Tuesday, October 19, 2010

An End to Council Houses For Life

The BBC has reported that council housing “for life” is to be phased out, due to budget cuts of more than 50% in the social housing budget. Already there has been huge outcry; the chief executive of the National Housing Federation called the proposal a “kick in the teeth to millions of people”.

I have no problem in giving a broad welcome to the move to end council houses for life. At present a council tenant can keep their property for life and even pass it on to their children. This is surely just plain wrong. The government should not be in the business of providing people with homes for life. Council houses should be there for when people fall on hard times and genuinely need help, but once they have got back on their feet they should be encouraged to find a property in the private sector, just as anyone else would have to.

Proposals look set to include local authorities checking whether council tenants still need help, and putting all new tenants on fixed term contracts and encourage them to move over to the private sector as soon as financially possible. Also “flexible” tenancies are to be introduced which will allow tenants to move round the country to find work. Grant Shapps also hopes to create a National Swap Scheme.

The government is going to end inherited tenancies, so no longer will council tenants be able to pass on their tenancies to their children. This comes after a freedom of information request discovered that more than £9 billion of council housing had been inherited to those who did not qualify for state help on their own circumstances. That is an unbelievably high figure, and I am glad the government is going to do something about it. We have a massive homeless population in this country and yet we have people living in council housing who could easily afford to live in private sector housing.

Of course, the PR problem here is that people imagine this policy is going to apply to existing council tenants. It won't. It will only apply to new tenancies. So for existing tenants nothing whatsoever will change.

It's also a consultative document, not even a white paper, and is designed to get a real debate going. There's no doubt that this is controversial and radical stuff. But is it right? I think so, but I'm open to persuasion.

38 comments:

Steve C said...

Iain, what is there to persuade you about? The Coalition policy is correct and the whingers are wrong. Spending money we haven't got on people whether they genuinely require assistance or not is not a policy available to an almost bankrupt country!

Tim said...

"Council houses should be there for when people fall on hard times and genuinely need help, but once they have got back on their feet they should be encouraged to find a property in the private sector, just as anyone else would have to."

That would create yet another perverse incentive not to work.

Jimmy said...

Removing inherited tenancies is quite sensible, however the review proposal creates a very obvious disincentive to work for a council tenant who may not be able to find affordable housing in his area. This looks rather like Shirley Porter all over again.

Rogue Gunner said...

Iain I watched you last night on Sky paper review and was surprised at your comments regarding the Falklands War when you said we would not have won the War without the help of America. I know the US was a much closer Ally with Regan and I know that we were greatly aided by the American sidewinder missiles, but can you quantify your comments as you have greatly offended many Falkland Veterans and the families of the 255 who gave their lives.

Grant Tucker said...

@Tim Tim, no one is proposing to take away people's council houses as soon as they find a job. It is all about when the time is right. At the moment we spend billions of pounds subsidising those who can afford to live in private sector housing, that is not right.

Iain Dale said...

As you know Tony, I hold Falklands veterans in very high regard and I would hate to think I have offended them in any way.

My point was that American intelligence and logisitical support were vital to the operation. Caspar Weinberger was a hero in what he did to help us. I think it is accepted by most military experts that without this help the operation would have been very difficult to complete and some would say impossible.

Sceptical Steve said...

Rogue Gunner

You pretty much answered your own point. The USA released the most advanced version of the Sidewinder to us when it could just as easily have sat on its hands. (Didn't the Belgian Government refuse to release NATO ammunition stocks to us at the same time?)

The Sidewinders, allied to the Sea Harriers and their brave and capable pilots protected the fleet, and therby allowed the islands to be retaken.

It's no attack on our own brave servicement to admit the crucial importance of Reagan's and Haig's backing to the success of the mission.

................................. said...

Why don't they rent a place from a private landlord like the rest of us have to, instead of whinging about how they're "owed" a subsidised home?

Bardirect said...

This sounds like a fundamentally conservative approach dogged by a LibDem inquisitive bureaucracy - wouldn't it all have been a lot simpler to end subsidy by a quick transition to market rents for all, leaving the welfare system to deal with the housing costs of those who cannot afford to pay? No need then for then for the council nosey parker's enquiring into people's "need" for a bigger house than others might need, or bumping people off the list if they are adjudged to be able to afford a private rent or a mortgage.

Dick the Prick said...

A chum of mine earns £40k per year and she only pays £60 per week - kerching!

Twig said...

Sounds like common sense, there is far too much abuse state support systems.

