Two ways of looking at this

Tens of thousands of hard-working families will be forced to leave their council homes and find themselves unable to afford a local alternative as a result of government plans to restrict social housing to the poorest, according to research obtained by the Observer.

The devastating figures – in a report commissioned by the Local Government Association – show that almost 60,000 households in England will be unable to afford to remain in their council properties from April next year, as a result of George Osborne’s reform, called “pay to stay”.

Under the policy, announced in last year’s budget, families or individuals earning more than £40,000 a year in London, and more than £30,000 elsewhere, will be told to pay the local market rate in the private sector, rather than the far lower social rent. The move is part of Tory plans to end what ministers say are effectively subsidies for better-off council tenants.

One is as above. The other is, well, why are 60,000 families who are not poor being subsidised as if they are poor?

27 thoughts on “Two ways of looking at this”

  1. So Much For Subtlety

    The other is, well, why are 60,000 families who are not poor being subsidised as if they are poor?

    Yeah but this will be a group of people who are just not poor enough to qualify. Not millionaires. After all, Lee Jaspers and his ilk will have political protection. So it is likely that the impact will be devastating. Welfare should taper off, not present people with these sort of serious costs on marginal differences.

    Which is an argument for housing vouchers.

  2. “So it is likely that the impact will be devastating. Welfare should taper off, not present people with these sort of serious costs on marginal differences.”

    Hardly devastating, but I agree about tapering. In any event, social housing should be a transitional stage, not a way of life.

  3. 30,000 is above the median income. If they are poor so is the majority of the country.
    I know people who are buying their own house from less than that.
    However some sort of taper is required. After all if someone got social housing when he genuinely was poor and has since worked his way out of poverty we don’t want to kick him in the face, and moving house is a serious expense and inconvenience even when the houses are similarly expensive. And we want to get rid of poverty traps, not create them.

  4. Obviously this only applies to council tenants with legal fully-taxed income. Any self-employed tenant will earn exactly £29,999 next year, with the rest cash-in-hand; and any drug dealers will carry on as they were.

  5. 40k a year family income is London is fuck all.

    Talk about an incentive to stay on benefits and taking away kids inventive to get good jobs.

    Alex

  6. We should remember that the private sector are not paying a market rent. They are paying a heavily State influenced rent, inflated far above a natural market level.

    So far as I can tell, the modern dream is a sort of hyper-Ricardianism, in which Georgism is entirely vindicated as the rentier takes everything produced by productivity growth.

    So let’s get the datum right. The people in social housing aren’t paying too little. The faux-market rent is (deliberately) too damn high.

    Take away the State-generated property inflation, abandon the planning restrictions, let people build and live where they want, pull out the central bank, then we’ll see what George’s “market rent” is and where the real “subsidies” are.

    This has got to be the most cuntish the Tories have ever been. Thatcher was trying to help people gain financial independence. This lot really are just a bunch of total fucking cunts.

  7. The root of this is that eligibility for social housing is measured once and once only: at the point a tenancy is granted. If you win the lottery the following day, there’s nothing anyone can do to end the agreement, except for a material breach of the tenancy, or the tenant surrendering the tenancy itself.

    Fixed term tenancies (with a review after 5 years for continued eligibility) have been looked at, but aren’t often used for the reasons. Andrew M stated above, plus the obvious disincentive of losing your home if you succeed at life.

    Twin this with the succession rights for children of tenants, which can take a home out of availability for a century, and the system is fucked.

    The only real way out is to do exactly what is being done above: create new houses that are more appealing to those sitting in social housing, and offer those in a different form of tenure like shared ownership. Tempt the bedblockers out and swallow the accompanying ghettoisation of the genuinely poor as the least worst outcome.

    The alternative is as Ian B describes: flatten the market as it stands and hope that something better emerges in its place

  8. It is all a lie in the first place. No-one will be forced to move. They are just being asked to pay a fair rent.
    So, Pat, the expense of moving house is imaguinary.
    Yes, there should be a taper, but it should start at median income not £40k and is *already* provided by “Housing Benefit”.

  9. “60,000 households in England will be unable to afford to remain in their council properties ”
    Shouldn’t those last 3 words be “the council’s property”. If you’re renting, then it’s not yours.
    Anyway, as john77 has said, on their salaries they can still afford to live there if they wish.

  10. “This has got to be the most cuntish the Tories have ever been. Thatcher was trying to help people gain financial independence. This lot really are just a bunch of total fucking cunts.”

    They have lost what little grasp they had on their marbles.

    To be pulling assorted cunning stunts on those with little while at the same time peddling every rotten manifestation of cultural Marxism shows that they really think themselves to be God’s gift to the Universe. Whatever nasty bit of stupidity occurs to them they will do–because they can.

    John 77: Yeah–maybe these people can be squeezed for more rent–but that rent goes to the scum of the state (no “public purse” bollocks please) to finance the rest of their shite.

