Tory government housing strategy: growing the market and shrinking ‘social housing’

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Swindon Tenants Campaign Group Briefing:

Tory government housing strategy: growing the market and shrinking ‘social housing’

From the Housing Bill currently going through Parliament and the Autumn Review we can see that the Conservative government housing strategy is based on subsidies for home ownership and the abandonment of support for ‘social housing’ for rent. They want to drive up home ownership at the expense of ‘social housing’. The detail of the Autumn Review makes this clear.

“Starter Homes” 

When the idea of Starter Homes was first introduced it was aimed at building 100,000 homes on brownfield and ‘exception’ sites which would otherwise not be likely to be developed. It was initially presented as housing in addition to “affordable housing”. In a pre-election announcement in March 2015 the figure was raised to 200,000. Now the government is saying that Councils will have an obligation to promote Starter Homes on all sites. Two planning requirements will be dropped – Section 106 and the Community Infrastructure Levy, which are used to pay for social rent, ‘affordable rent’ and shared ownership housing. This means that Starter Homes will become “the primary affordable tenure” in England, at the expense of rented homes. (Download a PDF here toryhousingstrategy  or read on below) More

Swindon rent cut options consultation

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This is the submission from Swindon Tenants Campaign Group to the Council consultation on options for dealing with the loss of income resulting from the government’s policy of cutting Council rent by 1% a year for 4 years. We explain why freezing ‘debt’ payments would be the best means of preventing a backlog of work building up.

Swindon Council rent cut consultation

Swindon Tenants Campaign Group submission

Swindon Tenants Campaign Group is calling for suspension of the £5 million ‘debt’ payment for the 4 years when the rent cut of 1% a year is being applied by the government.

Swindon Council’s consultation suggests 4 options for dealing with the loss of income resulting from the rent cut.

A) Use some of our ‘reserves’.

B) Repay less of our debt.

C) Reduce the amount we spend on improvements to our homes.

D) A combination of options A and B. More

Council rent cut: suspend payment of ‘debt’

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From April 2016 the government is instructing Councils and Housing Associations to cut their tenants’ rent by 1% a year for 4 years. This will make a pleasant change for tenants after years of above inflation increases. However, because of the way that our housing is funded the cut will have consequences. Swindon Council is consulting on various options to deal with the loss of income resulting from this cut. The only income which the Housing Revenue Account has (other than a small amount from rental of garages and shops that the Council owns) is the rent and service charges paid by tenants. Any cut in income means that the Council has fewer resources to maintain our homes and to renew components such as kitchens, bathrooms, roofs etc. There will be £22.8 million less rent income (than would have been available if the government had continued with the CPI + 1% formula) over the 4 years as a result of the cut in rents.

Swindon Council is proposing 4 possible options to counteract the loss of income: (Download a PDF here rentcutoptions or read on below) More

Let them live in garages?

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George Osborne’s Autumn statement was bad news for people who stand no chance of obtaining a mortgage. There was no funding for building homes with ‘social rent’ which offer an alternative to the expensive private rental sector (PRS). Osborne is lining the pockets of the big builders by handing over to them £2.3 billion to subsidise a 20% cut in the price of ‘Starter Homes’.

The abandonment of any support for building ‘social rent’ homes will increase the shortage of genuinely affordable homes for rent as Council homes are sold off and not replaced. This shortage is reflected in the PRS in Swindon. Councillors and Council officers have started to find people renting garages to live in. The fact that such a situation can exist in our supposedly affluent town is shameful. It’s not something you would do if you had an alternative.

At the same time we have begun to find ‘gazumping’ in the PRS. Taking advantage of the shortage of affordable homes to rent some unscrupulous landlords are making would-be tenants compete with each other for a tenancy by offering rent way above the original asking asking price.

Both of these things are reflections of an imbalance in housing in the town. The phenomenal increase in the PRS from less than 6,000 at the time of the 2001 census to over 16,000 today is the result of a shortage of Council housing combined with a growing gulf between house prices and earnings.

Swindon Housing Action Campaign has been launched precisely to highlight the human consequences of this housing crisis and to campaign against exploitative landlords. The government has abandoned to their fate those people who cannot afford a mortgage. In London and other places we have read about ‘beds in sheds’. In Swindon we now have beds in garages. It’s a shameful indictment of a failed housing policy.

Martin Wicks

Swindon Housing Action Campaign

For further comment ring 07786 394593

SHAC can be contacted by email at housingaction@btinternet.com

Swindon Housing Action Campaign – Addressing Swindon’s housing crisis

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This is a media release from a new housing campaign which we are supporting.

Six local organisations (listed below) have come together to launch Swindon Housing Action Campaign (SHAC) in response to the worsening housing crisis. The new campaign will be leafleting Swindon town centre on November 28th, from 10 – 12 o’clock.

Swindon suffers from a crisis of affordability for both rent and ownership. It suffers from

  • A shortage of Council housing – our homes continue to be lost to ‘right to buy’ and not replaced;
  • House prices which are too high for many people to afford a mortgage – prices even for the lowest quartile homes are over 5 times the lowest quartile earnings;
  • A rapidly growing private rented sector (PRS) with insecure tenure, high rents and much poor quality housing.

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Asset-stripping Housing Associations?

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There is clearly a whiff of panic in the corridors of power as the fateful day of the Autumn review approaches. Osborne is scrambling about for sources of money as he tries to overcome the impact of the spat in the House of Lords over the cut to Tax credits. A report in Friday’s Financial Times said that George Osborne was considering “selling off the government’s stake in the housing association sector” to private investors. In fact the government does not have “a stake” in housing associations. It, and previous governments, gave them grant for building new homes, not loans like Councils. The total grant, said to be £44 billion, goes back as far as 30 years. The money has been spent. It does not exist. It is like the Monty Python parrot. More

Social Housing lets – check your facts

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A Swindon Advertiser correspondent tells us that 61% of housing association homes last year were given to “East European migrants”. This is the reply.

I was reminded of the old maxim don’t believe everything you read in the papers when I read Jeff Adams letter (Drain on Infrastructure). Jeff wrote that “in the previous financial year, 61% of housing association properties went to East European migrants”. That’s an extroardinary statistic, or at least it would be if it was true. I don’t know where Jeff got this figure from. A quick Google finds reference to the 61% figure in the Telegraph and the Express. The Telegraph said

“Housing associations are also letting a bigger chunk of their stock to people from these EU accession countries. In the last financial year, more than six in 10 (61%) homes went to nationals from accession countries, up from 54% in 2007/08.”

This is complete nonsense. The article even managed to mention that 91% of homes went to UK nationals! The Express was more accurate.

“In the last financial year, 61 per cent of homes that went to nationals from these countries came from the housing associations, up from 54 per cent in 2007/08.”

The real figure for new tenancies going to people from Eastern Europe, which you can see in the Department of Communities & Local Government Households statistical release of October 6th 2015, is just over 3%. More than nine out of 10 new tenancies still go to UK nationals.

Martin Wicks
Secretary, Swindon Tenants Campaign Group

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