Urban renewal policies in the Netherlands in an era of changing welfare regimes

ABSTRACT

In The Netherlands, post-war urban renewal policies have emerged under the influence of various welfare regimes. Corporatist and social democratic regimes promoted social justice, social cohesion, inclusion and redistribution of income; urban renewal policies stimulated social mix and area-based interventions. Both public and market partners and residents were involved. Liberal ideas became increasingly explicit from the 1990s, and became dominant after 2010. Individuality, ‘citizens own responsibility’, and cuts in public services were leading objectives. Private investors and entrepreneurs were leading the renewal, facilitated by the state. In this paper we focus on the most recent policies and their effects.

KEYWORDS:

• Neighbourhood
• urban renewal policies
• social cohesion
• social mix
• area-based
• liberal
• private market

1. Problems, policies and evaluation

The Netherlands has long been called a ‘policy-dense’ country, which referred to major involvement of public institutions in shaping the country. That was certainly true in the realm of urban and regional social and economic issues. After World War II, a wide array of urban problems have received ample policy attention. Reviewing problem definitions and policies, it is possible to detect some structure in the dynamics. In this paper these issues will be discussed, first through a brief history of recent urban policy approaches, which are embedded in certain welfare regimes (section 2), then with a particular focus on the transition to and character of the most recent policies, which we label as – increasingly – liberal (section 3). This section will be followed by a more in-depth evaluation of the most recent types of intervention, using academic literature and other sources (section 4). In section 5 conclusions will be drawn, and critical comments will be provided.

2. Urban problem definitions and urban policy responses

The Netherlands have a long history of developing urban policies related to urban dynamics. This paper addresses the policy development process over the past half century and in particular over the most recent decades. Different types of policies could be distinguished, which were connected to the welfare regimes that dominated certain eras. These regimes included liberal, corporative conservative, and social democratic types (Esping-Anderson 1990). Policy information has been drawn from key policy documents of subsequent Dutch governments. We scrutinized ‘government declarations’, and important white papers, such as those on Housing (Nota Volkshuisvesting in de Jaren Negentig, 1989; Nota Wonen in de 21e eeuw, 2000), and on Urban Renewal (Stedelijke Vernieuwing, 2007). We also used studies by government advisory councils, such as the VROM-Raad (2007) (a council for housing and spatial policy issues), and key documents of the Netherlands Environmental Assessment Agency, such as a spatial planning document exploring urban economic inequality (PBL 2016); and we consulted several overview articles on urban renewal (Schuiling 2007; Uyterlinde, van der Velden, and Gastkemper 2017; Denters 2021).

In general, across time, most of the attention paid to urban issues has been characterised by an area-focus, giving attention to three types of interventions: physical urban renewal and renovations; stimulating the (urban) economy; and addressing social problems. During the period of Big Cities Policy (Grote Steden Beleid, GSB), governments have presented policies in terms of an integrated approach, suggesting integration of the physical, economic and social (as well as safety) realms.

Hereafter, we first present an overview of the different policy episodes, providing a brief indication of the main goals, the orientation of the policies, and the typical label or slogan that has been applied to ‘brand’ the policy. This will be followed by a characterization of how urban social issues were defined in each episode, and what kind of policies were activated (Table 1).

Table 1. Urban policies in the Netherlands.

Name of policy	Main goal	Period	Orientation	Slogan	Definition of social issues	Typical policy actions
Creating CBDs	Stronger economy	Until 1970	Efficiency	New jobs	None	Demolition of old quarters
Urban renewal	Improving housing	1970–1980	Social justice	Housing for the neighbourhood	Bad housing	Housing for neighbourhood residents
City renewal	Stronger economy	1980–1985	Efficiency	Stop degradation	Reduce unemployment	Improvement of economic climate
Multiple-problem	Help disadvantaged neighbourhoods	1985–1990	Social justice	Stop cumulating problems	Disadvantaged in several respects	Moderate social policies, no physical upgrading
Social renewal	More social cohesion	1990–1994	Social justice	Higher participation	Lack of social cohesion	Moderate social policies stimulating participation
Big Cities Policy I	Mixed neighbourhoods	1994–1998	Social justice	Promote Immigration of high incomes	Homogeneous poor neighbourhood (segregated)	Neighbourhood restructuring, attract better-off
Big Cities Policy II	Stable neighbourhoods	1998–2004	Social justice	Prevent leaving neighbourhoods	Housing career within neighbourhood	Creating opportunities in the neighbourhood
Big Cities Policy III	Stronger neighbourhoods	2004–2007	Efficiency	Powerful cities	Immigrant integration	Neighbourhood restructuring, social mix
Big Cities Policy III+	Integrated neighbourhoods	2007–2010	Social justice	Prevent parallel societies	Immigrant and social integration	Neighbourhood restructuring, social mix, housing association involvement
Liberal (non-urban) Policy	Integrated neighbourhoods	2010–2020	Immigrant Integration/ Identity/Efficiency	Stimulus for the private sector and reduction of public spending	Immigrant integration/ identity/ demand-supply matching	More space for private market, reduction and residualisation of social housing, social mix

