a new deal for tenants - scoping a precariat charter for social housing (web version with covers) -...

A New Deal for TenantsScoping a Precariat Charter for Social Housing

Hannah Fearn and Kevin Gulliver

Foreword by David Orr, Chief Executive of the National Housing Federation

A New Deal for Tenants Scoping a Precariat Charter for Social Housing

Hannah Fearn and Kevin Gulliver

Foreword by David Orr, Chief Executive of the National Housing Federation

A New Deal for Tenants: Scoping a Precariat Charter for Social Housing

Rainbow Rising? LGBT Communities, Social Housing, Equality and Austerity


CONTENTS

List of Charts

About the Supporting Organisation

About the Authors

Acknowledgements

Foreword by David,

Chief Executive, National Housing Federation 1

SUMMARY 3

1. About the Report 5

2. Social Tenants A Precariat Class? 7

3. A Precariat Charter - Rights and Requirements 15

4. Scoping a Precariat Charter for Social Housing 19

5. A New Deal for Tenants 27

6. Conclusions 31

Select Bibliography 35

About the Human City Institute 37




List of Charts

Chart (1) - Level of Tenants Total Household Income 9

Chart (2) - Tenants Experience of Debt 13

Chart (3) - Tenants Priorities for Policy Changes to Tackle their Finances 18

Chart (4) - Tenants Priorities for Social Landlords to Tackle their Finances 19

Chart (5) - Consumer Price Index for a Basket of Goods (2008-2014) 25

Chart (6) - Average Expenditure per by Tenants on Household Items 25




About the Supporting Organisation

The Matrix Housing Partnership

The Matrix Housing Partnership comprises the Accord Group, the Rooftop Housing Group, Trent &

Dove, Trident Social Investment Group, and WATMOS Community Homes. Matrix has also

delivered housing development services to the Black Country Housing Group, Nehemiah-UCHA

and Tuntum Housing Association.

Together the Matrix partners manage 29,000 homes across the Greater Midlands and allow other

partners and their people, residents, service-users and communities to benefit from economies of

scale, joint working and the sharing of best practice and expertise.

The Matrix Housing Partnership, formed in 2004, is a collective covering housing, health, care and

support, and social and commercial enterprises that include BME and mutual organisations, stock

transfer housing associations, charities and companies.

Matrix is a top performer as measured by value for money, cost-effectiveness and social purpose

criteria, delivering over 110m of new housing development a delivery record that is second to

none. The Matrix partners collectively manage over 29,000 homes across the region, employ

around 8,000 people, have assets of more than 1.2bn and a combined turnover of almost

200m.




About the Authors

Hannah Fearn is a senior journalist specialising in social affairs, writing for the Independent and is

contributing editor for the Guardian housing and public leaders networks. She also writes for

Guardian Society. Hannah is an associate of Slack Communications.

Kevin Gulliver is Director of the Human City Institute, Chair of the Centre for Community Research,

a partner in SWS Communications and contributing editor for Left Foot Forward. He writes widely

on housing, inequality, poverty and financial exclusion.

THE CONTENTS OF THE REPORT, ITS CONCLUSIONS AND RECOMMENDATIONS ARE THE VIEWS OF THE

AUTHOR AND DO NOT NECESSARILY REPRESENT THOSE OF THE SPONSORING ORGANISATION OR

THE BOARD OF TRUSTEES OF THE HUMAN CITY INSTITUTE.

All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in

any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without prior

permission of the publishers.

While all reasonable care and attention has been taken in preparing this report, the Human City Institute nor

Compass regrets that it cannot assume responsibility for any errors or omissions. The views expressed are those of

the authors.

The Authors 2015

ISBN 978-1-906149-32-1

First published in March 2015 by the Human City Institute 239, Holliday Street, Birmingham B1 1SJ

Internal design and layout by Kevin Gulliver

Cover design by Sheldon Bailey

Printed by Callprint




Acknowledgements

The authors would like to thank David Orr for contributing a Foreword to this report. Thanks also to

the housing organisations in the Matrix Housing Partnership for supporting this report.

A special tribute to Guy Standing of University of London for his ideas about developing a charter

to ameliorate the problems of the precariat class, so many of whom, unfortunately, live in social

housing following the effects of austerity, welfare reform, persistent poverty and burgeoning

inequality in the UK.

This report is dedicated to all of those social tenants who are struggling to make ends meet

because of no fault of their own and who remain dignified in their everyday lives despite being

stigmatised by some political parties and some sections of the media,

March 2015




Page | 1

Foreword

David Orr

Chief Executive

National Housing Federation

Reducing poverty among social housing tenants and improving the life chances for all who live

in the sector should be central to UK housing policy and command wide support from all political

parties, policy-makers and opinion-formers.

Social tenants have been disproportionately affected by austerity, welfare reform and escalating

prices to an extent where, the authors of A New Deal for Tenants argue they are unfortunately

part of a precariat class marked by low incomes, insecure employment, a lack of assets and

stalled mobility.

Offering social housing tenants greater opportunities of a stake in the nations wealth to reduce

inequality is part of building a fairer and more equal democracy, which should be the goal of all

in the second decade of the 21st Century.

This report from the Human City Institute is timely then, and proposes ways to tackle disparities in

wealth between social housing tenants and home owners, which the report by the National

Equality Panel, chaired by Professor John Hills of the London School of Economics, underlines.

The strong links between wealth and the housing market, between owning assets and owning

your own home show that we have to challenge widening wealth inequality to prevent it

becoming a brake on opportunity, social mobility and cohesion.

HCIs report argues that extending asset ownership cannot be achieved solely by encouraging

greater levels of home ownership. We must explore other innovative ways of widening asset

ownership, requiring partnerships between Government, social housing providers, tenants and

the wider community.

The report proposes an ambitious New Deal for Tenants under which assets could be

accumulated by tenants through a Government-funded scheme creating quasi asset accounts




Page | 2

dependent upon length of tenancy, periodically topped-up and into which social housing

providers and tenants could save further funds. A savings culture might also be renewed as we

slowly emerge from the shadow of the international financial crisis which hit us all in 2007/08 but

adversely affected social tenants more than most.

Times will be hard over the next few years with further cuts in public spending in the offing, which

will directly and indirectly impact on social housing and community regeneration. So perhaps the

most interesting aspect of the reports proposals addresses this issue head on by recommending

recycling the New Deal Fund into new housing investment, retrofitting the social housing stock

and enhancing community infrastructure.

Social housing tenants would receive an extra benefit in seeing their homes and neighbourhoods

improved while keeping the New Deal Fund relatively safe and presenting the Government with

good value for public money.

In the present economic environment it is critical that we think creatively to challenge wealth

inequality, invest in our homes and neighbourhoods and improve opportunities for tenants.

This report is an important contribution to that thinking.




Page | 3

SUMMARY

About the Report

The report seeks to discover whether social tenants are part of a growing precariat class

identified by academic Guy Standing. It then moves on to ask whether Standings idea of a

precariat charter can be imported into social housing via public policy and by social landlords

themselves.

Finally, the report proposes a New Deal for Tenants to encompass those precariat charter

elements most applicable to social housing, enabling tenants to lead more meaningful lives as

citizens rather than the Standings denizens they increasingly resemble.

Key Findings

A summary of key findings from the research is shown below under main headings.

