Monday, 30 June 2014

Behind the rhetoric

This government has presided over the lowest level of house building in peacetime since the 1920s. The government’s Help to Buy scheme is fueling house-price inflation, with Ministers claiming this isn’t a problem because house prices (other than in London) haven’t yet returned to 2008 prices. Do they not understand that 2008 prices were unsustainable and had been fueled by easy credit and corrupted sub-prime lending?

The failure to tackle the housing shortage means the cost of housing is rising out of reach of low-to-middle-income earners. There has been a significant increase in private renting, with buy-to-let purchasers outbidding potential owners, particularly at the lower end of the market. And private rents have increased well above inflation.

Meanwhile, the government has been cutting housing benefit and introduced the bedroom tax, creating an impression that the total housing benefit bill has been falling. Nothing could be further from the rhetoric.

There has been a huge increase in the number of people who are in work but who need to claim housing benefit to help pay their rent. It’s a direct result of the government’s failure to make work pay, tackle the cost-of-living crisis and build the new homes we need.

Now it has been revealed that, in England, there has been a 60% increase in the number of working people needing to claim housing benefit to pay their rent since 2010. 400,000 more working people are claiming housing benefit costing the taxpayer an estimated extra £4.8bn in housing benefit over the course of this Parliament.

This isn’t just a problem in some areas. Every single council in the UK has seen an increase in the number of people in work claiming housing benefit. In fact, Sheffield has seen a 93% increase and Rotherham a 92% increase, since 2010.

The number of households in South Yorkshire reliant on housing benefit to help pay their housing bill has now increased to more than 120,000. This rather undermines the headline claims of economic recovery and increasing employment.