Before World War II up until 1970, reinforcing the CBD was the main idea of spatial policies with respect to cities in The Netherlands, but also elsewhere. Following classic economic geographic theories (Alonso 1964; Muth 1969), central parts of cities were regarded the core areas of the city. These had to be made accessible via all sorts of infrastructure (Ostendorf 1992). Demolition of centrally located older neighbourhoods created room for firms, banks, shops and municipal government institutions, as well as highways. Housing policies were subordinate to this aim of accommodating the urban economy.

In the era of reconstruction and housing shortage after World War II, the issue of decent housing grew in importance, which also resulted in creating housing accommodation outside the city. This too was a process seen across the Western world. The ‘villes nouvelles’ in France, ‘groeikernen’ (growth centres) in The Netherlands, and the ‘million homes’ programme in Sweden may serve as examples (Massotti and Hadden 1973; Rowlands, Musterd, and van Kempen 2009). Such initiatives often implied demolition of older ‘problematic’ neighbourhoods in the cities. Ironically, many of the new housing estates were characterised by multiple problems too, soon after their development. This, on its turn, again triggered demolition, now of relatively new structures (Hall and Vidén 2005; Van Kempen et al. 2005; Severin-Barboutie 2012). Policies supporting CBDs dwindled, also because suburbanisation of firms and jobs decreased the need for more office space in the CBD. Urban policy within cities changed to ‘urban renewal’ and focused on housing for the urban poor: in poor neighbourhoods with bad housing conditions, urban renewal concentrated on building new dwellings and, in a later stage, on improving existing dwellings for the poor already living there. This changed in the 1980s, when it became clear that the urban economy had lost much of its strength due to suburbanisation and the focus on poor residents and on housing in general. The new and more liberal policy answer was ‘city renewal’. That label looked like the former policy – urban renewal – but the goals were very different: not housing needs, but the reinforcement of the urban economy became most important; the development of the compact city had to create a promising arena for international economic competition; city-marketing would persuade multinationals to engage in public-private partnerships bringing new economic growth to the city and its region (see, for example, Kotler, Haider, and Rein 1993). Yet, at the end of the 1980s urban leaders recognised that pure economic goals were harming social cohesive forces in society. This triggered new policies that concentrated on areas with multiple problems (problem-cumulating areas), and in a later stage the policy of social renewal (Priemus 2004). The Dutch government concluded that in an era of loosening ties (family, neighbourhood, church, work, and associations) a new social cohesive force was needed. Civic society had to be activated, firms in particular. Social renewal policy aimed to increase participation in society, via the labour market and via all kinds of social relations. The neighbourhood was considered to be an important vehicle in this respect, because social relations were thought to be activated there. In the 1990s, Big Cities Policy I (Grote Steden Beleid I, GSB I) focused on areas with concentrations of poor residents, which were perceived as socially homogeneous; some were even called ‘welfare ghettos’, based on voices that expressed the idea that welfare receivers would be discouraged from taking action to get back to work and to refrain from criminality (for a well-informed critique see Hancock and Mooney 2013). This fear for ‘welfare ghettoes’ was supporting policies aimed at restructuring the urban housing market at the level of neighbourhoods; low-cost accommodation had to be reduced or mixed with more expensive dwellings in order to attract better-off households to the neighbourhood. These ideas about mixing the housing stock in order to mix the population at the level of the neighbourhood appeared to be a returning element in later urban policies as well (Musterd and Ostendorf 2012). This was also true for GSB II, albeit that the aim slightly changed from efforts to attract new better-off households to the neighbourhood, to offering better chances for the existing residents of the neighbourhood in order to realize a housing-career within the neighbourhood. In subsequent GSB III and III+, neighbourhood restructuring was continuously stimulated. Although the first policy was more rigid and efficiency-based compared with the more ‘social’ second one, there was also continuity: both addressed social and ‘country of origin’ compositions of neighbourhoods, albeit in different ‘tones’, and both started from the assumption that disadvantaged neighbourhoods are segregated neighbourhoods, which required desegregation and physical restructuring, to produce social and cultural mix. In particular in GSB III+, the fear for the development of parallel societies became articulated: the poor were expected to become disconnected from mainstream society.

