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Ealing and Northfield

Playing games with people’s homes – no, making the benefit system affordable and getting incentives right

I don’t know for sure which of the East Acton councillors is responsible for the East Acton Labour twitter account but the other two councillors are not noticeably twittertastic so I suspect it is Labour’s housing spokesman, Hitesh Tailor. I accept that he knows something about housing, or at least social housing and housing benefits, as he has a job working as a Housing Principal Policy Analyst for Islington council. I accept that his heart is in the right place but he might think through what he thinks before he regurgitates the latest announcement from housing charity Crisis, see here.

I did as Crisis asked and looked up the benefit (LHA) rate for a one bedroom flat for my area (£219.23) and compared it to the Shared Accommodation rate (£98.50). The complaint is that 25 to 34 year olds, who are currently entitled to the one bedroom rate will have to make do with the Shared Accommodation rate from January next year. On the face of it this is a 55% reduction of their benefits. Viciously unfair?

I don’t know. Often the middle class professionals who make the most noise on some of these issues don’t know how little most ordinary people are paid, even in London. These are the people who have to pay the taxes to pay the benefits. If you go and look at the ASHE (earnings) statistics you will find that the mean gross pay for all workers in the London Borough of Ealing is £591.60 per week or £30,763 per annum. For that person to pay out £219.23 after basic rate tax and NI they need to earn £16,522. In other words 54% of their pay. We simply can’t afford to give non-workers 54% of average pay just to cover their housing costs.

Is the new figure fair? £98.50. I went to look on Gumtree for a house share that would be acceptable to me. I found one immediately. It sounds great:

We have a double room to rent for a professional, social and tidy person in a friendly international house.

Located between Lammas Park and Walpole Park, the property is within walking distance to Ealing Broadway Station (Central and District line), Northfields Station (Piccadilly Line) and West Ealing Station (National Rail)

You will be sharing with easy going professionals from Spain, Italy, New Zealand and England. The atmosphere in the house is really good. Everybody in the house gets along very well and we all enjoy some drinks together every now and then.

The house has everything you need: 2 bathrooms, a huge kitchen with washing machine, dryer and dishwasher, a large living room, conservatory and a very nice garden perfect for BBQs.

The rent is £425 per month inclusive of all bills (electricity, gas, water,council tax, internet and sky tv).
It is a nice bright room with double bed, desk, wardrobe, drawers and there is loads of storage room in the house.

The pictures look great too, go and see here.

I think that most people will look at these numbers and say this is reasonable. I would be interested to hear the counter arguments.

2 replies on “Playing games with people’s homes – no, making the benefit system affordable and getting incentives right”

From what you say it would appear that Labour in its previous governments has created a “market opportunity” for landlords to charge “social” tenants ridiculous amounts and hence inflate property values as a result of their earning potential.
I think that David Cameron has his work cut out for him to bring housing benefits back to more reasonable levels.
Mags.

Maggie,

You are quite right. I had an estate agent come to see me before the election complaining that there was a paralell market for people on housing benefits (Local Housing Allowance) whereby state supported tenants had more spending power than ordinary working people.

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