The worst of times can be the best of times for housing co-ops

While it is easy to be depressed when looking at the housing sector in the UK, the worst of times can be the best of times to achieve...

While it is easy to be depressed when looking at the housing sector in the UK, the worst of times can be the best of times to achieve change, thinks Rebecca Tunstall, Professor of Housing Policy at the Centre of Housing Policy, University of York.

Quoting Charles Dickens, she encouraged delegates at the annual conference of the Confederation of Co-operative Housing to start a revolution in the housing sector. There have been some positive trends in UK stats over the last decades, she said, such as an increase in life expectancy, falling crime rate, improvement in schools and lower unemployment in this recession than in previous recessions.

However, Prof Tunstall thinks that when it comes to the housing sector, there are great problems that need to be solved. She said that although the Coalition government has agreed on the existence of a structural problem within the housing sector, they have failed to come up with solutions. Prof Tunstall, whose main areas of work have been social housing, neighbourhoods, and inequality, explained how high housing costs as well as little concern with environmental aspects are just some of the issues faced by those trying to move on and make their way in the housing sector.

“This puts real blockages for people wanting to move on with their lives, generations ago this wasn’t the case”, she said.

In this context, it is important not to look at the housing sector on its own, thinks Prof Tunstall, but also to take into account the market situation.

“Our labour market is providing too many low quality jobs that don’t pay well. If that situation is combined with the housing situation, than a lot of people have trouble making their way,” said Prof Tunstall.

According to research by Joseph Rowntree Foundation, around 4.9m people were paid below the living wage in April 2012, while some 1.4m people were working part-time when they would prefer to work full-time. The social housing budget has also been cut by 60%.

As a result of these welfare reforms, the housing benefit bill decreased by £425m last year. The bill it is set to increase with an average annual rise for the next four years of £212m, a lower one than the £800m increase in 2011/2012.

In this context, explained Prof Tunstall, co-operatives themselves are being affected by the longest, deepest recession in a long time, which combined with a programme of deficit reduction and changes to the deal between the state and housing organisations.

“Breaking the link between housing and the benefit people get is unprecedented,” she said, adding that this has led to shortfalls, “asking people to survive as if by magic and asking housing co-ops to survive as if by magic.

“The idea of affordable rent is an unprecedented move away from social rent to market rent”.

Nic Bliss, chair of CCH, said that at his co-operative, the Birmingham Co-operative Housing Services, four members have been affected by the bedroom tax, all having to pay the extra amount themselves.

“Housing co-operatives are better placed to deal with these issues that larger housing associations”, he said, explaining that housing co-operatives know their tenants very well which enables them to work together to find solutions for these challenges.

At the same time, the financial crisis has led to more receptiveness among the political parties as well as the society with regards to co-operatives, she thinks.

“So far, the Co-operative Movement hasn’t been able to capitalise on this atmosphere”, she said, adding that it was more an atmosphere because no actual support was coming out of this enthusiasm.

Prof Tunstall highlighted that research projects focusing on assessing how people are dealing with the welfare reform have revealed that they tend to respond in three different ways.

The first response is self-denial by cutting down on essentials and non-essentials while the second reaction is a form of self-help by borrowing from families and friends. She explained that this brought real costs as well as benefits.

Under the welfare reform, working age tenants receive a single monthly payment directly and this will include their support for housing costs where as before their housing benefit was paid directly to their landlord and they also received other benefits.

“Before reform came people were so in-debt that when cash came they paid the friends and family before landlord. This self-help response to austerity means more people sharing, across generations. These are constrains, not choices people take freely” she said.

Another response to the austerity measures is charity. In the last years there has been an increase in the number of food banks users. UK employment minister, Esther McVey, said that no robust evidence linked food bank use to the welfare reform, but Trussell Trust argue that welfare reform was the main force driving increasing demand for food banks.

In June, a partnership between Southern Co-operative, its Funeralcare business and the Co-operative Group helped the Isle of Wight Foodbank open 15 new collection points.

In light of these challenges, Prof Tunstall believes that credit unions and food co-operatives would provide better solutions to the crisis.

“There’s a huge gap, a huge need for co-operative solutions. If you think about housing – when people are in stress, it is difficult to learn about organisations and to set up new organisations. You are the people that need to do that. I really hope you’ve got your steam right up”, she concluded, echoing the theme of the conference.


  • For more stories from the Co-operative Housing 2014 2014 conference, click here 



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