at the “more arbitrary” end of that- what really matters is that there is a clear and achievable challenge for everyone involved in housing supply to meet and time and space to come to real and actual ways to achieve them. The alternative is essentially a parlour game, where anyone with a spreadsheet and a set of range calculations can have their two pennies.

I’m happy to take part in that game, but would also like to see some decent homes built at the right prices in the right places first. If setting a clear figure and empowering people to get out and build according to a plan can achieve that then let’s get on and do it.

Numbers and numbness

Has everyone seen the video of the man who uses excel to paint? Well, I can’t say I’m anywhere near as interesting as him, but I can usually hold down a spreadsheet and extract some valuable information from it.

The heart wrenching testimony from the work and pensions committee have shown, once again, that the systems looking into what benefits people with health issues receive are not working properly.

As regular readers will know, I have already shared my two pennies on one of the reasons I think employment and support allowance (ESA) and personal independence payments (PIP) appeals are going through the roof and why mandatory reconsiderations (the new-ish process the DWP is forcing on claimants) are not helpful. I’m not alone in wanting to look at this, indeed, the work and pensions committee have an ongoing investigation into PIP and ESA assessments, where that recent testimony came from. As part of this the DWP has given them some supporting statistics, which are a treasure trove of interesting information.

That said, like most treasure you do have to do some digging. I’m always very interested in looking at government responses to select committees (or, for many local authorities, scrutiny committees). If you know what to look for you can often find what information the authors are trying very, very hard to avoid saying, whilst putting the data out into the open.

And so it is with the data tables the DWP have released, alongside an explanatory document that explains far more than it is trying to let on. That said, if you read just the explanatory document you wouldn’t see much of interest. But when you actually look in detail, you can see what they are hoping you will miss.

Before we get into the data proper, let’s just take a quick step back and remind ourselves what mandatory reconsiderations are. Introduced in 2013, this was an additional step where a benefit claimant thought a decision was wrong. Instead of just being able to appeal straight away, they had to ask for the DWP to look again at the decision and then only once this was complete could they, separately, appeal against the decision.

This was controversial as it was adding another layer of decision making, expecting claimants to understand the process and to push forward through a difficult and complicated appeals process if they believed the decision was wrong. This is even more difficult when you think that simultaneous cuts to legal aid mean fewer and fewer people can be appropriately represented through the appeals process.

What I find odd about the explanatory document is that it consistently puts each statistic into the context of a larger cohort. So we don’t see just the outcomes from mandatory reconsiderations, we see that within the context of all claimants.

Screenshot 2017-12-05 at 7.23.42 PM

Similarly, we don’t see just the proportion of PIP decisions that are overturned at the first tier tribunal, we see that within the context of all mandatory reconsideration decisions.

Screenshot 2017-12-05 at 7.25.10 PM

This makes issues appear smaller than they are. Sure, lots of people are asking for mandatory reconsiderations and then appealing, but they want you to look at it in the context of the whole benefit, where other people are not asking for a reconsideration and then appealing. Surely those people are happy with their decision?

Coming from that second graph, the second odd thing I notice is the insistence that there is a small (2 percentage points) gap between different health conditions. The suggestion seems to be that conditions are treated quite similarly and have similar results.

Well, both those oddities can be rectified by having a look at the actual data. As I suggested at the start of the post, I have held the statistics down and given them a bit of a thrashing out, which is available here. The graphs that follow all come from my tables, which are themselves simply rearrangements of the DWP statistics.

So, when we look at the actual data of decision making we can see some interesting results. Firstly, and coming straight from the government’s data, we can see that a whole lot of people stop after the mandatory reconsideration stage. Nearly 450,000 claims had PIP decisions upheld by mandatory reconsideration between 2013 and July 2017. All of those could have applied for an appeal if they still disagreed, yet only 126,000 have had appeals heard. Similarly, 448,000 ESA claims were upheld at mandatory reconsideration, but only 152,700 cases were heard.