Defining the Precariat

The precariat is defined as a new and emerging class facing chronic insecurity and marked

by poverty, disadvantage, economic uncertainty, high and long-term unemployment, reliant

upon high-cost credit and those without assets detached from old class boundaries. It is not

simply the poorest of the traditional working class; it also includes debt-burdened and/or over-

qualified graduates who now find themselves in an unstable employment market and priced

out of secure housing.

Social Tenants A Precariat Class?

There is a large overlap between membership of the precariat and some of the economic

and social indicators of those in the community most likely to be living in social housing.

Social tenants are increasingly stigmatised incorrectly by the media and targeted by the

welfare system as skivers as opposed to the strivers beloved of current policy-makers which

feeds into a powerful narrative of why cuts to reduce the National Debt have fallen on those

least able to bear them.

There is embedded poverty and disadvantage in social housing. Social tenants are

characterised by low incomes, welfare benefit reliance, a lack of assets on which to count in

times of crisis, dependency upon high-cost credit, and eroded standards of living through

above inflation increases in household essentials which make up the majority of tenants

household budgets.

A Precariat Charter - Rights and Requirements

A precariat charter seeks to enable those in the precariat class to become citizens once

again rather than denizens as they currently are. This would be achieved by enhancing rights

and tackling those policies which lead to denizenship rather than citizenship.




Page | 4

Social tenants clearly support some of the ingredients in the precariat charter adapted for

practical application; including a Living Wage, greater job security, better benefits (or

perhaps a Citizens Income?), regulated high-cost credit and support to improve their financial

knowledge and action by their social landlords to enhance tenancy sustainability.

Scoping a Precariat Charter for Social Housing

Social tenants because of the growing pressures placed upon them by housing policy and

practices enforced by government (such as changes to how homeless people are aided and

reductions in security of tenure), and a changing economic environment for social landlords

- now have less control over the decisions that shape their lives than in the past. It is this that

also contributes to the disintegration of the concept of the home, and the widening gap

between the precariat and other citizens.

A New Deal for Tenants

Social tenants in the UK need a New Deal that incorporates some aspects of Standings

precariat charter elements. The New Deals is built around extending social tenants rights

and community control, and the improving the affordability of many aspects of their lives,

including rents, living costs and credit.

The centrepiece in a precariat charter for social housing, is a New Deal for Tenants that

attempts to rescue the tenure from its poor (and undeserved) reputation via massively

increased investment in housing quality and service delivery, and introduction of a range of

new benefits (both monetary and social) to improve the status of those who live in the sector.

It would be an asset-based welfare approach whereby quasi asset/savings accounts would

be established for every tenant (like the now defunct Child Trust Fund).

Key benefits would be to reduce financial exclusion in the social housing sector and to provide

more stable and sustainable tenancies. Considerable savings in the housing management

costs of social landlords (e.g. via reductions in housing stock churn and vacancy rates) might

equally be achieved. The proposal would equally enable social tenants to build-up assets for

themselves or their children. Wealth inequality between tenures would be reduced too and

enable social tenants a more equal stake in national wealth.

This New Deal Fund would be controlled by a Social Tenants Mutual which might have

regional branches dependent upon localised contribution levels, lending money back to

social landlords and other third sector agencies at lower than market rates of interest. The

New Deal Fund management and lending vehicle would be tasked with improving existing

housing and community infrastructure, and supporting the development of new affordable

housing.

Consequently, social tenants savings would be safe with growth largely guaranteed, while

social tenants would see over time more investment in their neighbourhoods, thereby creating

a virtuous and ethical cycle of investment and representing considerable value for public

money.




Page | 5

1.

About the Report

Introduction

This report seeks to draw upon the work of University of London academic Guy Standing,1 who

has written widely and deeply about the precariat class and put forward the idea of a

precariat charter to ameliorate the position of a group of people who live precarious lives

marked by poverty, inequality and uncertainty.

The Human City Institute (HCI), which has a specific interest in chronicling poverty, inequality and

injustice in mainly city settings, has undertaken a range of research into the effects of austerity

post-2008, welfare reform and rising living costs on the pockets and purses of the poor. HCI has a

special interest in how these societal problems intersect with social housing and those who live in

this still large, but shrinking, housing sector.

The following report then, deploys the findings from this research, and from the literature around

precarious living and the growth of the precariat class, especially the work of Standing. It aims

to answer a series of research questions focusing on whether social tenants are part of the

precariat class. It further explores if a precariat charter is a useful policy tool to improve the

economic and social position of social tenants. Finally the report proposes some ideas for

importing precariat charter ingredients into social housing.

Research Questions

The key research questions asked in the report are:

What are the characteristics of the precariat class and what is the fit with those people

and households currently living in social housing?

Can a precariat charter, as proposed by Standing, be deployed, at least partially to improve

the lives and life chances of social tenants? And does this fit with the stated requirements of

social tenants?

To what extent can social landlords deliver elements of a precariat charter to their tenants

and can a New Deal for tenants be constructed?

What role does government have in supporting policies that reduce precarious living and can

this be achieved within the context of austerity and debt reduction?

1 Standing G. (2011) The Precariat: The New Dangerous Class. Bloomsbury. London & Standing G. (2014) A Precariat Charter: From Denizens to Citizens. Bloomsbury. London




Page | 6

Research Methodology

The research for the report encompassed a range of approaches including:

Review of Literature

The research has included a review of key literature relating to the precariat class and a

precariat charter, predominantly by Guy Standing. Other literature around austerity, welfare

reform, poverty and inequality in general, and relating to social housing in particular was also

been utilised.

HCIs Research

The report draws heavily upon recent research by HCI2 which charts, mainly through survey and

focus group work with tenants of social landlords living in urban and rural areas, the financially

precarious position of social tenants in the current economic and social climate with austerity,

welfare reform and the above average increases in the costs of household essentials biting deep

into their standard of living.

This research also focused upon social tenants views about the sorts of policies at national level,

and those that are, or could be enacted by social landlords to reduce the precarious living of

social tenants and enhance the sustainability of tenancies and homes in economic and societal

terms.

Structure of the Report

The report first explores what is meant by the precariat class and how its characteristics fit with

those of social tenants. It then moves on to ask how precariousness might be tackled by social

landlords and public policy. Finally it seeks to create a framework for action under the banner of

a New Deal for Tenants.

2 Gulliver K. (2011) Living on the Edge: Financial Exclusion and Social Housing. HCI. Birmingham & Cox. J., Gulliver K. and Morris J. (2011) On the Margins: Debt, Financial Exclusion and Low Income Households. Compass. London & Gulliver K., Trevitt V. and Cox J. (2014) Beyond the Margins: Debt, Financial Exclusion and Social Housing. HCI. Birmingham & Gulliver (2015) Costing a Living: The Experience of B3 Livings Broxbourne Tenants. HCI. Birmingham




Page | 7

2.

Social Tenants A Precariat Class?

Introduction

This section of the report seeks to define the characteristics of the precariat class. It then explores

whether such characteristics match those living in social housing, using data from various national

surveys3 and those undertaken by HCI. It also utilises focus group data from HCIs research.