Mr Shapps seems to have a good grasp of the problems judging by his performance on QT.

Tom Harris said...

"Council houses should be there for when people fall on hard times and genuinely need help, but once they have got back on their feet they should be encouraged to find a property in the private sector, just as anyone else would have to."

Sorry, Iain, but you don't understand council tenants very well. I was brought up in a council home, not because my parents had fallen on hard times, but because they made a positive choice in favour of public rented accommodation. It was appropriate for them at the time and the house my brothers, sister and I grew up in was fine for our needs.

Council housing is seen - usually by those who have no experience of it - as a "safety net", a last resort, rather than what it should be: a legitimate choice.

There was a time when the Conservative Party was in favour of choice. If this policy becomes law, then that time will be well and truly over.

Lauchlan McLean said...

All the forgoing is interesting but most posters are missing one of the main point,in many Social housing schemes such as Beacontree, Wythenshawe,and hundred more of which I have no immediate knowledge there a many widows and fewer widowers living in three/four bedroom houses and there is no system to encourage them to downsize within the area they are familiar with.Reason,no councillor or council will accept that they should have looked forward and reconised it as a problem and include a few single occupied dwellings in the estate mix

Grant Tucker said...

Tom, I to come from a family who grew up in council homes, and your right people who live in council houses don't see it as a last resort. That is the problem.

The state should not susbsidise those who can afford to live in private accomadation. Especially when we have a massive homeless population in this country. Those who stay in council houses who could afford to rent in the private market, keep the homeless on the streets.

Left Futures said...

This recognition that the social value of housing stock might take precedence over some of the tenant's rights - does it mean an end to the right to buy? If not, why not?

Jon Lansman

Hollow Godric said...

So if my partner and I quit our jobs (in the NHS) and had lots of kids we'd get the house and all the mod-cons we're currently saving to try and afford, plus have much more spare time.

I think anyone who opposes these measures cannot cite 'fairness' as their reason. I hope the Coalition gets on with it and ignores the naysayers

Nicholas said...

My dad died in June and what made it even more stressful for me was that I didn't think the council would let me keep the house. However the council let me succeed the tenancy and I was so relieved that I wouldn't be evicted from the home I've lived in for nearly twenty years. But now this has stressed me out again because the council might change their mind and kick me out?

Iain Dale said...

Tom, of course it is a choice, but that's part of the problem. Why should I as a taxpayer subsidise the rents of people who are quite able to afford to pay a commercial rent themselves?

Grant Tucker said...

Nicholas, these rules will only apply to new tenants. As outlined in the blog.

Gareth said...

Iain said: "Council houses should be there for when people fall on hard times and genuinely need help, but once they have got back on their feet they should be encouraged to find a property in the private sector, just as anyone else would have to."

Despite being a small state, libertarian type I actually disagree with this.

Council houses were and are *a good thing*. They were not intended to be given to people in the manner they are today. They were intended to provide an alternative to slums at affordable rates and make it easier for people to move where work was. Both my parents grew up in council houses and their parents and their parents' neighbours paid their rents. Council houses with paying occupants are not much of a cost to taxpayers if at all.(Done properly anyway. Throwing up carbunkle rabbit hutches made of cardboard isn't cost effective.)

The problem that we have today that must be tackled is the numbers of people of working age who are having their accommodation costs met by taxpayers, whether they live in council houses or in private accommodation - people who could work but are better off on benefits due to the potty nature of the system. These people *are* a cost to taxpayers. In the private rental market this money supply has priced productive people out of some areas too.

This policy is long overdue but avoids the major and unwarranted expense.

Danny Law said...

I fundamentally disagree with this idea of ending the right to inherit tenancies and long term tenancies.

Like Tom Harris i was brought up in a council house. And i know that if people think that the house is theirs for a long as they need it , then the majority will take a pride in their house. They will tend to improve it and make it better. And the ultimate focus for this was when Margaret Thatcher allowed people to buy their own council houses. This was a stroke of genius on her part.

If you make being in a council house tenancy transitory then an awful lot of people will loose the will to look after their property. You are going against human nature. Human nature is to build. If you go into a property with the likelihood that it will be taken from you at some time in the future then people are going to neglect things. Just ask any private landlord about short term tenants. They never care about their property the way long term tenants do.

And as someone else has mentioned - there will be a massive disincentive to get a job or improve yourself as you will loose your home you may have been in 5 or 10 years.