What does this mean?  I suspect, particularly for the more recent decisions, appeals have been made but not yet heard; the tribunal service have a big backlog for obvious reasons. It also means mandatory reconsideration has been an exceptionally powerful tool for stopping people from appealing. It’s hard to tell why that is, perhaps some genuinely accepted the DWPs version of events? But perhaps along with this, people are giving up, or are unable to cope with the stress of further appeals or blindly accept what the DWP is telling them or, worst of all, think that the mandatory reconsideration was the appeal. Further research is most definitely required, because I don’t think society can see this as a win until we know what is really going on.

But more than that, when you look at the overall appeal outcomes, these statistics start to mirror those of the tribunal service itself. Wade through the data and this shows the DWP confirming that 62% of their PIP decisions are overturned on appeal. For ESA it is nearly 45% between 2013 and July 2017.

The ESA result sounds better, until you see that the proportion overturned has been going up each year since 2013, with the rate so far this year matching 2016/17s high point of 61%.

Screenshot 2017-12-05 at 7.51.15 PM

So whilst mandatory reconsiderations may be preventing many people from appealing, those that do appeal are winning their cases in droves. It’s just like Sir Henry Brooke said a few weeks ago.

Coming onto the second oddity from the explanatory document, this idea that diseases are treated approximately the same. That looks like it is a result of the contextualising data rather than the actual facts. Here is the chart for different primary health conditions for PIP:
Screenshot 2017-12-05 at 7.57.20 PM

In PIP the highest areas of tribunal overturns are for immune diseases (100% of the 100 cases over those years), visual disease (77% overturns) and neurological disease (70%). The lowest is metabolic disease, with just (just!) 50% of the cases being overturned at tribunal.

And here it is for ESA:Screenshot 2017-12-05 at 7.59.25 PM

For ESA the highest proportion of successful appeals was in cases with ear and mastoid processes (60% of the admittedly small 500 cases over the period) with a wide selection of health problems getting 50% of claimants being successful in their appeals. There are so many at 50% I had to check I wasn’t using the same data twice! The lowest is childbirth and related issues with no successful cases recorded. Due to the way the DWP has collated these figures (to the nearest 100) this means a small proportion of cases could have been successful. Injury and poisoning, one of the biggest groups of people appealing decisions,  has the next highest failure rate, with only (only!) 36% being successful at appeal.

Overall, if you aren’t aware of the DWPs terrible record at appeals you should be shocked by how high each and every one of these numbers is. The DWP is losing cases by the bucketload, which asks serious questions about their competence and about the process of mandatory reconsideration.

What’s more, and however they are trying to argue it, it is losing cases for some primary health conditions more than it is others, so they should be looking at this to work out what they can do to make better decisions the first (or second) time around.  Finally, especially on ESA, it is losing a higher proportion of cases each year, indicating something is very wrong with its decision making.

I think the DWP is trying to say that the focus from people like myself is on a small proportion of their decisions. Those of us on the outside only think about appeal decisions and not about those people who accepted the decision, either when it was first made or after the mandatory reconsideration. But that misses the point: we don’t know why people didn’t appeal. Some might have been happy with the decision, but are others simply unable to get through the process themselves? Many of the decisions (particularly the refusals) could have been just as bad as those getting to appeal, but we simply don’t know. The heartfelt responses the work and pensions committee have received in recent weeks point to the fact that people feel let down and confused about the whole process.

This is a key issue with mandatory reconsiderations- it has added another layer in decision making. A layer suggestive of a tickbox exercise that seems to put droves of people off appealing further, even if they may well have a case on appeal. It is another piece of paper to fill in, another time you have to explain your health condition to a stranger, placing yourself emotionally on the line and another place where -as does happen- there is a chance the award can go down as well as up.

I think we can all agree mandatory reconsideration isn’t working. I don’t want to put extra work on the tribunals service, but I can’t see how the DWP can justify maintaining the current mandatory reconsideration process when their appeal outcomes are so bad. The DWP used to always reconsider their decisions after an appeal in any case, so we have to ask why this obstructive layer is allowed to remain.


