Edinburgh Tenants No Vote

On Thursday, December 15th, 2005, Edinburgh tenants plunged the Council's much vaunted stock transfer plans into crisis with a no vote in the council’s ballot. The decisive blow to the council’s privatisation plans was rightly celebrated by tenants as a victory for people power and was quickly followed by a demand that the Council commit to direct investment in Edinburgh’s housing stock.
news of the result
victory drinks
group hug
“The current amazement that the things we are experiencing are ‘still’ possible (…) is not the beginning of knowledge – unless it is the knowledge that the view of history which gives rise to it is untenable�. Walter Benjamin. The result of the ballot, on a 60.5% turnout, was 53% (7301 votes) NO; 47% (6553 votes) YES. The no vote means that the transfer of 23,000 homes from City of Edinburgh Council (CEC) to City of Edinburgh Housing Association Limited (CEHA Limited) will not go through. Campaigners had argued that a yes vote would have entailed a fundamental shift from public to private ownership. The tenants who voted no and those who campaigned for a no vote, predominantly Edinburgh Against Stock Transfer (EAST) and the Stock Transfer Information Group (STIG), have a right to celebrate the ballot result. The Council had over £5 million pounds of tax-payers money from the Scottish Executive, and a “clap-happy� media entourage at their disposal to promote the transfer of public assets - 23,000 homes - into private hands. Meanwhile, a small core group of perhaps 15-20 people, supporting small but committed groups of tenants on the estates, managed to pull together a campaign which provided the information – hidden by the council – that tenants needed to make a balanced decision on the transfer. It is not unfair to suggest that this extremely skilful, brave, and well-organised campaign was a triumph of direct democracy over the hegemony of New Labour doctrine and a major blow to the privatisation of housing throughout Scotland. The defeat leaves the City Council floundering. Unbelievably, no viable contingency plans were in place, so sure were they of a yes vote. Despicably, city leaders have resorted to belittling the democratic decision of their tenants and constituents (under conditions which stretch the term ‘democracy to the limit), by blaming the result on “scare-mongering� and “misinformation� - precisely the practices the Council have employed throughout the campaign. Throughout the camapaign period the Council attempted to harass, bully and persuade tenants into a yes vote, meanwhile portraying the spectre of an imagined landscape of decaying housing beset with damp, crumbling walls, and endemic anti-social behaviour should tenants vote no. Campaigners for a no vote acknowledge that many estates have serious social and infrastructural problems but the no vote suggests that the Council's deliberately negative portrayal of Council housing ran contrary to many tenants experience of their housing and communities. The Council now claim (as they did before the ballot) that it will be very difficult to invest in, and build new Council housing stock after the no vote. This should come as no surprise, as they’ve singularly failed to make adequate investments in new-build and maintenance since the 1970’s. The ‘right-to-buy’ scheme introduced in the housing Act of 1980 (www.scotland.gov.uk) meant that tenants could buy up existing housing stock (their homes) at massively reduced rates (in effect a huge subsidy to private buyers, and a bargain basement sell-off of public assets). Since that point no new council homes have been built and the stock has decreased by 50%, with a resultant 50% reduction in revenue to maintain the remaining stock (the least desirable half). The inevitable result of this ‘strategy’, promoted by the Tories and enthusiastically embraced by the Labour party, was an enormous escalation in private house prices (many sold their homes on again at massive profit), and a seemingly inexorable decline in the quality of council housing stock. Lack of provision, extended waiting lists, spiraling council debt, and the construction of a negative image associated with ‘social housing’ have followed in its wake, (Council housing is now generally seen as housing for ‘the poor’ rather than the more positive association previous generations have had with council housing where it was seen as an excellent opportunity for decent, affordable housing for a broad range of working people and professionals). This previous association still exists today for an older generation who remember how difficult it was to achieve this level of affordable housing in the first place. This may well account, in some part, for the no vote. The ramifications of the ‘right to buy’ policy and its effects are evident throughout Britain, where many estates (by no means all) suffer from a serious lack of maintenance and investment. No-one can deny there is a serious problem with ‘social housing’ as it stands. What we can argue about is what type of solutions we seek to these problems. The City of Edinburgh Council effectively short-cutted this debate by presenting a ballot with only one option on it – the transfer to a limited company citywide housing association. The other ‘option’, a no vote, had no positive conditions attached to it, beyond a rejection of a yes vote. The stock transfer ‘option’ isn’t only confined to Edinburgh, it is the solution favoured by the treasury, and one which is being pushed out on a city by city basis throughout Britain, as Gordon Brown finds yet another way to ‘cook the books’ (the treasury prefers to build new homes through HA's as the borrowing doesn't show up on the balance sheets). Despite this, and contrary to much of the ‘only game in town’ hype, 94 city councils have now rejected stock transfer in England. Edinburgh follows Aberdeen and Dundee (rejection at consultancy stage), in voting no to full transfer. The Edinburgh no vote was no anomaly; it is part of a wider resistance against stock transfer and privatisation throughout Britain. “As flowers turn towards the sun, by dint of a secret heliotropism the past strives to turn towards that sun which is rising in the sky of history. A historical