Social issues have been key elements of most of the urban renewal policies. The definition of ‘social issue’, however, and typical policy actions, changed from one period to another, as is shown in the two right-hand columns of Table 1. Sometimes a stronger urban economy was expected to help the poor. In other periods policy makers thought that physical decline would cause social exclusion; or that concentrated poverty would intensify social exclusion. Specific programmes of physical renewal were expected to diminish social exclusion. As said, after World War II, housing shortage was the problem in The Netherlands. This implied a focus on new accommodation, not on renewal of the existing stock. Renewal concentrated on strengthening city centres. From the 1960s suburbanisation and new town development were leading. This diminished the housing shortage in cities but also resulted in a reconsideration of the quality of the housing stock in cities, which subsequently stimulated policies of urban renewal.

Two very different developments could be observed. The first carried the label ‘new construction for the neighbourhood’. Here the poor population and problems related to poverty did not change. By offering better housing, policy-makers hoped to fight the problem of poverty. However, although a lot of money was invested in these neighbourhoods, no social upgrading could be found. Finally that resulted in a change of the policy to city renewal (see Dieleman and Van Engelsdorp Gastelaars 1992). The second development took place in neighbourhoods that had not been renewed because of financial or organisational problems such as fragmented ownership. In some of these neighbourhoods, especially the centrally located, a process of spontaneous renewal or gentrification began to develop. In these neighbourhoods social and physical upgrading occurred without needing governmental finance, although some of them still received significant public money.

According to Denters (2021, 109) in the period of city renewal a ‘revival of liberalism’ could be observed. He referred to the fact that ‘a number of Grand Operations were implemented to allow for a more lean and mean public sector’; and also to ‘cuts in public spending, privatization of public services, and deregulation’ (ibid).¹ The focus on the urban economy again became dominant. The idea was to help the poor by improving the urban economy, but the poor were generally not clearly involved in these programmes. The subsequent policy of helping areas with multiple problems was not very broad and also did not succeed in upgrading disadvantaged neighbourhoods. The policy of social renewal created a reaction to the focus on urban economic city renewal policies: problems of residents and of poverty were often neglected. Therefore, social renewal policy concentrated on improving social cohesion within neighbourhoods.

These policies were soon replaced by the ‘Big Cities Policy’ (GSB). Urban poverty was still prevalent, in particular in some neighbourhoods. Policy makers thought that this could be avoided by promoting social mix. This idea of social mix is important in all four GSB policies that have been developed. Housing – and diversifying the housing stock by demolition and new construction in order to promote a social mix in neighbourhoods – was most important in GSB I. GSB I hoped to attract new affluent households to areas of urban restructuring, but was criticised on the grounds that poor people were not necessarily helped by being given new high-income neighbours. Moreover, this idea lacked success, because the better-off could not be enticed to settle in disadvantaged neighbourhoods. So, in a later stage GSB II was adapted by aiming at reaching the ‘comprehensive city’; the tools for that were prevention of downgrading through outmigration of successful residents, and enabling housing careers within the neighbourhood. GSB III followed GSB II but changed its slogan to: ‘collaborate for a powerful city’. At this stage budgets available for urban policy were brought together in three big funds. Cities could apply for money from these funds, and to quite some extent they could decide what to do with it. This simplification may seem like a step forward, but one flaw remained: it still were three funds, a physical, a social and an economic fund; this was not stimulating ‘integrated’ policies. With GSB III, a shift towards issues of safety and ‘liveability’ was introduced, and statements regarding stimulating the economic strength of the cities were more frequently found. GSB III+ was launched during the 2007–2010 period and was characterised by efforts to continue GSB policy, but, certainly initially, with an eye for issues of social justice. In hindsight this episode marked a significant change to policies based on liberal principles. In the next section we will elaborate on the two main types of policies that have been shaping the most recent periods and describe the transition from GSB with varying liberal and social emphasises to policies with a clearly liberal character.

