Don’t mention the benefits freeze

Originally posted on March 8 on my blog for Inside Housing.

For once this was a Budget that was more significant for what it did not say about housing than for what it did.

In one sense the lack of announcements was nothing new. Chancellor Philip Hammond had already announced that this would be his last Spring Budget and that the main event will be in the Autumn.

The extra money for social care was inevitable if inadequate and it will have an impact on housing organisations.

Housing itself got a single mention in Hammond’s speech in the section on the next generation. ‘Will they be able to get on the housing ladder?’ was the rhetorical question that did not get any answer. (Nope, not unless they’ve got rich parents, since you ask.)

For once (unless I’ve missed something) the background Budget documents revealed little more than an intriguing consultation on a redesign of Rent a Room Relief, the tax relief that homeowners can claim when they let out a room.

The aim is ‘to ensure it is better targeted to support longer-term lettings. This will align the relief more closely with its intended purpose, to increase supply of affordable long-term lodgings’. Presumably the plan is to stop people avoiding tax on AirBnb earnings?

The Office for Budget Responsibility (OBR) Economic and Fiscal Outlook has some background on the profile of housing association spending spending and borrowing, which was less than it expected last year but is being brought forward at the end of the spending review period.

But what really caught my attention were some graphs on the scale of the continuing squeeze on benefits. This reflects the decisions that Hammond did not take to ease the effects of the four-year freeze on most working-age benefits announced by George Osborne in 2015.

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The country that works a lot better for some

Originally published on March 6 on my blog for Inside Housing.

If you are under 22 and you need help with your housing it all depends on who your parents are.

Three measures from George Osborne Budgets apply from next month: the cut in housing support for 18-21 year olds; the Lifetime ISA; and the cut in inheritance tax on main residences.

This time last week hopes were high that the government would row back on the first of these. A government source told The Observer that ministers and civil servants dealing with the cut in housing support ‘hate the policy’. Despite this the regulations implementing it were laid on Friday, a day when parliament was not sitting.

There is no official explanation of the move on the DWP website but a spokesman repeats previous lines about ensuring that 18-21 year olds ‘do not slip straight into a life on benefits’.

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Housing an ageing population

Originally published on February 24 on my blog for Inside Housing.

There is arguably no more important housing issue facing the UK than how we accommodate our ageing population but are we ready to face up to it?

The question is prompted by a combination of recent events including publication of the Housing White Paper, the crisis in social care and the NHS and the consultation on funding for supported housing.

Lurking further in the background than it should be is the mismatch between the stock of homes and likely future demand for them. We will need homes that we don’t currently have for people who are living longer and will need more manageable accommodation with access to more care. Because we don’t have those homes, older people will continue to live in homes that are too big and inflexible for them but would be perfect for young families.

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Two-way street

Originally published on December 7 on my blog for Inside Housing

The minister announces more investment in social housing – social, not affordable – and signs a pact with housing associations and local authorities.

This is not a fantasy or a trip down memory lane but something that happened last week in Wales, a country where the government and the housing sector are very much in sync.

Carl Sargeant, communities and children secretary, told the Community Housing Cymru (CHC) annual conference that Social Housing Grant (SHG) will be increased by £30m this year, or 44% on previous plans. He also signed a pact with CHC and the Welsh Local Government Association to deliver 13,500 affordable homes by 2021.

Though CHC is the Welsh counterpart of the National Housing Federation, the pact is not a deal that requires forced conversion to the merits of homeownership or that turns a blind eye to forced sales of council homes.The Right to Buy is being scrapped rather than extended and the pact sets out a series of other aspirations on everything from jobs and training to energy efficiency and rents to homelessness.

Housing in Wales works very differently to England thanks to devolution and a political culture that works on consensus.While London and Manchester are blazing a trail with new investment powers, Wales can make its own legislation. Greater regulation of the private rented sector and homelessness prevention are already in force, the end is nigh for the Right to Buy and stamp duty is being replaced with the first Welsh tax for almost 800 years.

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JAMs and NOMADs

Originally published on November 23 on my blog for Inside Housing

Wednesday’s Autumn Statement by Philip Hammond is good news for housing on several different fronts.

First, at long last housing is being recognised as infrastructure. That’s important enough in itself but Mr Hammond went even further by pitching housing as part of the solution to the key economic problem of productivity.

Along with transport, digital communications and research and development, housing will be part of the chancellor’s £23bn National Productivity Investment Fund. In financial terms, accelerated construction, affordable housing and the new Housing Infrastructure Fund represent a third of the total cost.

Mr Hammond also named “the housing challenge” alongside the productivity gap and the imbalance in prosperity across the country as one of the economy’s long-term weaknesses.

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The ides of November

Originally posted on October 31 on my blog for Inside Housing

The last four months have seemed to offer a series of new possibilities for housing from Theresa May’s new government. From the prime minister’s rhetoric about ‘a country that works for everyone’ to housing minister Gavin Barwell’s emphasis on the importance of all tenures, the signals have been pointing to a significant shift away from the stance of the previous Tory administration. Friday brought good news when the Homelessness Reduction Bill won a second reading with the support of the government.

But events in the next month or so will go a long way to determining where those signals are really leading us. For all the rhetoric we don’t know much more detail than when the government went back to work at the beginning of September. While the dates of some events are already set, others are expected “shortly”. Here’s a selected list:

November 7

A week today sees the start of the reduction in the overall household benefit cap from £26,000 to £23,000 in London and £20,000 elsewhere.

An updated impact assessment published in August estimates that 88,000 households (107,000 adults and 244,000 children) will be affected by the lower cap, including 64,000 who would not have been covered by the original cap.

That is much less than in the original impact assessment, one reason being that the government has introduced new exemptions for guardians and carers in response to defeat in the courts. It also seems on the low side given that it means housing benefit will not cover the rent for families in more expensive areas and with higher rents and for larger families everywhere, even in social housing. And it will only encourage more landlords to restrict their lettings of ‘affordable’ homes to ‘working families’.

To borrow a line from Steve Hilditch, if October ended with the Homelessness Reduction Bill’s second reading, then November will kick off what can only be a homelessness expansion policy.

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Falling and failing

Originally published on September 27 on Inside Edge 2, my blog for Inside Housing

Cuts in housing benefit are being blamed for a slump in the UK’s position in a European index of housing exclusion.

The UK was the biggest faller (down eight places) in the 2016 index and now ranks 20th out of 28 members of the European Union. The only countries doing worse than us are three in Southern Europe that were worst hit by the Eurozone crisis (Greece, Italy and Portugal) and five in Eastern Europe (Hungary, Bulgaria, Lithuania, Romania and Slovakia).

That puts us behind not just Scandinavian countries with more generous welfare states but also the rest of Western Europe and even Eastern European nations like Croatia, Slovenia, the Czech Republic and Poland. The UK has the second biggest economy in the EU behind Germany.

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