materialist must be aware of this most inconspicuous of all transformations�. Walter Benjamin. Campaign groups have argued that private finance has no real long-term interest in providing decent, affordable housing for people on low-incomes. This was the situation throughout the 1900’s and well into the 20th century (it continues to this day and will continue as long as capitalism exists). However, housing campaigns such as those that were waged on the Clydeside in Glasgow led to the first 1915 rent restrictions act, a modicum of tenant empowerment, and the first murmurings of a municipal approach to housing which would begin to address the question of affordable rents. Similar tenant movements, among other working class struggles for improved conditions, were organised throughout Britain for an improvement in living conditions. Until then, slums dominated the landscapes of many British cities, with illness reaching epidemic levels, child labour, and horrendous poverty the norm. The mass house-building programmes embarked upon by municipalities in the last century, and fought for through genuine popular struggle, played a considerable part in alleviating (though far from eliminating) the poverty and ill-health suffered by millions of people in urban and rural areas of Britain. The people who campaign to defend council housing bring this historical perspective to bear on the housing question. The City of Edinburgh Council, however, are bound by the realpolitik of the day – the threat of economic ‘punishment’ (the withholding of finances should policy not be obeyed) from their central government leaders - and the 'reality' of neo-liberalism (never fought, never challenged by politicians). In the face of this pressure to conform to central policy, the Council presented a clear set of arguments for stock transfer (borrowed from similar campaigns in the rest of Britain), which were backed by a massive £5 million publicity campaign, including DVD’s for all 23,000 tenants, billboards, bus advertisements, and regular half-page ad’s in the right-wing Evening Times. Some of their key arguments included the debt write-off of £310 million, the promise of £2 billion investment, and the guarantee of no rent increase for the first five years. First of all, regarding the debt, the council told us that 40p in every pound goes on paying off the council’s debt (accrued through previous borrowing). This debt severely impairs the council’s ability to maintain and improve current stock. The council argue that by transferring to a private housing association the Scottish Executive will write off the debt. They say this will not occur if the housing stays with the Council as this is not part of treasury agreements. In other words, the debt write-off will only be available if stock is transferred to a private Housing Organisation. Campaigners response to this was simple, they asked why this debt write off (in effect an enormous public subsidy or ‘sweetener’ for the new landlord) should only be available to a private company, but not for local councils. The City Council responded by saying that this was the current situation they faced and it was a hard economic reality they had no control over. EAST then responded by saying; CHANGE IT. After all, they argued, any other position would be an open admission of the Council’s inability to guide policy and therefore an index of their incapacity to satisfy the democratically expressed needs of their constituents (an argument all politicians are required to present). Campaigners went on to argue that it is entirely unfair that council tenants should have to pay for the Council’s poor housing management in the past (in particular the ‘right to buy’ policy), and that it is imperative that the Scottish Executive lobby for a change to the treasury’s rules governing debt write-off in order to create a ‘level playing field’ between local councils and private interests for borrowing. Campaigners found that many tenants across Edinburgh were disgusted by what they saw as debt write-off ‘bribery’ - this may have been partially reflected in the no vote. The City Council also maintained that a no vote would ‘unlock’ £2 billion pounds of investment for City housing over the next thirty years. £1.3 billion of this investment would come from private finance and be raised through borrowing. In this way, the council argued, they would be able to invest massively in housing stock without having to increase tenants rents. The £2 billion figure, minus £1.3 billion, still leaves £700 million. EAST argue that this money, from the Scottish Executive accounts, should be made available for direct investment through the City Council, without the need for transfer to a private housing association (in effect another enormous subsidy to the private sector). This is a substantial figure that would do much to create better living conditions throughout Edinburgh. Campaigners also argued that the £1.3 billion figure would have to be raised from private organisations, including banks, with very tough interest rates in comparison to money raised through the public works loan board which the state has access to (at least theoretically). They also argued that despite City of Edinburgh Housing Association Limited (CEHA limited) being a ‘not-for-profit’ company, would have to obtain its funding from private companies and banks, therefore shifting ownership from public to private and constituting a privatisation process. This claim was never adequately rebuked by the Council or by CEHA Limited (who hid the 'limited', therefore 'incorporated' part of their title until the last minute). Campaigners argued that this privatisation process would come at a considerable cost - to be borne later by the tenants through increased rent and maintenance charges to pay off the new more stringent interest rates. They made some simple and obvious analogies at this point, citing the chronic examples of the history of capitalist accumulation as evinced by many political economists from before Marx and onwards. A minor digression here makes the point. David Harvey, for instance argues that one of the main models of neo-liberal hegemony is ‘Accumulation by Dispossession’, whereby public assets are