This is from today’s Swindon Advertiser

POSTAL staff feel they have a moral obligation to strike even though they are frightened about the consequences of taking on Royal Mail bosses, says a union leader.

Chris Rye, branch secretary of the Communication Workers’ Union (CWU), spoke last night only hours before 1,010 Swindon postal workers were set to strike.

He said workers from the Dorcan Mail Centre – including employees from the mail centre, logistics, delivery and handling departments – were striking for 24 hours from 4am today.

His comments came days after it was announced that the company was to recruit around 30,000 temporary employees in the lead up to Christmas – action the union calls “illegal and unethical”.

The Swindon strike will be followed by a 24-hour walkout of almost 700 employees in Wiltshire, from 4am on Friday.

Mr Rye said: “People are scared, I am not going to lie. No-one wants to lose money and they know they are coming into confrontation with management making many worried and wary.

“Workers think their arguments are morally correct, there’s no doubt, but when they face difficulties from day to day sometimes you have to make moves like this.”

Mr Rye said he was unhappy with the way the dispute had been handled by the Government. He said: “The way this is being dealt with you would think there was a Conservative government in place with Margaret Thatcher at the helm.

“The Royal Mail and the Government expect the union to follow all the rules and the law when balloting and conducting industrial action so they should be expected to do the same thing themselves but by bringing in 30,000 casual employees they’re attempting illegal action.”

He said bringing in temporary employees would be unethical and unacceptable.

Mr Rye said: “There clearly won’t be enough time to vet these employees either, meaning there are fears among workers that people’s security is at risk.”

He added that 120,000 workers will be striking in the next two days of action and said if a deal was not agreed he expected a new set of strikes next week.

A Royal Mail spokesman said: “The 30,000 people we are planning to recruit will be temporary vetted people engaged directly by Royal Mail, who are separate to the vetted agency staff who, as a matter of course, work with Royal Mail throughout the year to help us deal with fluctuations in volumes, particularly in the run up to Christmas, and clearly all of this is absolutely in line with employment law.”

THE CWU’s national leadership warned of further strikes and attacked Business Secretary Lord Mandelson, claiming he was working to “undermine the dispute”.

General secretary Billy Hayes accused Lord Mandelson of being the “minister without responsibility” while Dave Ward, the deputy general secretary, said the Royal Mail had no intention of resolving the dispute and seemed intent on “sidelining” the concerns of postal workers. Mr Ward, who led union’s negotiators during marathon talks, said that Royal Mail managing director Mark Higson had “wiped out” any progress which was made.

In response a Royal Mail spokeswoman said: “Royal Mail said that it had agreed a set of words with the CWU over the last 24 hours that they had agreed to take to their national executive. Royal Mail finds it outrageous that the CWU leadership can accuse it during their press conference of reneging on that agreement which we were expecting the union to rubber stamp today and we remain happy to sign tonight.”

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CWU pickets at the Dorcan Mail Centre in Swindon this morning. There was a larger group of workers present as well. As you can see Alan Crozier is very popular with staff. Though Peter Mandelson would probably run him close.

This is a letter sent to the Swindon Advertiser

Why we should support the Postal Workers

The dispute that is currently taking place at Royal Mail is not the result of postal workers being bloody minded. They are defending their interests in the face of a bullying management which wants to manage by dictat and to break the power of the CWU.

Behind these dictatorial management methods, though, lies the process of ‘liberalisation’ of Postal Services introduced as a result of European Union legislation. Unfortunately the current government was so enthusiastic about liberalisation that it introduced it earlier than legislation required it to do.

The idea that competition would improve the service was always nonsense. Experience has proved it to be the case. Before the PO was commercialised it actually made a suplus. But ’sharpening up’ in the face of competition has produced an unrealiable service. You never know at what time of the day your post is going to arrive. The ‘competition’ in the industry is in any case rigged. Royal Mail has to deliver the post of its competitors in the ‘last mile’.

Liberalisation is a threat to the ‘universal service obligation’ which ensures that we pay the same price for post however far it has to travel. Unrestricted competition would mean that the private companies would only carry out work which gave them a profit. But Royal Mail is supposed to provide a public service. Whilst the Royal Mail has not yet been privatised, liberalisation has meant that the work is being privatised.

Members of the public judge the service by its quality and reliability. Private companies judge only by the money they make. Royal Mail management in trying to drive up ‘productivity’ only judges this by the balance sheet, not the quality of the service to the public.

The ballot of CWU members for national strike action is against management by dictat. But in the long term the public service can only be assured by campaigning to end liberalisation. Royal Mail should be a public service. Its efficiency should be measured by the quality and realiability of the service.

This is why service users should support the postal workers because they are not only defending themselves but also the quality of the service they provide. Many people have opposed the closure of local Post Offices. The closure programme was a direct result of liberalisation and the drive to make Royal Mail a profit-making business.

