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University Fees and Regeneration

I have a deep sense of injustice about university fees. Unfortunately it seems to be a different one to most of the rest of the world.

I have always felt that it was unfair that my university education was free. I’ve argued with the current generation of students that even a cap on fees may not be the best policy. If universities can charge what the market will bear (but crucially on the basis of student loans that are only repayable much later from above average incomes and over lengthy time periods) then perhaps we will move closer to an economically efficient number of university places (in both absolute terms and in distribution between subjects) and perhaps even better value for money education.

That may be rubbish but my bigger point is that from the perspective of the children from the poorest families, any available public money would be better spent on the first ten years of their education not the last three. The academic research is pretty clear that persistence in poverty is strongly linked to early years educational attainment.

Our biggest challenge in regeneration is primary education. In a world where primary school intake is based on the distance you live from the school, neighbourhood matters. In the inner urban areas the young (predominantly university educated) professionals who have moved in over the last fifteen years now have children approaching school age. They have some big decisions to make.

If the vast majority of them choose to stay, and use the publicly funded education system, then we can declare the last two decades of regeneration a success.

But the reality is that this will be the exception not the rule. There are still many places in the inner urban areas where the primary schools have not managed to completely overcome the disadvantage of high concentrations of poor pupils, many without English as a mother tongue. This is exacerbated by the league table messages which still focus more on absolute results rather than added value.

And these problems are often driven by the twin factors of a concentration of social housing in these neighbourhoods and the way this housing is allocated.

So we end up in a situation where wealthy mobile parents vote with their feet and leave the neighbourhoods they saw as attractively edgy and cool, close to entertainment, work and other similar people, and move to the suburbs. This is not a realistic option for those in social housing.

So what to do? Building more affordable housing in the suburbs would be an option. Its arithmetically impossible to achieve a better balance of incomes in poorer neighbourhoods without doing the same in wealthier neighbourhoods. Then maybe everyone would have the option to move to the suburbs to have children. Unfortunately our subsidy system (and our political system) has always struggled to cope with the this challenge.

Another alternative would be to change the way we manage subsidised housing. At the moment the subsidy goes with the house and stays with that particular property for a long period of time (until it is sold, either through Right to Buy historically or by its housing association owner on vacant possession more recently). If we could have a system where subsidy could be recycled in and out of individual properties independent of their location we could move in the direction of reducing the concentration of particular income levels in neighbourhoods. There is a lot of thinking going on around this at the moment with a focus on the value of the historic grant and the potential to increase the affordable housing supply through unlocking that historic grant (with some significant challenges to housing benefit budgets).

Or we could invest massively more in primary schools in inner urban neighbourhoods. This seems ‘unfair’ and is politically challenging but if schools in poorer neighbourhoods were clearly seen to be the highest performers we could be pretty confident that wealthier parents would try and move towards them. The pupil premium is a move in this direction.

There are other options as well but my point is that emotionally popular causes like resisting an increase in student fees are often not the most important issue.


3 Responses

  1. The Daily Telegraph under a FOI request discovered that £9 billion worth of social housing is presently being occupied by persons who have ‘inherited’ their homes even though they would not qualify if they were to apply in their own right.

    Apparently the taxpayer is subsidising this group who have inherited these homes at a cost of £300m per year.

    Surely these inherited tenancies should be reviewed so that only those who are eligible for publicly subsidised housing actually get to live in them?. It makes no sense that we are asking the taxpayer to provide even more social costly housing while there is £9 billions worth being occupied in this way?

    It seems that the financial benefit of social housing and lifelong tenancies is discouraging mobility and therefore opportunity. The new system of two year plus tenancies will hopefully be a start to reforming this broken system.

  2. Firstly I totally agree that serious investment in primary schools both staff and spaces is the best way to breaking the red lines around deprived areas in the city. It is also true that a whole new energy could be unleashed in urban churn if two year tenancies and ‘flying recycled’ subsidies become the norm.

    But the effects will not all be positive; rather it will exacerbate entrenched class differences in housing. While makeover programmes dominated the noughties there was little increase in the freedom for those renting in the social sector to impact on the character of their homes. With links weakened to a particular place there will be less time for any emotional investment in a home and less reason for management to encourage any kind of appropriation. Families made to feel insecure by continual assessment will provide cycles of occupancy for new housing ‘products’, commercial propositions modelled on the recent anonymous student residences. Or they will enter the volatile market of make do and mend stop gaps in the private rental market where landlords slip through their maintenance opbligations. This urban mobility is bound to be particularly stressful for those who move up and down through the income bands of eligibility for subsidised housing.

    It would be more cohesive to create mechanisms for people to pay income pegged rents or part mortgages on properties in tenure blind neighbourhoods. The current systems of exchange on the point system could be made fairer and more transparent through the increasingly sophisticated tools for mobility and barter.

  3. @Cany

    I don’t agree that council housing missed out on the makeover craze as the better homes’ program replaced kitchens, bathrooms and double glazing and redecorated millions of properties at no cost to the tenants.

    There are 90,000 homes which are inherited tenancies and occupied by persons who in their own right would not be entitled to social housing based on their income. This is costing the taxpayer an additional £300m as a cheap rent subsidy to the undeserving. That’s £9 billion worth of council housing be occupied under these inherited tenancies. Imagine what the effect was if this was properly accounted for and allocated to those who need a home for even a couple of years until they get on their feet?

    Personally I don’t buy the idea that it is the job of the state to make people so comfortable that it becomes an disincentive to move for work or indeed even go to work in the first place.

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