Among my large pantheon of elderly relations, were two maiden great aunts. They lived together, in a Tyneside flat, in the East End of Newcastle. When I was a child, we used to visit them on the afternoon of Christmas Day, where politeness and duty obliged us to plough through a creaking table laden with baked ham, pickled onions and chocolate Yule logs, even though we had only just finished eating goose immediately before we came and see them.
Back then, in the late ’80s and early ’90s, I remember their house as a refuge from the cold weather – my abiding memory is of forcing down another slice of Christmas cake, while a copper ashtray (hammered by a family member from the boilers of a ship crippled at Jutland) glistened in the light of the electric fire. But just a few years earlier, the property hadn’t been quite so cosy. Indeed, until the early 1980s they had to make do with an outside toilet, at the bottom of the yard.
There was a reason for the underinvestment in the property that had left it so out of date, and a reason for that problem being corrected when it was. For many years, their house was subject to rent capping. Without any prospect of raising rent to provide a return on investment, there was no benefit to the owner in paying to modernise it. Yes, the sisters paid very little for their home, but they suffered antiquated conditions in return. Only when rent caps were abolished were improvements made to the property.
This is a small example of why rent capping – proposed yesterday by Jeremy Corbyn – is a very bad idea.
Shelter, the housing and homelessness charity which is not a natural friend to landlords, has long opposed the idea, and warned again this week of the unintended consequences which would harm tenants as a result. These damaging effects have been seen in this country, back when rent caps were in place, and can still be seen in rent-capped areas around the world: a restriction of the supply of homes to rent, effectively encouraging landlords to discriminate more on perceived quality (read: income) of tenants; a disincentive to modernise and repair properties, reducing the quality of housing; and encouraging landlords to further cramp the living conditions of their tenants by subdividing existing properties in order to raise the income of the same square-footage.
Rent caps are an awful policy, but they sound simple and catchy – which helps to explain their undue popularity. This points to a wider problem in countering Corbyn’s pitch to the nation. His message has the benefit of simplicity: simply pull this lever to make things fine. It’s more difficult to explain the reasons why that lever might end up making things worse, regardless of the positive intentions for pulling it. ‘Simple but false’ has a PR advantage over ‘complex but true’.
The challenge for Conservatives is how to snappily and persuasively counter these mistaken but appealing ideas. If they’re ever implemented, we’ll all learn by grim experience – but that is a price the nation should not have to pay, and that we should seek to avoid. The obvious start would be to produce an alternative solution which is equally catchy but has the benefit of actually working.