PS I’m aware that the charts have some of the primary health conditions names chopped down. It is basically impossible to do it any other way when you have such big names for conditions. All of the full condition names are available on the google document containing the charts and sheets for your persual.

Please please please Letwin get what I want

It would be the first time. So, are we all enjoying the post-budget lull? It is quite possible that Philip Hammond will be off our TV screens for a little while (at least on things relating to his brief) as the world returns to worrying about Brexit.

In my previous post about the budget I tried to outline why I would be concerned about any policies announced that would have a long lead in time. Frankly, I’m worried the government, in its current iteration, won’t last long enough to bring in the longer term policies it announces.

So the news that a major part of the “housing budget” will be another review into turning planning permissions into homes, this time chaired by Sir Oliver Letwin, is a particular worry. It has been given a short period to assemble and write up its conclusions, with the demand that it should have published the results by the Spring Statement (March 2018).

Even then, it looks like a tall order for the government to stay in its current guise. Who knows what might happen in the next few months and, as experience has taught me, I won’t be celebrating any positive policy changes until they are enacted or implemented.

Of course Sir Oliver won’t have to necessarily commission new bits of research, he could just look into what has already been proposed and choose some options. He could look at the Barker Review, the Calcutt Review, the Lyons Review, the most recent Parliamentary briefings on housing supply, their own white paper and the Farmer Review, looking into skills shortages and demographic change. Plus plenty of others (feel free to tell me your favourite!).

Indeed, Sir Oliver has a veritable smorgasboard of options available to him. What needs to happen is for the government to actually take some of them and implement them. Which is where the problem lies.

For the government seems very keen to offer further demand measures whilst not really combatting the need for supply. Put simply the government’s approach since at least Eric Pickles’s days has been to force councils to release more sites whilst posturing and taking tough to housebuilders whilst doing very little to change the market to strongly incentivise or directly create steel toe capped boots on the ground. This has led to the situation where developers have lots of options on which site to choose, but no time or incentive to actually build much faster than they are already.

This approach was evident once again in the budget, with limited support for council building (£1bn seems like a lot of money but it spreads very thinly over the country) and lots of loan underwriting and guarantees. As if all housebuilders need is the final push to get them over the line on individual sites. If only they had share issues or assets they could borrow against.
It’s actually been a common point of my last few posts- political will is required to move beyond this and that means deciding to directly impact some negatively in order to help others. It’s as true with unrepentant city centre drivers as it is with housebuilders.

Trying to capture and reinvest land value uplifts (which is rather popular at the moment) would stop those who have land to sell from receiving the full market price. Robust compulsory purchase order powers (or use it or lose it), joint partnerships or new homes corporations will take business and/or profits away from existing housebuilders. Reducing house prices (however that is achieved) or reducing the rate of growth of house prices would impact people who already own homes.

Indeed, what the government seems incredibly shy of is actually using an arm of the state to directly build homes at scale. Yes, local authorities have been very adept at setting up joint ventures and yes, the government has some small scale schemes like the accelerated construction scheme. But at present these don’t add up enough to a significant market intervention. More funding, especially to cover start-up costs (you’d hope building would be self-funding quite quickly) are required in order to allow one bit or another to build at scale in a way that competes with existing developers.

There’s a word for this kind of decision making. That word is politics. Politicians are accountable to us as voters, but that isn’t the same thing as them needing to please each individual person by each individual decision.

So Sir Oliver, and by extension the government, don’t have to venture very far to solve the particular puzzle of increasing housing supply. Indeed, they have everything they need.

What they want to do, and what they are struggling to find is a way is to achieve, is creating supply without upsetting anyone else, particularly existing homeowners, landowners, landlords or those whose supposed purpose is to build houses on land. But in the real world that is very often simply necessary. It’s a puzzle of their own making, in their own heads and if they could see beyond it they would be able to deliver positive changes.