The CWU and its members are the only obstacle in the way of Royal M management providing a worse service as money making is placed above the interests of customers and the quality of the service that staff are able to provide. The staff deserve the widest support from trades unionists and the public in general.

Martin Wicks

Secretary, Swindon TUC

At the Council meeting last Thursday, in Public Question Time, I asked a number of questions in relation to the possible ballot of Council tenants on transfer to a Housing Association. (See the questions and answers at: http://swindontuc.wordpress.com/2009/09/25/balloting-tenants-questions-and-answers )

Asked if they agreed that tenants “have the right to hear the case for and against transfer before deciding whether transfer was in their best interests” the answer was evasive. It seems that tenants will have “a range of opportunities” to “engage in the process before voting takes place”. We can no doubt expect ‘engagement’ as practiced in the recent consultation: that is where officers meet tenants individually and public discussion is carefully avoided.During the recent consultation we are told that “tenants have been presented with a balanced case” and should the Council decided to proceed to a ballot, “that will continue to be the case.”

Sadly, nothing could be further from the truth. Did the Council present the pros and cons of transfer? No, they said “there is no alternative”. At the time the advantage of transfer was the fact that Housing Associations are able to keep all their income from tenants’ rent whereas Swindon suffered “negative subsidy”; the government took off us £16 million of our rent each year. There were disadvantages of transfer of which the Council was well aware, yet they avoided any debate on the actual pros and cons of the two options.

In the last Options Appraisal six years ago, they organised public meetings on the estates, where the options and their implications were openly discussed and debated. This time they decided not to organise meetings, holding sessions where they presented “the facts” to individual tenants. When asked why they did not organise meetings, one senior officer said that “the problem with meetings is that people with strong opinions have a lot to say”. In other words opponents of transfer might dominate the meetings and lead the poor tenants by the nose. Council officers would save them from this fate, and present only “the facts”, which by chance happened to coincide with the view of the Council that there was “no alternative”.

In response to Swindon TUC the Conservative ruling group said that they would not allow people to be “shouted down” in meetings. What such an idea is based on is a mystery since in the last Options Appraisal nobody was shouted down. This time around the only public meeting to have taken place was one organised by the Parks and East Walcot Forum. It was a lively affair, but once again nobody was shouted down.

The other ‘problem’ with meetings is that officers and Councillors have to justify what they are doing and saying. But isn’t this part of the process of accountability?

‘Balance’The lack of ‘balance’ in the conduct of the Council was reflected by the fact that neither they, nor the so-called Independent Tenants Advisor, had a single thing to say about potential disadvantages of transfer to a housing association (e.g. the difference in tenure between a Council tenant and a Housing Association, the fact that you can vote out your landlord at the Council but you cannot vote out the Board of a business).

It would be one thing to list the advantages and disadvantages of the two options, but they acted as if there were no disadvantages to transfer. In the case of the ‘Independent Tenants’ Advisor’ their main role was to downplay the consequences of transfer. They even argued against meetings on the grounds that opponents of transfer, or ‘unrepresentative people’ would dominate meetings, whereas they and the Council could ‘impartially’ present ‘the facts’ to individual tenants, away from the malign influence of campaigners against transfer. Presenting ‘the facts’ meant nothing other than driving home the message that “there is no alternative” to transfer. It was difficult to tell the difference between the Council and the ITA.

Of course, the ITA was not a disinterested and impartial provider of advice to tenants. It was in their interest for a ballot to take place. Why? Because if the Council decided against balloting then that would be the end of their contract. If a ballot was to take place, then they had the chance to be appointed to the next stage and earn more money. Could the fact that they did not present any disadvantages to transfer be connected with their prospects of earning more money?

In the public meeting which was organised in Parks the ITA representative was asked by one tenant, how many times have you advised tenants that their best option was to stay as Council tenants? Curiously enough he did not answer the question.

The BallotIn response to the question, “will it commit to providing a list of addresses to the campaign against transfer” they said that the content of any offer documentation “has not yet been considered” and this request “will be given serious consideration” (within the context of complying with the Data Protection Act.) In fact the right of campaigners to receive the addresses of tenants has already been established by ruling of the Information Commissioner. Government guidance simply reiterates this right.

The conduct of ballots has been brought into disrepute by many Councils. Instead of the presentation of ‘facts’ a concerted propaganda campaign has often been used to win a ‘yes’ vote. So much so that the government has seen fit to introduce a consultation paper on Statutory Guidance for the balloting process. This states that:

“Tenants… should not feel that the main purpose of the consultation document is to sell the transfer; rather it should provide neutral information.”

It further says that the document issued to explain that:

“…although transferring tenants will have broadly similar rights, some rights will be lost whiloe others will be provided by contract rather than by statute.”