Defining the Precariat The precariat is defined as a new and emerging class facing chronic insecurity and marked by

poverty, disadvantage, economic uncertainty, high and long-term unemployment, and those

without assets detached from old class boundaries. It is not simply the poorest of the traditional

working class; it also includes debt-burdened and/or over-qualified graduates who now find

themselves in an unstable employment market and priced out of secure housing.

Are Social Tenants Part of the Precariat? There is a large overlap between membership of the precariat and some of the economic and

social indicators of those in the community most likely to be living in social housing. It is to this

overlap that the report turns to next, taking some of these indicators in turn.

Poverty, Disadvantage and Inequality: Over the last six years or so, stagnating wages, the growth

in precarious unemployment, part-time work and zero hours contracts have conflated with

soaring living costs to create a perfect storm where more and more people, especially those with

little economic choice or power, are becoming reliant on credit to make ends meet. This has

been taking particular toll on vulnerable and low income communities, many of which are

accommodated by social landlords, exacerbating poverty and disadvantage (in both absolute

and relative terms).

Expansion of poverty and disadvantage have been accompanied by a widening gap in wealth

and income inequalities so that the UK is now the second most unequal country (after the USA)

in the G20 of industrialised nations. The long-run share in national income of the top 1 per cent of

earners, following sixty years of reducing inequality from the end of World War One to 1979, have

returning to levels not seen since Edwardian times. As the ONS Wealth and Assets Survey (WAS)

shows, the richest 10 per cent now own 4tr of total UK net wealth of 9tr while the bottom half

own less than 900bn.

3 Housing Corporation and Tenant Services Authority (2004 to 2010) various surveys of tenants across England with sample bases from 8,000 to 19,000. Hills J. (2010) Wealth and Assets Survey. ONS/LSE. London




Page | 8

Inequalities have grown faster in recent years. In 1997, the gearing between the wealth of the

top 1 per cent of the UKs population to the bottom 90 per cent was 18:1. But this had ballooned

to 60:1 by 2007. There is evidence that this gap is widening further as the effects of austerity and

welfare reform policies begin to bite. Tenure is also a metaphor for inequality with home owners

controlling at least 20 times more assets on average than social tenants.

Social tenants face a precarious existence. They are generally in the lower income bracket, rely

on welfare benefits and tax credits to survive, are more likely to be employed on sick or disabled,

have little in the way of assets (such as savings) to fall back on in times of crisis, are reliant upon

family and friends and high-cost lenders for loans (often just to get to the end of the week), and

are less likely than other groups to have access to mainstream banking services of Information

and Communications Technology (ICT). Some of these issues are discussed individual below,

drawing on the findings of HCIs surveys

Income and Benefits: Over two fifths (43 percent) of social tenants have total household incomes

(for all household members including benefits and tax credits but not housing benefit and with

taxes deducted) below 5,200 (99 per week) with the median income being around 7,900.

Some 80 percent have net household incomes below 10,400 (199 per week). Only 4 percent

have incomes above the national median wage of approximately 26,000 (also the benefit cap).

These findings are summarised in chart (1) below. Seventy-seven per cent of tenants are eligible

for housing benefit.

43

37

10

3 4 40

5

10

15

20

25

30

35

40

Up to 99 100-199 200-299 300-399 400-499 500 or more

Pe

rce

nta

ge

Chart (1) - Level of Tenants' Total Household Income ( per Week)[Source: HCI Survey (2014)]




Page | 9

Economic Activity: Forty-five per cent of tenants are economically active, with 24 per cent

employed full-time, 14 per cent employed part-time and 7 per cent in education or training. Of

working tenants, 35 per cent are in short-term work and sometimes working under zero hours

contracts.

Length of Unemployment: In terms of length of unemployment, one third (33 per cent) of

unemployed tenants are short-term unemployed of less than one year, with 9 per cent less than

3 months and 11 per cent 4 to 6 months. Seventeen per cent have been unemployed between

1 and 2 years and 38 per cent between 2 and 5 years. More than half (52 per cent) of

unemployed tenants have been out of work for more than 5 years.

Financial Exclusion: The National Housing Federation and the Institute of Housing in a range of

reports4 show that social tenants are disproportionately affected by financial exclusion and debt.

They constitute around 60 per cent of all financially excluded people but constitute only 18 per

cent of the general population. Nearly one in six social tenants have no bank account: twice as

high a proportion as the rest of the population. Eighty-one per cent have no savings account

Ninety-one per cent have no insurance cover. And one third dont have access to ICT.

Over one third (34 per cent) of tenants say that their financial circumstances are poor or very

poor. Just 4 per cent describe them as very good. Sixty-nine of tenants have no savings. Of those

who do, only 11 per cent say they are high or very high. Forty-six per cent of savers have less than

1,000 and 73 per cent have less than 3,000. Just 19 per cent of savers have over 5,000 (7 per

cent of total tenants).

Ipsos MORI and the Cambridge Centre for Housing and Planning Research (2013)5 commissioned

by the NHF to assess the impacts of welfare reforms for housing associations found that:

Four in ten (40 per cent) working age social tenants affected by welfare reforms do not have

access to the internet and of those who do have access, half (51 per cent) say they wouldnt

be confident making a benefit application online (equivalent to 30 per cent of all

respondents).

More than four in five (85 per cent) working age social housing tenants who have been

affected by welfare reforms say they have a bank or building society account;

A majority (95 per cent) currently have their Housing Benefit paid directly to their landlord and

nine in ten (92 per cent) say they would prefer benefits to be paid directly to their landlord

rather than their own accounts.

Seven in ten say they budget fortnightly or more frequently, and of these 68 per cent would

not be confident of planning their budget on a monthly basis. Fifteen per cent say they usually

budget monthly or less frequently.

4 NHF (2014) Welfare Reform Impact Assessment. London 5 NHF (2015) Welfare Reform Impact assessment: Final report. London




Page | 10

Around one in six (16 per cent) say they know a great deal or a fair amount about the change

to Universal Credit whereas around a third (34 per cent) say they have never heard about the

change to Universal Credit.

Other research by the NHF (2013) found that:

Housing associations expect some tenants will be unable to keep up with their rent following

welfare reform leading to an increase in the number of evictions for rent arrears.

Associations believe the social rented sector is likely to be placed under even greater pressure

as those unable to meet their needs in the private sector turn to the social rented sector for a

solution.

More than a quarter of associations (27 per cent) believe the introduction of the household

benefit cap will result in a rise in family separation.

Eighty per cent of associations believe they are likely to see an increase in the number of

existing tenants requesting a transfer to smaller property following the introduction of the size

criteria but just three in ten believe they are likely to see a rising number of tenants moving to

the private rented sector.

Tenants are considering what, if anything, they can cut back on in their household

expenditure in order to meet any increased costs.

Rent remains a priority, but heating, food and non-essential cut backs are all being

considered.

Those aware of the reforms were anxious and uneasy about what is going to happen. For

those affected by the size criteria, this is driven, in large part, by financial concerns. Money is

already tight and the possibility of having to find more each month to cover a reduction in

housing benefits is a source of concern for them.

Social tenants in HCIs focus groups provide insights into their plight and confirm the

precariousness of their lives:

Nobody is better off. Ive cut back on fuel and food. Do less shopping so that you cant spend any money. Cant afford to eat much meat. Being careful and monitoring everything including water dont just let it go down the drain. Never fill the kettle - only just enough for a cup of tea. Get up later and go to bed earlier. Wear extra woollens and drink hot soups.