We’ve come full circle in a way. The government need to make a decision; they have the policy options laid out infront of them. But choosing not to choose is about the worst thing they can do. More delays and half measures make building the right homes in the right places at the right prices significantly more difficult.

Paint, power, priority and priorities

It’s amazing what a lick of paint will do in the right place. I say this partly because our kitchen could do with a refresh and partly because of the launch of the King Street pilot in Toronto.

In the pilot King Street is seeing a huge priority shift in favour of public transport, with cars only able to use it for short (ie. one block) periods before having to move off. This leaves the rest of road free for public transport. The early results show large drops in commute times for public transport users, although there is much more time to see if this continues.

So there you have it, new roads or rail aren’t necessarily required to improve public transport travel times. Just change the roads around to favour whatever public transport is already using the streets. So why aren’t we seeing similar approaches tried everywhere? Well, to get into that we have to look at what it would mean and what the political risks are.

But let’s first have a think about why this is important. Many of our city centres are clogged with poisonous fumes, many are difficult to cross with any form of transport. Large, often multi-storey sections of city are used for the storage of wheeled lumps of metal and plastic that lie unused for much of the day, whilst often buses are half empty outside of peak hours.

I don’t think changing prioritisation is something unknown to policy makers or politicians. They know it is possible, in the right circumstances. They probably also know that in the long run it is likely to do some good and convince some people to change from car to public transport (the elusive prize of “modal shift”).

The first part of answering the riddle is that giving priority to one group of commuters (in this case public transport users) takes it away from another. All the economic theories about whether one group can “compensate” another through a change in policy won’t apply when you have a swarm of angry motorists (and their well organised lobby groups) making a path to your door.

Yes, the changes would hopefully convince some of them out of their cars, but in the meantime they are going to be unhappy and quite likely vocal about it. In Britain it has been a couple of years since the tabloids have unilaterally declared that there was a war on motorists, but I am sure with the right cajoling they could reopen hostilities. It would be a fearless politician who tries to unleash major prioritisation changes on an unsuspecting populace, but even with years of warming up quite a few people are still going to be upset about it.

The second issue is that while there are many people who feel they cannot live without their car, there really are some who actually can’t. People with certain disabilities, those whose work involves deliveries, those transporting raw materials and tools, people with caring responsibilities who may need to leave work in an emergency. Taxi drivers (of every description) might feel that they are a form of public transport. All these groups will be caught up in any de-prioritisation of the car. There may be a way to try and work with these groups to provide them with exemptions, but each time you do that you put more traffic on the restricted roads and lessen the overall impact of the policy.

Thirdly, especially from a European perspective, many of our roads weren’t designed for multiple lanes of cars. They weren’t even designed for cars, but for carts or pedestrians. Especially in city centres, it is hard to imagine road widening taking place if it will destroy buildings.

Add into this that almost all of our cities are built straddling rivers (because: history) then you have a real problem.

I grew up in Worcester, with one four lane road bridge in the city. If you don’t cross that bridge you can travel 2 miles south or five miles north, on essentially local roads, just to get to the other side of the river. The road layout means it’s pretty hard to see how some people travelling across the river won’t have to pass by the Cathedral in all its splendour. This means whatever happens with priority and prioritisation, cars are still likely to be getting close to the city centre when traversing the city, even if they are not travelling into the centre. They will still have to cross the bottleneck that is the road bridge and that is effectively that.

Just as the rivers present an obstacle, so do the actions of previous decision makers. I live in Leeds, where someone a long time ago decided to build a motorway into the heart of the city centre. We also have the shortest numbered motorway in the country right in the city centre. Indeed, if you are travelling from east to west, north to south or vise versa, you are most likely to get pretty close to the city centre. No lick of paint is going to take the roads away and even with lane priority for the buses that use the motorways people are still going to want to travel in large numbers close to the city centre. Better public transport that doesn’t travel to the city centre may be part of the solution to that, but that would require us to be able to direct public transport where to go.