handed over to private organizations in the process more widely known as ‘privatisation’. Harvey argues the obvious; that privatisation generates a means for profit for private owners, because after a transaction, they can sell or rent for profit to the public what used to be owned in commons. The history of accumulation shows this has always involved the use of force and uneven power relations. Campaigners were quick to point out that this process is exactly what has happened to our health services, railways, buses, water etc under privatization measures which were initially presented as ‘solutions’ to problems in those services. Campaigners argued that council housing is a valuable asset to hold in commons, and that we cannot trust private financiers to invest in public assets with the degree of social responsibility tenants would wish for. The privatisation debate may have been the most damning of all for the City Council, as it seemed to tap into wider areas of concern expressed by tenants throughout Edinburgh. Again, the no vote, and the Council and CEHA’s vain attempts to reject the privatisation claim, would seem to indicate that this was a crucial point, which the Council could not counter with a satisfactory answer. Another crucial issue was the question of rents. The City of Edinburgh Housing Association Limited (CEHA ltd) had argued that they could guarantee average weekly rents would be no more than £58.49 for the first five years should transfer go ahead. They contrasted this with rents should tenants stay with the Council. The average weekly rent would then be £67.57. However, campaigners argued that the five-year guarantee was merely a sop to the tenants. The Defend Council Housing campaign group has sourced evidence, which shows considerable rent increases in England after large-scale transfer to housing associations. Average rents had increased from between 24.40% to 43.01% between 1997 and 2004 in council areas which had chosen transfer: (The Office of the Deputy Prime Minister ODPM, www.support4councilhousing.org.uk ). Campaigners argued that the example of England gave severe grounds for concern. They also argued that the guarantee would only be part a contract between the Council and CEHA limited: not between the tenants and CEHA. They argued that this would not give tenants full representation and would create a democratic deficit. The National Audit Office has shown that 17% of Housing associations break rent guarantees (note that this doesn’t take into account rent rises after the usually short five-year guarantee period). Campaigners also pointed to the experience of Glasgow where there is already talk of rent reviews well before the five year guarantee has run its course - each tenant has received a letter warning them of this (info: Glasgow Save Our Homes). Some Campaigners also noted that, even if these rent increases were applied it would merely bring much of council housing up to the rent levels of local housing associations in Edinburgh. This rent rise would be difficult for many tenants to bear, but housing would at least still be in the hands of the Council, a recallable organisation (we can vote them out), where tenants would have shared ownership over the homes and the possibility of using the levers of citizenship (such as they are) to argue for improvements and maintenance to the stock. Under the new Housing Association board the cherry-picked tenants representatives are bound by company law to represent the aims of the board – not the needs of tenants. They are toothless. (Audit Commission, June 2004). Again, the tenants no vote surprised the Council by showing a principled, intelligent, long-term response to the kind of immediate financial inducement typical of the privatisation process. SUMMARY. The vote against stock transfer shows that government spin and the ideology of neo-liberalism, with its trademark economic model of privatisation, can be challenged effectively. While this should cause some celebration within the ranks of libertarian struggle, those who point to the inadequate provision provided by the state, and the intolerable conditions many tenants have to face on an everyday basis (without the prospect of immediate investment) have an urgent point to make. The positive and inspiring grass-roots opposition which opposed the privatisation of housing in Edinburgh, now needs to be built on, or aligned with, (not overtaken, or superseded by ‘vanguardist’ or ‘entryist’ factions), to drive forward the case for direct investment in council housing so that all tenants can have access to decent, affordable housing, and that new homes can be built without the rapacious demands of real-estate speculation having dominance over the housing market. This task is considerable, and will require a careful alignment of various progressive organisations and individuals across the political spectrum to achieve it. The next stage of the Edinburgh campaign must be to argue for the £310 million historic debt to be written off (perhaps with a local ‘drop the debt’ campaign?), and for the relaxation of treasury rules, so that the Council can borrow from the public works loans board for the direct investment that council areas desperately need to make the vital changes to housing provision and maintenance that tenants so obviously require. The fact that all Council areas are required by law to meet the Scottish Quality Housing Standard (SQHS) by 2015 (And in Edinburgh, the more stringent ‘Edinburgh Standard’), and that stock transfer has been defeated by popular mandate, puts further pressure on Edinburgh City Council to obtain this direct investment through the Scottish Executive. Campaigners can and must capitalise on this - recognising the limits of state action. Meanwhile, campaigners will continue to demand that the Council prosecute its current programme of investment promptly, while progressive forces should continue, or begin if necessary, to make horizontal links with tenant organisations to build a stronger tenants movements to ensure that proper consideration is given to the specifications of homes that get built (Britain build the smallest homes in Europe), and the kinds of communities that low-income families can benefit from.