The cuts are too deep and too quick - affects vulnerable people of all ages, particularly older people.

Standard of Living and Quality of Life: In the last two years, 31 per cent of tenants indicate that

their standard of living has worsened. 49 per cent say it has stood still and only 20 per cent have

witnessed any improvement. Similar results were found when tenants were asked about their

quality of life. The key reasons for this are explained by the following two charts, which show that




Page | 11

tenants main items of expenditure, food and fuel, have seen much higher levels of inflation over

recent years, while wages and benefits stagnated, so eroding tenants standard of living.

Tenants comments illustrate how their standard of living has been hit drastically:

Just have to buy the cheapest food or go without. Often just live on toast. There are days where you just dont eat.

Living costs have risen by 30-40 per cent. Heating costs have doubled.

Petrol has rocketed. Rents and service charges have increased while benefits are going down.

Weve all got less money and it is going to get worse. It is very hard to follow the benefit changes.

People want to work but they are penalised.

Older people would like a part-time job but it would affect their benefits so they darent.

Young families - the mums go to work and then dont qualify for family credits, they cant afford the nursery places.

It makes no sense to give people no incentives.

Bus and train fares have gone up so people are afraid to go anywhere because of the cost and older people cant walk to town and back to buy cheaper food from the market.

Nobody has any savings left - you have to use what little bit you have to make ends meet.

The gap is widening between the cost of living and salaries. I have not had a pay rise in four years.

Food is a luxury. Food prices escalating cant even think of buying anything other than basic ranges.

Heating costs have increased practically doubled. Too much time and effort needed to switch companies on a regular basis.

Car and house insurance has rocketed. Petrol is increasing all the time. Cant afford to travel anywhere either by car or public transport.

Eat less.

People on low income and on benefits are penalised every which way.

People are just depressed because they cant make ends meet, it is too difficult.

Use your credit to bridge the gap but then you cant pay it off so you pay more.

Dont use the heating. Wear an extra layer.

The Government is penalising low paid workers and those on benefits because they dont care and are ignorant of what it is like to be short of money.




Page | 12

Debt: Generally, tenants debts are not high in cash terms on average. Fifty-five per cent of

tenants say they dont currently have any debts many because they are unable to access

credit at all.

One in 5 of tenants with debts owe less than 300, and two in five tenants have debts of less

1,000. Twenty-seven per cent have debts between 1,000 and 3,000 and 13 per cent have

debts amounting to 3,000 to 9,000. Some 14 per cent have debts in excess of 10,000. Just 10

per cent describe their debt as high, with 21 per cent saying they have some debt. Fifteen per

cent say not much.

The average (median) debt is calculated to be around 1,500, which is not massive until tenants

incomes are taken into account. So the median debt to income ratio is about 1:5. However, this

places tenants in a precarious position if the debts are owed to high-cost lenders. Indeed,

repayment of debt is tenants third greatest expenditure item after food and fuel.

As shown in chart (2) above, 18 per cent of tenants say that they always or often have

problems making ends meet at the end of the week with 48 per cent saying they sometimes

have problems making ends meet. Only 34 per cent say that stretching their income is never a

problem. Around 1 in 5 of tenants had used a high-cost lender, such as payday loan companies,

or pawnbrokers, or high-cost credit stores like Brighthouse, in the last six months, and a few had

borrowed from illegal money lenders.

0

10

20

30

40

50

60

70

80

90

100

Have problems with

debt repayments

Feel harassed by

lenders

Do without necessities

to meet debt

repayments

Have trouble making

ends meet at the end

of the week

Pe

rce

nta

ge

Chart (2) - Tenants' Experience of Debt[Source: HCI Survey (2014)]

Always Often Sometimes Never




Page | 13

Conclusions

The precariat class is marked by uncertainty in the present and future. People in the class live

precarious lives in relation to work, life planning and life chances. They have few assets, are reliant

upon high-costs credit and benefits to survive, have low and varying incomes, and work in part-

time, temporary and zeros hours employment.

As the above analysis reveals, social tenants display many of the characteristics of the precariat

class especially low incomes, high and precarious unemployment, a paucity of assets on which

to rely in crises and dependency upon debt to make ends meet.

Of course, not all social tenants have all these characteristics. However, we estimate that at least

two thirds of social tenants exhibit at least three of these characteristics.




Page | 14

3.

A Precariat Charter -

Rights and Requirements

Introduction

This section describes some of the chief elements in a precariat charter, focusing on rights-

based policies approaches. It then moves on to consider, using HCIs research, the sorts of

interventions social tenants want from government and social landlords to improve their lives and

status that dovetail with precariat charter elements.

Rights

Designing a set of policies to address the challenges faced by the precariat is a difficult task

because this new class of citizens is so different to what has historically been understood by that

term. Standing identifies a new emerging class structure with the precariat at the bottom. At

the top is an elite of super-wealthy individuals and families who are largely immune to economic

change. Under them is the salariat in stable, salaried employment with pensions and associated

in-work benefits. Then comes the proficiat of professional and technicians earning good

incomes as self-employed consultants for example. Next is the old working class a shrinking

core of traditional, skilled and unskilled manual workers. Finally, is the precariat.6

A key characteristic of the precariat, beside their precarious lives driven by low incomes and

lifelong uncertainty, is that they have lost their civic rights, leaving them unable to participate fully

in society. In explaining how we have come to allow a precariat class to grow so rapidly,

Standing carefully describes how the rights of citizenship have been slowly stripped away, leaving

them not citizens but mere denizens. Many who belong to more affluent classes, as described

above, often come to take civic rights for granted. Civic rights should include:

Civil Rights: such as the right to life and liberty, the right to a fair trial in a equal justice system,

and freedom of expression.

Cultural Rights: including the freedom to participate in a chosen culture and speak chosen

languages freely.

Political Rights: the right to vote and to stand for office, and to campaign and demonstrate

freely.

Social Rights, including the right to housing, healthcare and education.

6 Standing G. (2010) Op. Cit.




Page | 15

Economic rights: a share in the resources of your country or community, and a fair share of

economic growth.

Typically, denizens are perceived as former citizens who have lost these rights as a result of

transitory statelessness; asylum seekers who are denied refugee status, for example. However, as

Standing demonstrates these rights are being denied as a result of poor handling of economic

and social policy. Our organs of democracy have left this new precariat class behind. As

Standing7 explains:

Denizenship can arise not just from migration but also from an unbundling of rights that removes some or all of the rights nominally attached to formal citizenship [This] unbundling of rights has gone with a class-based restructuring of rights. This is the ground on which the

precariat must make demands.

Standing argues for a new set of policies or demands, which would reinstate the basic rights of

citizenship, and provide some social, democratic and economic security for those currently living

precarious lives. A precariat charter, which sets out measures to recreate a citizen state, moves

beyond the traditional political boundaries of left wing versus right wing. It is a progressive

alternative, following in the footsteps of the reformers before us, such as the Chartists. Says

Standing:

The Chartists set the scene for a future forward march; they were a loose alliance of emerging class interests, asserting rights and expressing their insecurities and injustices.

Soon their demands were to become new norms.

Like the Chartists, a precariat charter demands action for this new, growing precariat class.