And:

“There are additional grounds for possession available to the new landlord that may be used against existing tenants in the event that the transfer goes ahead and these should be explained.”

Playing by the Queensbury Rules?Of course, the problem is that in reality a Council which is in favour of transfer is hardly likely to play by the Queensbury rules. In the case of our Council, if the tenants vote ‘No’ then the Council tax payers will bear the cost of the process which is estimated at £1 million. That would be a political problem for the ruling group because they would be open to the accusation that they have wasted Council tax payers money and so on. So they are bound to campaign for a ‘Yes’ vote rather than impartially presenting ‘the facts’.

We asked two other questions PQT. Does the Council accept that the ballot papers should go out with no accompanying material? The government’s guidance says:

“The ballot paper should be delivered to each tenant under separate cover from any consultation material. During a ballot period a local authority should generally refrain from issuing any further material about the proposed transfer.”

The answer to this question is curious. The Council says that since a ballot would be conducted by an independent organisation such as the Electoral Reform Society “they would have the final decision on what would be appropriate at this final stage”. This is unacceptable. The Council must decide what is “appropriate” in the light of government Guidance, and the avoidance of any tricks designed to assist winning a majority for a ‘Yes’ vote. ERS has behaved inappropriately in a number of ballots which it has conducted. For instance they have conducted balloting in the landlord’s office with their staff on hand and they have given details of who has voted to the landlord.

The final question related to who would be balloted. Some households have a single registered tenant, others have two jointly. Will all individual tenants receive a ballot or just one per household? Where there are two tenants there is no guarantee that they will vote the same way. What happens if they disagree? The only way to ensure their rights is to ballot all registered tenants. The Council tells us that they will seek Government guidance on this matter. 

Martin Wicks

This is a letter to the Swindon Advertiser in response to their report of last Thursday’s Council meeting.

The Adver report of last week’s Council meeting was deficient in one important respect. It gave the impression that a ballot of tenants on transfer of our housing to a Housing Association will take place in the autumn of 2010. Unfortunately the report did not explain the content of the resolution which voted through by the ruling Conservative group.

Tenants should be aware that the decision to ballot was “subect to” the government department confirming the writing off of Swindon’s existing housing debt and the “current arrangements” for transfer still being available. The Council will seek clarification as to whether or not this is the case.

If the government response is negative then the resolution says that the whole question would have to be brought back for further consideration by the Council.

We know that the government has decided to end incentives for tenants to vote for transfer. For instance they will no longer give a debt write-off if tenants “vote the right way”. The Housing Minister has said that the money available to Councils for their housing will be the same whether for transfer or keeping ownership of their stock. The only exception to this is where tenants have already voted in favour of transfer. Obviously this does not include Swindon where no ballot has taken place.

What the Council is doing is testing out whether the Minister really means this. If he were to be consistent then his response would be negative; that Swindon could not have the same terms of transfer that were previously available.

Whether he will be consistent remains to be seen, but the response will most likely determine whether or not a ballot goes ahead. If the level of debt which Swindon will have were to be the same for either transfer or continued Council ownership then the Council would not be able to say that a Housing Association would be able to provide “a better service”. (We don’t think this is true but it is an argument for another occasion.) So it seems unlikely that they would risk losing a ballot without holding out the prospect of a “better service”. If tenants voted ‘no’ then Council tax payers would have to pay the estimated £1 million bill.

So watch this space.

For a detailed briefing on the situation readers can go to the Swindon TUC website (swindontuc.wordpress.com). Anybody interested in campaigning against transfer should a ballot proceed can email us at swindondch@btinternet.com or ring  07786 394593 .

Martin Wicks

Secretary Swindon TUC, and tenant

Below are some questions I raised during Public Question Time at the Swindon Council meeting yesterday, and the answers from the Lead Member for housing. You can judge for yourself whether the answers are satisfactory. I will comment on them in a later post.

Questions:

1. Does the Council accept that tenants should have the right to hear the case for and against transfer before deciding whether transfer is in their best interests?

2. Will it commit to providing a list of addresses to the campaign against transfer (Swindon Defend Council Housing campaign)?

3. Does it accept that ballot papers should go out with no accompanying material on either side of the argument?

4. Will all registered tenants be balloted (i.e. some households have one registered tenants, others two, jointly)?

The Cabinet member responded

1. The Council is working with tenants to ensure they receive the highest levels of repairs and maintenance on their homes. The government proposals are based on delivering the Decent Homes Standard only and the minimum standard will not meet the aspirations of both Swindon’s tenants and the Council as their current landlord. If Council decides that the most appropriate course of action is to offer tenants a formal ballot then there will be a range of opportunities for tenants to engage in the process before voting takes place. During the consultation, tenants have been presented with a balanced case and, should Council decide to proceed to ballot, that will continue to be the case. Tenants will also continue to be supported by an Independent Tenants’ Advisor who will provide an unbiased view.2.
   

