Right to Buy is a deeply unequal stopgap, not a solution to the Housing Crisis

Under George Osborne's direction, the Conservative approach to tackling the housing crisis was to resurrect Thatcherism. This came in the form of Right to Buy, the cheap sell off of social housing to first time buyers.

The trouble is, from the start, it was always going to be a time and resource limited solution. Eventually, as always, the Tories would run out of public assets to privatise and the well would run dry.

As New Statesman Political Editor George Eaton put it, "the problem with Thatcherism is that eventually you run out of other people's assets."

Today, the homelessness charity Crisis and the Local Government Association (LGA) were on the same page in calling out the effects of Right to Buy on social housing: the draining of a vital resource that is not being replaced.

Right to Buy, like Thatcherite policies in the 1980s, plugged gaps created by the withdrawal of the state with privatised public assets to buy time for the private sector to get prepared to take over and pick up the slack.

Osborne's policy kept the middle class housing sector afloat at the expense of social housing - even that technically owned by housing association independent from the government - which was sorely needed to provide affordable shelter for the least well off.

Now as then, the results are wildly inconsistent and deeply unequal.

Crisis have put forward a strategy to eliminate poverty in the next decade that puts new social housing - a hundred thousand new homes a year - at the centre. It combines these with a national rollout of Housing First and the strengthening of the rights of renters.

The LGA say that the core of any sustainable social housing plans, like those proposed by Crisis, must by necessity be devolving proper funding to local government so it can get on with the work of building homes.

For progressives, redistributing funds to local government for affordable and social housing is a clear cut issue - especially to poorer areas that see the least benefit from a scheme that doesn't even return the full receipts from the sale of local housing assets. But will Conservatives listen?

Government turns to finger-pointing as it puts pressure on firms and councils to deliver on it's new homes promises

Photograph: Scaffold Repair Construction from Pixabay (License) (Cropped)

It seems that the government has woken up to the need to act on domestic issues. And yet, with the pressure on, the government has decided to start by pointing the finger at others.

Theresa May's ministry, and it's predecessor, have made some major pledges on housing that have not been met. Pledges of several hundreds of thousands of new homes a year that have not been delivered - as admitted by Housing Secretary Sajid Javid last year in a review.

So the government has laid it's plan to tackle this. On Sunday, the Javid issued a warning, via The Sunday Times, that the government would be putting pressure on councils to meet it's targets - prefacing plans to change up it's framework to push even higher targets, set against affordability of local homes.

The aggressive tone was complemented by the threat of stripping from councils decision-making power over what is built in local areas. The threat of intervention is not one that will be taken lightly.

The Prime Minister, today, followed up on Javid's set up to issue a warning to home building firms. She criticised the practice of 'land banking' and announced that firms could be penalised for delays with refusal of planning permission for future projects.

While she acknowledged that young people had a right to be angry - and that, without the 'bank of mum and dad', many would find it impossible to get a foothold on the property - she has answered that anger by shifting the blame to local councils and building firms.

There are real questions about the actual impact of land banking, why firms take so much time to build after planning permission has been received and whether supply is throttled - against which the industry defends itself vigorously.

But even more important are the big questions, that are being ignored, about the government's role in this present crisis. There have been deep cuts to local authority funding. Schemes like help-to-buy have drained social housing stock without adequate restitution or replacement - and driven up prices.

Will pressure on councils and firms to hit higher targets within narrower time frames deliver on policy promises? Or will it just increase the risk of corners being cut?

The Local Government Association (LGA) responded to the government's announcement, and threat of intervention, by saying it was 'misguided' and that the basic block on progress for local authorities was lack of funds with which to build their own homes - for which borrowing powers were needed.

As with Chancellor Philip Hammond's budget, these measures are just tweaks and salves. The Government's blame game isn't addressing the core problems - it's finding scapegoats. That isn't good enough.

There are bigger questions to ask about long term investment, about the role of land and the capture of it's value by a class of rentiers. The government is avoiding these problems in the hope that they'll go away. They won't.

Affordable Housing: That seven years of government was nearly reduced to a bitter meme reflects disappointment with Conservative broken promises

Conservative flagship housing policies have yet to deliver anything even resembling an affordable housing market where young people can get their foot on the ladder.