3. Big cities policies (GSB) and liberal policies

The underlying objectives of the GSB policies were summarised in brandings as: ‘the comprehensive city’, the ‘powerful city’ and the ‘safe and liveable city’; these cities ideally have neighbourhoods where everyone feels at home, they have thriving economies, a sufficient demand for labour, liveable neighbourhoods, safe streets and inclusive communities. The new Minister of GSB III+ spoke of disadvantaged neighbourhoods that had to be changed into ‘splendid neighbourhoods’ and ‘powerful neighbourhoods’. In fact, all GSBs aimed at reducing the number of persons with inadequate educational skills; intended to reduce integration problems; wanted to diminish criminality and unsafe environments; said to tackle high unemployment rates, reduce outmigration of the middle class, and to support economic vitality. Moreover, the policies intended to remove dilapidated housing, to overcome inadequate infrastructures and poor accessibility. Problems often accumulated and were seen as concentrated in specific districts. The dominant problematic and the interconnectedness of several urban issues were actually the main drivers behind the launching of large-scale, integrated area-based approaches to urban problems. Key GSB concepts in organisational terms were: ‘integration’, ‘area-based’ and ‘decentralised’ and these are currently (2021) applicable as well. The integration of ‘dimensions’ implies the horizontal coordination between different policy domains and cooperation between levels of government. The core idea was that coordinated investments in these dimensions would yield more success than in each of the policy fields separately. This implied, for example, that renovating an area, simultaneously raising the educational level of the inhabitants through special programmes, and introducing programmes to improve mutual respect and reduce local criminality would give the most powerful boost to the neighbourhood. Integrated policies were developed as area-based policies. This required analyses to determine which areas or neighbourhoods should be targeted. In the Netherlands, in 1994, only the four largest cities were targeted, and within these cities specific neighbourhoods; in 1995 15 cities were added; in 1996 it were 21 cities; and in 2007, 31 cities got involved. The competition between cities rapidly increased. Area-based policies are favourite until today. Over the years, decentralised approaches gained position over centralised. While a GSB Minister for Urban and Integration Policy was appointed until 2002, and a Minister for Housing, Neighbourhoods and Integration in 2007, this did not always express a preference for centralised governance, even though the vast amount of tax income and power still could be found at the central level. During the GSB policies a structure was in place that coordinated activities and interactions between and within the dimensions. The official Inter-ministerial Committee on Urban Policy and the Ministerial Council for Urban Policy coordinated the pooling of government resources and commitment on the part of the specialised Ministers to the field of urban policy. A crucial element, especially in the GSB II era, was the development of covenants between the state and the municipalities involved. The municipalities secured local integration by working in close consultation with residents and public and private sector partners. This allowed each city to focus on problems they regarded most important and to develop a vision of their own. Cities could formulate their own priorities in multi-year development programmes. Measurable goals were established in agreement with central government. Careful monitoring and on-site visits were applied to evaluate progress. This strategy made it possible to intervene where necessary. Local funding did not just come from the national government, but also from other sources, including the Structural Fund, the European Regional Development Fund (ERDF) and the European Social Fund (ESF). Especially during the GSB II period, large amounts of money became available for urban policies: over €10 billion for a five-year programme.

Despite the long period of time in which urban policies have been applied that had been developed in specific ministries designed for this purpose, the year 2002 marked an important change. While a gradual welfare regime shift was already going on from the 1980s and 1990s when liberal principles again started to gain territory (see for example Denters 2021), in 2002 the political climate suddenly changed significantly. Tension in society increased simultaneously with the rise of populist leaders who in harsh tones addressed potential conflicts between the already settled Dutch population and some categories of immigrants in the cities, mainly Muslims. These potential conflicts were often addressed in combination with identity issues. The change was also expressed in newly established national governments, which put ‘integration’ much higher on the agenda, but with varying connotations. Between 2002 and 2007, when there was no longer a special minister for GSB, the issue of integration was part of the Ministry of Justice. Increasingly integration was redefined from a field in which multiculturalism was celebrated into a field in which assimilation became leading. This also marked the beginning of stricter immigration policy. In that political climate Dutch Government accepted a new Act on Extraordinary Measures for Urban Problems, in 2006. This allowed municipalities to select a number of vulnerable or distressed neighbourhoods where they could refuse the settling of newcomers and/or those who had no income from work, pensions or student loans (Uitermark, Hochstenbach, and Van Gent 2017; Van Gent, Hochstenbach, and Uitermark 2018). Rotterdam was the first municipality to apply these selective and controversial policies, but others have followed since. The effectiveness of these interventions has, however, been challenged. A summary paper of an evaluation study of the new Act, which was conducted for the Ministry of the Interior, concluded: ‘While the Act produces socio-demographic changes, the state of the living environment in designated areas seems to be worsening rather than improving. Our findings show that the policy restricts the rights of excluded groups without demonstrably improving safety or liveability’ (Van Gent, Hochstenbach, and Uitermark 2018, 2337).

