As I\’ve been saying

Welfare tenants stay put in the same house for a very long time. Over twenty years, they will enjoy the benefit of subsidised rent worth £65,000 at Net Present Value.

It simply isn\’t true that the poor have no assets.

The average inhabitant of a council house has an asset worth £65,000….the council tenancy itself.

We were told by the Hills Report that the 90th percentile had £850,000 in assets and the 10th percentile £8,000.

Outrageously untrue, a simple bare faced lie.

For we\’ve all got a very valuable financial asset: the welfare state.

5 thoughts on “As I\’ve been saying”

  1. Well OK, in a sense you are correct.

    But when push comes to shove, I don’t expect my “right” to a free bus pass to be worth a hill of beans, or my “right” to a winter fuel allowance, or my “right” to the Old-Age pension, or my “right” to expect the government to keep any of its promises on anything at all, really – even though I have paid for all those things many times over.

    An asset that’s owned by someone else and entirely under their control, and whose realisation is at the whim of politicians and bureaucrats, is no kind of asset as far as I’m concerned.

  2. Tim – agreed. But if Cameron really wants to open up debate he shouldn’t shut it down immediately by excluding current tenants from any proposals.

    Considering how council properties can be ‘passed down’ through generations, it would be decades before a change for future tenants only had any significant effect.

    Andrew – your “rights” are still intangible assets – rights that have a value to you because they give you some kind of advantage, in this case subsidised housing or free bus travel…

    The historical value of those rights was worth a substantial amount of money. The future value may be reduced at the whim of politicians but I think you’ll find that the same applies to the rich too.

    Or are the assets of the rich immune from the vagaries of the housing market/pensions/shares/legislation or indeed future taxation?

    If these rights weren’t assets then

  3. The Pedant-General

    “your “rights” are still intangible assets ”

    Yes, but they’re not remotely fungible nor can you use them as security against finance. In this respect they are markedly different from other “real” assets.

  4. “they’re not remotely fungible nor can you use them as security against finance”

    Fair comment, perhaps benefits is the correct word, not assets. Of course there is the ‘right’ to buy the house too but I won’t even go there.

    It is fun watching Labour hurl abuse at Cameron for his ‘new’ council house plan when Caroline Flint proposed the same thing a couple of years ago…

  5. I wonder how much of a haircut the £65,000 figure should take to reflect the lack of fungibility and the inability to borrow against it? It’s plainly got a non-zero value, but it equally plainly is nowhere near as worthwhile as a windfall of sixty-five grand.

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