When the phrase "No Deposit Required" started trending on social media on Sunday, there was a rumble of excitment. Unfortunately, it was not trending for the reason that people, momentarily, thought it was (it was actually a gambling promotion).

The mistaken belief was that it was a brave new housing policy announcement, with an level of ambition that might make a real dent in the housing crisis. A policy that might really help make home ownership affordable.

The trend quickly became filled with the same joke - "I thought this was a housing policy, but..." - and, for a moment, seven years of government teetered on the brink of being reduced to a single bitter meme.

That disappointment is dangerous for such a weak government and, that it spread so easily in a free form moment, is a big threat to a party that relies so heavily on well practised, old media control over the message and tone of politics.

The Conservatives rely on controlling public discourse and their grip is slipping. That is a sign of Conservative failure, symbolised by Philip Hammond's Autumn Budget in which he promised help to young people toward owning homes.

The breakdown of his signature offer of cutting stamp duty for first time buyers, however, is a narrow policy whose benefit will mostly be helpful to those who are already home owners - a key Conservative audience - and beyond a narrow group, may actually lead to homes being more expensive.

While Hammond put his faith in tinkering around the edges, with some subtle shifts in regulation, it's clear that out there in the public imagination tackling the growing crisis of affordable housing is going to take bigger ideas.

The fact that there was excitment about a policy of no deposits when buying a house - a policy that would come at an extraordinary cost, even for renters - shows just how far the May-Hammond government is from the scale of response the public is expecting.

For Jeremy Corbyn and John McDonnell, that will be music to their ears - perhaps a sign that their message is getting through or has a receptive audience. However, Labour is not free from singeing by the burn of this particular trending topic.

Housing is an issue that no party has adequately dealt with - not even William Beveridge, when he drew his ideas for the welfare system, had an answer for housing.

Homes are too expensive and the growth and security of incomes is low and sliding. Land and property remain archaic, rentier dominated, sectors - cartels like great spiders sat in webs in the midst our economy, catching our resources, extracting and hoarding them.

Conservative failures and broken promises have fed disappointment that risks turning bitter. Progressives must take seriously the need to unravel these webs, and push out the fat lazy spiders, on which so much of our economic potential is snagged.

Budget 2017: Cautious Hammond has salves not solutions, as Budget falls short of action

Chancellor Philip Hammond was in bombastic mood for delivering his second Budget of 2017, making jokes despite the Office of Budget Responsibility's projections that listed productivity as down and growth falling. He brushed past those figures with lots of Brexiter-placating language and an opening salvo of £3bn put aside to get the country Brexit ready.

In the build-up to the Budget, Sarah Ann Harris in The Huffington Post UK posted an article listing those measures that charities said would be needed to address Britain's varied crises. Together, they would have required at least £10bn of new funding.

In the Budget, Hammond acknowledged the pressures and hardships and said that he was prepared to invest. But when the announcements came, they ultimately offered no more than half of the requested amounts to alleivate hardships.

On the disastrous impact of Universal Credit, Hammond went halfway towards the requests, even of MPs on his own benches, of reducing restraints on claimants - taking one week rather than two out of the waiting time to receive funds. With other easing measures, Hammond called this a £1.5bn package of support. Yet this was step didn't even reach the minimum requests for alleviation.

On the NHS, the Chancellor offered up some large numbers. These break down to smaller numbers, though. The figure of £10bn, for capital spending - infrastructure, buildings, etc - is spread across the five years of the Parliament, meaning no more than £2mn-£3mn a year. Another £2.8bn will be spread over three years, with just £350mn front-loaded to avert crisis this winter.

There was an olive branch to nurses in the form of a commitment to fund a pay rise for nurse, but this was conditional on negotiating a new contract settlement with the Health Secretary Jeremy Hunt.

To address the housing crisis, and in particular affordability, the Chancellor announced a £44bn fund. This was, however, then broken down. This fund would be only partly public funding, with the other parts being loans and guarantees, and was intended to run through to the middle of the 2020s.

That could stretch that £44bn over eight years, or even more, meaning the yearly amount would actually be much lower, at around £5bn-£6bn - of which only a part would be a public funding rise.

At most this overall package, to tackle a range of social crises in Britain, will come to £2.4mn/year, plus only a part of the around £6bn/year package being invested in the housing market. That looks like being a long way short of the £10bn minimum requested.

