Planning for a Future of Asset-based Welfare? New Labour, Financialized Economic Agency and the Housing Market

Abstract

This article focuses on core aspects of the political economy of New Labour and surveys the strategic priorities to which it is likely the planning process will have to adapt. As with other policy areas, the effects of enhanced Treasury micro-management of the Government's reform agenda has begun to impact upon the field of planning. The prime example in this respect is the Treasury's preference for replacing state provision of welfare-enhancing services with the move towards an individualized system of asset-based welfare. The article begins with an analysis of this shift, showing how it is dependent on creating financialized economic agents who think instinctively as active saver-investors in their quest to accumulate assets to fund future consumption of welfare. In contemporary Britain the housing market dominates the accumulation of assets amongst everyday saver-investors. The article concludes by analysing the possible tension that will be introduced into the planning process because of New Labour's twin goals: (1) to defend the current value of asset wealth even as the mortgage lending market has stalled and confidence in the stability of house prices has temporarily evaporated; and (2) to restrict exclusion from private ownership in the housing market so that broadening access can be used to propel a universal move towards an individualized system of asset-based welfare. The fallout from the world credit crunch, which began in autumn 2007 and remains ongoing at the time of writing in January 2009, looks likely to exacerbate what was always a tension-prone combination of objectives.

Acknowledgement

This piece was written with the financial assistance of a grant from the UK Economic and Social Research Council (number RES-000-22-2198). The author gratefully acknowledges the Economic and Social Research Council's continuing support of his research.