With the 2006 elections opinions changed once again; in February 2007 a special (social democratic) Minister for Housing, Neighbourhood and Integration was appointed (and housed in the Ministry of Housing instead of in the Ministry of Justice). The link with housing was given extra weight because of the renewed attention to the role of housing associations in urban renewal processes. Housing associations had to operate with less state subsidies and with more responsibility for their own finances. During the latest phase of GSB III+ they were even supporting the physical and social renewal programmes in a broader sense. They were also expected to assist with realizing broader integration objectives, even though by law their first task was to provide social housing in a stricter sense. Their wider tasks reflected the strong belief in the relation between integration, housing and neighbourhoods. The focus of the GSB III+ policy was on solving social arrear problems. The Minister thought this could best be done by selecting a few neighbourhoods with relatively high levels of arrears. Special intervention in only 40 neighbourhoods was expected to be sufficient. This policy, however, appeared unsuccessful, and was heavily criticised (see section 4); the Minister had to step down at the end of 2008.

From that moment on liberal policies took centre stage and public funding for housing and urban policies was cut significantly (Boelhouwer and Priemus 2014). Policies and market processes in which private actors, such as private investors, and private developers were taking the lead, became more important and were enthusiastically supported by the state. These changes in fact followed a more general welfare regime change that accelerated between 2010 and 2020 when the Dutch government was continuously led by a Liberal Conservative Prime Minister, Rutte. Issues of urban marginality were still approached as a matter of integration, but that concept was increasingly understood as adaptation and assimilation. Debates about safeguarding the ‘Dutch identity’ continued to come to the fore, together with policies aimed at controlling the situation (Uitermark 2014). Housing and social mixing programmes continued to be applied but several scholars argued that this was often with entrepreneurial and private market objectives in mind: stimulating upgrading and gentrification of former working class neighbourhoods while replacing the poor by more affluent middle class households (Lees 2008; Bridge, Butler, and Lees 2012). Increasingly, (migrant) segregation was presented as rapidly growing, and said to result in ‘ghettoization’ and parallel societies. This was clearly feeding fear for the other (Bacqué et al. 2011; Andersson, Bråmå, and Holmqvist 2010).

4. Evaluation of recent GSB and liberal policies

The latest GSB’s, but also successor policies with a stronger liberal character, can be criticised on logical and empirical grounds, as has partly been shown in the literature. GSB III+ was paying ample attention to ‘ghettoization’ and the rise of parallel societies. Such conditions obviously were presented as the anti-poles of the harmonious, integrated community, which comes close to the ideal of Social Democrats and Christian Democrats. If such parallel societies would be developing indeed, there would be good reason to really buckle down to it, but even then the question is how? First we would like to focus on the urgency question. Is there a development of a parallel society in the Netherlands, as suggested across the political spectrum? Are segregation levels extremely high? Is the direction of change worrisome? The answers to all these questions appear to be mainly negative. Studies on Dutch and other West- European cities are showing that segregation levels based on country of origin, or based on socioeconomic positions are relatively moderate, and that parallel societies in fact do not exist (Tammaru et al. 2016; Arbaci 2019; Jargowsky 2020; Musterd 2020). There are so-called migrant concentration areas, but the vast majority lives in mixed neighbourhoods. Segregation based on country of origin in fact turns out to be decreasing. This can be shown for the UK, the Netherlands, Sweden, and other contexts (Stillwell and McNulty 2012; Andersson 2012; Van Gent and Hochstenbach 2020; Boterman, Musterd, and Manting 2020). In other countries, such as Germany, levels are low already (Vidal and Windzio 2012). In the Netherlands this development parallels a much improved integration in society: higher levels of migrant participation in education and the labour market, and more social mobility (Jaarrapport Integratie CBS, 2018). However, segregation levels based on socioeconomic position, which are relatively moderate still, appear to be increasing (Tammaru et al. 2016; Andersson and Kährik, 2016; Hochstenbach and Musterd 2018). The Netherlands Environmental Assessment Agency (PBL 2016) concluded that in the Dutch central cities segregation of poor employees and those who receive social benefits (the ‘poor’) is increasing. This may relate to increasing social inequality in the past. European and American studies have shown that levels of social inequality positively relate to levels of spatial inequality, but with a time-lag (Marcinczak et al. 2016; Bischoff and Reardon 2014).