2. The content of any offer documentation has not yet been considered and this request will be given serious consideration, however, any information released by the Council involving individuals’ personal details must comply with the Data protection Act.

3. The information on the ballot documentation should be as clear and direct as possible so that tenants can make an informed choice. The guidance is clear in that, the ballot cannot be undertaken by the Council. The ballot would be conducted by an independent organisation such as the Electoral Reform Society they would have the final decision on what would be appropriate at this final stage of the ballot.

4. The Council will seek Government guidance on the matter if we proceed to ballot.

Martin Wicks

People having hip replacements at private treatment centres brought in to cut waiting times are up to 20 times more likely to need painful and expensive repair work. Many operations are having to be redone in NHS hospitals, at great cost and with serious staffing implications for the health service.

A study by orthopaedic surgeons in Cardiff found that of 113 hip operations on patients sent from their NHS trust to Weston-super-Mare NHS Treatment Centre between 2004 and 2006, two thirds showed clear evidence of poor surgical technique, such as poor cementing of the hip.

In the three years since the operation, 18 per cent had undergone revision or were awaiting an operation — 20 times the 0.9 per cent NHS-wide revision rate at three years. A study on knee operations at the unit, conducted earlier this year, recorded a tenfold increase in revision rates.

Since the Independent Sector Treatment Centre (ISTC) programme was introduced in 2003, dozens of centres have been set up, mainly conducting orthopaedic surgery, cataracts and diagnostic screening. A total of 44 are described as NHS centres — though they are often staffed by independent sector contracts — and 23 are provided by private companies.

Leading surgeons said that this new data underlined the need for a significent overhaul of the multimillion-pound programme, which was introduced with great fanfare by the Government to reduce waiting times and increase patient choice.

They said a total lack of supervision of the sector and its clinical outcomes was a dereliction of duty by the Government, which had put a premium on reducing numbers rather than patient care. Early concerns about poorly vetted overseas doctors carrying out the work had not been addressed, they said.

The Cardiff study, published in the Journal of Bone and Joint Surgery, offers the most compelling evidence to date of problems with care in the sector, and the lack of proper auditing.Surgeons told The Times that the data backed anecdotal reports from elsewhere in the country, although it was likely to be at the high end. They said that NHS trusts were being left to manage the extra workload created.

While a hip replacement costs £6,000, the more complex repair operations, with more expensive implants, bone grafts and longer hospital stays, cost between £10,000 and £15,000. In an accompanying editorial in the journal, Fares Haddad, a consultant orthopaedic surgeon based at University College Hospital, London, says that the whole programme is in jeopardy because of the lack proper audit and follow-up. He adds that were such performance data available — and even if revision rates were lower — it would still “make the economic argument for ISTCs untenable”.

Mr Haddad told The Times that the disruption caused by the errors had an acute impact on hospitals, budgets and patients. He said that a revision rate of 3 per cent would still be unacceptable as it was “200 per cent greater than the NHS norm”, and even more so given that most treatment centres were sent the easier orthopaedic cases.

“We all want to cut waiting lists and give excellent care to patients,” he said. “But this was introduced without data to show that it worked. We are now seeing the studies to show that.

We have all had work increased by this, and the cost implications are huge too. Revision work costs two or three times the cost of a primary replacement. What is more, the failure of a joint replacement is often worse than the arthritis that led to the original operation. Mr Haddad added that if it were compulsory to register every operation on the National Joint Registry, trends would quickly emerge.

We would start picking up on those that were failing,” he said.

Tony Hui, chairman of the British Orthopaedic Directors Society, which represents heads of NHS orthopaedic departments, said that care in his area of South Teesside had also been affected. “We are seeing patients that have been treated elsewhere and they have problems and end up back at the NHS. The work has been suboptimal, and we have to do the revision which is time consuming, risky and expensive. With each case that comes along it’s another half day of operating — which could be two other patients.”

Steve Cannon, a surgeon at the Royal National Orthopaedic Hospital, Stanmore, northwest London, said the scheme had been about “speed of getting through the numbers” and was an “iniquitous waste of money”.

David Worskett, director of NHS Partners Network, which represents independent providers, said that the sector was being unfairly portrayed by surgeons and many were offering care of an excellent standard. He said that he could not comment on the case of Weston-super-Mare because, although private provision of care was involved, it was organised by the NHS.

A Department of Health spokesperson said: “Patient safety is top priority with all contracts with the independent sector.

The Department of Health requires all Independent Sector Treatment Centres to have robust policies and procedures in place. All ISTCs operate under standards monitored by the Care Quality Commission, the independent health watchdog.

The CQC… have not raised concerns with the Department about the safety of ISTCs.”

