Privatisations%20in%20Germany,%20the%20Netherlands%20and%20Great%20Britain

1
Privatisations in Germany, the Netherlands and
Great Britain

• Mark Stephens
• (Centre for Housing Policy)
• Marja Elsinga
• (OTB)

2
Scope of Presentation

• Meanings of Privatisation
• Experience in the three countries
• Conclusions

3
Meanings of Privatisation

• Narrow sense
• Transfer of state-owned assets to the non-state
  sector
• Broader sense
• Withdrawal of state support for the social rented
  sector
• Widest sense
• Policies that promote the provision of private
  housing, especially home-ownership

4
Social Rented HousingThe big shrinkages occur
only as a result of policy
5
GermanyUnusual definition of social housing

• Meaning of social rented housing
• Historic emphasis on provision of new housing
  over its ownership
• Availability of subsidies to private landlords
• Ownership of social rented sector diverse
• Social rented housing defined by
• Receipt of subsidy and the contingent
  obligations
• who can be housed
• level of rents

6
Germanythe melting away of the social rented
sector

• Implications of supporting private sector
• Decline of social rented sector in-built
• When subsidies are repaid the housing ceases to
  be social and commitments end
• But the figures appear exaggerated to non-German
  eyes
• 67 of units owned by Municipal Housing Companies
  are not social by this definition
• If included, social rented sector rises to almost
  10.

7
Germanythe new privatisation

• Sale of dwellings owned by Municipal Housing
  Companies
• Notably Dresden (2006) 48,000 units
• Others blocked
• Sale of dwellings owned by (former) state
  companies
• Stock of former state railways public pension
  fund (2003) 80,000 units
• But note residential housing excluded from
  G-REITs introduced in 2007

8
The NetherlandsA non-state social rented sector

• Social rented sector already formally non-state
• Largest sector in Europe
• Almost wholly owned by housing associations
• In principle independent in 1995
• State loans written off
• No more subsidies
• ? become financially very strong

9
The NetherlandsHow independent?

• Housing associations supported by
• Central Housing Fund (CFV)
• Legally a non-departmental public body
• Financial supervisor
• Helps financially distressed landlords
• Since 2001 redistributes equity for special
  purposes
• Guarantee Fund (WSW)
• Legally private
• But ultimate guarantors are central government
  and municipalities

10
The NetherlandsThe Key Question

• In all aspects of Dutch housing policy the key
  question is
• who actually owns the housing associations
  assets?

11
The UKHistoric dependence on state provision

• Historically social rented sector
• Developed
• Owned
• Managed
• By the state (local authorities/ municipalities)
• Peaked at 33 in late 1970s
• Now just under 20 of households
• And now state share down to 55

12
The UKThe Right to Buy

• Right of sitting tenants to buy house at
  discount made possible by maturity of sector and
  inflation
• Local authorities obliged to sell
• Reduced levels of new build
• Sector shrinks
• RTB part of residualisation but allocation
  policies and economic restructuring also
  important drivers

13
The UKThe Right to Buy 1.7 million sales in
England
14
The UKThe Right to Buy runs its course
15
The UKLarge Scale Voluntary Transfers (LSVTs)

• Bottom-up policy
• Emerges in late 80s as subsidy arrangements hit
  surplus councils
• Later used to facilitate refinancing of housing
  in need of renovation
• The latter often requires subsidies
• All transfers require ballots of tenants
• New landlords are non-profit housing associations

16
The UKLSVT almost 1 million units transferred
in England
17
Conclusions

• Is ownership of housing the key to defining its
  function?
• Ownership of social rented housing is diverse
• Even where private
• Government can exert influence through subsidy,
  regulation, supervision, etc
• European Commission may regard as public sector

18
.

• Privatisation
• Like social rented housing has many meanings
• Ownership of asset should not be confused with
• Organisational behaviour
• Government influence