Building an economic recovery

Give the builders a chance

The bankers had their billions, in 2009 a coalition called the Coalition Group argued it was the turn of the builders; only they could save the economy, it was argued. By Mark Cantrell

First published in Northern Housing

SPARE a few billion quid for a beleaguered banker? Before reaching for the chequebook, stop and think. It’s worth considering how many construction jobs and brand new affordable housing units the taxpayers’ ‘ragged trousered philanthropy’ could buy - with all this entails for the national economy.

Certainly, that’s something Gordon Brown’s government is being asked to consider by the new 2020 Group, a coalition of the National Housing Federation (NHF), the housing charity Shelter, the Local Government Association (LGA), and the Trades Union Congress (TUC).

Chaired by Kate Barker, a member of the Bank of England’s monetary policy committee and Gordon Brown’s former housing adviser, the 2020 Group wants to see a massive investment package included in April’s Budget, so that a mass programme of housebuilding can get underway without delay.

The group has challenged the Government to invest billions of pounds to build 100,000 new affordable homes in the next two years alone, to ultimately fulfill its 2007 Green Paper vision of three million new homes by 2020.

The stakes are high given the heavy demands already placed on the Government’s coffers. In its report, ‘Housing and the Credit Crunch’ published at the end of February the Communities & Local
Government Select Committee expressed concern that the Government did not know how its borrowing was going to be paid off.

“We are particularly concerned that the Government is borrowing from future budgets now with apparently no idea how it is going to restore that money at a later date,” said Dr Phyllis Starkey MP, the select committee’s chair. Even so, the committee urged the Government to stick to its targets to build more homes.

Starkey added: “The credit crunch has not reduced the numbers of households needing new housing, nor does it affect the need to address years of under-supply. The message we have received from witnesses during our inquiry was clear: the steps the Government is taking are welcome, but further action is needed if the Government is to have any chance of meeting its targets for home building and achieving the goal of a decent home for all.”

The 2020 Group’s fiscal stimulus package is not calling for money borrowed from tomorrow’s budget, but a massive shot of new investment into housebuilding that will help the country build
its way out of recession - and solve some of the historic housing problems in the process.

“Support for housing today offers excellent value in terms of sustaining economic activity,” Barker said. “And it reduces the risk of a very severe loss of capacity in the housing and related industries. There is real concern that the present fall in home building is sowing the seeds of the next boom.”

The idea of the boom might not sound so bad, until we remember the stratospheric rise in house prices of the old boom, spiralling out of control until the entire bubble burst and dumped the country into ‘credit crunch’ bust. The 2020 Group warns that without action now, by 2020 things might be so much worse.

“For years housing output has failed to keep pace with demand,” it said in its launch statement. “By 2020 on present household projections, if policymakers fail to act, the supply shortage will worsen markedly, with devastating consequential impact on affordability and the social and economic health of the nation.”

In other words, without massive investment to build new affordable homes in the here and now, today’s economic problems will prove but a ‘dress rehearsal’ for those of tomorrow.

“Without radical action many people in construction will lose their jobs and up to five million could find themselves on housing lists by the end of 2010 - this is the Government’s chance to help us make sure that neither of these things happen,” said David Orr, chief executive of the NHF.

“The group’s proposed house building programme could kick start the economy, save jobs, and deliver new homes for more than 200,000 people. This is a one-off chance for the Government to stimulate the economy and help housing need in one fell swoop.”

Adam Sampson, chief executive of Shelter, agreed: “As housebuilding dries up and thousands of construction workers face the dole queue, building the homes this country needs can not only help the thousands of people living in poor housing, it can also give a real and much needed financial injection to the economy.”

TUC general secretary Brendan Barber said: “When the private sector stops spending, the public sector must fill the gap, otherwise the recession will be deeper and longer than it need be. With such obvious housing need, the case for more social and council housing is very strong. When such investment can ensure such an important sector as construction retain jobs, capacity and its skills base then the case for a significant boost in the Budget becomes overwhelming.”

Margaret Eaton, chair of the LGA, added: “Even when the economic good times were rolling, councils saw ever-increased pressure on their social housing stock. Now that the recession is upon the country it appears that many thousands more people will be looking to councils to provide them with a permanent home as they either find it impossible to get on the housing ladder or see their home repossessed.”

So, a new clarion call is sounding, one might say: not ‘billions for the bankers’ but rather ‘billions for the builders’.

Nowadays, there’s a lot of demand for the Government to open its wallet and sub the economy through the harsh times. The car industry and the retail pub sector have both cried help too. In the case of house building and the construction industry, however, the 2020 Group’s fiscal stimulus package is less an up held begging bowl - rather it’s a call to arms.

Now, it’s up to the Government to answer the call by filling the war chest.

This article was written for Northern Housing magazine (circa March 2009) and was subsequently re-published on the Housing Excellence website, 3 June 2009.

Is Yosser Hughes about to make a comeback?

Where there's a will there's a way

Worklessness and unemployment are entirely different beasts, but with the recession purging the ranks of the employed, action to ensure they don't become trapped in a cycle of exclusion is all the more crucial, writes Mark Cantrell 

 First published in a 2009 edition of Northern Housing magazine

IN the words of Yosser Hughes (pictured) - "Gizza job... I can do that."