The Chancellor found some money to invest, with £500m for various areas of tech, a few billion more to extend the Nation Productivity Fund, and a new £2.5bn fund to support new innovative, knowledge intensive, companies. Another £1.7bn was found for cities and city regions for various local infrastructure projects. The reality though, is that most of that will be spread over several years.

The Conservative Chancellor framed this as rejecting extra borrowing and instead using some of the headroom within his fiscal rules. However, there are still questions over how the Chancellor is going to fund these and the reality is there will still be lots more borrowing, with the process of eliminating the  debt and deficit extended over a longer period.

The headline offer made by Hammond was to end Stamp Duty for first time home buyers on homes up to £300,000. While this was trailed as a boon to young people, the reality is that it will serve current homeowners best - likely helping and subsidising current people who are, on the face of it, more likely to already be Tory voters.

The cautious Chancellor had hedged his bets with this Budget. He has tried to appeal to all sides, to make everyone feel like they came out of this Budget with a little something. The reality is that no one has gotten what they wanted, although Brexiters may have been midly appeased by £3bn and adopting their rhetoric.

Social pressures in Britain demand a response, but the Chancellor has decided not to act. Hammond has stuck with cheap salves rather than paying for the solutions. To make real progress, we need more from the Exchequer.

General Election 2017 - Housing: There is a progressive consensus that Britain needs more homes and more protection for renters

The future of housing in Britain is a key issue, for which the main parties rarely have a convincing answer.

It is not an overstatement to say that housing is in crisis in Britain. The housing and homelessness charity Shelter are stern in their assessment of a Britain that is short on affordable housing and facing the rise in precariousness and powerlessness that follows.

The Conservative approach to the crisis has been half-measures and pointed fingers. Despite the facts not agreeing with them, the Tory government has insisted it has built more houses than Labour - placing the present problems at their opponents feet.

Meanwhile their own response has amounted to mostly shoring up their own supporters. Disproportionately to the disadvantage of the least well off, the Tories have raided the public sector- councils and housing association - for more homes to prop up a housing market reluctant to build.

The Conservatives continue to make promises. In the Autumn, as they acknowledged they have failed to meet targets, Chancellor Philip Hammond and Sajid Javid announced plans for a mix of funds and loans to get back on target.

Theresa May has announced, during the current campaign, that new land will be made available for Councils to build social housing - though, they'll still be sold off after ten to fifteen years. And the plan isn't new, just a re-announcement of previous spending commitments.

It is painfully unclear that Conservative plans will not do much of anything to affect the fundamental problems.

What is clear is that there is a progressive consensus to be found on housing. Across the Left and Centre, there is a realisation that - at the raw heart of the matter - more homes need to be built. There is no escaping from that reality.

The Labour response has been to pledge a million new homes over five years. The plan accounts for half of those to be council and housing association homes, to be made available for affordable rents. The pledge was accompanied by a commitment to ensuring more secure tenancies and end bad letting practices.

The Liberal Democrats by comparison have pitched for 300,000 new homes a year across the next parliament. As is becoming more common, they have combined this with a plan to allow councils to levy penalty fees on absentee landlords with empty homes - up to 200% of council tax.

This theme of building homes, tackling bad landlording and taking on the problem of empty homes is also present in the Green Party's policy announcements. Their proposals pretty much match Labour's step for step and include the Lib Dems focus on bringing empty homes back into use.

However, what no party has offered is a concrete means of dealing with the fundamental problem: a 259% rise in house prices over just twenty years. The standard response has been simply to increase the sheer number of houses - hoping that increasing market supply alone will drive down prices.

Certainly, making rental more secure, longer termed and protected from bad practices - like hiked rents or exorbitant fees - more widely available will go some way to providing viable alternatives to home ownership, that will increase competitive pressure.

But at some point, some party or movement will have to address the fundamental roadblock to housing reform in Britain: the interests of homeowners, landlords, developers and the government being so closely aligned and deeply invested in the continued increase in property values as to form a cartel.

This problem goes deep into the heart of Britain's economic system and find there problems that are supposed to be extinct.

The rentier - the magnate who makes their unearned income from rent - is seen as an issue of the early twentieth and even nineteenth century, but remains a problem in modern Britain.

