John Moss, London Assembly candidate for the area including Barking and Dagenham says the Labour council leader has questions to answer and that this is another example of how housing welfare policy needs to change
Cllr Liam Smith, Labour Leader of Barking & Dagenham council, was granted an "emergency" tenancy of a two bedroom council property six weeks after breaking up with his wife. This despite earning £45,000 a year and many two bedroom properties being available at rents well within his budget in the Borough he leads.
There are two things which stand out here. The speed with which Cllr Smith was granted his tenancy and the moral question – as put by Victoria Hollins on BBC London News Tonight – of why somebody on £45,000 a year needs "emergency" housing from the state.
The first question is simple. Did Cllr Smith secure this tenancy because he was able to exploit his position at Barking & Dagenham Council? There is certainly no question that couples with children living in one bedroom flats on Barking & Dagenham's waiting list will be asking themselves why Cllr Smith was such an urgent case, when for less than a third of his £2,400 a month take-home pay he can rent privately in the Borough. Rightmove has 10 pages of 2 bedroom flats and houses to rent in the Borough between £750 and £950 a month, all of which he could move in to in a week. Yet he applied for a tenancy of a Council property at a below-market rent and secured this in six weeks, when most people applying to the Council for housing are told they may not secure a tenancy in their lifetime.
Now, it may be that Cllr Smith played by the rules of the game, made his case for "emergency" housing because his 14 year old son was "homeless" and they were in urgent need. I am sure there are many households who perhaps are not well-versed in the assessment procedure – he probably helped draw it
up, after all – who don't have that advantage, but that brings up back to the question. Did he get this tenancy because Officers felt they were under pressure because of his position as Leader of the Council? There is only one way to clean this up. There must be a fully independent inquiry into how this application was handled and why Cllr Smith secured a tenancy that few others could expect to be granted.
The second question is a different one. Should the welfare system provide housing for people on £45,000 a year? The recent debate about the benefit cap has largely ignored the fact that it will not apply if an adult if the household receive Tax Credits – ie there are in work – but then this cuts off at £41,300, so Cllr Smith with his £45,000 a year would not qualify for Tax Credits anyway, But he might also be able to claim Housing Benefit. Unfortunately, the very helpful Benefits Adviser on the Direct.Gov.Uk website tells us he isn't.
So, in almost all circumstances, Cllr Smith would not be entitled to benefits. Yet Barking & Dagenham council, which he leads, has granted him an "emergency" tenancy of a Council property, presumably at a taxpayer-subsidised below-market rent. How can that be right?
The answer to this is for the Government to go further than the current proposals to ask tenants who earn more than £100,000 a year to pay market rents or move out. "social" rents should be set at a third of take-home pay until this exceeds the Local Housing Allowance rates for the property appropriate to the household. After that, market rents should apply. So Liam Smith would already be beyond this as the current rate for a two bedroom property in Barking & Dagenham is £185 a week and he takes home over £600 a week.
Integrate this with Universal Credit and this automatically adjusts as income rises and produces a much fairer system. And it would not allow Cllr Smith to get away with paying a cheap rent for a property that ought to be there for a household in far greater need than he has demonstrated.