Sharp tactics: the spikes on the ground outside a London block of flats which sparked outrage. Photo: Getty
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Laurie Penny on rough sleeping: A war on homelessness should mean shelter, not metal spikes

Rough sleeping has almost doubled in London in the past few years and private businesses are making it tough for the new homeless to put down their blankets.

"Social housing, not social cleansing." Not long ago, on the hottest day of the year, I saw these words scrawled on a bedsheet in the boiling sun, draped on the gate of an empty east London council home whose tenants had been evicted to make way for “redevelopment”.

There was a time when such a statement would have been considered hyperbolic, but on the Carpenters Estate in Stratford, with its boarded-up windows and vacant lots tucked away behind the glittering Westfield shopping centre, it doesn’t seem too far-fetched. Rents are soaring and London is becoming a city for the rich, with the poor driven out of their communities, away from their families, jobs and schools.

Stratford is only a few miles from Westminster but for the housing minister Kris Hopkins it must seem like a different world – one in which alien people live, scroungers who listen to Pharrell and don’t vote Tory. “I bought a house,” he said in April, defending the soaring price of property across the UK on Newsnight, “and I expect the value to rise”. Hopkins is making money in the new housing bubble. Lucky him. Unfortunately, for the millions of people across the country who are watching their incomes devoured by punishing rent rises, reassurances that the rich are getting richer will be no comfort.

The housing minister is doubly fortunate because, as an MP, he is among the few who can afford to rent in London. It has emerged that some 300 MPs are claiming expenses to rent a second home here and those housing benefits are the only ones not being cut.

Many of the MPs claiming them are the same Tories who voted for the bedroom tax. Last year, Hopkins claimed £18,045 in rent payments for his second home. The employment minister Esther McVey, another supporter of the bedroom tax, claimed £17,227 – presumably for an enormous glass house from which to throw stones.

Can politicians such as these conceive what it means to lack a safe place to live? To be forced to move every six months, preventing your kids from ever settling in at school? To breathe in mouldy air and share a bathroom with ten strangers where the leaky shower always runs cold? We must assume that they can’t imagine it, because the alternative is that they just don’t care.

The scale of the housing crisis in Britain and particularly in London is difficult to overstate. It’s not just a matter of building more homes. There is plenty of housing stock to go around but it is unevenly dis­tributed. Thousands of properties stand empty, accumulating value for the global super-rich, while ordinary workers are increasingly unable to afford to live in cities and 7 per cent of homes in the capital are overcrowded.

Rent controls are the obvious solution but the Conservative Party will go to the wall before it does anything at all to help those who do not own property. So the government’s stopgap has been the Help to Buy scheme – underwriting first-time mortgages with state aid, a policy that may have lit the long fuse of a second financial collapse. The IMF has stepped in to warn the Chancellor that this new housing bubble must be addressed but no emergency measures have been taken. No rent controls. No social construction projects.

Around the capital, where house prices have risen 18.2 per cent this year, metal spikes are appearing on park benches and street corners. Rough sleeping has almost doubled in London in the past few years and private businesses are making it tough for the new homeless to put down their blankets.

Many of us can no longer afford to rent in London – not even if we work full-time. This includes the nurses, teachers and transport workers who make the capital what it is, as well as the artists and students who keep it trendy. As many as 26 per cent of Londoners claimed housing benefit in 2012 and most of those were working. Instead of capping out-of-control rents, the government has chosen to cut housing benefit and artificially inflate the property market. What this means is quite simple. Landlords are doing everything they can to evict tenants to make way for those who can afford average rents of £1,500 per month and rising. Pretty soon, that’s going to be the housing minister and nobody else.

All of this has happened before. In 1832, fearful of the social unrest that was sweeping Europe, the Whigs decided to extend the voting franchise to middle-class men who owned property. For almost a century, you were only allowed to participate in democracy if you had the title to land, buildings or both. Fast-forward 200 years and, yet again, it’s property owners who matter most in our nominal democracy. The Conservative Party has it in for renters. People who rent tend not to vote Tory – so why should they get somewhere safe to live?