The challenge is to describe and shape a strategy for realizing it.

Standings approach is designed to encourage a fair society rooted in an asset-based welfare

system, redistributing productive assets among all citizens rather than based on independent

wealth, income and inheritance. Its measures embed all five forms of civic rights lost in our current

system, creating the precariat and its denizens.

Some of the most interesting items in his 29-point charter force us to look critically at both the

welfare state and the apparatus of government in its failed efforts to distribute effort and assets

fairly. Standing calls for an end to workfare policies which force the precariat to work in return

for the welfare support to which they should be unconditionally entitled to as a citizen without

employment. Similar arguments are made about the commodification of education, and the

chilling effect of rising graduate debt.

A key article in Standings charter is the introduction of the citizens income. This simple and

increasingly popular policy which replaces all means-tested welfare benefits with a single,

unconditional annual payment to each adult as a right of their citizenship. It is designed to

7 Standing G. (2014) Op. Cit.




Page | 16

prevent all of us from falling into poverty traps, and to tackle the needs of the disenfranchised

precariat more directly.

One key argument in its favour is that it removes the stigma from state support: we all start from

the same base, and can keep any money we earn above that base level. In the UK, such a

measure would be funded by removing costly and complex means testing mechanisms in the

current benefits regime (these payment schemes are removed altogether) and dropping the

level at which tax is charged on additional income.

Considering the plight of the precariat, its clear that urgent reform of our civic structures is

necessary to improve both quality of life and life chances for a growing proportion of the

population. Standing puts forward a series of proposals including reform of the labour market and

regulating flexible labour, reforming the high-cost credit market, reducing poverty and precarity

traps, improving knowledge of finance, greater equality through capital sharing and reviving

common and collective endeavour through mutualism.

Requirements: What Tenants Want

Having discussed the rights agenda stemming from Standings precariat charter proposals, it

is time to consider whether social tenants requirements and their support for any of the precariat

charter ingredients and if such policy changes at a national level, or by their social landlords,

could improve their lot. The following two charts summarise the results from HCIs research.

1.3

1.9

2.1

2.2

2.4

2.5

3.6

3.7

3.8

4.2

0 0.5 1 1.5 2 2.5 3 3.5 4 4.5

Better access to credit union loans

Being able to borrow from the Post Office

Local savings schemes by HAs

Capping high-cost lenders to lower APR

Having a bank account

Capping interest on credit/store cards

Better job security

Increased wages

A Living Wage

Increased benefits

Score out of 5 (5 being highest priority)

Chart (3) - Tenants' Priorities for Policy Changes

to Tackle their Financial Problems (score out of 5)[Source: HCI Survey (2014)]




Page | 17

Social tenants clearly see where their priorities lie in advocating actions to relieve their financial

exclusion by the wider economy and society. At the top of their list is increased welfare benefits

which have been eroded over the long-term in relation to wages. Their priorities also include the

introduction of a Living Wage and wages increased generally. Alongside, enhanced job security

in the age of part-time and zero hours work is a priority. And tenants also want to see a range of

actions to reduce the costs of borrowing and to improve access to affordable credit.

As shown in chart (4), social tenants want social landlords to provide a wider range of services to

alleviate financial exclusion, reduce their reliance upon high-cost credit and to aid tenancy and

community sustainability. They clearly want rents and service charges kept down (at 61 and 60

per cent respectively) and many social landlords are trying to do this. Tenants would also like

greater provision of furnished housing, extension of banking services, help with employment,

training and short-term loans at reasonable interest.

Conclusions

A precariat charter seeks to enable those in the precariat class to become citizens once again

rather than denizens as they currently are. This would be achieved by enhancing rights. Social

tenants clearly support some of the ingredients in the precariat charter adapted for practical

application; including a Living Wage, greater job security, better benefits (or perhaps a Citizens

Income?), regulated high-cost credit and support to improve their financial knowledge and

action by their social landlords to enhance tenancy sustainability.

4

14

15

20

25

30

36

41

46

47

60

61

0 5 10 15 20 25 30 35 40 45 50 55 60

Other

Help with budgeting

Help with small business start-up/development

Landlord offers short-term, low interest loans

Landlord offers money advice

Landlord helps with education/training

Landlord helps with furniture

Landlord provides employment directly

Landlord offers banking/saving

Landlord provides furnished tenancies

Reduce service charges

Reduce rents

Percentage

Chart (4) - Tenants' Priorities for Social Landlords

to Tackle their Financial Problems[Source: HCI Survey (2014)]




Page | 18

4.

Scoping a Precariat Charter

for Social Housing

Introduction

In section 4, the report seeks to assess how housing-related policies in recent years have fed the

precariat class and how a new set of policies designed to return citizenship to social housing

denizens might help scope a precariat charter for social housing.

Social Housing as a Testbed The social housing sector is a relevant testbed for precariat charter measures, supporting as it

does a large minority of that new and growing class. Clearly there is much in Standings original

thesis that cannot be enacted by a single sector alone. But there are smaller, equivalent steps

that can be taken at organisational, or even estate, level that could help to embed the social

values that will improve prospects and opportunities for the precariat as well as creating more

equal communities.

The social housing sector could do much to mitigate the worst risks to which this new precariat

class is exposed, as previously discussed. Social landlords, after all, provide affordable

accommodation to those in most need, offering stability and a foundation for life.

However, current housing and welfare policy in the UK is having the opposite effect. The way that

social landlords are forced to operate today - and the way in which some choose to structure

their organisations - is cementing the link between a growing precariat and social housing. Not

only are members of the precariat more likely to live in social housing, but social housing policies

and practices are actually increasing the numbers of people living precarious lives. This is

explored next.

Homelessness

At its most basic level, government policy now states that housing support is no longer

guaranteed to those who are struggling to house themselves. Under new regulations put into

place two years ago, local authorities are no longer required to provide an offer of a social

tenancy to those who are found to be legally homeless.

The homelessness suitability of accommodation (England) order came into force on 7

November 2014. Before this point, when someone presented as homeless to a local authority,

that council could make an offer to help the applicant find somewhere to live in the private

rented sector, including offering support with a deposit or rent in advance. However, the




Page | 19

applicant could still turn that down and wait (usually in temporary accommodation such as a

B&B or hostel) until a council or housing association property became available. For those that

chose to hang on, it offered a clear route out of homelessness; stability for life.

Now that route is lost. Those who refuse a first offer of help into the private sector (which usually

only provides a 12 month tenancy) will then be assessed against five strict criteria to see if they

are considered legally homeless. If they are, they could still be offered help in the private sector.

But they may fail that test.

As tenancy advisor Ben Reeve-Lewis wrote at the time:

The homeless household has a certain amount of choice and control if they accept the homelessness prevention offer. Yet if they choose to go through the full assessment route, they

run the risk of failing a test and getting no housing assistance at all. And if they pass the five

tests they will probably be offered the very same property.

Today, homeless applications are no longer a assured route into social housing.8 Though there

has been some targeted work to support rough sleepers in cities (such as the No Second Night

Out scheme) this significant change in policy has led to a rise in revolving door homelessness,

as short term tenancies in the private sector are lost. The number of homeless people in the UK is

rising year-on-year with 185,000 a year now affected. The number of people sleeping rough in

London rose to 6,437 in 2012-13.

