For 'housing association', read 'social enterprise'

On Wednesday the National Housing Federation (NHF) will be holding its annual conference in Birmingham. For the first time, they’re including a day of talks and debates around the subject of social enterprise. Why have they done this? Ruth Davison, director of policy and external affairs for the Federation, explains:

“It has long been the contention of the Federation that housing associations are the longest established, most successful social enterprises in Britain but they’re not seen as such in the social enterprise sector and some housing associations don’t see themselves as a social enterprise. When we published ‘An Ambition to Deliver’, the sector’s ambition for the next 20 years, one of the aims of it was to be widely recognised as a social enterprise. The day at our conference is not just about realising the sector's vision but exploring and examining the way the bigger social enterprises work in the sector and how they work with different people.”

The NHF represents 1000 non-profit independent housing associations of varying size. They don’t only provide low cost social housing but “houses for every price point” as Davison puts it. It remains the case though, that much of the housing provided for the vulnerable (including a spectrum of people including those with mental health issues or learning difficulties to recovering addicts or women sheltered from domestic violence) is also taken care of by these associations.

Housing associations were initially set up by philanthropic benefactors in the nineteenth century but in recent decades have taken up the role commonly thought of as council housing. Legislation (including Right To Buy), combined with funding cuts over the years, has meant that councils now hold limited housing stock, with housing associations filling the gap in social housing. To use the royal borough of Kensington and Chelsea as an example, the council have 502 properties to let but around 25% of the population of the borough (nearly 160,000 people) live in social housing.

Housing associations receive some money from the Government (through the Homes and Communities Agency) to build houses but the amount available has been shrinking every year due to austerity cuts. It is currently estimated to be worth around £20,000 towards the cost of each house associations build. In this environment, housing associations have had to be entrepreneurial. Many have taken loans, using their housing stock as collateral. They might, for example, build some new homes with that money, sell some of them at market prices and use that profit to build more social housing. In this context it is straightforward to consider housing associations as social enterprises.

Davison was keen to emphasise that it’s not only houses the associations supply. “Why I think they’re a stunning example of social enterprises is that their boards decide what is important to them, what the social purpose is, and what their focus should be: is it around delivering homes because housing pressure is the big issue or is it about providing access to employment or training opportunities?” She gives an example of an association that provided a leisure centre as part of a regeneration project. After drawing a blank trying to find a social enterprise that could look after the project's catering, the housing engaged unemployed tenants, trained them and had them run the catering. Furniture reuse or restoration and gardening services are some examples of other social enterprises that exist within housing associations.

With Jeremy Corbyn using one of his first six prime ministers questions to focus on housing and housing minister Brandon Lewis stating at the weekend that the government will aim to build a million new homes over this Parliament, the housing crisis remains centre stage politically. Chancellor George Osborne announced in the budget that housing association rents would be reduced by 1% a year for the next four years, something that Davison says will take nearly £4bn away from associations’ coffers. Will this mean less houses being built? “I think associations are mindful about their social purpose when making decisions about what to cut or what not to cut. We’ll have to make tough choices but we’ll continue to build because people need homes and the country faces a housing crisis. We’re going to play a part in that, however difficult it is.” 

Does she think that Lewis’ figure of a million new homes is achievable? Davison responds firstly by pointing out that housing associations built a third of all new homes last year before saying: “It’s ambitious but I’m pleased that somebody has raised their sights to be that ambitious. It's better to have an ambitious target that you slightly fail to deliver than not having raised your sights to do it to begin with. I’m not saying it’s not doable – I think it is with the right focus”

The National Housing Federation annual conference takes place at the ICC in Birmingham 23rd-25th September http://annual.housing.org.uk/

Photo credit: SuSanA Secretariat