Building Sustainable Communities – The Role of Housing Policy

on Wednesday, 02 July 2008. Posted in Issue 58 Time for Justice?

Peter McVerry SJ
July, 2008

pdf Building Sustainable Communities – The Role of Housing Policy

 

The Barriers to Community

 


Community
Barriers to community?
© D. Speirs

Building sustainable communities is extremely difficult in Ireland today. In many urban areas, at least, the sense of community has almost disappeared.

There are several reasons why this is so:

First, increased mobility means that many people expect to move from one community to another and so may have fewer bonds with the community in which they currently live. People move job, and therefore move home, much more often than their parents did. Many others see a first home as simply ‘getting a foot on the property ladder’ and when they are able to purchase a bigger house, or a house nearer to their work, they will uproot themselves and move. 

Second, in today’s society a person’s ‘community’ may be very scattered, with their most important friendships and links based on common interests or arising from workplace contacts, rather than proximity to the people in their neighbourhood.  Increased prosperity means that more people have their own cars and so can more easily maintain contact with this scattered ‘community’.

Third, the economic system of capitalism, in which we have so successfully embedded ourselves, persuades us to use our purchasing power to make ourselves as self-sufficient and independent of others as possible. Dependence on others, capitalism suggests, leaves you very vulnerable, as people are unreliable and changeable. The only one you can depend on is yourself. Therefore, root your security in your property and assets and not in the whims and moods of others.

The ‘commodification of housing’, which is a consequence of the capitalist system, has contributed in a significant way to the loss of community. By commodification, I mean the process by which a house has increasingly come to be valued as an asset – an investment which sooner or later will yield a handsome return – rather than as a means of providing shelter, security and a sense of place.1


If, as we are pressured by the economic system to believe, security and fulfilment are to be found in surrounding yourself with material goods, then to be community-minded becomes something optional, an add-on to life, for those who are that way inclined! A bit like going to church, in fact.

Paradoxically, however, capitalism, in order to thrive, must persuade us to find our security in the purchase of goods and services and, at the same time, persuade us to be dissatisfied with what we have purchased, so that we will go out and purchase again – a never-ending merry-go-round. It is not surprising that in the past the sense of community was often strongest in poor areas, as people in such areas had little but one another.

Building a strong sense of community is therefore counter-cultural in the Ireland of today. People are being pushed in the direction of individualism, isolation and aloneness, a direction diametrically opposed to the building of community.

I believe that the loss of community has led to a loss of meaning in the lives of many, who now must search for meaning in the accumulation of assets and material goods and who, not surprisingly, find only emptiness and disillusionment.

Housing policy, then, is facing an uphill battle in trying to create integrated, sustainable communities; the task of housing officials is now far more difficult than at any time in the past. But, in my view, unless we can recover a sense of community, people may grow wealthier but more unfulfilled; have more material goods but less satisfaction; have stronger locks on their doors and more expensive burglar alarms but feel more insecure.

The task of building community is therefore, in my view, the most important challenge facing Irish society today. Meeting that challenge will require the State to alter many of its existing policies in the areas of housing and planning. And it will require also that the State and the churches act together to counter the negative aspects of the current direction in which Irish society is headed.


The Injustice of Segregation


Housing policy in Ireland has contributed, I believe, to one of the most fundamental injustices in our society – segregated housing. The segregation of housing into poorer local authority estates and wealthier private estates, often far removed from each another, affects many of the other fundamental structures that determine the quality of life of our citizens.

Poorer estates, with a high proportion of low-income families, often have poorer schools. These schools cannot benefit from fund-raising drives in the local area and may be unable to retain good teachers if there is a high proportion of ‘difficult’ children or children who may be under-performing. Schools therefore may reinforce the already disadvantaged status of those pupils who live in homes where parents struggle with poverty and have little motivation to push their children to succeed within the educational system. Thus, in some poorer neighbourhoods, some children fail to transfer to second-level education; many leave primary school unable to read and write appropriately for their age; and many leave school before Junior Certificate. In some schools, absentee levels on any one day can be as high as 30 per cent.

For far too many young people, growing up in a disadvantaged area leads to educational underperformance, which reduces their employment prospects, and in turn their options for housing and the educational opportunities for their children, and so on in a vicious cycle.

So while I would consider education to be the most important structure in society – since educational achievement is such a determinant of one’s future life prospects –  housing is the most fundamental structure, as it has a huge influence on educational and indeed all other structures.


In my view, the most important policy decision in the past twenty years was the requirement under Section V of the Planning and Development Act 2000 that developers allocate 20 per cent of their residential output to social and affordable housing. Over time, this would have provided sufficient social housing to meet the needs of those on the local authority housing waiting lists but, equally importantly, it would have begun to provide socially integrated housing in our newer estates.

