Five thoughts on Michael Gove's "sell prisons, build houses" plan

Who would live in a house like this? HMP Wandsworth, south London. Image: Getty.

Britain's government doesn't generally believe it's the state's job to build houses – at least, not for the likes of you and me. But there is one part of the population it's decided to provide with shiny new digs.

This morning justice secretary Michael Gove announced plans to modernise the prison estate, by building nine new prisons. Between them, these will house 10,000 prisoners.

That's one half of the plan: the other is to close a series of crumbling Victorian jails in city centres, and to sell their sites for housing. Because old buildings cost a fortune to run, the programme should be self-funding. Better than self-funding, actually: the government claims it'll save £80m a year.

Here are five thoughts on the plan.

1) It’s good news for the housing market.

The first of the prisons to be sold will be HMP Reading, whose residents included Oscar Wilde, and which closed in 2013.

The government is being a bit cagey about which prisons will follow. But there's speculation that they could include prisons in the inner cities of Manchester, Birmingham, and Leeds; and several (Brixton, Pentonville, Wandsworth) in London.

Look at a map of the capital’s prisons, and it's not hard to see why:

That's some expensive real estate those prisons are sat on: central, accessible, close to tube stations... Any homes built there would cost a fortune. The land required to build replacement prisons far from the madding crowd, by contrast, wouldn't.

So it isn't just the savings on the maintenance budget that make this a good deal for the government: it'll make a few bob playing the land market, too.

2) It isn’t that good for the housing market.

The plan is meant to create 3,000 homes. (Whether this would mean converting the prisons – Oxford's former prison is now a posh hotel – or knocking them down and building something new isn't exactly clear.)

That, er, isn't that many homes. Every little helps, but that's something like 1 per cent of one year's worth of demand.

In other words, it's little more than a rounding error. It's good news – but let's not pretend it's going to make a substantial impact on the market.

3) It's bad for prisoners' families.

It's quite easy to get to, say, HMP Brixton. It's in zone 2, it's not too far from the tube, there are umpteen buses past the front gates... Basically, anywhere within an hour of London will be comfortably under two hours from Brixton Prison.

It'll be rather harder to get to a replacement prison in, say, rural Sussex. It’s unlikely to be that close to a station. You probably need a car.

That's going to be a pain in the backside for anyone hoping to visit a family member who's inside. It'll probably be more expensive, too. You may have limited sympathy with anyone who finds themselves facing this situation, but let’s not pretend there’s no downside here.

4) The state could probably get a better deal here.

Today's announcement suggests that the government will not be building the homes itself: instead, it'll just sell the land to a housebuilding firm and let them get on with it.

There are some advantages to doing things this way round: it releases money sooner rather than later; it reduces the risk of a downturn in the housing market (LOL) wrecking the financial basis of the plan.

But there are some downsides, too.  Relying on private developers will almost certainly mean less social housing. The government won’t benefit from any future increase in land or house prices, either. And it means the government is giving up a lucrative and reliable source of revenues – rent on government-owned housing – because it doesn’t think this is the sort of thing that governments should do.

Which makes me think...

5) Government accounting methods are really, really stupid.

There are two sides to a balance sheet. One shows liabilities. One shows assets. The British government, in its determination to reform public services and slash the deficit, spends a lot of time worrying about the former – but it seems bizarrely disinterested in the latter.

You'd think that a government would be quite keen to increase its holdings of city centre housing, so that the taxpayer could benefit from both price inflation and rents.

And yet, no. Apparently, building and owning housing is no longer seen as a job for the state – even when it'd be profitable, even when building housing is the entire point of the exercise. The government is so obsessed with its liabilities, it’s entirely ignoring its assets.

The result of all this is that the only people for whom the British government will be building new homes any time soon are its prisoners.

Jonn Elledge is the editor of CityMetric. He is on Twitter, far too much, as @JonnElledge.


Was the decline in Liverpool’s historic population really that unusual?

A view of Liverpool from Birkenhead. Image: Getty.

It is often reported that Liverpool’s population halved after the 1930s. But is this true? Or is it a myth?

Often, it’s simply assumed that it’s true. The end. Indeed, proud Londoner Lord Adonis – a leading proponent of the Liverpool-bypassing High Speed 2 railway, current chair of the National Infrastructure Commission, and generally a very influential person – stood on the stairs in Liverpool Town Hall in 2011 and said:

“The population of Liverpool has nearly halved in the last 50 years.”

This raises two questions. Firstly, did the population of the City of Liverpool really nearly halve in the 50 year period to 2011? That’s easy to check using this University of Portsmouth website – so I did just that (even though I knew he was wrong anyway). In 2011, the population of the City of Liverpool was 466,415. Fifty years earlier, in 1961, it was 737,637, which equates to a 37 per cent drop. Oops!

