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Having the conversation

Housing and local government minister Julie James tells Jules Birch about her priorities in the wake of the independent reviews of affordable housing supply and housing decarbonisation.

The run-up to the summer recess is always a busy time for ministers as decks are cleared and promises kept about announcements due. However, in the run-up to this summer break things have gone into overdrive.

The two weeks before WHQ’s interview with Julie James are marked by the official response to the independent review of affordable housing supply, a major consultation on extending the notice period for evictions in the private rented sector and the first meeting of the new Homelessness Action Group. The landmark report on the decarbonisation of housing is launched the next day and the long-awaited announcement on social housing rents is due imminently. All this while one huge event outside of Welsh Government’s control is impacting on everything it does.

The Swansea West AM took over the housing brief from Rebecca Evans in December and has quickly gained a reputation for straight-talking. I start by asking her about the ‘21st century socialism’ that is central to first minister Mark Drakeford’s vision for Wales. What does that mean in housing?

‘For me, what that means is social justice,’ she says. ‘I grew up in a council house, and my grandmother was the first person to move into the house and talked all her life about how lovely the house was and so much better than where they’d lived before. Some of that was swept away by the Thatcher regime and the 89 Housing Act. Now I have the privilege to be in a position where the rules that were put in place then, which I fought vehemently at the time, have been taken away. So for the first time in a generation, we’re able to start to build the social houses that will mean that the 21st century generation will be proud of the place that they live and be able to say, gosh, you wouldn’t believe where I lived before.’

All of this seems appropriate in the year that marks the 100th anniversary of council housing and she agrees. ‘Isn’t that right and somewhat ironic that we’ve finally come around to doing it again, realising the mistake of the diversion away from this and the idea that everybody’s got to own their own home to have value or worth in society?’ she says. ‘What people want is a secure decent house, that they can call their own and have security of tenure in.’

Here she points to the Renting Homes Act, which she says will fundamentally alter the balance between private sector landlords and tenants in Wales. The Act passed in 2016 introduces a whole range of new safeguards for tenants but has not yet been implemented. Welsh Government is now consulting on extending the notice period for no-fault evictions from two to six months.

‘We haven’t been able to implement the Act, very frustratingly, because we’ve been having difficulty with the court IT system,’ she explains. ‘We’ve now found a solution to that – we’re basically paying to have the system changed – and so we’re able to implement which is great. One of the things we now want to consult on is whether 173 of the Act, which allows landlords to get possession of their house, should have a longer notice period. We’re consulting on making it six months to give somebody half a year to be able to sort themselves and their children and so on out.’

Extending the notice period does not fully meet the aspirations of campaigners who called for no-fault evictions to be ended completely, as the Conservative Westminster government has said it will do in England. However, the minister argues that there is a different legal context. The campaign focuses on scrapping Section 21 of the 1988 Housing Act whereas the entire Act is being abolished in Wales.

Landlords have called the extension ‘scandalous’ and argued that it will cut the supply of private rented homes but she says it will not stop them removing a tenant who is breach of their contract. ‘There are balances on this. A well-behaving landlord won’t have any problem and a well-behaving tenant won’t have any problem. But if a tenant is in arrears, then then there are processes to go through as normal.’

That leads naturally enough to another subject she has raised recently: evictions by social landlords. The issue was first flagged up for her by work done for Welsh Government last year on indebtedness to public services. ‘Our guess was that most of that would be council tax arrears but it turns out to be social rent,’ she says. ‘That’s been driving some of our thinking since then. In 2016/17 we evicted almost 800 people from social housing in Wales, but we started the process on nearly 4,000 people. So if you think of the trauma induced in the tenants, even when they didn’t go all the way through that, and then their interaction with other public services that we provide, GP services, mental health services and so on, that’s not acceptable. That’s not a sensible approach to public service delivery.’

Following more recent research for Welsh Government research that shows big inconsistencies between different councils and housing associations, she says: ‘We want to have a conversation with the sector, about what they’re doing and why they’re doing it and what the need for it is, and whether there are unintended consequences from what we do. Why are social landlords doing that? When you evict somebody from social housing, you are pretty much evicting them into homelessness. There’s no sense in that.’

There is a direct connection here with her agenda on homelessness. ‘The flip side of that is that we’re really keen on rolling Housing First out. So we will need to have a set of services around people who have found themselves street homeless, perhaps for a long time, and who are now back in accommodation, but who will need help to get the skills together and get their benefit sorted out or get employment or mental health support or whatever it is they need. So we want to work with the RSLs to make sure that those approaches are in place so that we don’t have evictions. Because when that family is evicted where are they going?’

Here the minister makes her first mention of something that will become one of the central themes of the interview: making links between the rent settlement and other Welsh Government priorities.

‘We need to roll that [Housing First] out but the RSLs will have to help us with that or we will never do it. In setting the rent policy in the future I want to see what flexibilities we can put in there for landlords that behave properly and less flexibility for those that don’t so that there are incentives and carrots and there are some small sticks in that system as well.’

That talk of evictions and Housing First, begs some questions about her wider approach to homelessness. Does she think ending homelessness in Wales is possible? And what should the priorities be?

