Housing Issues

There has been plenty of chatter of late about the Thatcher legacy. Much of it has been highly partisan and somewhat ill-informed but one aspect struck a chord - housing policy.

I have heard it suggested that the "right to buy" policy was a major success of the Thatcher regime. In that it expanded asset ownership to a much wider tranche of the population then the assertion has some truth. I do find it somewhat galling, still, that as a rate-payer I was essentially subsidising these purchases - but then any public expenditure is made with what is ultimately private wealth captured by the state or other public bodies. What I believe Thatcher failed to do was put in place the mechanisms to ensure that building of social housing, or affordable private housing, continued. This is one reason why we have a new housing crisis upon our hands.

What put these thoughts into my head was the ludicrous suggestion that permitted development rights should be temporarily relaxed to allow extensions of up to 8m depth to be constructed without the need for planning permission. The suggestion is that this will kick start the construction industry - which I doubt - and will provide much needed family space. The latter is just bonkers. All it will do is create bigger houses that are even further from the financial grasp of many potential buyers.

This has all bubbled up in the context of a local discussion about affordable housing development and, in particular, the use of exception sites (allowing building in the Green Belt for local affordable housing only). I am not a fan of green field/Green Belt development but these exception schemes should at least be considered. There are good social cohesion arguments to be considered among others.

Has The Reseach Really Not Been Done?

I read in a recent edition of Building 4 Change (don't you just hate the trendy marketing use of a numeral instead of good old fashioned word?) that BRE is about to embark on a study of solid wall properties to assess heat loss before and after insulation, and the behaviour of occupants. Has this research really not been done? Have thousands of homes been insulated under CESP without a reasonable understanding of the heat loss reduction expected? Or did DECC have a pot of money it didn't know what to do with?

Ding Dong And All That

I think the BBC got it wrong with their Ding Dong decision. The campaign to promote the song is being driven, I believe, by simple nastiness so why can't the BBC say so. What's wrong with stating that the song comes from a much-loved film and is appearing in the chart because it has been hijacked by what most people will agree are a bunch of unpleasant so-and-sos with unpleasant motives?

By the way, I was no supporter of Mrs Thatcher. In my view her governments got some things right but they got others horribly wrong. However, what I think about her politics is one thing; acting like a little ******* is another.

After Fanny Mae and Freddie Mac - Georgie Os?

How can George Osborne be so timid on the tax and spending front and so cavalier when it comes to credit? His scheme for subsidising home ownership is, in effect, HMG (and ultimately you and me) buying stakes in private homes. And these are homes being purchased by the people who, self evidently, can least afford them. Am I being daft or is this not the way the US got into their disasterous sub-prime fiasco a few years ago?

Marchant Joins Doom Mongers

So Ian Marchant is also warning us that the lights might go out. There is an implied criticism of legislators in what Marchant says - and in my post of a couple of weeks ago I said that HMG had failed to put in place proper incentives for generators to build new plant. However, Marchant is being somewhat disingenuous. The start of this county's value chain is its energy sources - first primary fuels and next, inter alia, electricity. Marchant knows this. Other generator bosses know this. Is there not a collective moral duty on them to ensure that the rest of the country does not suffer because of their failure to build new plant?

Not The Greatest Of Pictures

It's not the greatest photo' but I was so pleased to spot a leopard in the wild during our recent Sri Lankan holiday.

Should Electricity Utilities Vertically Integrate?

I have been through the "nationalised industry is privatised and disaggregated only to re-aggregate at a later stage" cycle so I was interested to see that Bain & Co have recently published a short piece on how utilities should evaluate the benefits of vertical integration.

Sadly I was rather disappointed. Admittedly it was advertised as a "Bain Brief", and brief it was. Bain consider just three motivating factors: avoiding transaction costs, hedging against volatility, tapping different profit pools. Not surprisingly they show that under many circumstances integration does not add significant value through these drivers in an piece of analysis that any half decent MBA student could have produced.

I rather expected more from a top strategic consultancy.