From the Times

Why is Swindon Council rushing to ballot tenants when the government’s Housing Revenue consultation is not even finished?

In July the ruling Conservative group on Swindon Council decided to withdraw its resolution to ballot tenants for transfer of our Housing to a Housing Association, owing to the announcement of a government consultation on Housing Finance. The government intends to end the current Council Housing Subsidy system and has published draft proposals for what it calls a ‘self-financing’ system. The ruling group decided to assess the implications of the draft proposals for the town’s Council housing finances.

Having made their assessment they have decided to reinstate the ballot proposal, though before the consultation has even finished. The deadline for submissions is October 27^th. We understand the Council intends to make its own submission to the consultation, so why not wait to see the outcome and the government’s finalised proposals? If there are any significant changes in these then the Council will have to redo their financial calculations in any case.

Housing ‘debt’

Why the rush? The government says that in order to introduce its new system there needs to be a ‘one-off debt settlement’. The national ‘debt’ which is currently managed by the government would be divided up and managed by each local authority. Under the current system, although Swindon has a housing debt of only around £12 million the government determines that we have a ‘notional’ debt of £30 million. The Council, using the criteria of the government for determining what level of debt each Council will have under this settlement, has estimated that Swindon’s debt is likely to be somewhere in the region of £150 – £213 million.

Clearly the dumping of such a level of additional debt on the tenants (who have to pay it through their rent) is completely unacceptable. As we understand it the Council’s submission to the consultation will say that we should not have any additional debt above the ‘notional’ £30 million. The majority of local Councils will be responding in a similar fashion since most of them will also see increased debt under the government’s draft proposals.

What the ruling group in Swindon is doing, however, is proposing to ballot on the basis of financial calculations for a system which is likely never to be introduced. The government has said that the new system can be introduced under existing legislation only if all Councils agree to the formula for determining debt. There is no chance of this since most of them will see significant increases in it. If not, then primary legislation would have to be introduced in Parliament. The government will have to consider the submissions to its consultation and draw up its response and finalised proposals. This cannot happen until January of next year at the earliest. The chance of legislation being pushed through before the election is extremely unlikely to say the least.

What is the Conservative ruling group’s response to this? They say that since legislation will probably be necessary a new system will not come into force for another three years. Given their calculation that in the next five years there is likely to be a shortfall for capital expenditure for Swindon of £19 million we cannot afford to wait. David Renard told members of Swindon Tenants Voice: “The problem is here and now and we have to act now.”

But wait a minute, what if as seems likely a Tory government is elected next May? Will they not come riding to the rescue of the tenants? The Lead member tells us that he has been trying to find out what his Party’s policy is, but alas he has drawn a blank. With the approaching General election they are “keeping their cards close to their chest” (his words). From this he makes the assumption that whatever government is elected we will have to wait three years for a new Housing finance system.

What do they want their party policy to be?

A question springs to mind here. The Swindon Conservative group has been placing demands on this government; for instance, the right to keep all the rent they collect from tenants. This has been conceded. Are they just passively asking what the national policy of their party is? Why are they not telling their own Party leadership what policy they want them to adopt? What are they doing to press their own leadership to act in the interests of our tenants? Of one thing you can be sure; if the Conservative group thought that a newly elected Tory government was going to offer more than the current government to our tenants they would not be rushing ahead with a ballot. They would wait to see the outcome of the consultation and the outcome of the soon to follow General Election.

A better service?

Councillor Renard tells us that a transfer is in the best interests of tenants because a Housing Association will be able to provide a better service for tenants than the Council can. This, of course, is based on a financial projection over 30 years. It is true that the government tells Councils to make these projections, but they are nothing more than very rough estimates over a time-scale which will see at least six governments come and go. There are so many variables in the equation that are impossible to predict.

But even if you accept these projections the question of the best interests of the tenants is not just determined by financial calculations alone.

The disadvantages of transfer

When the Council carried out its consultation on transfer they were selling the idea that there was ‘no alternative’. They said they were merely presenting the facts to tenants yet they did not mention a single disadvantage of transfer. What are these?

• Council tenants at least have the right to vote their Council out of office if they are unhappy with them. You cannot do this with the Board of a business.

• Housing Associations are businesses run on commercial lines. They have to borrow money at higher interest rates than a Council can. That is why their rents have been around 20% higher than Council rents.

• Tenants transferring to an HA will lose their ‘secure’ tenure and have only ‘assured’ tenure. It is easier for HA’s to remove tenants,e.g. ‘ground 8’ which is a ‘mandatory’ ground for eviction. This means a court has to order eviction even if arrears of rent are not the fault of the tenant (e.g. a mistake made by the Benefits Office or their failure to deal with a claim in time).