Which leads me onto the next point and the need for public transport priority improvements to be matched with decently directed and quality services. People won’t be nudged into moving out of their cars if the public transport is slow, liable to break down, doesn’t go where you want or is not very pleasant to sit on. For much of the UK that just isn’t happening and the growing consensus is that local democratic control (and perhaps higher subsidies alongside this) is the only thing that could improve this.

Finally, there’s nothing truly exciting about changing priorities for most people. No-one apart from us policy geeks are going to remember the politician who decided to repaint the roads, no matter what impact it makes.

There’s even a school of thought, connected with my previous point, that says you have to wow the middle class, middle income commuters out of their cars with something exciting. Trains excite people more than buses, trams even more than that and don’t even start people on undergrounds or monorail (monorail monorail!). But all of that comes at a cost (exorbitant in some cases) that is not only financial. Roads have to be dug up, viaducts built, stations expanded, tunnel diggers bought, buildings knocked down, land purchased.

Hopefully what I’ve described isn’t enough to turn anyone off road reorganisation, but has laid out why it isn’t as easy as it might appear.

Let’s take a second to look at a case where it most definitely did not pan out. York is one of those historical cities with a medieval street layout, a large river and a set number of bridges in the city centre. It has issues with pollution and slow travel times for private and public transport travellers alike. The council, much like Toronto are currently doing, decided to pilot a scheme where one of the bridges -the one with the highest level of bus use- would effectively become a bus only bridge. It wasn’t just paint, they paid out for some number plate recognition cameras and signs, which meant people received notifications and (eventually) fines for driving through in their cars.

What happened next is most likely seared into the collective memory of every transport planner in the country. It became the single most important issue in the city, dominating press coverage for months. Many people received fines, some without knowing they had broken the rules, some out because they found themselves funnelled into a route that they couldn’t get out of, some out of intransigence. The council lost legal battles to enforce the fines and it eventually became such a millstone around their neck that they ended the pilot. It weakened the ruling administration in the council and strongly contributed to it’s eventual loss of power.

So, upsetting motorists is a difficult sell. It needs careful management and early and clear engagement with the public. You need to be able to show that the majority of the public want better public transport and you have to try and deliver the results early and aid a quick modal shift so that full public transport is passing three quarter empty cars.

Crucially, to my mind at least, you have to be able to present any changes as part of a package that looks wider than a single street or improvement. If X or Y road is effectively closing to cars what will happen elsewhere? What public transport improvements can you lever in at the same time?  Who gains from increased use, a private company or local services? Can investment be made in out of centre parking? And also crucially, how will the needs of people who genuinely need to use their cars be met?

This is an issue many councils in the UK are going to be looking at. Hopefully all eyes are on Toronto, but it will be important to learn not only what they did on the road, but how people reacted to the changes and how the public can be convinced to accept re-prioritisation of the roads for what is clearly in the interest of everyone.

Until the PIP squeaks

Even for a non-lawyer like myself, there is something deeply interesting about Henry Brooke’s arguments showing how the tribunals service are trying to cope with social security appeals.

His most recent comments focus on the issues the quality of evidence from the Department for Work and Pensions (DWP), especially in health related benefit decisions, for Personal Independence Payments (PIPs) and Disability Living Allowance (DLA) that PIP is replacing. Try and remember those acronyms- I’m going to be using them a lot!

From my time as a welfare rights worker (ending just as PIP was being brought in) I’ve seen the confusion and upset that poor decision making can have first hand and the successes and failures of individuals as they go through the tribunal system. What I want to try and spend a little bit of time contemplating is how we got here and what can be done to overcome this dire situation.

I believe Henry’s arguments can be boiled down to the concerns that decision makers often rely too heavily on medical evidence provided by the DWPs own contractors, that this contracted medical evidence is, itself, often of quite a low quality and that the loss of legal aid for most social security cases has made life much more difficult for applicants.

If you want my two pennies on why this seems to be happening, it is the DWPs approach that tries to turn decision making and then appeals work into a bulk job. Indeed, that’s something that really come through when you consider how PIP works in comparison to DLA.

