Cllr John Moss is a councillor in Waltham Forest.
Can we all agree that welfare should be based on need? If you don’t need help buying food or clothes, you don’t get it, do you? So why do we continue to “help” households meet the rent, whether they need that help or not?
That said, I’m not a fan of Pay-to-Stay. At least not as constructed by the previous government. It was crude and clumsy at best and at its heart was a typically bureaucratic approach based on thresholds, which, if you passed, you faced a “cliff-edge” to coin a mot-de-jour.
However, I do like the idea of income-related rents. (So did the Joseph Rowntree Foundation, if I recall correctly.) If you are renting your home from a “social” provider, why shouldn’t that rent be set at a level which you can reasonably afford, based on your income? Seems logical.
The funny thing is, I suspect we might actually get there now that this terrible version of the policy has been ditched. Why? Because Councils and Housing Associations now have to introduce shorter, renewable tenancies and review the financial circumstances of the tenants when deciding whether to renew them or not.
Now it is entirely possible that the civil servants and Ministers will make yet another pig’s ear of this.
They could force social landlords to evict people if they earn too much. That would actually be worse than forcing them to pay more, as they would probably end up in the private rented sector and be eligible for – higher – Housing Benefit payments towards their rent. Oh, and I’ve no doubt they would be getting some sort of compensation as well so the whole thing would be an even bigger and more expensive mess if we went down that route.
However, there is a really easy way to make this work. Go back to one of Eric Pickles’ guiding principles and let Councils (and Housing Associations) have the freedom to decide what they do.
So, when a tenancy is getting close to its end, let the landlord choose what to do, but ensure that they apply the following tests. If the household has no income, renew at a “social rent”. If they have income, renew at the Local Housing Allowance rent. And, if they have so much income that they can meet the market rent with 30 per cent of the household income, set it at the market rent.
Government should then allow those councils who collect these, potentially higher rents, more freedom to borrow or use Right to Buy receipts to build. Those who stick with the outdated idea of a household paying a subsidised rent, irrespective of their earnings, should have those additional freedoms denied.