What does this imply for policy approaches and interventions? Also during the GSB III+ policy there appeared to be no dual or parallel society in the Netherlands, even though the responsible social democratic minister expected to find that. She thought she would address large numbers of people in distress by selecting the 40 socially weakest neighbourhoods. However, soon critical reviews showed that the social difference between neighbourhood ranked 40 and neighbourhood ranked 200 was very limited. Van Gent and colleagues (2009a, 2009b) calculated that in the 40 selected neighbourhoods (together 5% of the country’s population), less than eight per cent of those who were in arrear could be found.² In other words, at least 92% of the target group of policy did not receive extra attention. Demolition and newly built housing in such neighbourhoods did change its signature, but often triggered displacement of the poor to other locations (Bolt and Van Kempen 2010; Permentier, Kullberg, and Van Noije 2013). In short, a policy approach through intervention in a selected number of areas or neighbourhoods did not seem to be very effective.

The policy aim to socially (and culturally) mix the population of neighbourhoods was a favourite approach of the latest GSB policies as well, but very difficult to pursue. Disadvantaged people continue to settle in neighbourhoods in least demand where the prices are low, while advantaged inhabitants tend to leave these neighbourhoods as soon as they can. If they stay together in the same neighbourhood, interaction between advantaged and disadvantaged inhabitants of the neighbourhood remains an exception (Blokland 2003). Research has shown that most households are searching residential environments with socioeconomic, demographic and cultural attributes that match their own characteristics (Musterd et al. 2016, 2019; Van Gent, Das, and Musterd 2019; Damhuis et al. 2019). Some social mix is possible, however, especially at a slightly higher scale than the direct environment of households; a policy aimed at producing relatively homogeneous neighbourhoods within larger heterogeneous (mixed) districts may be feasible. In addition, mix-related policies will be more successful when the social distance between population groups is small; when social inequality is limited. This remains relevant, because in cases of high levels of inequality and extreme segregation, so-called neighbourhood effects may show up: extra negative effects, especially in very large and intensive spatial concentrations of households with arrears. As also was concluded by PBL (2016), in such cases area-based intervention may be required. However, so far such cases are seldom found in the Netherlands.

This brings us to the evaluation of the current liberal-conservative policies. Even though the effects of these policies may differ somewhat between cities, due to historically grown differences and specific contextual conditions (also see Atkinson, Tallon, and Williams 2019), the main impacts of the policy shift are clear. These policies are characterised by efforts to reduce spending on social policies. We see a re-orientation of state intervention in several domains and therefore call the changes a welfare regime shift. The social housing sector is rapidly declining; former worries about rising social inequality seem to be replaced by more relaxed attitudes, while inequalities did not decrease; support for private market processes and businesses appears to rise; privatisation of many former public services continues; etcetera. These changes tend to be especially beneficial for the better-off, while the less well-off experience problems in their lives. In the Netherlands the contrast between ‘winners and losers’ in terms of after tax income is still relatively limited due to a long history of egalitarianism, past policies against social inequality, and a history of progressive income taxing. Access to social services and social benefits is still in place for the vast majority of the population; part of the old age pension is a social pension of the same level for everyone; also access to all sorts of education and to health care is equally available and of almost similar quality to everyone. Yet, wealth inequality is rather high in the Netherlands, and signals of harsher housing conditions are gaining territory. Access to services in several domains of life and to affordable housing are becoming more difficult. Since housing and affordability are corner stones of urban renewal policies, we pay some extra attention to changes in the housing domain, and to income and wealth inequality in Box 1.

Box 1

t

After the 2^nd World War, the Dutch social housing sector increased rapidly, from almost 10% in 1947 to around 44% in 1989 (Jobse and Musterd 1994). The year 1989 marked a turning point (Nota Volkshuisvesting in de Jaren Negentig, 1989). While ownership housing was continuously promoted, the social housing sector started to decline. In 2020 the sector’s share was already down to 29% of the housing stock (Statistics Netherlands, Statline, consulted 31–03-2021). Housing associations simultaneously lost connections with the state; eventually they became financially independent; state subsidies came to a halt; increasingly the ‘private market’ was expected to offer solutions for housing problems. The role of housing associations, which during a long period of time was defined rather wide, became reduced to offering affordable and accessible housing for just those who were unable to take care of housing themselves.