It was one of the things that originally led liberals to coalesce into a party to fight: the power of aristocratic landlords who maintained their wealth and privilege on the back of the work of others. Their answer was to fight for earned income to replace rent income.

Yet conservatism adapted and capitalism has kept alive at its core a rentier class, that finds disproportionate advantage. The continued prevalence of inherited wealth and the huge privilege afforded to wealth, allows a class to virtually exclude others from access to one of the most basic needs: shelter.

Addressing the grip of this cartel just simply isn't in the interest of a government - not least conservatives. In Britain, so much has been staked on 'financialisation' and that investment speculation is deeply entwined with property.

But what is the answer? The strong or expansive economies of countries like Germany and Singapore both have huge public ownership of land and housing and in the last twenty years have not seen prices rise like they have amidst Britain's private finance and privatisation boom.

The progressive parties are all putting forward plans that will be an improvement upon Conservative policy and there is real and meaningful overlap in their ideas. They recognise that Britain needs more decent affordable homes and renters need protection. That alone is enough to vote for progressive parties on the issue of housing, over Tories that raid social housing to feed an out of control market.

But the big answers on housing have yet to make their way into the party mainstream in Britain.

Housing White Paper: Government looks only to patch over the Housing Crisis

Last week the government released its "fixing our broken housing market" white paper, with which it promised reforms that would fight market failures with radical measures.

Radical measures are certainly needed. Britain is in the midst of a housing crisis, were the poor and young are excluded, from both ownership and rental, by housing shortages and by what effectively amounts to a self-enriching cartel.

In terms of the shortage, Shelter have said that the gap between housing need and supply is around 150,000 a year, with some estimates putting the shortfall over the past twenty years at 2.5m (Griffiths & Jefferys, 2013; Halligan, 2017).

In his statement, acknowledging that the house price to average income ratios have gone up from 3.5 to 7.5 in the past twenty years, including under the Coalition, Communities Minister Sajid Javid told the House that the government recognised that the drain on people's income that housing - even rental - had become was a huge barrier to social progress (Javid, 2017).

But the excuses crept in quickly: claims that Labour didn't build enough and councils have ducked decisions and don't plan properly. There were also promises, of transparency, of faster construction, of coordinated public investments, to encourage greater innovation by opening the building market beyond the ten companies that build 60% of homes.

Renters were also paid some attention. Javid promised to promote longer-term tenancies, to tackle unfair terms and to improve safeguards - on top of the previous promises to ban agent's fees.

Now, there are two levels of critique for holding a government white paper to account. The first is the thing it promises. Does it contain a good policy? The second is delivery. Does the government have a record of following through and will it do so this time?

As with the government's prized right-to-buy scheme, the government's white paper does not seem to be offering solutions sufficient to deal with the full scale of the problem, although the government at least seems to recognise that there is a serious problem (Easton, 2017). There are some positive steps - if there is follow through. But it all seems like wallpapering over the cracks.

Meanwhile, the government seems content to continue feeding the beast. As when it chose to drain social housing to make up its for sale housing numbers, now it seems intent to just keep things afloat a little longer - build a few more houses, a bit more quickly, with a bit more market competition - and leave the new ideas to someone else.

All of this just shovels more of the UK's precious resources into an extremely greedy fire - as demonstrated by the government pitching houses costing £250,000, even after discounts, for households with combined incomes under £90,000, as 'affordable homes' (BBC, 2017).

As for delivery? In the past six years in office, the house price to average income ratio has continued to grow and the overall increase in housing costs have been extreme (Full Fact, 2015). Waiting lists for social housing remain long and even rental costs, both private and social, are becoming unsustainable.

During the Labour dominated late 1990s and 2000s, house building was usually between 150,000-200,000, falling to between 100,000-150,000 in the later art of the decade before the Conservatives came to office.

The Conservatives made no promises on housebuilding in 2010 and didn't break that pattern. In 2014 there were 125,000 new homes. By 2016, a corner had perhaps been turned. Javid claimed 190,000 were built last year. However, homelessness has also risen sharply, under the impact of private rents and cut to welfare support (BBC, 2017{2}).