• The agreement which is made in a transfer which usually affords some protection in relation to rents, say for five years, does not cover service charges. HA’s are using these more and more as a means of driving up rents.

• A common feature of transfers, especially when Housing Associations are under increasing financial pressure, is the cutting back of staff that provide the service to tenants (as the wages of the senior officers rise sharply).

• Although the government has been trying to drive up Council house rents to HA levels (giving the message to tenants that there is no difference between the two tenures) they have had to keep putting the deadline for ‘equalisation’ back. Whilst Councils recently cut this year’s rent increase by half, owing to more money being made available from the government, HA’s have not made this cut. Moreover, their national lobbying body is pressing the government for the right to push up rents faster.

So there are good reasons to maintain our Housing stock with the Council even if it appears there might be more money available for a HA over 30 years.

Transfer won’t address the Housing crisis

Given the shortage of Council housing, waiting lists have risen massively over the past decade. This has happened in Swindon where the latest figure is 8,600 individuals/families. Many people who might put their name on the list do not even bother because they have no chance of getting a Council property.

How does the Council propose to address this problem? It cannot rely on the private sector which is well known for its profiteering. Only yesterday news was released of over a hundred building companies being fined for colluding in what was effectively price fixing in relation to public sector contracts.

The current government has finally conceded the right of Councils to build new Council housing, though on a tiny scale. We are getting all of 13 in Swindon. But to address this crisis we need a large scale Council house building programme. For many people buying a house is a necessary evil which can become an albatross around their necks, making life a constant struggle to get by month by month. Many people would not bother if Council housing was available. Home ownership and easy, irresponsible levels of credit has played a big part in the crash. The Tenant Services Authority has recently announced a survey which shows a decline in the number of tenants in ‘social housing’ who want to own their own home, from over 30% to only 12%.

To ballot or not to ballot?

The ruling group in Swindon wants to ballot tenants but its resolution has a caveat. It will ask the government whether the ‘same conditions’ for transfer which were available will apply now that they have decided to abandon the existing Housing Revenue system. For 12 years the government sought to end Council housing by offering incentives for transfer, such as write-off of housing debt. However, because of the housing crisis and the campaign against transfer waged by tenants, trades unions, and Councils, the government has decided to end these incentives to transfer.

If the government responds to Swindon Council in the negative – that the ‘same conditions’ do not apply – (e.g. there will be no debt write-off) then the the issue will have to come back to the Cabinet. If the Council is told that the same debt level under the new system will apply for maintaining Council stock or transfer then it is unlikely that they will ballot, since they could not even offer a ‘better service’ under a HA (even if on the basis of a dodgy 30 year projection). If they say that Swindon can have the current ‘notional’ debt then the Council will press ahead with a ballot.

If a ballot proceeds we will campaign for a ‘no’ vote and the maintenance of our Council housing. However, even if they decided against a ballot we will still have to campaign for the funding necessary to maintain and improve our housing.

The current government has made some concessions – such as being able to keep all our rent – but they have not gone far enough. The discrimination against tenants should be ended and the love affair with home ownership which has proved so disastrous should be abandoned. The ‘right to buy’ should be ended.

Housing debt should be written off, or at the very least no Council should have any more debt imposed on them than their current ‘notional’ debt.

We need more Council housing, not less. Were Swindon to transfer its stock they would still have a statutory duty to house the homeless but would have no stock to do so.

September 24^th 2009

Visit these websites

www.defendcouncilhousing.org.uk for the national campaign

keepourcouncilhomes.wordpress.com for the Swindon Defend Council Housing campaign

]]> http://swindontuc.wordpress.com/2009/09/24/council-housing-update/feed/ 0 swindontuc http://swindontuc.wordpress.com/2009/08/13/a-debt-to-tenants-why-historic-debt-should-be-written-off/ http://swindontuc.wordpress.com/2009/08/13/a-debt-to-tenants-why-historic-debt-should-be-written-off/#comments Thu, 13 Aug 2009 11:27:34 +0000 swindontuc http://swindontuc.wordpress.com/?p=301 ]]>

As part of its proposal to introduce a new Housing Finance system the government is proposing a ‘one-off settlement’ of what it calls ‘historic housing debt’. Currently it is saying that this debt should rest on the shoulders of Council tenants who have benefited from Council house building and maintenance. They say it would be ‘unaffordable’ and ‘unfair’ to the general taxpayer to cancel this debt.

The irony of this position is that since it came to office in 1997 the government was intent on transferring all Council housing to Housing Associations or private companies. Amongst other inducements aimed at pressuring tenants to vote for transfer the government was prepared to write off the debt of each authority transferring its stock. Since 1988 when transfer began almost £4 billion has been spent writing off debt in England. In Scotland a further £1.3 billion has been spent likewise. Yet such a write-off has been denied those tenants who have chosen to remain with their Council.