‘Yes I do think it’s possible. I don’t think it’s possible immediately. I’ve been asked many times to say that there won’t be any homeless people on the streets this Christmas and I can’t say that, because we don’t have the systems in place to be able to ensure that. We will certainly be putting emergency accommodation in place and I will be making absolutely certain that people do have the space to get in off the streets and all the rest of it. But to say that we’ll be able to solve that problem in four months, we just can’t, and I’m not in the habit of giving promises I can’t keep. What we can do is we can start to redirect our services away from things that have not proven themselves in the longer term into the things that are proving themselves. The Housing First approaches do seem to work. They’re more expensive up front but they seem to have a much better effect at the end.’

She expresses her frustration that Welsh Government does not control all the policy levers -notably the welfare system and Universal Credit – but argues that what it can do is ‘make sure we are not inadvertently making things worse by our policies as well’ and ‘make our services work better together’.

Presumably that must start with having the homes in place to deliver Housing First? ‘Yes. We need to build the places to get that supply in place. Fortunately, we’re now in a position where we can start to build, at last, social housing, at pace and scale. I’ve been doing a very heartening tour of Wales talking to people and they’re really enthusiastic to do just that.’

We are talking in the context of an affordable housing review that was set up to find ways of delivering more homes within existing resources. A key theme running through both the review and the Welsh Government response to it is value for money. How does she see that?

‘We need to find the right balance, don’t we?’ she says. ‘I understand entirely where the panel we’re coming from, what they’re saying is that if we have a rent policy that has a ceiling, and an RSL has just gone to the ceiling and they have not done anything about their costs, or admin or anything else then those tenants are not getting value for money. If on the other hand, they work with their tenants to make sure that the rent is at the right level and so on, well, they are getting value for money. And the rent might be the same, it just depends on what you’re delivering for it.’

Whatever the exact formula in relation to CPI, it’s clear that this rent policy announcement will be different.

‘We want to have enough flexibility to be able to reward the behaviours we want, and not reward the behaviours we don’t want,’ she says. ‘I’m not going to name names here but you I’m aware that some RSLs that have set the policy at the ceiling and then said it’s the Welsh Government’s fault. Well, we didn’t tell them to put it to the ceiling, we just said that was the most that you could charge in every circumstance. I need to work with people to make sure that they understand that it’s not a target, it’s a ceiling.’

So what might that policy mean in practice? ‘I’ll be looking to give more flexibility to well behaving people who do the right thing and less flexibility to people who do not do the right thing. That’s why I’m a bit reluctant to say when I’ll announce it because it’s more complex than just saying “here’s a number”. It’s getting the nuances of that right.’

And what might the other considerations be? ‘Lots of things, so services for tenants, what the tenant voice looks like, whether you’re building or not, whether you’re using the rental stream to increase the social housing stock, what your build policy is. This is a trade-off, isn’t it? This is the income stream that people use to borrow the money to build the next lot of social housing so in those circumstances you want them to be able to do that. But not all RSLs are building and not all councils are building.’

She also sees a connection between decarbonisation and the rent settlement. ‘We may do a rent policy in a couple of tranches,’ she says. ‘We can say we’ve set a ceiling number but don’t be fooled because there’ll be a whole pile of strings attached to that that we’ll be announcing slightly later on. I understand that people want certainty about it, they want to be able to sort themselves out, but I also want to produce a lot from that system. We haven’t got that many levers so we want to use them to the best advantage. I’m not pushing against the sector here. Everybody else wants to do this, too so we’re all on the same page. I’ve not encountered anyone who’s telling me that this isn’t what we should do.’

She says she is looking forward to reading the decarbonisation report in detail over the Summer. ‘I want to see what they say about where we’re getting the money from to do that, what we expect for tenants, what we need to do with dowry and major repairs allowances and what we’re going to do with the Welsh Housing Quality Standard (WHQS) when we’ve reached it.’

Amid expectations of a WHQS 2, that raises the whole question of costs. As it dawns on social landlords how much their resources could have to be devoted to decarbonisation of their existing stock, how does she see the trade-off with how much they invest in new homes?

‘We’ve got to come to a conclusion about that. We’ve got to have those conversations about what is the trade-off between new build and the older stock. What is the point in time at which you decide it’s not worth bringing the old stock up and you demolish? What is the carbon footprint that results from that? And then there’s a whole issue around homes as power stations. What happens if we put photovoltaics on our social housing roofs? What impact will that have on the tenants? What can we do there with the rents? Who gets the benefit of that? If you’ve insulated that home properly, it can cool it in summer and heat it in winter and tenants’ bills go down. There’s lots of good things that can be done.’

Ahead of the rest of this packed agenda, the affordable housing review panel called for investment in sufficient resources within Welsh Government’s housing department to be able to implement recommendations such as the proposed new grant framework. Decarbonisation and the prospect of a new rent settlement with strings attached underline that point even more. But raising that question of resources soon brings us to that huge event that is outside Welsh control.

‘It’s certainly something we’re looking at and we accepted the recommendation’ she says. ‘But now we’ve got to talk about the hideous Brexit word. The resources of the Welsh Government are currently stretched as anything in trying to sort out as much as we can because of the prospect of a no deal Brexit, which would be catastrophic. We’re really pushed for resources, more than we’ve ever been. So I think we’ve got the will to do that, we absolutely accept the premise, but at the moment we’re dealing with another crisis. And I think it would be disingenuous to say anything else.’

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