Private Sector Criteria and the Radical Change in Provision of Social Housing in England

Abstract

The 1988 Housing Act signalled substantial changes in the provision of social housing in England. The act places housing associations at the centre of social housing provision. Moreover, their role as the main providers of social housing depends, in line with government intentions, on the greater use of private finance, as the proportion of public sector funds declines. The introduction of what amounts to a new regime for social housing provision in England has effectively changed the agenda of provision from one informed by public sector thinking to one established around private sector criteria. Housing associations have thus had to readjust quickly to an environment in which they are now exposed to a variety of interrelated risks. In order to manage such risks, associations have had to reorganise internally and to reevaluate their priorities. Against this background, this paper is aimed, first, at reporting on how a selection of case-study associations active across the main regions of England have faced up to the challenges that the new environment presents, and, second, at presenting the views of a selection of private sector financial institutions about their perceptions of social housing as an investment medium, the types of risk they view as characteristic of this sector, and their response to the efforts made by associations to manage the risks of social housing provision. The paper is concluded by setting out the likely shape that social housing provision will take in the immediate future.