Wednesday, 5 November 2014

It isn’t fair, is it?

Week in, week out, I meet and talk to a large number of my constituents. 

Although their economic circumstances may be different – many are struggling, others are doing well – overwhelmingly they tell me that, as we make our way through the national and global economic recession, they do want to see some fairness in paying for the problems and in addressing the recovery.

Back in 2010, George Osborne told us “We are all in this together. I am not going to balance the budget on the backs of the poor.” It’s a message which he and David Cameron and Nick Clegg have kept repeating.

It’s certainly a message which the vast majority of my constituents wanted to hear and for it to be acted on. Unfortunately, right now, they tell me that they do not believe that they’re getting a fair deal from this government.  It’s important to examine why.

Since 2010 there have been 24 tax rises; this does not include the cuts to tax credits which have hit millions of working families.  The result is that households will be about £1000 a year worse off by May 2015 than they were in May 2010. In addition, as wages have not kept pace with inflation, on average, they will be another £600 a year poorer.

However, David Cameron and Nick Clegg have chosen to cut the 50p top rate of tax to 45p. Just 1 in 100 households will be significantly better off because they are enjoying a £3bn tax cut. It has meant that someone earning £1 million has received a tax cut of over £42,000 a year and millionaires as a whole got an average annual tax cut of £100,000.

What my constituents are telling me is that ‘When the deficit is still high, when tough times are now set to last well into the next decade, when for ordinary families their real incomes are falling and taxes have risen, it surely cannot be right to have chosen to give the richest people in the country a huge tax cut.’

I agree.

Monday, 3 November 2014

Stop the Rip-off

The housing crisis continues to grow.

As I write, Shelter publishes its latest report confirming that more than 90,000 children in the UK without a permanent home, living in some form of temporary accommodation. Meanwhile, 9 million people now rent privately including over 1.3 million families with children.  Nearly half of private rented households are over the age of 35. 

It is undoubtedly the case that, whenever any market is unstable, some people will seek to exploit the situation for their own benefit. I have written before about those letting agents who are double-charging, purporting to act for both the landlord and the tenant and providing a complete lack of transparency of their fees.[i]

It is now clear that some estate agents are pulling off a similar trick, charging both buyers and sellers for a sale of the same property. This practice creates a conflict of interest, as it is not clear who the agent is represent. With some agents charging buyers 2.5% of the sale price of a property that fee can run into thousands of pounds.

The average home is now eight times the average wage, and it takes over 20 years for the average family to save for a deposit. In the last year, 1 million homes were bought in the UK.  House prices rose by nearly 12% over the last year.

It’s in this context that many estate agents have introduced a new form of contract, called ‘sale by informal tender’ involving sealed bids to make offers on properties.  Estate agents are then charging the successful bidder an ‘introductory’ fee, but also charging a fee sellers to market their property in this way.

The practice is rapidly spreading from London to the rest of the UK. It’s a rip-off and it needs to be stopped quickly. We have a chance to do this in the Consumer Rights’ Bill, currently in the House of Lords.

Despite people clearly being fed-up with those who want rip-off Britain, Conservative and Liberal Democrat Ministers have so far rejected attempts to change the law. It’s time to try again