  11. I see the difference “London” Rest of UK is 10k annually.

    Isn’t the fact that just for the London area alone ( never mind regional differences elsewhere..) you need an offset of 25% to begin with a sign something is dreadfully wrong to begin with?
    Especially since 25% difference seems a tad low to begin with.

  12. You’d think the prospect of either clearing out the self-sufficient home blockers in order to better assist the poorer parts of society, or increased council rent revenues, would please the Local Government Association.

  13. ‘Tens of thousands of hard-working families will be forced to leave their council homes’

    ‘almost 60,000 households in England will be unable to afford to remain in their council properties’

    Should we feel bad about the families that are not hard-working? “Hard-working” is propaganda for the stupid.

  14. £30k is easily enough to buy a house on in most of the country – I think when I bought mine, I was earning about £18k and that was only 4 years ago.

    The thrust of the policy I thus clearly agree with (why on earth should I be subsidising those earning far more than me, when I’m paying market rates), but the absence of a taper is moronic in the extreme. Does no one in government even think slightly these days?

  15. In my circle only one family lived in council housing. The widowed mother was still earning, modestly; the daughter earned enough to pay lots of income tax at the higher rate. It was absurd that their rent was subsidised, just as it was absurd that the daughter would inherit the tenancy.

  16. “Work by the Resolution Foundation found that a household with two earners in Oxford which took on one hour more of paid work a week, tipping joint earnings over £30,000, would see the rent increase by more than £4,000 a year.”

    This is where I label the “Resolution Foundation” as basically, a crooked bunch of cunts. If you’re going to pick Oxford as your example, you’re deliberately picking the worst possible case.

    Frankly, no-one living in Oxford should be living in subsidised housing. There’s plenty of high-earning people that would like to live there.

  17. @dearieme

    In every housing association I have ever worked in, the biggest general complaint by tenants is about carparking. Most estates planned on at most a two car household, which isn’t adequate for many families. You can still tell which estates have a low rate of right to buy families, as those are the ones that are still clogged with cars.

    The lower rent is just a route to subsidising cars

  18. @ The Stigler
    Are you mixing Oxford with Cambridge? Morris Motors gave Oxford a valuable industrial base until Jack Scamp,Wilson et al screwed up the British motor industry. There are consequently large council housing estates around Cowley (and elsewhere) housing people who are not high-earning any more.

  19. You are going to have to subsidise socially useful people to live in places like London because 1) we need them there 2) house prices and rents are too high 3) wages are too low. You lot claim to be realists : how has your laissez faire policy gone so disastrously wrong? (Stand by for blast of : this is not real laissez faire; the markets are not allowed to work by interfering Statists etc)

  20. So Much For Subtlety

    DBC Reed – “You are going to have to subsidise socially useful people to live in places like London because 1) we need them there 2) house prices and rents are too high 3) wages are too low. You lot claim to be realists : how has your laissez faire policy gone so disastrously wrong?”

    3. cannot be true because 2. proves it is not true. Housing prices are high because wages are high. It is true that wages for bankers are high. But then if 1. we need poor people in London it is to provide those bankers with cleaners, drivers, prostitutes and take away pizza delivery men. Since when did it become sensible economic policy to subsidise servants for the ultra-rich?

    The London housing market is a monument to poorly thought out government policy. They restrict housing density. They restrict building outwards due to the Green Belt among other things. They regulate the [email protected] out of the housing market. And then they are surprised that there is a housing problem. The solution is not more regulation.

  21. Surely the London housing market should fix itself if we stopped messing with it.

    If you couldn’t get bin men, waitresses, bus drivers or hair dressers because they couldn’t afford to live there, surely you have to pay them more… which would make London less attractive for the rich, (as the cost of living was higher) and more attractive to the “working class” – until an equilibrium was found in which the richest stayed, along with those required to service their activities. It would be the middle earners who don’t actually need to be in London that would get squeezed out – IMHO that wouldn’t be such a massive problem as all that.

    At the moment we appear to be randomly chucking hefty subsidies at some segments of Londoners with little to show for it other than it adding to the pressure on rents and house prices.

  22. London needs lower end workers for sure. Which does not mean that that lower end workers need to work in the centre, or that their incomes should be subsidised by everyone else. Those that need the workers should pay for them.

    I don’t know the full details, but public transport policy is rather different in the US, at least in the bits I know.

    A tube from the very edge of the network in Chicago and New York is the same price as for a single stop journey. In other words, all journeys are the same price.

    So the cleaner from East Queens is subsidised at the expense of the Wall Street millionaire.

    In London, the further out you are, the more you pay, and rents are highly sensitive to Underground zones.

    Maybe London has this the wrong way around.

  23. @JC Quite sensible. Or you could have a monster Land Value Tax levied on rich shits and foreign gangsters resident (or not resident) in the centre of London to pay for very cheap commuting by very fast not stopping trains to bring essential workers in from beyond Green Belt.

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