In the nineteenth century, one of the key steps that philanthropists took to ‘alleviate the suffering of the poor’ was to build decent homes, enabling them to leave some of the worst slums in Europe. In the UK we are familiar with names such as Rowntree, Cadbury, Guinness and George Peabody: those who devoted vast sums of money to building thousands of homes, many of which are still available for social rent today. However, after the First World War, David Lloyd George pledged to build homes fit for heroes; social housing became the responsibility of the state, and the relationship between philanthropy and social housing drifted. Today, according to Inside Housing magazine, ‘the building of new social housing is no longer a major philanthropic cause’. This seems to be backed up by data on corporate giving, of which only a very small proportion of around £1.6 billion a year (two thirds cash and one third in-kind giving) goes to the social housing sector.
Recently, NPC and The Smith Institute have been working with Peabody to explore whether it is time for a new agenda for philanthropy and social housing. As organisations such as Shelter have pointed out for many years now, the UK is in the grips of a housing crisis, with millions of people categorised as being ‘in housing need’. Supply is not keeping up with demand − in 2012, 98,280 house builds were started, an 11 per cent drop compared to the previous year and, critically, far short of the 230,000 households that were formed. Based on the government’s projection for growth in household numbers, if we continue in this direction there could be a shortfall of 750,000 homes by 2025.
On top of this, the lack of housing stock is compounded by recent changes to the welfare system, which are beginning to affect people’s living arrangements, directly or indirectly. It has only been two months since the Government’s spare bedroom subsidy − or ‘bedroom tax’ as it is often known − was implemented, but housing associations are already reporting that tenants affected by change, who are losing as much as 25% of their housing benefit, are failing to cover the shortfall in their rent. Councils across England have also reported a huge leap in the number of applications they have received for discretionary housing payments (DHP) − the emergency hardship funds available to people in urgent need − with some councils receiving over five times more applications since the introduction of the subsidy. The government has increased its DHP pot from £60 million in 2012/13 to £155 million in 2013/14, but the surge in applications in the first few months indicate that this might not be enough.
So where do 21st-century funders come into all of this? At an NPC and Smith Institute roundtable held earlier this year, attended by people from the funder world as well as the social housing world, we learnt that there is a degree of nervousness surrounding rehabilitating the relationship between philanthropy and housing. For some, it breaks the ‘rule’ that says charitable funding should steer clear of needs that are meant to be met by the state. For many, there is a concern that the modern housing crisis is so vast, and the cost of building so astronomical, that it would be virtually impossible for a funder to make a dent in the issue in the same way as his Victorian forbears.
However, I believe that the housing crisis, and the plight of those in housing need, has now reached such a scale that funders need to look again at how they might make a difference. A safe, stable and secure home underpins so many other factors crucial to playing an active role in society − your mental health, educational attainment and your ability to hold down a job will be influenced by where you live.
In the autumn, NPC and The Smith Institute will be publishing a collection of essays looking at what a 21st-century relationship between housing and philanthropy might look like, including some ideas and suggestions for funders to explore. I hope it will not only make for interesting reading, but also trigger some new ideas and new ways of thinking about how funders can re-engage with this issue, one that we simply cannot ignore.
Vicki Prout is Media Relations Manager and Housing Lead at NPC.