I’m not about to argue that DLA was perfect or that there were no bad decisions; far from it. But there’s a real policy point here about what we want from disability benefits. If you’ve been reading my blog from the early posts you’ll know what I’m going to say next: reality is complicated.

In that post I looked at the ways complexity can come about in policy. Hopefully I got across that complexity can pop up either from law not being detailed enough (in which case ambiguities arise) or being too prescribed and not flexible enough to cope with people’s real circumstances. DLA was arguably the former, but PIP is most definitely the latter.

Who got what under DLA was one of those situations where the law itself could be summed up in a few sentences. But what that meant filled entire books, could change based on caselaw and often turned on very small facts in individual cases. Decision makers would have to consider each of these points when coming to a view and, if needed, would be required to justify this in light of the available evidence.

Coming on to the evidence, this was mostly the account provided by the applicant on their claim form and any other medical evidence that had been collected. Applicants could provide evidence alongside their claim, but the DWP often wrote to some of the people working with them (whether it was the GP, specialist, counsellor, etc) for further information. This usually included the set questionnaire which asked general questions when what was really needed was specific information. The final decision often relied very heavily on this third party information. Whenever I filled in a DLA form (and at times that was 4 a day) I would ask the person what their GP knew of their condition. If they said not much (for example they’d referred to a consultant years ago) I would always expect their claim to be knocked back in the first decision, whether or not I thought they had a good claim.

At least information from a GP was someone who could be aware of the condition. Under PIP the government has moved further towards carrying out their own assessments and this usually means a generalist health professional making very quick decisions.

What’s worse is that many of the assessments appear to be very generic and generalised, with it feeling like it is a tick box exercise rather than a robust assessment of someone’s specific needs.

Coming back to the underlying policy, PIP uses a points system with a range of different descriptors. So those few sentences for DLA are now 7 pages of finely gradiated areas. Each of these descriptors lead to points and points, eventually, mean prizes. So where once a decision maker had to weigh a few big areas together, based on the evidence they had to hand, now they have to look at descriptor after descriptor and make a decision on each individual area.

With the DWP contracted report in their hand, I’m not surprised that decision makers just follow this. It essentially advises them how to make a decision. Do we expect them to unpick a consultant’s circumlocutory response to the wrong question (DWP requests for information are often oblique and I don’t think anyone trains medical staff in how to reply to these questions) or look at what the nurse from Capita says about the exact descriptor?

Over time the reports from the DWPs contractor get very samey, but at least the answer the questions we are expecting decision makers to answer. So, as is the case with Employment and Support Allowance, what the contracted health professional says becomes more and more right, even when it is wrong. What’s more, do decision makers feel that the contracted report is “their” version of events, which has to be weighed against, but is somehow more virtuous or accurate than another health professional’s?

Henry is right to point to mandatory reconsiderations as a way to try and improve this. Too often it looks like these are there to provide a final check on truly ridiculous decisions and to ensure that the the DWP hasn’t totally erred before confirming the decision and seeing whether the applicant will formally appeal.

What really needs to happen is for the decision makers undertaking the mandatory reconsiderations to put themselves in the position of the judge and panel. Is it reasonable to weigh this evidence in this way? Is everything in the right place to ensure this evidence is verified and we know who it is from? Will the medically qualified panel member read something in this report that the original decision maker has not? Do we need more evidence to make the decision we have come to?

Making disability benefits a points game and then basing the points overwhelmingly on medical reports from your own contractor sounds like a recipe for poor decision making and plenty of appeals. Indeed, as Henry says, lots of appeals are coming through and the DWP is losing a high proportion of them.

At the moment it feels like this bad decision making has too low a risk for the DWP and high externalities for other people. Applicants are left in limbo for months as appeals wind their course, tribunals are full of basic decisions that can be made easily on paper in the applicant’s favour. The Courts and Tribunal Service may suffer, but is that a worry for the DWP? Whatever the underlying thinking of decision makers, the idea that political rhetoric is impacting on how we think about those claiming benefits means trying to make arguments about improving benefit processing to the public can be a sticky wicket.