In 2015 the Conservatives promised around 475,000 new homes by 2020 - of which about 55,000 a year were to be affordable homes and 40,000 a year were to be starter homes (CPA, 2015). Yet the number of households, by the government's own statistics, is set to rise by more than double their promised housebuilding targets (Full Fact, 2015). And the promised ban on agent's fees has yet to materialise (Collinson & Elgot, 2017).

Neither David Cameron's ministry nor Theresa May's have acted decisively on housing. Both governments plans patched things over and kept just enough houses in circulation on property markets to keep key property owning voters happy.

The reality is that a Conservative government cannot deal with the essential problem: that a cartel of property owners, developers and investors can only justify obscene investments with ever increasing property values and rents - that are utterly unsustainable.

How can a Conservative say no to these people? Well-to-do home owners, profit-making businesses and financial investors? That is basically a list of the key Conservative supporters. So for now, all there will be is a white paper to patch things up.

'Housing market' is a lie - there is no market, only a corporate monopoly, fueling a crisis, that needs desperately to be broken

Government right-to-buy policy is plugging holes in the greedy housing sector, but is unsustainably syphoning homes form social housing to do so.

Britain's housing crisis rumbles on. When Theresa May returns to the role of Prime Minister in earnest, to face whoever will be (at least nominal) leader of the opposition, getting to grips with housing has to be at the top of the list.

An uncomfortable fact for the Conservative leader is that the money made by private landlords from housing benefit - received as a welfare benefit by households in order to pay their rent - has doubled over the last decade (Gayle, 2016).

That fact goes side by side with the continued rise in rents and prices, escalating beyond reality for the overwhelming majority of people (Chakrabortty, 2016), and the failure of successive governments to build sufficient housing. And then there is the siphoning off of homes from social housing stock (Williams, 2016).

To plug shortfalls in properties available for purchase by those with the means, former Chancellor George Osborne raided social housing and housing associations. Rent-to-buy took affordable housing for the least well off, to feed a greedy and bloated system in danger of collapse.

All of these facts point to a very particular problem. The housing system is very much tailored to the interests of a small group of people. Those who own property and those who have capital to spend, playing in a housing market that is exclusively for them.

Conservative policy has failed the worst off and served only an upper middle class of wealthy property owners and those fortunate enough to already have some 'equity' in the system. Everyone else, the poor and the young, is automatically frozen out.

For some this is a double blow. While private landlords reap astounding profits from housing benefits - since the government effectively subsidises this rentier practise, so literally encourages this state of affairs - it is the taxpayer that is funding this policy.

What is more astounding is that investing public funds instead in a big increase in homes in the social housing sector would actually reduce this private landlord subsidy by billions (Gayle, 2016), saving taxpayers huge sums at a time when spending on essential services is stretched thin.

Amongst the first tasks has to be to get to grips with the rental sector. New York housing chief Alicia Glen has argued that Britain's problem is the expensive and inefficient private landlording system (Murray, 2016), which flies in the face of the lower costs, and so cheaper rents, of operating at scale - although that implies that the purpose is efficient service not self-enrichment of rentiers.

But larger organisations, operating at scale shouldn't be the end of the story. There is room and need for mutuals and cooperative principles - for rental housing that can operate at scale and which honours the stake held by those investing time and money in living in those properties.

However, this is nothing less than a complicated situation. Not all private landlords bad or greedy. For some it is an essential source of income in hard times - look at the difficult situation facing tourist trammelled Barcelona, where efforts to stop illegal renting to tourists runs up against the needs of people with otherwise limited sources of income.

A small clan of property owners are being enriched by rising property prices as most people are simply cut off from access. Some exploit that position further as rentiers, raking in cash from private renters and from public subsidy. It is clear that a new approach is needed.

Part one of any response has to be public investment: build more housing and make most of it affordable, truly affordable, social housing. So many ills could be fixed through this one act of government spending, one that would pay itself back many times over.

But part two is more difficult. The entire housing sector needs to be urgently rethought, because it is not fit for use. Housing, a human essential, a necessity like fresh water, is being held ransom by those few holding it as property - stifling supply and bloating prices in bubbles that have disastrous rippling results.

Not least, steps should be taken to discourage unproductive property accumulation - like land banking or small rental property portfolios that gouge prices - and policies such as land value taxes should be taken into serious consideration, because the phrase 'housing market' is a lie. There is no market, only a corporate monopoly that needs desperately to be broken.