This development implied a residualisation of the social housing sector. Between 1989 and 2009 the share of households that had a below median income and lived in social housing in the Netherlands, increased from 63 to 80% (Musterd 2014). In the decade thereafter, this process continued. Between 2012 and 2018 the share of the so-called ‘target’ group (those with a low income) in the social housing sector grew from 53 to 57%, while the middle and high income groups lost position (from 26 to 17%). Those on social benefits increased from 21 to 26% (Staat van de Volkshuisvesting; Jaarrapportage 2019, 31). The social transformation of the sector was actively pushed by the state. Housing associations were heavily taxed from 2013 onwards (through a landlord levy tax based on the value of their stock). They only could survive by selling housing, or by raising the rents of part of the stock above inflation. This was allowed when households earned a relatively high income, or when real estate values of housing in their neighbourhood rapidly increased. In both cases this resulted in spatially varying rent increases, which stimulated segregation processes. It also often led to such high rents of social housing that these automatically moved into the private sector (this happens when the rent passes the so-called liberalisation boundary). In that sector prices rapidly increase when sitting renters move and new renters show up. The combination of a shrinking and residualizing social housing sector rapidly marginalised the sector that was not marginalised before. For a more extensive overview of the reasons for the decline and of the effects, see Boelhouwer and Priemus (2014).

While the social sector was declining and increasingly became the domain of the poor, the homeownership sector continued to grow and increasingly became the domain of the affluent and the wealthy. In the Netherlands income inequality is not driving the gap between poor and rich; inequality based on disposable household income after tax and transfers appears to be relatively moderate (Gini-coefficient 0.28, in 2016), comparable to the levels in countries like Belgium, Germany, Norway, Sweden and Switzerland, and much lower than the level in countries like the US (0.39 in 2017), or UK (0.35 in 2016). However, when also wealth inequality is taken into account, the Netherlands is showing much higher levels; in 2019, the top 5% of households according to wealth owned 49% of all wealth; the top 1% owned 27% of all wealth. In both categories, The Netherlands showed the highest figures of all 17 European countries for which recent data on wealth was available. Again, these figures were lower than in the US (68, respectively 41%), but higher than those in the UK (40, resp. 23%) (https://stats.oecd.org).

Together with the fact that many social rental housing estates have been built in large numbers in relative concentrations and together with the selective rent increase practices the developments mentioned also implied more social spatial inequality and a clearer distinction between residential areas for the poor who rent versus the affluent who buy (also Tammaru et al. 2016; Musterd 2020).

The conclusion based on the information provided is that liberal policies, especially those of the past ten years, have stimulated entrepreneurial activity and reduced public policy budgets, among other things resulting in rapidly decreasing shares of social housing, in marginalisation and residualisation of the social housing stock, and in a rise of affordability problems. In spatial terms, time-lagged, large-scale residential areas with the better-off in ownership housing will emerge at the most preferred locations. This will contrast with large-scale areas with marginalised households in social housing at the peripheries of urban areas (Musterd 2014; Hochstenbach and Musterd 2018). This segregated outcome may create the conditions for a range of social problems, social tensions and negative neighbourhood effects.

Interestingly, liberal policies also claim that they favour social mixing. However, as already noticed in the former section, critical scholars argue that here the motive is not to bring different classes together, but to ignite processes that will initially create social mix, when more wealthy household move into poor, yet attractive, neighbourhoods; but that the transformation eventually will result in the development of homogeneous affluent neighbourhoods (Bridge, Butler, and Lees 2012). This happens when gentrification becomes a dominant process. The Dutch urban condition in connection to the housing market has recently been adequately summarized by a Dutch weekly (De Groene Amsterdammer, 8 March 2017) which quoted the Liberal Conservative Minister of Housing, a few days before he moved to another Ministry: ‘In a new government there is no need for a new Minister of Housing. Housing policy has been brought to an end; the market can take over’. Urban transformation and renewal processes are realised through providing opportunities to private investors and entrepreneurs who change the city, but mainly in favour of the affluent. Social programmes seem to disappear; urban policies are re-framed as chances for the private sector.