Meanwhile, support services that work with council homelessness referrals are also being cut as

a result of a huge drop in government funding for local government. A study by Inside Housing,

drawing on information gathered through the Freedom of Information Act, found 77 local

authorities cut a total of 34m from their homelessness budgets.

The issue of homelessness has since been axed from the housing ministers brief, leaving it

divorced from the governments wider housing policy. It is also worth noting that under this

government the act of squatting an empty residential property has also been criminalised,

leaving homeless people refused council support with literally nowhere to go.

Changes to Tenancy Rules

We are seeing an increase in the number of people precariously housed. Growing use of the

private rented sector in place of a shrinking social housing stock is an obvious example of this:

private tenancies are rarely offered for more than 12 months (after which rents often rise) and

such lack of stability is a key indicator of membership of the precariat.

But social housing is becoming a more precarious tenure too. Changes to the type of tenancies

offered by social landlords are creating a growing precariat population. In the past, social

housing tenancies were overwhelmingly offered as lifetime agreements, often with the possibility

8 http://www.theguardian.com/housing-network/2012/oct/26/council-homelessness-rules-housing-policy




Page | 20

of passing that tenancy on to another member of the family. This ensured that a secure home

could be maintained as a foundation for family life.

Now housing associations have the flexibility to offer shorter term and starter, or flexible,

tenancies to new tenants. These may be anything from one year to five years in length to begin

with, and are reviewed at regular intervals. If a tenants circumstances are considered to be

sufficiently improved, that tenancy can be removed from the property and left to find alternative

options in the private sector. These tenancies can also be used to test the offer of a home against

certain behaviours: not simply paying rent on time, but taking part in activities to promote access

to work, parenting other socially desirable activities. Social tenancies are increasingly becoming

conditional on factors other than need.

More importantly, the social tenancy has also been divorced from the guarantee of a sustainable

rent level with the introduction of the governments affordable rent (AR) regime. Under AR,

housing associations benefiting from government grant to develop new homes are free to

charge up to 80 per cent of market rent levels to maintain their competitiveness, with the average

charge sitting at 65 per cent of market rent. Most of these will be let on a flexible tenancy basis.

In the areas in which this new tool is being used most aggressively, affordable is a misnomer. A

two bedroom flat in Southwark let at 80 per cent of market rate would require a household

income of almost 44,000 to sustain it. Even 65 per cent of market levels is extremely high in

comparison to average inner London salaries. Social rents are effectively rising out of the reach

of those who are granted a social tenancy.9

The government has warned that future grant funding may require housing associations to

migrate tenancies across from traditional social rent regimes to AR. These changes mean that

even when a social tenancy is achieved, it is often short term and can be expensive; it is now a

more precarious tenure than many realise.

Welfare Reform and Sustainable Tenancies

The rising cost of sustaining a tenancy across both the social and private rented sectors is a key

cause for concern. The single biggest issue facing tenants today is welfare reform. Caps on overall

benefit levels are hitting claimants in London and the south-east of England hard, with some

forced to move to new areas (often away from their community and support networks) to find a

cheaper property that can be managed on reduced income levels.

The introduction of the bedroom tax has put additional pressure on tenants, particularly those in

social housing who are allocated and property and can exercise little choice over the number

of bedrooms in their home. Government admits that 660,000 households affected by the

additional housing benefit cut. Even those who choose to move in order to avoid the tax may

find there is nowhere to go: some analyses suggest that 96 per cent of those looking to downsize

into a one or two bedroom property are trapped. Meanwhile the government is still aggressively

selling off small properties to tenants through the heavily-discounted right-to-buy scheme,

9 http://londonist.com/2013/09/affordable-housing-get-ready-for-80-of-market-rent.php




Page | 21

particularly in central London and the south-east where smaller properties are in demand and

more valuable. In Camden, 81per cent of homes sold since 2010 had either one or two bedrooms,

while 74 per cent of Southwarks sold stock was small. Across 125 council areas, almost half (45

per cent) of the total 14,616 properties sold across England had two bedrooms or less. As such

there are very few smaller homes available for tenants to move into unless they forego the relative

(though diminishing) security of a social tenancy and move into the private sector where they

face a higher risk of sudden eviction and uncapped rent rises.

Sustaining a tenancy is becoming increasingly difficult in itself. The majority of new housing benefit

claimants are in work, and work paid at the minimum wages is not sufficient to meet the cost of

rising rents across both the social and private sectors. Part time or zero hours contracts are

increasingly common in low wage industries, while wages are rising more slowly than the cost of

living - and particularly slowly when compared with rising rents. With the latest showing a fall in

inflation to 1.6 per cent, regular pay rises are unlikely to resume for most employees during 2014.10

For those entering work after a period of unemployment, starting salaries are stagnant. According

to the CIPD, just 2per cent of employers offered an above-inflation pay rise to new recruits last

year. This will also impact directly on housing benefit levels:

Camerons plan to peg housing benefit to wages rather than prices will hit the precariat hard.

Wages are falling, housing costs are rising.11

The situation is likely to deteriorate as the roll out of Universal Credit, a single monthly payment

rolling all benefits into one and updated in real time as claimants circumstances change,

progresses. To date the project has run behind schedule due to poor management; in August

the Public Accounts Committee reported that categorising the scheme as reset could have

the effect of preventing scrutiny into its earlier failings.12

Nevertheless the first 12 pilots revealed the implementation, even if managed securely by

government, will put enormous pressure on households struggling on low incomes. The decision

to roll housing benefit into the single payment, meaning that it is up to tenants to ensure that they

pay their rent on time even though the cost is covered with state support, has caused particular

consternation to housing associations. Many fear that hard-pressed tenants will prioritise other

costs (such as heating and food) over rental payment. Early tests of the scheme suggest it is a

possibility, with one study indicating that arrears increased by 180 under UC. Some housing

associations are already demanding that tenants overpay rent before the introduction of the

policy to prevent them falling into arrears when they switch over.13 The monthly payment is also

difficult for many tenants to budget for: figures suggest as many as half of those in low paid jobs

earning less than 10,000 a year are paid more than once a month.14

10 http://www.theguardian.com/business/economics-blog/2014/aug/19/uk-inflation-figures-pay-rise-interest-rates 11 http://www.theguardian.com/money/2014/aug/11/salaries-stagnent-cipd-survey-uk-inflation-wages 12 http://www.theguardian.com/politics/2014/aug/19/universal-credit-failings-pac-accuses-dwp 13 http://www.insidehousing.co.uk/rent-arrears-to-go-up-180-under-universal-credit/6526711.article 14 https://www.unison.org.uk/upload/sharepoint/Onpercent20lineper cent20Catalogue/21619.pdf




Page | 22

For those who are unemployed, an aggressive system of sanctions for Jobseekers Allowance

(JSA) - often mismanaged by staff who are targeted on the number they make per month - put

already precarious low household incomes at risk. In the year to September 2013, 874,850 JSA

claimants were sanctioned, a record high since the benefit was introduced almost 20 years

ago.15

Analysis by Glasgow Universitys David Webster showed that, through the period of coalition

government since May 2010, JSA sanctions have run at 4.4 per cent of JSA claimants a month.