Integrated housing in some of our older estates has been happening for several years, but it has always occurred through middle class households moving into a previously poor area which has suddenly become attractive to live in – because, for example, it is located in or near the city centre, close to jobs and city amenities. Integrated housing where poorer households move into previously middle-class housing estates is, of course, still a no-go. Section V of the Planning Act would have had that effect – which, of course, is why it was emasculated.

The failure to provide socially integrated housing estates goes back to the foundation of the State and even further. More desirable locations, such as those along the seafront, are bought by developers to provide private housing estates and make substantial profits, while less desirable locations are bought by local authorities at lower cost, thus providing social housing at reduced economic cost – but at a substantial social cost. The division of housing into socially isolated segments has been intensified as housing has become increasingly commodified.


The Commodification of Housing


While a house is a means of meeting a basic human need, it is also a very desirable asset. There is, then, for the State a conflict of values: the value of ensuring that each household has suitable accommodation at a price it can afford, and the value of ensuring that people can have legitimate access to ownership of private property in the form of a house.

Right up until 1987, the balance between housing as a social need and housing as a private asset was fairly well maintained – new social housing output in the 1970s and 1980s was between 20 and 33 per cent of all housing output; indeed, from 1922 up to the mid-1960s, 50 per cent of all housing output was social housing. In 1987, the balance began to shift:  that year only 16 per cent of housing output was social housing. Two years later, it dropped to 4 per cent. Subsequently, right through the Celtic Tiger years, it remained at a low level compared to earlier decades in the history of the State: in 1993, it was 9.8 per cent; in 1999, 7.5 per cent; 2004, 6.6 per cent. In 2007, new social housing provision reached 11 per cent of total housing output for the year, reflecting both a significant increase in local authority and voluntary sector provision and a context in which overall housing output had declined by 16 per cent from 2006 figure.2

In effect, over the past two decades, housing as a social good has declined in favour of housing as a commodity, to be bought and sold like stocks and shares. Of course, as housing becomes more and more a commodity, rather than a social good, those who purchase this valuable asset certainly do not want its value diminished by having local authority tenants living beside them.

The overall decline in social housing output, particularly during the Celtic Tiger years, reflects, I believe, a very conscious decision by government to withdraw from the provision of social housing and to transfer the task of meeting social housing needs to the private sector, massively subsidising it in this role. The use of the private sector need not necessarily be a bad thing, if government remains in the driving seat, as was intended by Section V of the Planning and Development Act. The problem arises when government becomes dependent on the private sector, which then takes over the driving, and/or when the subsidisation of the private sector is at a level that represents poor value for taxpayers.


The hazards of resorting to private sector providers to supply social housing became all too evident in the collapse, during May 2008, of the regeneration projects in St. Michael’s Estate and elsewhere, as a result of the withdrawal of the private developer from the Public Private Partnership (PPP) that was to carry out the regeneration.

As a method of providing roads and transport infrastructure, the PPP model may be a good thing – although many debate its value even there – but the use of PPPs for the provision of social needs, such as housing, health and, increasingly, education, reflects an ideology that wishes to see government reducing its responsibility for social goods, with more and more dependence on market forces as the means of meeting even social needs.

I can understand some of the rationale behind PPPs for housing regeneration – the desire not to re-create the one-class ghettos that previous housing policy created, by offering incentives to the private sector to provide socially mixed housing. At first sight, the arrangement seems like a good idea: the local authority provides the land, which it already owns, to the private developer and in return gets several hundred social housing units – and this is achieved without the cash-starved local authority having to provide any direct financial input. Meanwhile, the private developer gets the profit from several hundred private housing units built alongside the local authority housing. A socially integrated housing estate is thereby built, with no apparent cost to the local authority and with the developer making a handsome profit – an apparently win-win situation.

However, as P.J. Drudy and Michael Punch show in their book, Out of Reach, the value of the land donated to the developer far exceeds the value of the social housing provided, thus transferring a very valuable asset, owned by the State, into private hands. In the case of St. Michael’s Estate, the value of the land handed over to the developer was estimated at over €100 million, while the value of the social housing which the local authority was to receive in return was about €14 million.

Furthermore, the number of private houses to be built under PPPs far exceeds the number of social housing units and no-one has control over who will buy the private housing, or what commitment they will have to the area or to the community.3 In addition, the social housing being built is intended to be offered to sitting tenants for purchase at a substantial discount, so over time the number of social housing units may actually drop to very few or none.

The whole scheme is therefore a recipe for the gentrification of social housing communities. No one has control of the development of the community that results from this process. The regeneration of Ballymun, for all its problems, is also creating a socially mixed community, but without the same dependence on the private sector as the regenerations using PPPs.

