The Times reports (£) this morning a proposal from Westminster City Council that it should be able to charge its wealthy tenants higher Council rents on a sliding scale. Of course there have been the odd high profile examples of highly paid individual continuing as council tenants – and thus a subsidised rent. Frank Dobson lived in a council house when he was a Cabinet Minister. Bob Crow, leader of the RMT transport union, who earns £145,000 a year and is a Council tenant.
But what Westminster have discovered is that the numbers are significant. 4,300 Council tenants in Westminster alone are earning over £31,000. Why should those on lower incomes who rent privately have to pay full market rate for their own rent and then pay in their tax to subsidise those richeer than themselves? Of course we don't want worse off geetting a job for fear of losingg rent subsidy – but that is why the sliding scale makes sense. Would someone earning a £100,000 a year really be likely to go on the dole to avoid their rent increasing by £6,000 a year?
The report says:
Westminster, a Conservative council, has asked ministers to give it new powers after finding that 2,200 tenants are earning more than £50,000 a year and more than 200 people are on salaries of more than £100,000 in the borough. It wants to set a sliding scale, linked to income, for all those on more than £30,000 to ensure that those on high salaries pay more.
Under the new scheme, tenants on £50,000 would pay about double what they pay now in subsidised rents. The rent for a two-bedroom flat, for example, would rise from about £6,000 to £12,000 a year.
Croydon council is considering a similar system and has started assessing the incomes of its tenants. Other local authorities are waiting to see whether ministers grant the new powers before following suit. A new housing strategy is expected in the next two months that could include greater flexibility for town halls.
Money raised in this way could help keep rents low for those in need. The report says the Government "did not rule out regulations to devolve rent-setting powers to councils."