This compares with approximately 2.5 per cent during the Labour government from May 1997 to

April 2010. Anecdotal evidence suggests that these sanctions are often through no fault of the

claimants own. Campaigners have collated examples of some of the most invidious decisions,

including delaying an appointment with Job Centre because it clashes with a job interview and

failing to demonstrate that effort has been made to find employment on Christmas Day.16

Combined, these measures mean vulnerable tenants are now at increased risk of eviction by a

social landlords because they are behind in paying rent. Welfare reform and associated

sanctions leave the poorest households - often those living in social housing - at constant risk of

losing their home.

The Costs of Living

Together with unstable and unreliable income streams, the cost of maintaining a home is also

rising fast. Energy prices rose 47.3 per cent between 2008 and 2014 as chart (5) illustrates.

Together, Britains big six suppliers increased their prices by 37per cent between October 2010

and November 2013 alone. During that period, average earnings rose by just 4.4 per cent.17

Meanwhile, across the developed world, the cost of food is also rising. In the UK, food inflation sits

at around 5per cent, far higher than wage inflation. Latest analysis suggests that, in the UK, the

cost of food will continue to rise faster than wages until at least 2018. In 2013, the chief scientist

Professor Sir John Beddington said the cost of food would rise globally as the worlds population

continued to grow. He warned that demand for food and energy would rise by 50per cent by

2030, with the result that the cost of living in the UK will also rise rapidly.18

In 2013, housing, fuel and power cost the average household 68 per week. The growing costs of

both utilities and consumables means that many members of the precariat, often living in social

housing, are now having to choose between heating and eating - often with a knock on impact

on rental payment too.

These household essentials are what take up the majority of social tenants incomes.

15 http://www.theguardian.com/society/2013/mar/21/jobcentre-set-targets-benefit-sanctions & http://www.theguardian.com/society/2014/feb/19/record-number-sanctions-benefits-claimants 16 http://birminghamagainstthecuts.wordpress.com/2013/07/13/a-selection-of-especially-stupid-sanctions/ 17 http://www.theguardian.com/money/2013/nov/16/energy-prices-rise 18 http://www.telegraph.co.uk/foodanddrink/foodanddrinknews/9776144/Cost-of-food-not-going-to-stop-rising-warns-UK-chief-scientist.html




Page | 23

18.9

13.3

20.2

21.8

30.7

31.5

36.5

47.3

0 5 10 15 20 25 30 35 40 45

CONSUMER PRICE INDEX

Communication services

Recreational services

Housing - rent & services

Water rates & meters

Food & drink

Travel & transport

Energy - electricity & gas

Percentage

Chart (5) - Consumer Price Index for a Basket of Goods (2008-2014)[Source: ONS CPI Tables (2014)]

2p

4p

4p

6p

8p

13p

18p

20p

32p

0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32

Other

Recreation

Support a disability

Clothing

On the home

Transport

Fuel

Debt repayments

Food

Expenditure of Household Items in Pence

Chart (6) - Average Expenditure per by Tenants on Household Items[Source: HCI Survey (2014)]




Page | 24

Reform of the council tax benefit system means that many of the poorest households are now

called on to contribute towards their council tax bill for the first time. When the council tax benefit

system was devolved to local government it was passed down with a cut in subsidy, meaning

more households are now called upon to pay. Many simply cannot afford to do so, placing them

at risk of fines and driving them further into debt.

One way that households are attempting to cope with these costs is by borrowing from high street

lenders or, in the most pernicious cases, door-to-door loan sharks. Although there has been some

movement in parliament to cap the interest charged by legal high street or online lenders payday

lenders, the rates inflicted upon borrowers who need money simply to pay their bills are pushing

tenants even further into membership of the precariat. Drawn together the impact is the

continual erosion of the concept of a stable home for the poorest people.

Housing as a Source of Asset and income Inequality

Finally, it is worth pointing out the broader context of how housing policy is linked to the growing

precariat. A sustained lack of investment in housing over a number of decades and successive

governments of all political persuasions has exacerbated the insecurity of the social housing

sector and led to the rising use of the private rented sector to cope with housing need. National

housing statistics show that more people now live in the private sector than live in social housing

for the first time since the rapid post-war expansion of the social housing sector. (This is in part due

to rising house prices forcing the relatively financial secure out of home ownership as well as the

failure to invest in the social housing sector).

The creation of a range of social housing products risks, different products for different people

with a range of socio-economic circumstances, risks embedding a them and us culture into

social housing - the exact opposite of what it is designed to achieve. The fact that the largest

housing associations are now plunging their funds into the development of new properties to offer

on the private rental market - while welcome for those relatively wealthy young professionals who

will find greater security than in the PRS - only compounds that feeling.

The shrinking power of tenant and resident associations and other democratic organs of local

control passed down to tenants has also had a chilling effect on the impact that social tenants

can have over decisions which affect their lives and futures. This has been more marked at the

largest social landlords become more corporate, seeking as they do to replace lost government

funding with more commercial ways of working in which the concept of mutualism holds little

weight.

Conclusions

Social tenants - despite the growing pressures placed upon them by housing policy and practices

enforced by government, and a changing economic environment for social landlords - now

have less control over the decisions that shape their lives than in the past. It is this that also

contributes to the disintegration of the concept of the home, and the widening gap between

the precariat and citizens.




Page | 25

5.


Introduction

This final section of the report proposes that social tenants in the UK need a New Deal that

incorporates some aspects of Standings precariat charter. The New Deals is built around

extending social tenants rights and community control, and the affordability of many aspects of

their lives, including rents, living costs and credit.

Community Control

The behaviour of social landlords has changed as they seek to work more closely with the private

sector than the state. Social housing providers have become large-scale developers, working

with contractors and private funders in order to design, build and populate new social housing

projects. In doing so, some of the language and ethos of corporate life has spread into the social

housing sector, with troubling results. It has subtly altered the relationship between landlord,

removing elements of community engagement and control and replacing it with a commercial

paradigm which further reduces and undermines the rights of tenants while increasing their

responsibilities. Social housing is no longer a community partnership.

A good example of this is the new language employed by senior housing professionals in their

working lives. Tenants are now regularly described as customers, yet by any meaningful

definition of the word this is a nonsense: customers exercise choice, while tenants are largely

allocated social housing because, due to their socio-economic circumstances, they have little

choice when it comes their housing options.

More important, tenants don't want to be called this; HCIs research asked what they would

prefer, tenants describe themselves as residents. This term emphasis the community

participation that is part and parcel of managing, and holding down, a tenancy. The removal of

this sense of community in everyday language has contributed to the demonisation of social

housing that senior leaders fight hard to combat.

Banishing management jargon and restoring community control - through residents panels,

estate management groups and ideally even through mutual management structures - is a first

step to recalibrating the relationship between landlord and tenant.

Affordable Rents

One of the most troubling consequences of the governments rapid withdrawal from funding of

the social housing sector has been the changes to tenancy rules and costs imposed as a

condition of what little development funding does remain available. The naming of Affordable




Page | 26

Rent - the policy which allows social landlords to charge up to 80 per cent of market rent for

certain properties - is a misnomer in the extreme. While completely unaffordable in some areas

of the country (London and the south-east, for example), the policy makes no economic sense

at all in other, less economically successful regions. In the north-east, true social rent is often higher

than affordable rent because the private rented sector is relatively small and undesirable tenure.

