The Autumn package kicking off the 2023 European Semester cycle was released on November 22nd. Read our first analysis that Housing Europe was invited to share at a high-level joint meeting of the Social Protection Committee (SPC) and Employment Committee (EMCO) as part of a delegation from the Social Platform.
The Annual Sustainable Growth Survey strongly focuses on the current energy and cost of living crisis. The package rightly points at the need for governments to support households (as well as companies) while at the same time keep encouraging a decrease in energy consumption, in line with Green Deal objectives. As Housing Europe, we are monitoring closely to what extent current measures are providing adequate safety net to those living in public social and cooperative housing.
We also appreciate the point that to tackle the inflated cost of energy used at home, housing renovation is the most effective solution in the mid- to long-term, and social and affordable housing is a key part of a fair energy transition. However, at the moment given supply chain problems, lack of skilled workforce, and increasing costs of materials in construction this much-needed effort to speed up renovation risks is to be put on hold unless significant additional funding is made available.
The document recalls the funding from the Resilience and Recovery Fund, as well as Cohesion Policy as important tools. However, looking at economic governance and especially considering that the general escape clause from the Stability Growth Pact will be deactivated in 2024, we call for consideration of the fact that debt in our sector is an investment with high social and environmental returns and not just expenditure.
While it is important to focus on the current emergencies the Semester should not forget existing long-term issues and the lack of affordable housing is clearly one of them. The Alert Mechanism Report describes extensively house price dynamics from a macroeconomic stability perspective – unfortunately, with little if no mention at all of housing affordability. It announces that in 2023, 11 countries will have a special thematic analysis in their in-depth review with a focus on housing markets. ‘An in-depth thematic note on housing market developments will look at the risks and drivers associated with house price developments and mortgage markets and household debt. The note will focus on Czechia, Estonia, Germany, Hungary, Latvia, Lithuania, Luxembourg, the Netherlands, Portugal, Slovakia, and Sweden’. It would be a missed opportunity if this analysis did not include a reflection on social and affordable housing and policy measures to enhance affordability.
Last but not least the Joint Employment Report recommends ‘Address homelessness as the most extreme form of poverty; promote the investment in the renovation of residential and social housing, as well as integrated social services; ease access to quality and affordable housing, social housing or housing assistance, where appropriate', in line with the Pillar of Social Rights and its principle 19.
Besides this recommendation though the document mentions housing only seldom and in reference to specific vulnerable groups (such as the homeless and children in poverty). It fails to capture that, especially in the current context of rising inflation, a much larger share of the population is struggling to secure adequate housing, especially in cities. The problem of key workers being priced out of urban areas for instance is becoming a widespread reality – this trend bears risks to employment and productivity too in the long term.