The character in Alan Bleasedale's hard-hitting drama Boys From The Black Stuff, screened in late 1982, went on to become symbolic of the despair born of mass unemployment. Bernard Hill's portrayal of a man stripped of his job, his prospects, his self-respect, and his hope, provided a vivid demonstration of the toll the recession of that era was taking on ordinary families and individuals the length and breadth of the country.

Fast forward to 2009, and Yosser Hughes' desperate plea becomes symbolic of another generation of recession-hit families. Mass unemployment has returned, and though it remains below the Eighties' peak of three million, at just under 2.5 million it isn't far off.

Here is another emerging generation whose cry echoes that of Hughes, but the painful irony of this 'sequel' is that his fictional grandchildren may not to be among them. Rather, in the final indignity for this once proud and hard-working man, his descendents are more than likely to be among the ranks of the workless - trapped in a cycle of poverty and disadvantage. This is the grim potential lurking within the statistics as the recession munches its way through jobs.

The TUC has called rising unemployment the country's 'Number One Emergency' and urged the Government to do all it can to protect and create jobs as a means of steering both society and the economy out of recession.

"Unemployment is rising relentlessly. It will pass the 2.5 million mark next month and could hit three million by the end of the year. Behind these statistics are millions of people struggling to pay their mortgages and support their families," said TUC general secretary Brendan Barber.

"What grates most is that ordinary working people are paying the price for the mistakes of an elite few who have laid the system to waste and still walked away with their millions. Even as unemployment rises at its fastest rate for 30 years, some City players are already talking about recovery in the financial sector, as if the spectre of three million unemployed doesn't matter," Barber added.

"There is only one indicator of economic recovery that matters, and that's when unemployment starts to fall and people can get back to work. Let us be clear, no recovery will be possible while there are millions of people out of work. We saw the price of unemployment in the 1980s - communities devastated, industries destroyed, and widespread social unrest. We cannot afford to go back to those days."

As in the '80s, as now, the lingering after-effects may well boost levels of deprivation, financial and social exclusion, and steadily erode community cohesion. It is feared that today's recession will make the problems of worklessness even worse; with the waves of redundancies, and fresh school leavers facing ever-lengthening dole queues, there is concern that it will promote long-term unemployment, leading in turn to even more workless households, and those 'not in education employment or training' (NEETS). According to the Office of National Statistics (ONS), this latter group is four times more likely to occur in households where no adults work, demonstrating how the 'institutionalisation' of unemployment can all to easily transmit down the generations.

Unemployment disproportionately hits the young, which is why the TUC has welcomed the recent Budget's 'war chest' of £2 billion for schemes to help young people unemployed for over a year, though the organisation was concerned about the timing of its implementation. Some 111,000 young people (aged 18-24) have been unemployed for over 12 months, it says, and it fears that number will increase to 250,000 or more by early next year.

"We will not abandon a generation of Britain's young people to the unemployment scrapheap," said James Purnell, work and pensions secretary, announcing the new £1 billion Future Jobs Fund.

This is intended to help social enterprises and local authorities create at least 150,000 new jobs. Set against the sheer numbers of unemployed, however, that target might seem like small beer, but every little helps as it were. A new National Worklessness Forum has also been launched, to help councils spearhead job creation in their areas.

If nothing else, it shows a crucial difference to the hardline attitudes of the 1980s. In that unsympathetic age, mass unemployment was regarded in high office as the necessary price of economic modernisation. Of course, it's always easy to be blasé about the bill when someone else is reaching for the wallet: a truism as applicable to the current MPs' expenses scandal as it is the collateral damage of economic policy.

Given that many of today's problems around worklessness and deprivation had their primordial origins in the 1980s recession, it is perhaps just as well that the Government says it has 'learned its lesson' and eschewed the 'scrapheap' approach to managing mass unemployment, but the challenges - especially for those at the sharp end of implementing real measures - will be immense.

There are already some 4.5 million people living in workless households, according the CIH, even before the impact of the recession is factored into the equation. While the race is on to prevent today's unemployed becoming tomorrow's workless, the hard slog of combating pre-existing worklessness continues.

Late last year the CIH launched its 'Worklessness Toolkit' to assist social housing providers to tackle the problem. Some thought the recession inevitably made a hopeless mockery of the sector's efforts, but the CIH, and the Toolkit's author Helen Cope proved adamant that while the challenges have become so much harder, the recession made it all the more crucial a task.

Unemployment, of course, is not quite the same beast as worklessness, and so requires different strategies, but it is clear that the former - if not addressed - has the danger of nurturing the latter. As Tom Murtha, chief executive for Midland Heart, said: "It is the barriers to work that fuel worklessness, rather than the recession itself, which continues to feed unemployment. Worklessness and unemployment are two very different issues, however, both have a significant impact on people's lives and communities and therefore are of importance to us.

"We and other housing associations are perfectly positioned to provide the catalyst for change through our existing relationships with many of those affected. By coming face to face with worklessness, we are very well placed to assist individuals. It is clear that housing associations have a unique and increasingly important role to play in helping to tackle worklessness at a time when the need to bring about economic and social change has never been higher."

The echoes of Yosser Hughes are carrying across the decades; whether his rage is finally appeased, or drowned beneath the laments of another generation, will all depend on the outcomes of a wide range of agencies and individuals working together.

They may fail, of course; we won't know until long after the recession, but at least this time round there is a will to make a difference.


This article first appeared in Northern Housing magazine, circa April or May 2009. It was subsequently re-published on the Housing Excellence website, 12 June 2009