Come Clean On Everything - Not Just Success

Many publicly-funded activities are now working overtime to justify their existence, for obvious reasons.

My inbox has been heaving with press releases from quangos, housing associations (formally known as residential social landlords or RSLs) and the like. The best has come from Moat, a RSL in south east England, which has prepared a briefing on behalf of 20 other TSLs to bolster the case for shared ownership in an age of austerity.

It has plenty of well-rehearsed arguments both for SO and RSLs and here are a few of its facts and figures:

• About 52,000 SO owners have bought their homes (anything from 25% to 75% shares) between 2004 and 2009;

• About a quarter of purchasers go on to buy more shares until they own 100% of their properties and 70% of homes initially purchased under SO remain in that sector;

• The median income of SO households from 2004-2009 is £25,560 (implicitly making it hard for these to afford typical privately owned homes);

• Public subsidy for each SO home is just under £27,000 per unit;

• In 2008/9 0.42% of owner-occupiers and 0.46% of buy-to-let landlords had their homes repossessed. Only 0.38% of SO owners had them repossessed.

So far, so good. But of course there are weaknesses in these arguments because they are so partial.

Firstly, most figures can be turned on their heads.

If that £27,000 subsidy per unit had instead been given to first time buyers, they could almost certainly have afforded a deposit on a private home, for example. Likewise, if 70% of SO homes remain in that sector on resale, this means 30% presumably go into the wider private housing market. So why spend public money via subsidies and RSL bureaucracies on what goes on to become private property?

Secondly, some figures are missing.

How much do RSLs cost to run, let alone the Homes and Communities Agency and other public-funded bodies directly or indirectly providing homes? More controversial still, there are no figures on the salaries of RSL bosses.

Thirdly, there is inadvertent bad PR.

The Moat document is laden with jargon like ‘staircasing’ and ‘intermediate market purchase’. And there is no analysis of whether RSLs building their own homes for sale (so playing at being private developers, effectively) is actually the right thing for housing associations to do at all.

Don’t get me wrong.

RSLs and social housing are needed more now than at any time before thanks to the combined affordability and credit problems. The same argument makes it sensible to consider the return of old-fashioned council housing, which used to provide homes and a construction industry base for apprenticeships and so on.

But if public bodies are justifying their existence, surely they should do so by being more holistic in their defence, admitting the problems as well as highlighting the successes.

That way they'll earn our respect - and perhaps stay in business as a result.

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