Accelerating Divergence? Housing in Scotland and England

by Ken Gibb

I write this on a long-haul flight on a Saturday night. After 6 weeks of long hours to clear the decks, much teaching and many deadlines, we are on our way to a family wedding and a conference (ahrc2016.nz), both taking place coincidently a week apart in New Zealand. As a result of front-end loading work for the last wee while I have not been writing much but I hope that will now change.

My conference paper is concerned with what we should make of the evident accelerating divergence between housing policies and approaches in England and Scotland? Is it a source of evidence of innovation, does it suggest differences which might provide lessons or ideas, or if not, what we can learn about both the state of housing policy in each country and indeed about devolution?

What are the grounds for saying that there is accelerating divergence? Prior to 2007, there were important legislative distinctions such as the 2003 homelessness legislation in Scotland and the earlier decision not to consider, for public funding reasons, arms-length management ‘solutions’ to social housing (as favoured in England). There was also long-standing examples of divergence by degree, such as the long standing and cumulative effects of higher rates of per unit grants for social housing in Scotland. Much of the rest of the respective housing systems, nonetheless, looked much the same.

The big changes started when electoral results meant that different parties governed north and south of the border. In 2007, the new SNP minority government signalled its intention to end the Right to Buy for new council homes so as to encourage councils to build for general needs (later supported by capital grants on a similar basis to housing associations). The RTB was later abolished altogether by the majority SNP Government elected in 2011. The election of a UK Coalition government heralded the deficit reduction strategy which impacted on the housing sector through deep departmental spending cuts and new low subsidy programmes in CLG and, of course, welfare reform and Housing Benefit cuts. The Scottish Government produced impact assessments on the effects of these cuts completely at odds for those produced at DWP.

More recently, the furore over the present housing and planning legislation in England (and their substance) concerning the raft of social renting reforms and the direction of new build initiatives, looks increasingly alien in a Scotland where the main parties are largely signed up to expanding social and affordable housing supply to come close to meeting (or meet) the estimated levels of national affordable housing need of 12,000 per annum using deeper levels of grant per unit £72,000).

But it is not all divergence. Sometimes, the different governments happily follow each other even if they tailor initiatives. For instance, Scotland adopted the Help to Buy model though it was targeted to new build that was supposed to be aimed at first time buyers (though average realised prices were high if they were to do this). At the same time we have had unquestionably inefficient and unhelpful policy competition such as with the devolution of stamp duty – The Chancellor responded to the new Scottish progressive tax rates by trumping the rates, leaving the Scottish finance secretary obliged to come up with an even more progressive structure of tax rates. The Scottish housing market faced three tax systems in a year and, not surprisingly, the tax revenues raised were less than predicted. Most recently, when the Chancellor announced the decision to increase stamp duty by 3% at all these new tax rates aimed at buy to let investors, the Scottish finance secretary chose to do the same.

Policy competition can be wasteful but it does remain at least conceivable that there may be functional benefits, and useful things to learn from policy experimentation and divergence. The simultaneous development of multiple local community housing associations in Glasgow was a test bed for all manner of housing and neighbourhood innovation. Why, if there was a will could it not be the case that policy innovation or divergence in housing, as much as any other area of devolved policy competence, could not and indeed should not be systematically studied in order to make progress for citizens living in all parts of the U.K.?

What are the barriers to useful transfer and lesson-learning? One is political – certainly between the UK and Scottish governments, policy based collaboration appears to be vanishingly rare. Second, for the same way two parties, the incentives to share and learn seem disappointingly weak, in part because the ends of their respective housing policies and the means willing to be adopted e.g. on the composition of new supply and tenure – are so different. Not fertile ground and probably also not helped by less and less institutional policy development dialogue from civil servants. Unlike national comparisons (also not without methodological and empirical problems), there seems to be less glue sub-nationally in a system such as that of the UK to let us share and learn. While one may see how this can happen between the Conservatives and the SNP in 2016, it does not really explain a trend between Scottish and U.K. Governments that began to be discernible arguably  when Labour was in power in both places. Neither does it explain the lack of deeper relationships between the non-England parts of the U.K. All the odder in this era supposedly dominated by policy networks. For many of the same reasons  as above, we should not be confident, however, that a wider comparative policy transfer analysis role can be played by think tanks and other similar specialist policy commentators.

I don’t know if this unintended failure of devolution is unique to housing but I very much doubt it.

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