5. Conclusions

Over a long period of time, after World War II, well-established discourses on the existence of a negative relation between segregation and integration drove policies of Western European countries and cities, including the Netherlands. The discourses resulted in strong interventions, and billions of Euros were spent on attempts to reverse social and spatial inequalities, even though these inequalities were often more moderate than they were presented. In this paper we demonstrated the persistence of policies of this type in The Netherlands, until approximately ten years ago when liberal policies became dominant. This has had and will have major impacts on the social structure of cities. Social (wealth) inequalities increased, spatial inequality in the socio-economic sphere is increasing and also developing at larger scales. This may be a route to even more inequality, more separation. When the scales of poverty and affluence increase, that inequality will also become more noticeable in spatial terms. A dark scenario is that this may eventually result in estrangement, conflict, and increasing difficulty for the poor to escape from their peripheral poverty situations.

Only recently we found that especially socioeconomic segregation levels are increasing. It is also only recently that we find increasing social inequality. There is more debate on migrants, even though their integration is progressing very well. That debate is imbued with fear for the other and most frequently framed in identity debates and populist ideas. At the same time, middle-class presence in all sorts of neighbourhoods seems declining, while area-based interventions miss their goals. So what should be done to get to cities that are characterised by economic prosperity, inclusion, and social justice, which is what most politicians say they want to reach? Three types of interventions seem required.

First of all social inequality (especially inequality driven by income and wealth differences) should stay high on the agenda. There are strong indications that social inequality eventually results in social spatial inequality. This process will create very negative outcomes, ultimately also for the affluent, directly or indirectly through locking themselves up in gated communities, losing access to much of urban life, and continuously fearing the risk to become a victim of crime.

Second, the favourite social mix policies should be approached more critically. There might be social motives behind that policy, as expressed in social democratic circles, but there may also be hidden agendas, favouring the affluent and displacing the poor. Social mix policies should be connected to space more rigorously. The scale of social homogeneity (either rich or poor) is highly important, and it makes sense to consider policies in which individual household’s stated and revealed preferences are recognised and taken seriously. This requires policies in which very local residential territories may be accepted as relatively socially, demographically, and culturally homogeneous, but only if such small homogeneous areas can be combined with other social spatial entities which together form a more heterogeneous social district, where various population categories may meet each other and interact, which will de facto only be possible when social and cultural inequalities remain or become relatively small.

The third type of intervention regards those organised by the state and local authorities, aimed at optimising social conditions. A strong welfare state, which is very active during crises, seems essential. Essential elements seem to be the association between being employed and having an income on the one hand; and enjoying decent housing, being entitled to social security, having access to good health services, and receiving high-level education on the other hand (Musterd and Ostendorf 1998). If a person loses his/her job and/or income, the position in the other domains, housing in the first place, should not become terribly weaker. That seems to be an important key to the ‘decent society’. If that relationship would be strong, as it is, for example, in the USA, huge social problems will continuously pop up and create bad conditions for those who are involved, but also for the rest of society. Some years ago, this view received independent support in a study by Hemerijck (2013) who observed that economic recovery and further development are actually benefitting from strong social policy: ‘regulating markets, social policy, redistribution of affluence through unemployment benefits, state pensions, education, and health care are all firmly connected to the private market economy and have a stabilising and productive function’ (p.7). What is of great importance is that the social mobility of individuals must be addressed, and that some individuals who lack social mobility are entitled to receive support. Support can, partly, also be provided via urban policies. Negative neighbourhood effects may trigger such intervention, but one should be aware that these effects will likely only occur when concentrations of poverty are deep, in the sense that many (very) poor people are concentrated, and when concentrations of poverty are large-scale, and therefore blocking even visual interaction with others on a daily basis.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

1. Like many scholars in the field, Denters also refers to these changes as ‘neoliberal’ policies. Strictly speaking this may not be correct if mainly ‘classic’ liberal principles are under discussion. In such cases, referring to ‘liberal’ policies seems preferable. Because in this paper we mostly refer to ‘classic’ liberal practices where cities (and states) favour privatization, market logics, deregulation, and reduction of public services, and hardly address social inequality, we systematically refer to liberal instead of neoliberal policies and principles. In this paper we refrain from a more elaborate discussion on these concepts. For a short critical review, addressing the often ill-defined use of the concept ‘neoliberal’ and the negative connotation that is frequently attached to it, we refer to Buitelaar (2020). For an extensive discussion of different conceptualizations of the concepts of liberalism and neoliberalism in urban policies, we refer to Le Galès (2016).

2. Several different operationalisations of ‘arrears’ were applied: on the basis of the share of people with a low income (5%); the share of receivers of social benefits (8%); and the share with an unemployment benefit (7%).