Plus what about your family. What if your children are going to school locally, your doctor is local, your work is local. You are going to force these people to move and find somewhere else to live. Also what is going to be the yardstick to evict people from their homes? If they get a job? X amount of cash in the bank. What’s your criterion for tipping them out their house? and you think people wont find ways round such rules if they want to. of course they will.

It’s all utterly irrational. All for what – the vague idea that council housing/social housing is only for the very poor. So what will you create – ghettos? Social housing will become ghettos for the very poorest in society that are least able to help themselves. This will almost certainly lead to an increase in social problems and crime in such areas. You will turn every council house estate into a sink estate.

Plus where is all this private rentable housing stock going to come from? You can’t just magic up thousands and thousands of private houses to rent.

It sounds great on paper. Use social housing as a stepping stone to greater things. But it makes certain assumptions about human nature. That everyone is capable or even desires to climb this greasy pole.

Dr Kevin said...

I fundamentally disagree with this idea of ending the right to inherit tenancies and long term tenancies.

Like Tom Harris i was brought up in a council house. And i know that if people think that the house is theirs for a long as they need it , then the majority will take a pride in their house. They will tend to improve it and make it better. And the ultimate focus for this was when Margaret Thatcher allowed people to buy their own council houses. This was a stroke of genius on her part.

If you make being in a council house tenancy transitory then an awful lot of people will loose the will to look after their property. You are going against human nature. Human nature is to build. If you go into a property with the likelihood that it will be taken from you at some time in the future then people are going to neglect things. Just ask any private landlord about short term tenants. They never care about their property the way long term tenants do.

And as someone else has mentioned - there will be a massive disincentive to get a job or improve yourself as you will loose your home you may have been in 5 or 10 years.

Plus what about your family. What if your children are going to school locally, your doctor is local, your work is local. You are going to force these people to move and find somewhere else to live. Also what is going to be the yardstick to evict people from their homes? If they get a job? X amount of cash in the bank. What’s your criterion for tipping them out their house?

It’s all utterly irrational. All for what – the vague idea that council housing/social housing is only for the very poor. So what will you create – ghettos? Social housing will become ghettos for the very poorest in society that are least able to help themselves. This will almost certainly lead to an increase in social problems and crime in such areas. You will turn every council house estate into a sink estate.

Plus where is all this private rentable housing stock going to come from? You can’t just magic up thousands and thousands of private houses to rent.

It sounds great on paper. Use social housing as a stepping stone to greater things. But it makes certain assumptions about human nature. That everyone is capable or even desires to climb this greasy pole.

Daedalus said...

Totally right; except for the fact that it does not seem to cover people who are living in the "family 3/4 bed house" after the kids have left.
A couple in their 60s who are living in a 4 bed house with all the kids gone should give it up and move into a 2 bed flat or similar. In fact there maybe something in the fact that after the children have gone over the age of 18 (lets be generous 21) then they move then. This could be done straight away, people still get cheap housing but it frees up bigger houses. By the way this is people on the housing list for years not new arrivals.

Daedalus

Will Brambley said...

@Tim: you're right, it's a perverse incentive, but that has to be weighed up against the cost saving. All means testing, indeed all progressive taxation, is a perverse incentive, but few people advocate removing it all. The key is reducing perverse incentives that don't save much and cause severe changes in behaviour. Though personally I favour removing council housing entirely and using some of that to up benefits somewhat to ensure that the poorest in society can afford to rent somewhere. Or even using a truly universal benefit to remove the perverse incentive entirely.

@Tom Harris: as others have mentioned, why should the government be subsidising a one choice over another? If somebody offered to subsidise my rent, of course I'd accept, but since I can afford private rent it would seem to not be a great use of public money.

I admit I have no experience of council housing, however I think when using public money, it's necessary to justify why to the broader group of taxpayers than just those who have direct experience receiving that benefit. And while few people would deny the need for a safety net to ensure that people are able to afford somewhere to live, I don't see the justification to use public money to subsidise people who can afford to private rent, especially in such an inflexible manner.

Dr Kevin said...

Oh and two other quick points:

1. the person who posted saying they knew someone who only paid £60 a week in rent – remember housing benefit is payable to those in both social housing AND private renting – and that wont change. So the level of rent has nothing to do with council housing

2. I bet very few of the people who are gung ho for this policy live in council property or will be affected by it themselves. It’s always easy to be enthusiastic about a policy when it won’t touch you. I think its no coincidence this idea comes from a government where most of the front bench are either ex-public school or millionaires (or both). You can take it most never lived in a council house.

Jimmy said...