Local Elections: What can local government do about the housing crisis?

Government's 'Right-to-Buy' policy is a parasite feeding itself on social housing stock, another drain on the scarce resources at the disposal of local government to protect the public welfare of their communities.

Few things symbolise the UK's problems like the housing crisis. The escalating price of housing has plagued Britain for more than a decade, and has roots even deeper than the housing bubble that contributed to the 2008 Financial Crisis.

Beveridge, who had answers for so many other issues of social welfare, struggled to address the complications and implications of the housing sector (Birch, 2012). The housing benefit bill, his stop solution gap, has only escalated.

The housing crisis will be a key issue in this week's local and assembly elections. Studies released suggest confusion over the nature of the crisis, with a misplaced belief that immigrants are somehow responsible for the housing shortages and rising prices (Tigar, 2016) - rather than the more complicated reality behind the broader issue of cost living.

But there are fewer doubts about the impact of the crisis. The overwhelming majority, in a society that places emphasis on home ownership, have been disenfranchised (Helm & Doward, 2016), being effectively priced out of ever taking part. More division and social strife are not going to solve that problem.

The housing crisis, beneath the murky layer of divisive negative politics (Oborne, 2016), has dominated the London Assembly debate. As expected, that has led to candidates making grand promises and trying to find ways to work around Westminster-imposed austerity.

For instance Caroline Pidgeon, the Liberal Democrat candidate for Mayor of London, has proposed using the Olympic levy to fund the building of 50,000 homes under direct Mayor's office supervision (Hill, 2016) - to be council houses kept safe from the government's social housing draining Rent-to-Buy policy.

A similar pattern has emerged in Scotland. Devolved control over taxation is being taken as an opportunity to differentiate the country from Westminster government policy.

The opposition Labour and Lib Dems have both proposed to use new tax powers to raise tax, by a penny in the pound, to increase education funding - in stark differentiation from the cuts policy of the Westminster government. This follows into housing.

The Liberal Democrats have pledged 50,000 new homes for Scotland, with four fifths being for social rent (BBC, 2016), while Labour have pledged 60,000, with three quarters to be rented out by councils, housing associations and co-operatives (BBC, 2016{2}).

Increasing social housing stock is definitely a good idea, not least for the social security it offers. It is also one of the few ways that has been shown to help in keeping the housing benefit budget under some semblance of control (Johnson, 2015).

So far government aims to encourage home building has stalled in private hands, regardless of policy (Wright, 2016). So the question remains if these devolved institutions will have more luck than Westminster in getting developers to, effectively, act against their own interests and increase the housing supply.

That is a particularly tough ask when councils have been dealt an even shorter leash than other devolved bodies. While some powers have been handed over for various areas, the capacity to fund them has been decreased and the level to which democratic authority extends is being curtailed.

From alterations to local business rates or the administration of schools being made centrally at Westminster and imposed on local bodies (Butler, 2016; Cook, 2016), to responsibility for social care being added to the jobs of protecting front line services even as council funding is being dramatically slashed (Wintour, 2016; Oliver, 2015), local bodies are being handed new responsibilities and poor funding hand in hand.

In the face of these restrictions, how much can councils really do to help ease the housing crisis?

Well, elsewhere in Europe, municipal governments are getting organised - building horizontal alliances with other councils, pooling funds and looking for innovative solutions during times that have imposed thrift on an entire continent (Zechner & Hansen, 2016).

In Spain, Barcelona En Comu have been leading a municipalism movement that has seen it working with local citizens and other cities to overcome the hindrance of austerity. The movement, of whom Mayor Ada Colau is a member, has found innovative and resourceful solutions to increase social housing availability in the city (Rodriguez, 2016).

Westminster's support for local government has been sporadic and erratic (Wainright, 2016). To fill the gaps left in budgets, local government has to look to build new kinds of partnerships. And a spirit of cooperation will have to be a part of that.

Regardless of who wins where, all councillors and assembly members will have to be willing to work across party boundaries, and even across local government boundaries. To overcome the challenges ahead, local government needs elected figures with constructive voices who are prepared to cooperate and build alliances across the usual borderlines and divisions, in order to protect vital services and the welfare of their communities.

