Social housing in a typical town

Why aren’t housing associations investing more into social housing?

The governments official definition of a housing association is:

‘ Housing associations in England are independent societies, bodies of trustees or companies established for the purpose of providing low-cost social housing for people in housing need on a non-profit-making basis. Any trading surplus is used to maintain existing homes and to help finance new ones. ‘

With this in mind, and the fact that we’re in the midst of a housing crisis via the biggest housing shortfall on record, take a minute to digest the following facts:

  • With a backlog of 4 million homes, England must build 340,000 homes per year until 2031 to meet demand
  • The UK’s housing associations made record operating profits of £3.5 billion in 2017
  • In 2016/2017 there were 22,858 affordable housing completions in England and only 597 were social rented housing, in comparison to 18,280 so-called “affordable rent” completions
  • Global account statistics show the largest reductions for housing associations were made in major repairs, falling by 14% in 2014
  • Housing associations core business (social housing let at low rents) continues to dwindle, now representing just 69% of their turnover
  • Average pay for housing association chief executives was £166,245 last year, with the top 5 chief executives earning between £344,000 and £579,183 per year.
  • ‘For profit’ social housing providers have been allowed to register since 2010. However, recent controversy over Sage Housing, claiming that they’re a ‘housing association,’ has seen the National Housing Federation request that they stop using this term.

As the last article link above quite rightly asks:

  • Should profit-making organisations be seen as housing associations?

At Shelforce we are highly committed to corporate social responsibility, therefore we don’t think they should be allowed to. We also ask:

  • Should profit-making organisations be able to state that its ‘affordable rent?’

As these homes can be let up to 80% of local market rents, which can be as high as £400 a week in the likes of London. Working with Birmingham City Council, we can clearly see that there is a real need for high quality home improvement products within the social housing sector.

With this ever-increasing pressure on Britain’s social housing stock, at Shelforce we urge all housing associations across the UK to go back to their roots; non-profit charities who primarily provide housing to people on low incomes and the vulnerable, rather than being driven solely by profit. The core of corporate social responsibility is about proactively taking responsibility for the company’s effects on environmental and social wellbeing. The repercussions of this ‘profit before people’ attitude is having a detrimental effect on the UK’s housing sector right across the board. It’s echoed in the Grenfell Tower aftermath, child poverty at its highest level since 2010 and our intensifying housing crisis.

We understand that it’s not as simple as black and white as it first appears, what with government subsidies diminishing over the years and additional regulations heaped onto the housing sector. But at the same time, housing associations should be reinvesting their profits to build more affordable homes; that’s been their sole purpose for over 100 years after all.

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