Presumably the newly affluent tenant would retain the right to buy which would presumably be cheaper than the private sector, so you don't free up anything.

DareDolly said...

I always find it interesting when people talk about inherited tenancies. I have obviously missed something. My parents have lived in council housing since coming to this country over forty years ago. They were both on the rent book. When my father died, I asked to have my name put on the rent book as I was living at home and could afford the rent - my mother couldn't. I was told that you could only make a change once, and that change would be removing my fathers name, I couldn't have my name put on it. When my mother dies - hopefully not soon!- my sister and I will lose our family home. That is fine as we are no longer at home and are able to support ourselves. My point is, there are rules about having your name on a council rent book and I don't understand how families keep their homes for generations. Obviously I am missing something...

trevorsden said...

Dear Rogue Gunner - Iain is right, though I am not sure he knows why.

The USA made available to us the very latest Sidewinder missile (AIM9L) which could lock onto its target from head on (not bad considering it was a heat seeking missile). This made the Harrier invincible, harrier was a jolly useful plane but it was its missile which was a killer.
the airfield at Ascension was run by the USA as well.

BTW one of the problems with rerunning the Falklands is not our navy its the decline in our merchant marine - there are fewer ships to commandeer.
Fortunately we have fighter aircraft on the Falklands to deter aggression.

And lets not forget the bFrench
'As a large part of Argentina's military equipment was French-made, French support was crucial. France provided aircraft, identical to the ones it supplied to Argentina, for British pilots to train against. France provided intelligence to help sabotage the Exocet missiles it sold to Argentina. In her memoirs, Margaret Thatcher remarked of Mitterrand that "I never forgot the debt we owed him for his personal support … throughout the Falklands Crisis." Sir John Nott, who was UK Secretary of State for Defense during the conflict later acknowledged: "In so many ways Mitterrand and the French were our greatest allies."'

On this day lets not forget we are defended by an alliance. NATO.

trevorsden said...

"I was brought up in a council home, not because my parents had fallen on hard times, but because they made a positive choice in favour of public rented accommodation." -- why should that choice be available to you?

There is nothing wrong or immoral about council housing. A mate of mine was brought up in a nice one and it was a better house than mine.

But it forms no part of the business of government and local authority to provide estates of housing for people who could quite easily find housing elsewhere if its supply was encouraged. There is no excuse for bad landlords either.

But of course council rents were low so that housing was not maintained and bad tenants were dumped into sink estates which forced out 'decent' tenants to create self perpetuating ghettos.

The state should provide housing of last resort, decent good humane housing, and encourage a variety of rented accommodation.

Libertarian said...

@Tom Harris

Baroness Uddin lives in a taxpayer funded home in East London whilst owning a property in Kent. I guess she chose that route as it makes financial sense for her and her family. Meanwhile me as a taxpayer that is funding it finds it outrageous.

There is plenty of choice in the private rental sector. I'm not paying for you and your family to live in subsidised housing just because you want to.

Nicholas said...

When my father died, I asked to have my name put on the rent book as I was living at home and could afford the rent - my mother couldn't. I was told that you could only make a change once, and that change would be removing my fathers name, I couldn't have my name put on it. When my mother dies - hopefully not soon!- my sister and I will lose our family home. That is fine as we are no longer at home and are able to support ourselves. My point is, there are rules about having your name on a council rent book and I don't understand how families keep their homes for generations. Obviously I am missing something...

I thought this too because my mum and dad were on the rent book and then my mum took her name off the rent book and my brother put his on. He moved out and his name was taken off the rent book, leaving just my dad on it (my brother subsequently moved back in but was not back on the rent book). However the council said legally me or my brother could succeed the tenancy but this could only happen once (which it now has). Therefore I believe the rent book and the tenancy must be separate issues.

Tim said...

We have had swap schemes for years, and basically they don't work. That is why I wrote "Right to move" (Policy Exchange) - which was a good enough idea to get on Tory leaflets. It would be much more effective - and surely a market based scheme like mine is more appealing to Conservatives than a barter/swap scheme? http://www.policyexchange.org.uk/publications/publication.cgi?id=103 for more details.

£9bn is about 1.2% of the value of the total stock - not many people get to inherit a council house. (5m houses @£150k = £750bn worth of stock). Like overoccupation, inheritance is true, but not frequent. By all means stop it, but don't imagine that it will make a lot of difference.

Ian said...

This is good policy. But ...

This is all part of the benefit trap. Unless market rates are charged for all council properties, there will be no incentive to work.