Return of Charles Kennedy's proposal of a penny on tax for education signals worries that more needs to be done on inequality

The late Charles Kennedy, whose practical policies have returned to the table for consideration in Scotland. Photograph: Charles Kennedy speaking at the Friday Rally at the Scottish Liberal Democrats Spring Conference, 2015 from James Gourley/Liberal Democrats (License) (Cropped)

One of the more worrying statistics of the moment is that generational inequality is rising, as the doors that allow social mobility are closing (Inman, 2016). One particularly telling factor is that home ownership has become a distant and fading dream for young people, as modest incomes are no longer enough to get started (Elliott & Osborne, 2016).

So far, George Osborne's efforts have been aimed at finding ways around tackling the key problems: making larger and cheaper loans available, turning rents into deposits and selling off social housing cheaply to tenants. All of these moves are attempts to stimulate the private sector and take care of the middle class - largely at the expense of those worse off. What they don't do is fix the core problems, like a lack of supply that drives rents and prices through the roof.

But Osborne's austere laissez faire isn't going to close the inequality gap. For schools, for example, the place where inequalities first begin to take their substantial toll - whose teachers and administrators are buried under mounting stress that is driving employees away (Harris, 2016) - a place to start would seem to be a simple, practical acceptance: more money is needed. Yet with austerity ascendant, that will be a difficult thing for this government to accept.

Under the present conditions, its really no surprise that the late Charles Kennedy's penny on tax policy has seen a resurgence. Kennedy proposed, as Ashdown did before him, to add one penny in the pound to income tax - an increase of 1% in search of £3bn in additional funds - to support extra spending on education (BBC, 2001; Marr, 2001; Taylor, 2016).

The same policy has now turned up in Scotland. Will Rennie, leader of the Scottish Liberal Democrats, announced the return of this policy to the Lib Dem's platform at the end of January (Carrell, 2016) - only to be upstaged a week later by the Scottish Labour leader Kezia Dugdale's adoption of the same policy (ITV, 2016).

Under Kennedy, this was seen as a bold, but practical measure at a time when the economy was improving dramatically. Under Kennedy's successor Nick Clegg, the emerging financial crisis led to these ideas being translated into 'fairness'. Clegg's, now much missed, red lines in government involved sharing the burden  (Parkinson, 2012) - refusing to have cuts impact on the poorest without the equivalent be expected of the richest.

Amongst the things Clegg fought for was increased spending for the early years at school (Ahmed, 2015), hoping to close gaps so that children might grow up with the skills necessary to seize opportunities on their own merits. During that time, Conservative supremacy and lust for cuts was barely restrained by the Coalition. Now it doesn't seem to be restrained at all.

All in it together, to protect the next generation from crippling public debt, seems to have become the means to disenfranchise the next generation - denying young people public services and affordable housing. Meanwhile, the wealthy are doing just fine (Inman, 2016).

And yet, austerity has laid bare and made finally visible in the UK the true extent of the financial crisis - from which the UK was largely sheltered by the government funded public sector. From homelessness at the extreme, to the now common shortages of affordable homes, the public may now finally - thanks to austerity - be realising the full weight of the burden falling on them.

In those conditions, the re-emergence of policy's like Kennedy's penny on tax is not surprising. A general outcry for more the government to do more cannot be far away. While that, of course, doesn't necessarily always have to mean constant high levels of public spending on fully nationalised services. But more has to be done.

Mariana Mazzucato, economist and one Labour Shadow Chancellor John McDonnell's anti-austerity economic advisors, has argued that the private sector is a weak innovator that is loathe to take risks. Quoting Keynes, she argues that most innovation - the opening of new economic spaces - is done best by government (Mazzucato, 2013) - in the form of a smarter state.

Inequality has many facets that need to be tackled. Education needs more support. Housing needs to be more widely available and cheaper. Young people need to see more opportunities in more fields. None of these things can be achieved without some additional government funding at some stage. Public bodies have the ability, and the right, to act: to open up new economies, to create new opportunities where there are now none, and to invest in new futures.

 

Breakthroughs in all of these areas would lead to new economic growth and wider spread shares of the spoils. A penny on tax for education is a modest, practical start. A small, subtle, rejection of the austerity doctrine. But it is one small solution, for just one part of a huge and interlinked problem of inequality that the government cannot for much longer simply trim around the edges.