Subsidised Private Rented Sector

Further evidence of government moving away from accepting responsibility for the provision of appropriate and secure accommodation for low income households is provided by the increased reliance on the private rented sector for housing lower-income households. It has been estimated that over a third of all households receiving social housing assistance from the State are in the private rented sector, being supported through the Rent Supplement Scheme. The majority of these households have long-term social housing needs.4

The Rental Accommodation Scheme (RAS) introduced in 2005 may bring about some improvements in standards and provide greater security for tenants but there are grounds for concern that the Scheme represents another instance of the State institutionalising its dependence on the private sector to meet social housing needs.5


Government Policy


The commodification of housing has been quite consciously promoted by the policies of government over the past eleven years. In particular, the failure of the Fianna Fáil and Progressive Democrat administrations to implement key recommendations of the government-commissioned Bacon Reports meant that the process of commodification went unrestrained.

Two of these recommendations were the abolition of mortgage interest relief on houses purchased by investors or as second homes, and an ‘anti-speculation property tax’ – an annual tax on dwellings which were not primary residences and were bought for speculative purposes.6 Neither recommendation was implemented. Another  recommendation of the first Bacon Report – that Section 23 tax relief on investment residential property be abolished – was implemented for a short period. However, pressure from property interests led to the re-introduction of this tax relief.7

As well as the disregarding of these proposals in the Bacon reports, there has been a failure to act on the key finding of the report on private property issued by the All-Party Oireachtas Committee on the Constitution in April 2004.8 The Committee unanimously concluded that enabling local authorities to acquire land for building purposes at existing use value plus 25 per cent, as recommended by the report of the Kenny Committee 1973, would not be contrary to the Constitution’s provisions on the right to private property.9 The possibility that granting such a right to local authorities would be unconstitutional had long been put forward as a reason for not acting on the Kenny recommendation.

Despite the fact that the All-Party Oireachtas Committee undertook its examination of the issue of private property in the Constitution at the specific request of the then Taoiseach, Bertie Ahern TD, and despite the Government welcoming the report, no commitment to act on its recommendations has been made in the four years that have elapsed since the report’s publication.


Throughout the period of rising house prices, therefore, the continued failure of government to introduce measures to control prices, and the encouragement to investors to put their money into property, allowed the commodification of housing to gain the ascendency and our understanding of housing as a basic need and human right to be relegated to a minor role.

The increased commodification of housing goes hand in hand with an increased individualism in our society. As a house becomes an asset to be purchased by an individual person or household, then the provision of housing becomes a matter for individual choice, and the development of community takes a back seat – or it also is left to market forces.


Social Housing Policies


One of the biggest obstacles to the planning of integrated communities is the shortage of social housing. This reduces or almost eliminates the flexibility that is essential for planning for such communities.

In this situation of scarcity, individual households are prioritised on the basis of need, and are allocated their individual house according to the ‘points’ they have been given in the assessment procedure. This process has the advantage of being fair to those on the waiting lists, and transparent in the way allocations are made, but it proceeds from the base that providing social housing is a matter of assigning individual houses to individual households, within a situation of limited availability, with little or no consideration of the social or community dimension of housing allocations.

In effect, the pressure arising from the need to house those on the waiting lists, who are often living in very unacceptable conditions, means that planning sometimes must give way to crisis management.

A significant factor in creating the shortage of social housing is the long-standing policy of selling local authority houses to sitting tenants, with no requirement on local authorities to ensure that their stock of social housing is not thereby permanently depleted.

The rationale for the policy of selling-off local authority housing is clear: people will look after their house better, and take more pride in it, if they own it, rather than renting it. Tenant purchase means a reduction in the cost of housing maintenance to the local authority – a cost that is significant. Here, again, is an apparently win-win situation.

Again, however, the social costs of this policy are very high. If new social housing is provided to replace that which has been sold off, this will be through new construction or through purchase in the current market, and so it will be at far higher cost relative to the stock sold.  Furthermore, some of those who buy out their local authority home may subsequently sell this house, and move out of the community; almost by definition, they are the more able, the more motivated and more employable people in the community.

Over the years, large numbers of local authority houses have been sold to sitting tenants at a substantial discount from the market price. During the boom in housing prices, some owners who had acquired their homes with the benefit of this subsidy were able gain further as they sold them on at a handsome profit. This phenomenon reflected and intensified the process of commodification of housing in Ireland.


Necessary Conditions for Building Community


If we are to create sustainable, integrated communities, several prior conditions need to be met:

Firstly, the price of housing must be controlled. We must return to a concept of housing as a basic need, not as an investment on which people can make a quick return. It may be already too late: like climate change, there comes a point at which the process becomes irreversible, when the damage has already been done. The housing market is already going through a re-adjustment which has the potential to seriously damage the financial health of many previously comfortably-off households. But as long as a substantial proportion of housing continues to be bought by investors or those wanting a home-away-from-home, supported in their objective by housing policy expressed in the form of tax breaks, there is little anyone can do to create and sustain a sense of community.