Roger Thornhill said...

The way to deal with this is quite simple.

Charge commercial rents then subsidise with HB.

This way, those not getting HB will have no financial incentive to remain in the property. HB is regularly reviewed and so the subsidy will be naturally reviewed.

RantinRab said...

A lot of commenters haven't a clue about what really goes on in the world.

I live in a council house, earn slightly above the average wage. The rent is around 240 every four weeks.

Across the street a single mother lives in the same type of house, privately owned and rent paid via housing benefit. The rent for that house is 550 a month. Paid for by you and I.

I choose to live in a council house. I refuse to to give my hard earned cash to greedy, grasping landlords.

'Private' housing is way over-priced in this country, whether buying or renting.

It's a total racket and I refuse to play the game.

No One said...

Remember what the worst 30% of council houses are really like! the market rent for a house on a sink estate with the worst schools in Europe and the worst GPs in the country and no jobs within travelling distance is precisely nothing, so if the state stops the subsidy to the houses (to the councils or housing associations), and instead directs subsidy to those in need, then yes people will probably move, and probably in many cases this will be better for all, however the state (or housing associations) are going to be left with a lot of houses which nobody is prepared to rent or buy, and the debt they have on those properties will become bad, so if everyone in the sink estates moves to other areas, apart from the fact the necessary quantity of physical houses don’t exist elsewhere at the moment, how much debt will be left behind with the councils and housing associations which is incapable of being paid back - as there will be no subsidy or tenants encouraged to live there by financial incentives – and therefore no income stream to service that debt
it would of course be good for us all if the worst sink estates were cleared, and folk got to live somewhere nicer, but in many cases wont the problems just move somewhere else, if other measures are not taken at the same time? (The history of slums which were cleared by moving whole communities to brand new housing estates in Milton Keynes etc was just to create new estates with very high crime rates, and so on)
And what about the debt on the houses they leave behind? Presumably the only answer will be to let many housing associations go bust and do a “railtrack” on them – boy will that shake things up and make the credit worthiness of any pseudo government body look questionable
what does need to happen is a shakeup of the private rental sector, allowing some security of tenure for genuine good families, the current almost 100% short term tenancies is useless for families who need some stability so that their children can at least stay at the same school for a year or two. We are the only country in Europe with almost no availability of long term tenure for decent families, and the way rental estate agents get away with outrageous stuff needs to be clamped down on.
We do need a mobile workforce, and the inertia in the public housing system which acts against folk moving town for a new job as they risk the security of their council house (once they have been lucky enough to get a half decent council house) is bad, this could be sorted easily. But so does the way you move to the beginning of NHS waiting lists if you move address, and so on, the whole system is stacked against the mobile workforce this country depends on.
Etc

operanut1972 said...

My concern lies in the fact that as a wheelchair user, social housing is only available through the local authority and there a very few available in the private sector. It is therefore not wise to assume that everyone who uses social housing has a choice. I had none, I have been forced to move from an area I enjoyed living in and felt safe and secure to one of my cities biggest sink holes.

info said...

It seems that there are several issues to be addressed here:
1. Private landlords need to be monitored better. Many have purchased council properties and then let them out a higher rents but don't look after them properly. At the same time, councils charge them for being leaseholders but do not necessarily maintain the estate properly which has a negative effect on decent leaseholders who may continue to live in their properties.
2. There needs to be longer term leases for people with children to provide stability for them because of schooling. Such instability creates problem children which can create other problems.
3. There needs to be a complete rent review of all properties so that they are reasonable and cover the cost of maintaining the property with any damage to interiors to be paid by the tenant.
4. Putting in new kitchens and bathrooms seem a good idea but not if the household cannot afford new appliances but have old ones which need replacing but cannot afford to replace them. Plus such "nice" kitchens and bathrooms only show up the rest of the home if not up to a good standard.
5. Being able to live peacefully and safely in one's home should be a priority but very difficult without proper soundproofing and unreasonable neighbours. These issues are very important to people's well being. Not all of us need the "mod cons" but we do need to feel safe and secure in our own homes for however long we have them.
6. Most council tenants who are not working would prefer to work and pay their own way but again, if the rents from private landlords are too high, then who will pay the difference and the results will still put people on the poverty line albeit in private accommodation. If you have ever lived in a bedsit you will know how isolating this can be, especially when there is hardly any room to swing a cat, let alone have friends round and yet some landlords charge £70-£80 for such a room.
There's loads more to consider but I am sure others will add to this list. The big question will anyone take any notice?