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12 January 2016

David Cameron’s rhetoric writes a big cheque – but the policy can’t cash it

The best way to expose Cameron? Take him seriously.

By John McTernan

David Cameron has discovered the inner cities. It comes to all Tory leaders eventually. Edward Heath had the Inner Areas Programme. Margaret Thatcher had a series of interventions – the Liverpool Garden Festival, the Task Forces after the riots in the mid-eighties, the Urban Development Corporations – almost all led by Michael Heseltine. And now that he has found the issue, Cameron too has asked Heseltine to take the lead again.

There is a lot to say about Cameron’s initiative to regenerate 100 ‘sink estates’, not least that it is too little too late. But the real problem is that at the heart of what Cameron is proposing is a fatal contradiction – his central housing policy runs contrary to all that we have learned in Britain, Europe and the US about successful urban policy. The key is always to create mixed communities. It is simple really – social capital is fundamental to health, education, well-being and employment. The latter is easily explained. The truth about employment is that the best way to get a job is to have one – think of how many job offers you have had while employed. The next best way is to know someone with a job – half of all vacancies aren’t actually advertised.

The worst way to get a job is to be unemployed with a social network of people who are out of work or underemployed. Yet that is Cameron’s plan for social housing – to residualise it, to eliminate people with jobs from all housing estates, whether good or bad. Cameron is introducing ‘Pay-to-Stay’ – regular means-testing of tenants in social housing. If your joint household income is above £30,000, or over £40,000 in London, you will have to pay a market or near market level of rent. It is – effectively – a tax on employment and runs counter to every successful policy – Labour or Tory – to develop sustainable communities. Cameron’s vision for the future of social housing is not renewal – his plans will deliver ghettos of pensioners and the unemployed.

This is where Labour fire should be aimed. Cameron should be taken at his word and exposed. In the end, the intellectual contradictions are always the biggest vulnerability because the errors flow from them fundamentally. Nail that and you get a bridgehead – all the other arguments can then be deployed. And there are many.

First, there is something absurd about a proposal to transform 100 estates with £140m. For a point of reference the Acton Gardens Estate in west London are currently bidding for £40m of capital. The ide that £1m an estate can leverage any private sector money at all is laughable and the notion that pension funds will make up the difference is a joke – it is matter for pension fund trustees to maximise returns or they are in big trouble with the regulator. A comparator would be the regeneration John Prescott led in Tony Blair’s government – nearly £100bn was spent on the Decent Homes Programme, the New Deal for Communities and the employment new deals. If David Cameron came to south London with the announcement of this money he’d learn a new phrase or two. 

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Secondly, the key to the successful transformation of estates is to use multiple approaches. Financial capital is not enough on its own. Investment is needed in the social capital of communities, in the human capital of individuals through skills and education – particularly Further Education and environmental capital through tackling crime, low-level disorder, graffiti and cleanliness. The funding for these, through local government, FE colleges and police are being reduced massively through Osborne’s cuts. 

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Finally, what can one say about an announcement that promises to deliver more homes by demolishing them? It would be a joke if it weren’t so tragic in its human impact.