In fact, the City of Liverpool’s peak population was recorded in the 1931 Census as 846,302. Its lowest subsequent figure was recorded in the 2001 Census as 439,428 – which represents a 48 per cent decline from the peak population, over a 70 year period.

Compare this to the population figures for the similarly sized City of Manchester. Its peak population also recorded in the 1931 Census as 748,729, and its lowest subsequent figure was also recorded in the 2001 Census, as 392,830. This also represents a 48 per cent decline from the peak population, over the same 70 year period.

So, as can be seen here, Liverpool is not a special case at all. Which makes me wonder why it is often singled out or portrayed as exceptional in this regard, in the media and, indeed, by some badly briefed politicians. Even London has a similar story to tell, and it is told rather well in this recent article by a Londoner, for the Museum of London. (Editor’s note: It’s one of mine.)

This leads me onto the second question: where have all those people gone: London? The Moon? Mars?

Well, it turns out that the answer is bit boring and obvious actually: after World War 2, lots of people moved to the suburbs. You know: cars, commuter trains, slum clearance, the Blitz, all that stuff. In other words, Liverpool is just like many other places: after the war, this country experienced a depopulation bonanza.

So what form did this movement to the suburbs take, as far as Liverpool was concerned? Well, people moved and were moved to the suburbs of Greater Liverpool, in what are now the outer boroughs of the city region: Halton, Knowsley, St Helens, Sefton, Wirral. Others moved further, to Cheshire West & Chester, West Lancashire, Warrington, even nearby North Wales, as previously discussed here.

In common with many cities, indeed, Liverpool City Council actually built and owned large several ‘New Town’ council estates, to which they moved tens of thousands of people to from Liverpool’s inner districts: Winsford in Cheshire West (where comedian John Bishop grew up), Runcorn in Halton (where comedian John Bishop also grew up), Skelmersdale in West Lancashire, Kirkby in Knowsley. There is nothing unique or sinister here about Liverpool (apart from comedian John Bishop). This was common practice across the country – Indeed, it was central government policy – and resulted in about 160,000 people being ‘removed’ from the Liverpool local authority area.

Many other people also moved to the nearby suburbs of Greater Liverpool to private housing – another trend reflected across the country. It’s worth acknowledging, however, that cities across the world are subject to a level of ‘churn’ in population, whereby many people move out and many people move in, over time, too.

So how did those prominent images of derelict streets in the inner-city part of the City of Liverpool local authority area come about? For that, you have to blame the last Labour government’s over-zealous ‘Housing Market Renewal Initiative’ (HMRI) disaster – and the over enthusiastic participation of the then-Lib Dem controlled city council. On the promise of ‘free’ money from central government, the latter removed hundreds of people from their homes with a view to demolishing the Victorian terraces, and building new replacements. Many of these houses, in truth, were already fully modernised, owner-occupied houses within viable and longstanding communities, as can be seen here in Voelas Street, one of the famous Welsh Streets of Liverpool:

Voelas Street before HMRI implementation. Image:

The same picture after HMRI implementation Image: 

Nonetheless: the council bought the houses and ‘tinned them up’ ready for demolition. Then the coalition Conservative/Lib Dem government, elected in 2010, pulled the plug on the scheme. 

Fast forward to 2017 and many of the condemned houses have been renovated, in a process which is still ongoing. These are over-subscribed when they come to market, suggesting that the idea was never appropriate for Liverpool on that scale. 

At any rate, it turns out that the Liverpool metropolitan population is pretty much the same as it was at its peak in 1931 (depending where the local borough boundaries are arbitrarily drawn). It just begs the question: why are well educated and supposedly clever people misrepresenting the Liverpool metropolis, in particular, in this way so often? Surely they aren’t stupid are they?

And why are some people so determined to always isolate the City of Liverpool from its hinterland, while London is always described in terms of its whole urban area? It just confuses and undermines what would otherwise often be worthwhile comparisons and discussions. Or, to put it another way: “never, ever, compare apples with larger urban zones”.

In a recent Channel 4 documentary, for example, the well-known and respected journalist Michael Burke directly compared the forecast population growths, by 2039, of the City of Liverpool single local authority area against that of the combined 33 local authority areas of Greater London: 42,722 versus 2.187,708. I mean, what bizarre point is such an inappropriate comparison even trying to make? It is like comparing the projected growth of a normal sized-person’s head with the projected growth of the whole of an obese person, over a protracted period.

Having said all that, there is an important sensible conversation to be had as to why the populations of the Greater Liverpool metropolis and others haven’t grown as fast as maybe should have been the case, whilst, in recent times, the Greater London population has been burgeoning. But constantly pitching it as some sort of rare local apocalypse helps no one.

Dave Mail has declared himself CityMetric’s Liverpool City Region correspondent. He will be updating us on the brave new world of Liverpool City Region, mostly monthly, in ‘E-mail from Liverpool City Region’ and he is on twitter @davemail2017.