Housing procurement hits the headlines – another challenging spend category!

It's often not when a political policy announcement is first made that we see the outcry, it's when it starts to bite. Not surprising I suppose, although you would think the media could look ahead and see what certain announced decisions will mean in implementation phase.

Beautiful Newham

The latest example is the furore around Newham Council in London approaching a Housing Association in Stoke on Trent (almost 200 miles away) to ask whether they might like to house up to 500 families from Newham. The changes in housing benefit policy mean that basically, property in some parts of London will be unaffordable to folk relying on housing benefit. Newham isn’t the most expensive part of London by any means but their councillors claim that the large number of people on benefits in their borough is causing real issues.

We won't get into the philosophical rights and wrongs of this too much – but there is an argument that says most people in work can't afford to live in the nice parts of London, so why should unemployed people? Reading stories of people (who have often contributed little to the UK), occupying property in the best parts of London that 99% of us haven't got a hope of affording, does make one feel that even the Daily Mail does have a point at times.

Lovely Stoke-on-Trent

The risk of creating no-go areas for poorer citizens is one counter argument, as well as the human cost in disruption to family lives – Caitlin Moran wrote a brilliantly moving piece about this in the Times a while ago (behind their paywall unfortunately) which would soften the heart of anyone.

But it was clear when the changes in the benefits policy were announced that this move, or something like it, was the inevitable and logical conclusion. So it seems strange that only now it has become a real “issue”.

Anyway, what it does do is open up yet another role for skilled sourcing, commercial and procurement professionals in the public sector. The leaked letter from Newham is signed by the rather wonderfully named Frank MacCool (should be “Frankie” really I think), and he is the Housing Supply and Contracts Manager at Newham Council.

Now I don't know if he considers himself a procurement professional, but his role looks like “sourcing” to us. And as well as the sourcing element, one would hope that he has a role to look at the supplier and contract management aspects of the resulting contracts. Category Manager, Social Housing, might be another job title.

And what a challenging, interesting and important spend category this is! As the changes to benefits (and indeed, general lack of funds for many public services) bite over the next few years, we are going to see a need for other creative thinking, and “new” procurement roles and strategies, in many public sector spend areas. So, all in all, well done Mr MacCool for your innovative approach – you're ahead of the game here, but others will undoubtedly follow in your footsteps.

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Voices (6)

  1. Michael Breen:

    Once the Olympic caravans have moved on to their next taxpayer subsidised location Newham should have no shortage of empty properties available. I am sure that the City borders signs will be reappearing out that way.

  2. Paul Wright:

    We should be clear that this is an intended consequence of the government’s policies, which is to allow market forces to prevail, to allow skilled individuals to concentrate in London and the South East, and to stop supporting the other regions against the attractor of London. Over time, this will lead to shortages of low paid staff – which will lead to increases in pay for those staff and the situation will balance out. The regions will have low wages and become more attractive to investors, in turn balancing out. It may be unpleasant over the next 5 or 10 years, and be socially disruptive, but that is the theory. Not my view, but the government is quite clear (if quiet) about that is how it should work.

  3. October:

    I note your comment

    “Reading stories of people (who have often contributed little to the UK)”

    please remember there are a large number of people who are on minimum wage who are in receipt of housing benefit.

    I’m sure you would agree it would be difficult to source a number of services across London without such individuals working in the supply chain. As is always the case there are perhaps even wider procurement issues to consider here

    1. Peter Smith:

      October – I agree, and the Caitlin Moran article gave a powerful argument why it might make sense to pay housing benefit above the cap (in Brighton) to someone who isn’t even working. He has some mental health issues, so not only was his life going to get a lot worse through moving, but the support he gave to other disadvantaged people – friends and family – in Brighton brought wider societal benefits, hard to measure, but real nonetheless.
      And the issue of the low paid in London – that’s a scary one given that London property is becoming the exclusive preserve of the affluent buying for investment, rich people escaping from less pleasant parts of the world, or moving their money out of Greece, Italy etc. I don’t know where it ends..

  4. bitter and twisted:

    Lets just skip a few satirical escalations and eat their children.

    1. Final Furlong:


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