Secondly, there is required a huge increase in the provision of social housing. While social housing output has risen substantially in the past twelve months, it is still well short of the level recommended by the NESC report, which in itself was a compromise figure.10

Thirdly, the policy of selling local authority housing stock must be re-examined. As it stands, this policy means either a reduction in the number of social housing units available for low-income families or the replacement of the stock at a substantially higher cost to the taxpayer. At a minimum, there needs to be a requirement that sales of local authority houses will not result in a permanent reduction in the stock of social housing and there should be greater equity in the level of subsidisation provided for tenants who purchase their local authority homes. In its 2004 report on housing, NESC recommended ‘the application of a level of discount and claw-back provisions which remove windfall gains from the tenant and ensure the true cost of the transaction to the state is captured’.11

Fourthly, and most importantly, if we wish to build sustainable communities, those responsible for housing policy must listen to those who are active, energetic and committed to the building of their community. Politicians and officials must be prepared to really enter into dialogue with local people, believing that they are the experts in their own communities, and not just engage in a superficial or half-hearted discussion, seeking to impose preconceived planning proposals on local communities. Housing policy must reflect a willingness to invest resources in the ideas of the community and not just seek to provide housing at the lowest possible cost to the local authority. 

Although building integrated sustainable communities today is extremely difficult, we cannot give up. The process for the regeneration of Ballymun, St. Michael’s Estate and Fatima Mansions shows that enough people in local authority communities want community and want to be involved in the planning of their community. Housing policy must change so that such local involvement is fostered rather than frustrated.

Integrated sustainable communities are still possible, though time is running out.  The cost of failure will be social unrest, drug-related crime and anti-social behaviour on a scale which we have not yet known.


This is a revised version of a paper presented at a conference, ‘Sustaining Social Housing Communities: Failing to Prepare = Preparing to Fail?, Respond! National Conference 2008’, held in the Killeshin Hotel, Portlaoise, Co Laois, on 5 June 2008.

Notes

 

  1. 1. Michael Punch, ‘Commodity or Home? Critical Perspectives on Irish Housing’, in Sara O’Sullivan  (ed.), Contemporary Ireland: A Sociological Map, Dublin: UCD Press, 2007, pp. 336–337.
  2. 2. In 2007, the total output of new housing was 78,027. New social housing units built or acquired by local authorities and voluntary housing bodies totalled 8,673 (6,671constructed and 2,002 acquired).
  3. 3. P.J. Drudy and Michael Punch, Out of Reach: Inequalities in the Irish Housing System, Dublin: tasc at New Ireland, 2005.
  4. 4. Comptroller and Auditor General, Report on Value for Money Examination, Department of Social and Family Affairs: Rent Supplements, Dublin, 2006.
  5. 5. By the end of 2007, over 11,000 private sector tenants who had been in receipt of rent supplement, were accommodated through the Rental Accommodation Scheme. Department of the Environment, Heritage and Local Government, Annual Report 2007 and Annual Output Statement, Dublin: Department of the Environment, Heritage and Local Government, 2008, p. 25.
  6. 6. Peter Bacon & Associates, An Economic Assessment of Recent House Price Developments, Report Submitted to the Minister for Housing and Urban Renewal, Dublin: Stationery Office, 1998, p. 88; Peter Bacon & Associates, The Housing Market in Ireland: An Economic Evaluation of Trends & Prospects, Dublin: Stationery Office, 2000, p. 87
  7. 7. Drudy and Punch (eds.), op. cit., p. 76.
  8. 8. The All-Party Oireachtas Committee on the Constitution, Ninth Progress Report: Private Property, Dublin: Stationery Office, 2004.
  9. 9. The All-Party Committee concluded: ‘Judged by contemporary case-law, it is … very difficult to see why the recommendations contained in the Kenny Report would not survive constitutional scrutiny.’ (p. 39)
  10. 10. National Economic and Social Council, Housing in Ireland: Performance and Policy, Dublin: National Economic and Social Council, 2004 (Report No. 112), p. 152.
  11. 11. Ibid., p. 162.

 

Peter McVerry SJ is a member of the Jesuit Centre for Faith and Justice team and an Executive Director of the Peter McVerry Trust, which provides accommodation and care for homeless young people.

When Ireland became an independent State it inherited some appallingly bad housing conditions. This was most notoriously the case in the severely deprived areas of inner-city Dublin, but inadequate and overcrowded housing which lacked basic facilities was also prevalent in towns and villages and rural areas around the country. Read full editorial

Working Notes is a journal published by the Jesuit Centre for Faith and Justice. The journal focuses on social, economic and theological analysis of Irish society. It has been produced since 1987.