When the Tories speak of a “property-owning democracy”, they mean it quite literally. This is becoming a country in which only those who own property matter to the state. That’s what social cleansing looks like and the closer you examine it, the dirtier it looks. By the time this new housing bubble bursts, it will be too late. The British housing crisis is a social, cultural and financial disaster. If action isn’t taken to turn it around, all of us will pay. 

Laurie Penny is a contributing editor to the New Statesman. She is the author of five books, most recently Unspeakable Things.

This article first appeared in the 11 June 2014 issue of the New Statesman, The last World Cup

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BHS is Theresa May’s big chance to reform capitalism – she’d better take it

Almost everyone is disgusted by the tale of BHS. 

Back in 2013, Theresa May gave a speech that might yet prove significant. In it, she declared: “Believing in free markets doesn’t mean we believe that anything goes.”

Capitalism wasn’t perfect, she continued: 

“Where it’s manifestly failing, where it’s losing public support, where it’s not helping to provide opportunity for all, we have to reform it.”

Three years on and just days into her premiership, May has the chance to be a reformist, thanks to one hell of an example of failing capitalism – BHS. 

The report from the Work and Pensions select committee was damning. Philip Green, the business tycoon, bought BHS and took more out than he put in. In a difficult environment, and without new investment, it began to bleed money. Green’s prize became a liability, and by 2014 he was desperate to get rid of it. He found a willing buyer, Paul Sutton, but the buyer had previously been convicted of fraud. So he sold it to Sutton’s former driver instead, for a quid. Yes, you read that right. He sold it to a crook’s driver for a quid.

This might all sound like a ludicrous but entertaining deal, if it wasn’t for the thousands of hapless BHS workers involved. One year later, the business collapsed, along with their job prospects. Not only that, but Green’s lack of attention to the pension fund meant their dreams of a comfortable retirement were now in jeopardy. 

The report called BHS “the unacceptable face of capitalism”. It concluded: 

"The truth is that a large proportion of those who have got rich or richer off the back of BHS are to blame. Sir Philip Green, Dominic Chappell and their respective directors, advisers and hangers-on are all culpable. 

“The tragedy is that those who have lost out are the ordinary employees and pensioners.”

May appears to agree. Her spokeswoman told journalists the PM would “look carefully” at policies to tackle “corporate irresponsibility”. 

She should take the opportunity.

Attempts to reshape capitalism are almost always blunted in practice. Corporations can make threats of their own. Think of Google’s sweetheart tax deals, banks’ excessive pay. Each time politicians tried to clamp down, there were threats of moving overseas. If the economy weakens in response to Brexit, the power to call the shots should tip more towards these companies. 

But this time, there will be few defenders of the BHS approach.

Firstly, the report's revelations about corporate governance damage many well-known brands, which are tarnished by association. Financial services firms will be just as keen as the public to avoid another BHS. Simon Walker, director general of the Institute of Directors, said that the circumstances of the collapse of BHS were “a blight on the reputation of British business”.

Secondly, the pensions issue will not go away. Neglected by Green until it was too late, the £571m hole in the BHS pension finances is extreme. But Tom McPhail from pensions firm Hargreaves Lansdown has warned there are thousands of other defined benefit schemes struggling with deficits. In the light of BHS, May has an opportunity to take an otherwise dusty issue – protections for workplace pensions - and place it top of the agenda. 

Thirdly, the BHS scandal is wreathed in the kind of opaque company structures loathed by voters on the left and right alike. The report found the Green family used private, offshore companies to direct the flow of money away from BHS, which made it in turn hard to investigate. The report stated: “These arrangements were designed to reduce tax bills. They have also had the effect of reducing levels of corporate transparency.”

BHS may have failed as a company, but its demise has succeeded in uniting the left and right. Trade unionists want more protection for workers; City boys are worried about their reputation; patriots mourn the death of a proud British company. May has a mandate to clean up capitalism - she should seize it.