The government says this debt is around £19 billion, yet when you examine it carefully, all is not what it seems. In 1996-7 the total Council housing debt was £20 billion. By 2004/05 it had been reduced to £12.7 billion. How did it rise to £19 billion when virtually no Council house building was taking place? The government ‘performed a sleight-of-hand’ in relation to ALMO’s (Arms Length Management Organisations – a half-way house to privatisation which had the advantage that no ballot of tenants was required to set one up). It announced in 2000 that it was making additional resources available for ‘high performing’ ALMOs . This eventually added up to £5.7 billion. Yet the government didn’t finance it. They simply added the borrowing onto the historic council housing debt. So all Council tenants were subsidising additional money for the ALMO’s out of their rent!

Robbing the tenants

New research carried out for the Parliamentary Council Housing group shows that government has “siphoned out a total of £68.6 billion from council house rents and receipts from ‘right to buy’ sales since 1979.”

From 1990-1 to 2003-4 government took 75% of all receipts from Council house sales to pay off the historic debt costs of building these homes. Councils that became debt free were able to keep all their receipts. These tended to be the result not of brilliant management but where Councils sold off a higher percentage of their stock.

From 2004/5 this changed. The government ‘pooled’ the 75% of RTB receipts and no longer used it to pay off historic debt, nor recycled it into Housing Revenue Account allowances. Between 2004-5 and 2008-9 a total of £4.7 billion was effectively stolen from the HRA in this way. Some of this money was used to pay for home ownership schemes and grants to Registered Social Landlords (Housing Associations).

Right to Buy Discounts

The total value of the discount given to tenants buying their council house between 1979 and 2009 was £32.5 billion. When a housing association home is sold, the cost of the discount is borne by general taxation. But Councils had to bear the cost of the discount themselves.

The House of Commons Council House group is right when it says:

“Today’s council tenants are being penalised to carry the cost of Governments’ decisions to discount the sale of council housing. Councils lost housing without being able to replace it, rent from fewer properties had to pay the same overhead costs, making council housing more expensive to run.”

So more than £37 billion was lost to the national HRA as a result of discount policy and siphoning out receipts – more than enough to pay the current supposed £19 billion debt.

Robbery from rents

Between 1994/5 and 2008/9 council tenants paid a total of £91 billion in rents. Yet the allowances which were given back to Councils by the government were only £60 billion for management, maintenance and repair of homes. In other words they withheld £31 billion of tenants’ rent. Most of this went towards supporting debt, but between 1994/5 and 2008/9 the government’s ‘negative subsidy’ system cost council housing £7.8 billion over and above debt payments.

Why should tenants pay the debt?

Council housing is a public asset like hospitals and schools which are subsidised from general taxation. Yet tenants are being told that they should pay the debt. Government does not attempt to recover public subsidy from any other form of housing tenure, so why from council housing?

RSLs received a total of £33.5 billion of public subsidy between 1986/7 and 2007/8 in England alone – £40.6 billion in GB as a whole.

The government subsidises profit-making companies, consortiums and private individuals involved in buy to let, through tax breaks.

Between 1986 and 2000 a subsidy of £59 billion was spent on MIRAS (mortgage interest relief).

Capital Gains Tax relief to owner occupiers rose ten-fold between 1996/7 and 2005. The “net tax advantage of owner-occupiers” for just one year, 2004/5, was estimated at £15.7 billion.

Income Support for Mortgage interest between 1980 and 2007 was £14 billion.

‘Investment earnings’

Treasury officials justify the money they have taken from tenants as a ‘return’ on investments’. But the government does not seek a ‘return’ from schools or hospitals, so why from council tenants? The House of Commons CHG says that the government “has milked council housing like a cash cow for decades”.

“Tenants have already been forced to finance more than the total amount of current historic debt.”

Cancel the debt

It is clear from the foregoing that the ‘right to buy’ not only involved giving away public assets on the cheap. It had consequences for the remaining council tenants, by increasing the costs of managing and maintaining the stock.

Even if you accept the £19 billion figure at face value, writing it off would cost just over £1 billion a year, giving councils money to invest in their stock (they would no longer have to pay to ‘service’ the debt). When you consider that the government has provided £125 billion in ‘quantitative easing’ and now a further £50 billion in a second tranche, then the assertion that it is not affordable to write it off is put in perspective.

Writing off the debt would have the added advantage that in making money available for new build. It would play a role in putting redundant building workers back to work, helping to tackle the recession.

In abandoning the housing revenue account subsidy system the government has overturned some aspects of its housing policy. It has said it will end financial inducements to transfer of stock. It has abandoned the ‘negative subsidy’ system, accepting the right of Councils to keep all their rent raised from their tenants. It has abandoned its opposition to Councils building new Council housing allowing councils to apply for ’social housing grant’.

