REGULATION AS SOCIAL POLICY: HOME EVICTIONS AND REPOSSESSIONS IN THE UK AND SWEDEN

DOIhttp://doi.org/10.1111/padm.12171
Published date01 September 2015
Date01 September 2015
AuthorHANAN HABER
doi : 10. 1111/p adm .12171
REGULATION AS SOCIAL POLICY: HOME EVICTIONS
AND REPOSSESSIONS IN THE UK AND SWEDEN
HANAN HABER
This article asks how the UK and Sweden regulate, prevent, or mitigate the consequences of
mortgage-related household eviction and repossession. Contrary to initial expectations, the nd-
ings show a growth and diversity in both regulation and social spending in the UK intended to
address this social issue; something that has not occurred in Sweden. In the UK’s liberal ‘regulatory
welfare regime’, the aim is to prevent the eviction and repossession of vulnerable borrowers who
have defaulted on their housing loan. In the Swedish social democratic ‘regulatory welfare regime’,
effort focuses instead on minimizing the risk of default before it occurs rather than after the fact.
These ndings offer a more nuanced understanding of the relations between regulation and welfare
more generally, demonstrating that regulation may be used as a form of social policy once the
welfare state has failed, as a safety net of last resort.
INTRODUCTION
Housing policy and the housing credit market play an important role in human wel-
fare and in the economy. The relationship between mortgage lenders, borrowers, and the
state plays an important role in both respects (Castles 1998; Kemeny 2005; Schwartz and
Seabrooke 2008; Schelkle 2012; Schwartz 2012). This is especially true regarding borrower
eviction and repossession.
Unfortunately, this aspect is rather neglected in the study of welfare and social policy
(on the relation between housing and welfare, see Malpass 2008). More generally, we know
little about the regulation of access to basic services and social rights in the market, and
the manner in which they have developed in different types of welfare states. There is little
interaction between the literature on the regulatory state and the welfare state and social
policy literatures (Levi-Faur 2014).
This article asks how the state regulates the social risk of home eviction and repossession
due to debt and arrears on household sector mortgage payments. This form of regulation
is analysed and compared in the housing credit sectors in the UK and Sweden.
The literature on the welfare state and on the regulatory state (Esping-Andersen 1990;
Majone 1997) forms our theoretical expectations regarding the use and application of social
regulation in both cases. More specically, we would expect more of a welfare effort in
the social democratic case of Sweden, rather than in the liberal case of the UK. The nd-
ings, however, show a growth and diversity in the UK in measures intended to regulate,
prevent, and mitigate the consequences of homeowner eviction via regulation and social
spending, something that has not occurred in Sweden. The article highlights a basic differ-
ence between the two cases: while in the UK effort is directed towards preventing eviction
and repossession once debt and arrears on mortgage payments have already accrued, in
Sweden, social assistance may prevent such debt from accruing, but not assist borrowers
once debt has already occurred.
The introduction and expansion of regulation aimed at preventing, mitigating and com-
pensating for eviction and repossession represents an effortto allow citizens access to basic
Hanan Haber is at the Federmann School of Public Policy,Hebrew University of Jerusalem, Israel.
Public Administration Vol.93, No. 3, 2015 (806–821)
© 2015 John Wiley & Sons Ltd.
REGULATION AS SOCIAL POLICY 807
goods and services even when they can no longer afford them through the market. Regu-
lating consumers’ continued access to necessities, as opposed to scal transfers and social
insurance, represents a different kind of welfare effort from that which the study of the
welfare state has focused on, leading to different kinds of results, and different patterns
of political and bureaucratic involvement. This kind of regulation can serve as a second
safety net, a safety net of last resort, once the safety net of the welfare state has failed.
The regulation of the risk of eviction and repossession is a relevant issue, rst because
of its social salience, and the impact this risk has on individuals, households, and the com-
munity, especially after the 2008 recession. Second, this issue has theoretical implications
for the study of two central institutions of political economy: the welfare state and the
regulatory state.
In the study of regulation, this article goes beyond the image of regulation as a strictly
economic issue (Majone 1997, 2011), focusing on the distributive implications of regula-
tory policy, and on the use of regulation as a form of social policy (Haber 2011; Leisering
and Mabbett 2011; Chng 2012; Dubash and Morgan 2012; Urueña 2012; Mabbett 2014;
Levi-Faur 2014; Pieger 2014; Eckert forthcoming). In the study of welfare, this article goes
beyond the image of the welfare state as focused on social spending and insurance, within
several main areas of social provision (Esping-Andersen 1990). It adds to this image the
issue of access to services such as housing credit, and a focus on how the state regulates
their provision through the market once citizens can no longer affordthem (see also Castles
1998; Kemeny 2005; Hoekstra 2009).
This article also contributes to our understanding of how different types of welfare states
cope with the challenges of eviction and repossession, through both spending and regula-
tion. The comparative case choice juxtaposes Sweden as a social democratic welfare state,
and the United Kingdom as a liberal one (Esping-Andersen 1990; Arts and Gelissen 2002;
Hicks and Kenworthy 2003). The well-established account of either kind of welfare state
is not quite adequate to address the regulation of mortgage credit default in practice. This
article offers a nuanced view of this resilient typology.
The article is a comparative, case-oriented study,based on the collection and critical ana-
lysis of primary sources such as legislation, regulation, reports by state, business and third
sector actors, and press coverage. The period chosen for analysis is based on the results
of a previous study on the development of regulatory welfare measures in the electricity
sector in the UK, Sweden, and Israel (Haber 2011), beginning in the late 1990s. This previ-
ous study showed the development of regulatory welfare measures during this period, in
response to electricity sector liberalization. This is a stepwise method of case choice, aimed
to gradually and cumulatively develop an understanding of regulatory welfare across dif-
ferent sectors over the same period (Levi-Faur 2006).
This article begins by focusing primarily on the period during which mortgage regula-
tion was undertaken by the UK’s Financial Services Authority (FSA), starting in 2004, and
ending in 2013, when this body was abolished and its responsibilities divided between the
new Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA).
The article then traces the development of regulatory welfare measures in the Swedish
case during the same period.
The rationale for comparison between the two cases is strengthened due to similarities
in housing tenure and repossession patterns. In both cases, the tenure mix has shifted in
recent decades towards homeownership, and is now comparable to the EU 28 average
(roughly 70 per cent). In the UK, this gure has risen since the 1980s, together with a drop
in renting from local authorities (Department for Communities and Local Government
Public Administration Vol.93, No. 3, 2015 (806–821)
© 2015 John Wiley& Sons Ltd.

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