The sound of squawking

Yesterday should have been a day of triumph for Grant Shapps and the DCLG. Instead it was the day when the chickens began to come home to roost.

The day began so well too. Well-placed leaks in the Sunday and morning papers prepared the ground for TV and radio saturation for the launch of two key parts of the housing revolution promised by David Cameron in his party conference speech and first outlined in last year’s housing strategy: the new build indemnity guarantee and the expansion of the right to buy.

After all, the only thing better for a Conservative housing minister than a plan to back tens of thousands of new home owners is one to revive that most iconic of Tory policies. Get the personal backing of the prime minister and sit back and wait for the glowing media coverage.

Except that somewhere between the approving coverage of the right to buy in the Sun and Express and Mail and Monday’s TV studios things had started to go wrong. The reaction to NewBuy was much more mixed than ministers must have hoped. Criticism did not just come from the usual suspects but from influential people in the wider property industry and from others much closer to home. The Daily Telegraph headlined it a ‘gimmick’, the Spectator called it ‘sub-prime thinking’ and Matthew Oakley, the head of Policy Exchange’s economics unit, called it ‘corporate welfare’. With criticism like that from Conservative supporters, the DCLG was left to proclaim the unsurprising support of housebuilders and a rather more muted welcome from mortgage lenders. I blogged my own take on NewBuy for Inside Housing yesterday.

According to the script, the day should have kept on getting better for Shapps and the DCLG with communities and local government questions scheduled for the afternoon. Two popular policies to boast about and a succession of opportunities to put down Labour MPs with well-prepared lines about the banking crisis, the housing boom and bust and the opposition’s record on social housebuilding. Very real concerns were being raised by MPs (for example, Tory, Lib Dem and Labour worry about the effect of direct payment of housing benefit) but that was just the warm-up for some of the sort of parliamentary jousting that Shapps and Pickles have won effortlessly in the past.

Not yesterday. Labour’s Jack Dromey was there to needle the housing minister about rising private rented sector rents, the latest chapter in a long-running dispute that’s been rumbling ever since David Cameron made a questionable claim that they have fallen as a result of housing benefit cuts and then refused to correct it even after Inside Housing proved he was wrong. Would Shapps now admit that he got it wrong?

Grant Shapps: The LSL survey shows that in the three months through to January rents actually fell, but we do not have to believe LSL—[Interruption.] There was rightly some scepticism there—LSL measures only buy to let—so let us instead look at the absolutely authoritative figures recently produced by the English housing survey, which show that in real terms rents have fallen in the past year.’

This was not the confident, Tiggerish Grant Shapps of last year, but a new unbounced Tigger, retreating into detail, quoting figures that are a year old and (clue in the ‘in real terms’) more or less admitting that rents have risen.

Shapps was more on form when he batted away a question from Labour’s Chris Williamson accusing him of complacency in the face of the housing crisis facing young homebuyers.

Grant Shapps: I have certainly been shaken out of any sense of complacency by that question, given that it came from a member of a party under whose government we saw house building crash to its lowest level since the 1920s. I can report to the House this afternoon that in the past year alone house building starts in England went up by 25% compared with those in 2009.’

This was almost up to the fly-swatting standards set by Shapps last year except that those comparisons with 2009 are getting past their sell-by date. Everyone including him knows that house building has fallen since they took office and that he has given a huge hostage to fortune by proclaiming that building more than Labour is his gold standard.

After the latest round of a long-running battle with former Labour housing minister Nick Raynsford over the stats about his pet new homes bonus project, it was the turn of his former Labour shadow Alison Seabeck to have a go about the right to buy. This was an open goal for Shapps surely: not just a chance to put himself on the side of aspirant people against the last government who ‘savagely cut’ right to buy discounts but another chance to use one his best put-down lines. Seabeck asked him to clarify the right to buy announcement and his plans for one-to-one replacement. ‘Does that mean he does not mean like-for-like replacement in the same area?’ she asked.

Grant Shapps: Where local authorities can provide the new homes in the same area, we will certainly look to keep the money locally and build in the area. The hon. Lady, as a previous shadow housing Minister—one of the eight I have faced—knows that the money will be used for the affordable rent programme, which will enable us to build 170,000 affordable homes for rent, and this will give us another 100,000 on top of that—far more than the previous Administration built over 13 years.’

There was the line about the eight Labour shadows, there was the one about the last lot’s record, there was the boast about the 170,000 ‘affordable’ homes, but none of them was enough to distract attention from the answer to the question, which was yes. (EDIT March 15: Talking to people about this a bit more for my blog on the right to buy for Inside Housing, the vagueness is perhaps understandable: if councils can’t provide new homes in their area, it’s better that there should be homes somewhere than that the receipts simply disappear).

In fairness to Shapps, his boss Pickles was at it too. The self-proclaimed champion of transparency and ‘shining a light’ on spending in government, was hoist by his own petard by a question by Labour’s Hilary Benn about the NPPF. Everyone wanted to know, said Benn, which construction and property companies he had met especially given the sector’s £500,000 of donations to the Conservative party in the second half of the year. Yet no records of meetings between CLG minister had been published since June 2011. Could he say why that was?

The Pickles of last year would have batted that one away with ease. The 2012 version ducked the question and put up junior minister Robert Neill in his place. The record would be ‘published in due course’ and then ‘very shortly’ and he pointed out that the DCLG was the first department to publish online all its spending over £500.

And so a day that started so well and should have continued with cheers and applause in the Commons before more media appearances in the evening instead resounded to the squawking of chickens coming home to roost.

Why now? One reason, I would suggest, is that these are ministers who love to shoot from the hip and make policy up as they go along. That has been their modus operandi from their earliest days in office when Pickles ‘abolished’ regional spatial strategies only to suffer a series of embarrassing legal defeats that forced him to abolish them all over again. NewBuy is yet another example of this process. It may – or may not – work but there has been no impact assessment to try to find out despite the fact that it is backed with £1 billion of public money.

Prolonged scrutiny was bound to find them out sooner or later. It looks like that moment has now arrived.

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2 Comments on “The sound of squawking”

  1. The problem is the Government have been forced to come up with ideas very quickly without thinking many of them through – something Shapps unfortunately appears to be very good at (mates mortgages being a prime example – http://www.ipinglobal.com/ipin-live/391085/uk-housing-minister-grant-shapps-gets-matey ) and also the suggestion that living on house boats would solve the housing market problem.

    The other point of note is the press are more than happy to call a Government scheme offering 95% mortgages a gimmick, and yet they are quite happy to promote 95% offerings from banks and brokers in virtually the same breath and hail them as the next housing market saviours – both meanwhile still cause almost instant negative equity for a sector of buyers that can ill-afford it.

  2. Jim says:

    “which will enable us to build 170,000 affordable homes for rent, and this will give us another 100,000 on top of that—far more than the previous Administration built over 13 years”

    But Labour built 362,000 social rented homes in its 13 years, so even if you accept that affordable rent is the same thing this claim is still wrong.


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