Rent restructuring was designed to bring parity across the social housing sector, but has failed to

create an equal playing field. Rather than introducing such complexity, a single formula should

be used to calculate rent for all social housing tenants regardless of the terms or length of that

tenancy. This should take into account relative cost of living and what can be considered a

genuinely affordable rent in different parts of the country. As a starting point for discussion, one

possible answer could include setting social rent as a percentage of the local market rate for

each region to enhance rental affordability in the social sector.

Affordable Credit

When social tenants find themselves facing a financial shortfall their status as a tenant often

leaves them faced with only very expensive sources of credit. The popularity of high street

payday lenders and easy to access online credit has risen just as tenants lives are becoming

more financially precarious and benefits are being both cut back and sanctions.

Efforts to regulate payday lenders and prosecute illegal loan sharks are welcome, but these

measure are insufficient to ensure that the financial rights and opportunities of the poorest people

in our communities are protected. Social housing providers should, together with existing credit

unions and other community lending organisations, ensure that every tenant has access to

affordable credit. This can be done through partnership, or through direct investment of the social

housing provider itself. Just as importantly, financial advice should also provided free of charge

for all social tenants. While it cannot lift tenants out of the precariat alone, good financial

education and equal access to affordable credit will provide a level of security that is bolstered

by the other commitments in this charter. Social landlords have a crucial role to play here.

Affordable Lives

It is clear that rising costs of living of household essentials, capped benefits and stagnating wages

have seen the living standards of social tenants fall appreciably and from an already very low

income base. As part of a precariat charter for social housing, it is important that social landlords

play a part in helping tenants reduce their living costs through affordable warmth and support

for sovereign and affordable food supply via food co-operatives, urban farms and the like.

Government needs to play its part through better regulation of public utilities and downwards

pressure on prices. Government also needs to ensure that welfare benefits and wages rise faster

than inflation over the coming years to ensure that standards of living rise generally, but especially

for those at the bottom. A Living Wage, perhaps coupled to a Citizens Income and real reform

of welfare, coupled to further regulation of the high-cost lending sector and support for

community finance via mutual are equally important measure to reduce precariousness and

uncertainty and embed economic wellbeing.




Page | 27


Our chief proposal to underscore some of the above and as the centrepiece in a precariat

charter for social housing, is that social housing tenants need a New Deal that attempts to

rescue the tenure from its poor (undeserved) reputation via massively increased investment in

housing quality and service delivery, and introduction of a range of new benefits (both monetary

and social) to improve the status of those who live in the sector.

A centrepiece would be an asset-based welfare approach whereby quasi asset/savings

accounts would be established for every tenant (similar to the now defunct Savings Gateway

and Child Trust Fund).

The public purse would allocate an initial amount and then transfer annual amounts based on

the appreciation of social housing value nationally. The initial start-up costs would be an average

1,000 per tenant equating to 4b and 100 per year on average thereafter, or 500m per

annum. The Fund would be topped-up by social landlords and tenants. Social tenants could save

as much as they can afford, so fostering a greater savings culture in the social housing sector.

Where tenants are wholly dependent upon state benefits for their income, a further small

contribution could be made within the existing Housing Benefit totals.

Key benefits would be to reduce financial exclusion in the social housing sector and to provide

more stable and sustainable tenancies. Considerable savings in the housing management costs

of social landlords (e.g. via reductions in housing stock churn and vacancy rates) might equally

be achieved. The proposal would equally enable social tenants to build-up assets for themselves

or their children. Wealth inequality between tenures would be reduced too and enable social

tenants a more equal stake in national wealth. The total amount generated would eventually

amount to 9 billion over a decade.

This New Deal Fund would be controlled by a Social Tenants Mutual which might have regional

branches dependent upon localised contribution levels, lending money back to social landlords

and other third sector agencies at lower than market rates of interest. The New Deal Fund

management and lending vehicle would be tasked with improving existing housing and

community infrastructure, and supporting the development of new affordable housing.

Consequently, social tenants savings would be safe with growth largely guaranteed, while

social tenants would see over time more investment in their neighbourhoods, thereby creating a

virtuous and ethical cycle of investment and representing considerable value for public money.

Topped-up with private finance raised by social housing providers, this approach would produce

a significant level of new investment in some of the countrys most deprived communities and

offer multiple outcomes in tackling neighbourhood poverty and inequality.

Other aspects of the New Deal would encompass a realignment of the relationship between

social landlords and social tenants, moving from current consumerist and top-down

approaches to enable social tenants to have more of a say in the management of their homes.




Page | 28

This would involve establishing a new generation of tenant management organisations (TMOs),

co-operatives and community mutuals, adopting of community gateway principles by

mainstream housing associations and going beyond the current trend towards co-regulation

between social housing providers and tenants to a more co-productive style of management.

In addition, existing and new tenants would have their right to a permanent tenancy and related

positive measures ensured.

Finally

These various measure would make a start in helping social tenants out or the precariat class

and into meaningful citizenship where household incomes would be bolsters, assets would be

enabled and community control strengthened.




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6.

Conclusions

In the above, we have proposed a precariat charter for social housing. Standing states that

such a charter should set out:

Policies and institutional changes are proposed that correspond to the need to revive the great trinity of freedom, fraternity and equality from the precariats perspective.

We have endeavoured to do the same in our proposals for a New Deal for Tenants.

Our measures focus on restoring the two key civic rights members of the precariat living in social

housing have lost: social rights and economic rights. These are the rights which have been most

aggressively stripped away by some in the social housing sectors willingness to work with

government to implement a set of policies which have had disastrous effects on the relative rights

of social tenants, compounding their journey from citizens to denizens.

Not all the articles in our New Deal can be implemented without lobbying of central

government, but we hope that this will act as a call to arms for the social housing sector to

campaign on behalf of the civic rights of social tenants, as well as lobbying for greater investment

in bricks and mortar.

Many social landlords have a proud legacy of supporting their tenants through a variety of

community-based initiatives. But we feel it is time that more widespread and government-support

measure are enacted to ensure that the precariat class becomes a thing of the past.




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Select References

Cox. J., Gulliver K. and Morris J. (2011) On the Margins: Debt, Financial Exclusion and Low Income

Households. Compass. London

Gulliver K. (2011) Living on the Edge: Financial Exclusion and Social Housing. HCI. Birmingham

Gulliver K., Trevitt V. and Cox J. (2014) Beyond the Margins: Debt, Financial Exclusion and Social

Housing. HCI. Birmingham &

Gulliver K. (2015) Costing a Living: The Experience of B3 Livings Broxbourne Tenants. HCI. Birmingham

NHF (2014) Welfare Reform Impact Assessment. London

NHF (2015) Welfare Reform Impact assessment: Final report. London

Standing G. (2011) The Precariat: The New Dangerous Class. Bloomsbury. London

Standing G. (2014) A Precariat Charter: From Denizens to Citizens. Bloomsbury. London




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About the Human City Institute

MISSION

The Human City Institute is a charitable research institute and 'think-tank' dedicated to

investigating social exclusion, social justice and inequality, sustainable communities, issues

around faith and ethnicity, health, housing and urban policies, quality of life and happiness, so

promoting more human cities that meet the future needs and aspirations of their residents.

VALUES

People-Focused

Human cities begin with putting people and

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