However, it owes a debt to tenants for continuing the policy begun by Thatcher. It continued discrimination against tenants; a ‘philosophy’ based on worship of home ownership as a ‘natural’ aspiration. It’s proposed ’self-financing’ system has abandoned its defeated attempt to put an end to Council housing.

Cancelling the debt – much of which is not the result of historic council house building – is affordable and would provide an act of justice for tenants, even if somewhat belated.

The deadline for responses to the consultation is October 27^th. Trades unions and tenants organisations will be demanding the cancellation of the debt. To do so either:

Email councilhousingfinance@communities.gsi.gov.uk

Or by post to:

Review of Council Housing Finance , Communities and Local Government , Zone 1/J9 , Eland House, Bressenden Place London SW1E 5DU

Note:

The figures quoted in this article are based on the document Council Housing, Time to Invest by the House of Commons Council Housing Group. To read this document go to the Defend Council Housing campaign website:

www.defendcouncilhousingcampaign.org.uk

Martin Wicks

August 13^th 2009

This is the initial response of the Defend Council Housing campaign to the government’s consultation on reform of Council Housing Finance, published on July 21st. The consultation finishes on October 27th.

We said we would measure proposals in the government’s consultation on reform to council housing finance against our long-standing demands – and they fall short.

The consultation document explicitly promises “a level playing field between transfer and retention”. But the demand by tenants, trade unionists, councillors and MPs for a ‘level playing field’ with transfer does not mean levelling the field down to the poverty standards previously on offer for retained council housing.

The promise of capital grants in excess of £6 billion to meet the backlog of outstanding works offers real hope to those areas where tenants have refused to be blackmailed into transfer or ALMO. But councils also need enough funding to maintain these standards, to prevent us going round the same cycle of disrepair again.

The government promised that this review would deliver a “long-term sustainable future” for council housing. But the amount of extra money being offered for management, maintenance and major repairs in the long-term is derisory. A mere 24% uplift for major repairs is a kick in the teeth – a fraction of the necessary 75% identified by the government’s own research. It is laughable that the BRE are now suggesting only a 5% uplift in management and maintenance, where they previously recommended 40% (see below for details).

Tenants would welcome a quality standard which includes “lifts, garages, CCTV, TV reception, alarms, play areas, external lighting, walls and fences, and grass and planted areas” – but what confidence can we have that such standards will be possible with so little increase in funding?

The government’s impact assessment gives further evidence that the settlement falls well short of what is needed. With a projected cost of £12.3 billion they are only planning to reduce, not end, their robbery. Under the present system they will take more than £22 billion over 30 years – under the new proposals they will still be taking more than £10 billion (see below for details).

£12.3 billion is a significant breakthrough for our determined campaign over many years for the fourth option of direct investment. It’s real money on the table which will translate into real doors and windows and roofs and kitchens for tenants. But tenants and councils won’t accept a settlement which isn’t going to deliver decent homes and estates for the long term. The door is opening and now more than ever we need a strong united campaign to push it all the way.

The consultation document suggests a reformed national system of allowances as an option. This would be far safer: it would be crazy to accept an inadequate settlement in exchange for all the risks of self-financing.

Finally, the government’s outright refusal that the Treasury should bear any responsibility for writing off debt does not address any of our criticisms. They have been willing to write off all the debt for homes which transfer – based on actual costs of maintaining homes and estates, not a ‘national formula’, but now they want to discriminate against tenants who chose to stay with their council! Council housing is a public asset, but the government dares to try and argue that the public should not pay for the historic cost of building it – a government which hands over billions to bankers to pay for their toxic debt.

We welcome the decision by the select committee of MPs which oversees the Communities and Local Government department to scrutinise these proposals before the consultation ends.

Our message to the minister must be clear: tenants and their landlords will not be bullied into accepting unsustainable levels of debt based on poverty standards. We will not accept anything less than fair funding to bring homes and estates up to genuinely decent standards, and maintain them for a sustainable future.

What you can do

Get your council to cost what the settlement means for them – and how much they really need. Get them to send this as evidence for the select committee’s inquiry; and as a response to the government’s consultation.

Organise a meeting to discuss the proposals. DCH will try and send a speaker

Details of submission to select committee

Each submission should:

1. be no more than 3,000 words in length;

2. begin with a short summary in bullet point form;

3. have numbered paragraphs;

4. be in Word format (no later than 2003) with as little use of colour or logos as possible; and

5. be accompanied by a covering letter containing the name and contact details of the individual or organisation submitting evidence.

A copy of the submission should be sent by e-mail to clgev@parliament.uk and marked “Decent Homes”

If you are unable to send an electronic version, please send a paper copy to:

Nicola McCoy
Committee Assistant
Communities and Local Government Committee
House of Commons
7 Millbank
London
SW1P 3JA