So can these externalities be internalised? At the very least the DWP should be offsetting some of the costs of HMCTS whilst decision making is so poor. But should they be nudged further, maybe by a surcharge on each overturned decision- with a waiver for hard cases? Should successful applicants receive a generous rate of interest on any backpayments? Do DWP need to be forced to represent themselves in person at appeals, so that only those worth fighting for get through? Or is there something about the process, particularly about how medical evidence is compiled and then examined, that needs to be sorted out first?

Supported housing- details, details, details

Forget what the calendar says, last week was the one for fireworks. This is the week for detailed policy analysis (yay!). The announcement that the LHA cap wouldn’t be imposed on social rented housing was (as far as I could tell) universally welcomed. However, the next step is to see what is being proposed in its place.

It is hard to think of a more foolish attempt at supposedly saving money than trying to pretend people needing supported housing (defined widely) could only receive the LHA amount (the 30th percentile market rent) for their area. The supposed top up fund was poorly thought through and led to a lack of confidence in the sector about how it would fund new housing when it couldn’t be sure how much income it would receive in the long run.

But let’s first take a couple of steps back and work out how we got here.

As the population ages (something Brexit may well hasten) more of us are going to need housing that is more than a roof and some walls. We might need specialist equipment, alarm systems, help nearby, visits or adaptations to suit our needs. At one point the solution to this issue was institutional and one size fits all. Now people rightfully expect that their needs are provided for, but that their freedom and independence is respected. Instead of care homes people are more likely to want to have homes that support their needs without institutionalising them.

I doubt there would be much discussion about there being a need for housing tailored to individual’s needs and a mechanism, through the state if required, to both provide appropriate housing and the additional support a person requires.

Housing-related costs have traditionally (in England) been provided by housing benefit with a means test and some arbitration system for unusually big costs. Other costs, such as general care and support visits was paid for through other, locally administered schemes, like supporting people or the general social care budgets.

This is one of the reasons it can be frustrating to hear politicians bemoaning the size of the housing benefit budget without proper reflection on what it actually contains. Paying for supported housing through this budget is a choice, but really only an accounting one. If it wasn’t through housing benefit then it would have to be paid through another route, but claiming housing benefit is growing beyond all proportion (and insinuating that is solely due to unemployed working age jobseekers) really does a disservice to what it is actually paying for. To repeat, paying for supported accommodation is a cost that will keep on growing in the short and medium term, no matter what schemes the government try to insist on imposing on working age tenants.

But, of course, housing benefit is on the way out. It is being rolled into the super-colossus of universal credit, the benefit that is doing so well at winning hearts and minds at the moment.

So getting the government to stop, shake their head and then turn on the heel for an LHA cap, not just for supported housing but all social housing, has been a massive achievement for the sector. That said, I doubt there would have been much of a social housing sector, particularly for supported accommodation, if they hadn’t been successful.

The government have stepped back from the brink, but what are they proposing instead? On Tuesday they announced their plans and things are about to get complicated…

They’ve tried to split supported housing into three main groups:

  • Sheltered and extra care housing, where tenants can receive a new payment (noted as “through the welfare system” but it is unclear (to me at least) if this is part of universal credit) called “sheltered rent”.
  • Long term housing, which is meant to meet the needs of people who will need significant support in the long run, such as those with learning difficulties or mental or physical ill health. This will be provided through universal credit, but with no upper limit on payments although the government is still mulling and asking for advice on “cost control measures”.
  • Short term housing, such as accommodation for people experiencing homelessness or people (overwhelmingly women) fleeing domestic violence. This is proposed to to be a grant payment made through local authorities. So local councils will have to negotiate with central government about their local needs in order to secure their bit of the pie and then negotiate with providers in order to fund them.

