Originally posted on May 11 on my blog for Inside Housing.
As we await the manifestos, what are the chances of real change in housing over the next five years?
Give or take the odd leak, there are some positive signs. First, this election has one of the two major parties pinning its election hopes on housing reform and members of the other saying that ‘building more homes‘ is a bigger priority than it has been for years.
Second, a clutch of select committee reports, which were published just before parliament shut down for the election, set down some useful all-party markers for future policy.
Third, in Gavin Barwell and John Healey the two main parties have their best housing spokespeople in years. That may be damning them with faint praise but both seem to be politicians who get the case for housing.
For all the sound and fury over national insurance and the self-employed, it is still a sideshow in wider debates about tax, employment status and rights at work.
Philip Hammond’s unraveling Budget matters politically and it signals both the strength and the weakness of the government. Only a chancellor facing the worst opposition in decades could even consider a measure that breaks four separate commitments in the 2015 Conservative manifesto. Only a prime minister with a small majority could be forced to retreat at the first sign of Tory dissent and newspaper headlines about white vans.
Much of the blame lies with the ex-chancellor now trousering £1m a year on top of his MP’s salary for his advice and speeches. It makes you wonder how George Osborne is being paid for all that hard work and hope that he’s about to get clobbered for tax because it’s through a personal service company.
It was Osborne who in 2015 abolished Class 2 national insurance contributions (NICs) for the self-employed (from 2018) and gave them access to the higher state pension via Class 4. If he had introduced an increase in Class 4 contributions at the same time, few people would have complained. Instead he posed as the great reforming chancellor, agreed the manifesto pledge and left Hammond to fill the holes in his spreadsheet.
Combine these different measures and the treatment of the self-employed looks (reasonably) fair: most of the lowest paid will pay less, there’s a better state pension than before, and the burden falls heaviest on people earning more. But try and defend this week’s Budget announcement using that argument and you look like a shifty betrayer of ‘ordinary working families’ and ‘entrepreneurs’.
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’.
If you think the row over business rates is bad, imagine for a moment what would happen if council tax went through a revaluation.
As I’m writing this, some sort of government climbdown seems inevitable after weeks of press coverage of the rates increases faced by shops and other small businesses.
Some of the furore seems justified. The business rates system seems stuck in the past, unable to cope with out-of-town supermarkets let alone internet retailers and almost seems designed to destroy High Street businesses. There are cliff edges built into the system, especially at the bottom end. It’s not clear why farms are exempt but hospitals are not. Exemptions for empty and unused property create incentives to keep it empty.
Much of it is not. The journalists reporting from the mean streets of Maidenhead and Weybridge seem much less inclined to travel to Merthyr or Wakefield to talk to people whose business rates will be cut. The government maintains that this is a revaluation with no net increase in the tax (though some Tory MPs dispute this). That means the benefits will be felt where they should be: in less affluent areas.