Building an affordable utopia: The State, State Policies and Market Logics

1. Building an affordable utopia: The State, State Policies and Market Logics Paper presented at RGS-IBG Annual International Conference’ London 30 August 2013 Bob Colenutt (University of Northampton) Allan Cochrane (The Open University)Martin Field (University of Northampton)

2. Submitted abstract • The policy commitment to affordable housing is often presented as part of a wider commitment to social welfare, as a challenge to spiralling house prices in cities like London which mean that those on low or even middle class incomes can no longer afford to live in certain parts of the city. But, of course, it is increasingly apparent that this form of market driven welfare rarely delivers housing that most people can actually afford.But the problem that the language of affordable housing is intended to address is not just an ideological one, not just a means of shifting attention away from the decline of council housing. The lack of affordable housing (that is housing which can be afforded by skilled professionals in the public and private sectors) in particular areas may (as the UK Treasury sponsored Barker report noted) be a significant brake on profitable economic growth because of the effect it has on the labour market, pushing some costs up and limiting supply in key areas (particularly infrastructural sectors such as education and health).Drawing on evidence from an ESRC funded project, this paper focuses on the experience of one set of government initiatives on the edge of the London city region, as an attempt was made to 'nudge' the major house builders to deliver a major programme to deliver 'sustainable communities' providing affordable housing for key workers and others need to fill those labour market gaps.This was scheme whose success was predicated on a continued and continuing rise in house prices, and which was already missing its targets before the financial crash. Despite the language of pragmatism and market rationality in which it was couched, this was a programme that was just as utopian in its own way as any leftist fantasy. The paper reflects on the outcomes of the process and on the limits of affordable housing as a policy nostrum 

3. Content of presentation • Setting the context from 2000 onwards: planning to maximise the economic drivers of ‘market driven’ housing 2. The Sustainable Communities Plan and its delivery frameworks 3. Impact of the 2007/8 economic crisis and analysis of growth areas plans 4. Comment on the utopian vision for ‘affordability’ and ‘sustainability’

4. Planning ‘market driven’ housing from 2000 onwards Economic drivers Start of sharp growth in market values Growing concerns about overall supply – Barker, et al Need to house key workers, especially in SE Belief in role of ‘housing’ to drive macro economy Will to increase private sector investment in residential markets Ideological drivers Optimism of New Labour; The Third Way; Mixed Economies ‘Light touch’ central state + readiness to court private sector development Belief in ‘Spatial Planning’ (national framework / regional and local governance / integrated management) Holistic approach to ‘climate change’ and sustainability

5. Levels of housing supply

6. Projections to meet identified need

7. The Sustainable Communities Plan 2003, and delivery frameworks National intentions: • Housing to underpin national economic growth • Affordability’ for all • ‘Step change’ in quality & quantity of housing supply • Substantial new supply • Renewal of failing markets • Support to local aspirations • Complementary jobs growth • Capture of ‘planning gain’ for local benefit • Delivery by private sector National framework: • National housing targets • Regional Plans • Spatial plans & Core Strategies • Growth Areas in SE • Pathfinders in Midlands and North • Light -touch Delivery Agencies • Sub-regional governance • Sustainability Appraisals • Subsequent Policy Guidance – PPS3

8. Regional housing supply and demand

9. SCP growth areas in SE England

10. MKSM ‘growth area’

11. ‘Affordability’ and ‘Sustainability’ in ESRC study area Policy for ‘housing growth’ • Core strategies : North N; West N; Milton K • Agencies : WNDC; NNDC; MKP • Governance: MKSM Board; Joint Planning • Sustainability : Checklists; Tariffs Housing delivery plans 2001-21 growth numbers: Milton K – 44,900 West N – 47,400 North N – 52,100

12. Analysis and what was exposed by the 2007/8 economic crash Policy positions • Extended and elaborate core strategy process • Limited clout of LDVs & sub-regional partners • Minimal funds for land / strategic infrastructure • Disputes about strategic investment • No prioritisations from ‘sustainability’ measures Market responses • Targets unrelated to industry delivery rates • Delivery below targets by 2011 (see graph) • Allocated and ‘approved’ land not built upon esp. large sites (Sustainable Urban Extensions) • Increasing resistance to deliver ‘planning gain’ • Sustainability seen as a ‘cost’ to be minimised

13. Housebuilding outputs pre and post-recession

14. Key reflections (1) • SCP a first national use of ‘Spatial Planning’ – this has met both ambivalence and resistance • The ‘utopian’ vision of “sustainable communities” was too naive to challenge monopolies of builders, landowners & lenders • MKSM delivered plans and some successes, but has not sustained sustainability measures • There was no Plan B – ‘crash’ or no-crash

15. Key reflections (2) • SCP also first national framework predicated upon the interests of volume housebuilders – consequence for their current intransience • ‘Sustainability’ is increasingly interpreted through a short-term economic lens - this defers costs, but does not remove them • Mechanisms for controlling ‘affordability’ of house prices seen as politically unacceptable, yet wide concern remains about unsustainable prices

16. The ‘utopian’ vision? • Was there always a tension over the imagining of an ideal affordable world and meeting all the different demands for “affordability”? • Was the vision of public/private sector collaboration compatible with the underlying adversarial relationship between planners and developers? • Was the Plan always predicated upon a picture of an ‘ideal economy’? – at times of economic stress would the aim of cross-funding and collaboration necessarily fall apart? • Must markets always lessen ‘affordability’?

17. Can affordability be re-created?