Taking the last point first, I can see the sense in directly paying for short term housing. From my housing benefit assessment days I remember the succession of 2 day claims for hostels and the local women’s aid, usually with no proof of income or details to really decide a benefit claim. Of course, any reasonable authority simply paid up- why would anyone stop to try and enquire further on a benefit claim for a woman fleeing domestic violence? So the whole thing was a bit of a paper exercise. A 40 page paper exercise that had to be completed as part of the stay. Not something you want to be doing if you are homeless, fleeing violence or trying to overcome an addiction.

But there are some issues with the grant approach. Firstly, government gives grants but it can also take them away. At least the benefit system is a right rather than a process of continuing negotiations, especially in the context of austerity. With priorities changing and if there is an insistence on delivering savings then grant funding can always be cut, either the total amount England-wide or the amount paid by the local authority to each individual provider.

There is also the tricky issue of assessing needs between areas. Not everywhere is lucky enough to have a women’s aid and many women experiencing violence need to leave the area completely to get away from their abuser. So does the funding go to their “home” authority or the authority they are staying temporarily in?

Some national charities have already commented that payment through local authorities may negatively affect them. This is for two reasons. Firstly, local authorities will each incur costs that they will want to recoup through the funding grant. Secondly, local authorities are unlikely to want what remains of their allocation going to fund the national management of organisation; they’ll want it spent in the local area. Thirdly, and they haven’t said this outright, local authorities may prefer to fund local organisations, especially if they know them and get on with them, rather than the big boys who operate all over the country. So local funding tips the balance in favour of local organisations without management costs elsewhere in the country and perhaps with people they know running it or sitting on management boards.

This all means that fateful and fashionable word: “disruption”. If this is a big enough issue then national organisations could choose to become umbrella bodies rather than directly manage services, spinning local provision out to local organisations. They may also need to have a think about how they use charitable donations. No-one wants to know that their monthly direct debit is paying for a middle manager to attend a meeting with a middle manager from a local authority or central government, but that is often what they do. So it might be that they have to push hard for more charitable donations in order to do the advocacy and campaigning that go alongside actual provision.

Moving on, perhaps you had to read the definitions of long term housing and supported/extra care housing a few times to work out the difference? I know I did and I’m still not 100% sure. How exactly government plan to differentiate between the two, especially as there could be quite a big jump between the payments received for each, will be something to watch out for.

I’m going to stick my neck out and say that there will be appeal cases where providers have tried to claim a particular tenancy is long term housing rather than supported housing/ extra care and other cases where a landlord is trying to claim their housing is supported housing whilst decision makers disagree. Thinking back on the housing benefit system there seemed to be an large number of cases (at least for a few years) where what counted as “exempt accommodation” or provision “of care, support and supervision”, particularly by third parties, was debated again and again. So I think there will be a similar pressure to define both what housing can be included in any of these categories and then which are “long term housing” and which are “supported accommodation/ extra care”.

If this is a matter for universal credit decision makers then we have a whole other issue to consider, which is how we think people sat many miles away can make decisions about local areas. At least with housing benefit the authority would either know the organisation, get them in for a chat or visit the housing to look at it. I doubt universal credit decision makers will do that- they’ll just look at the details on paper and come to a view. The outcome: more appeals.

What we don’t know yet is what the payment gap between sheltered/extra care housing and long term housing will be.

The government have proposed that “sheltered rent” should be the formula rent (basically ratios of local rent and national rent levels and the estimated house price relative to the national average) plus or minus 10% plus eligible service charges. All of this is set to an overall cap, but we don’t yet know what that is and it is likely to be calculated on a local basis.

So the big question mark is will this be enough to pay for decent accommodation and secure new investment in the kind of housing people will need in the future? I’m guessing that there will be finance staff looking at spreadsheets up and down the country this week trying to work that out. The real difference is the extra 10%, but is 10% on top of the formula rent enough to imbue confidence across the sector? I don’t know, I don’t have access to the data, but as soon as those spreadsheets start coming up with an answer I am sure we will hear about it.