I think I Venn diagrammed fairly about Labour and policy over the last couple of days - Owen Jones and Sunny Hundal certainly seemed in similar mood on Twitter.
But tonight we have learned that Labour will scrap the bedroom tax. It's a long way from all that's needed to reform the UK. But it's very welcome.
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Well, they SAY they’ll scrap it! Great if they actually do, but I know how much most politicians promises are worth!
Here’s hoping!
I’m unhappy with how they’ve presented it. They’re saying they’ll make up for it financially by closing tax loopholes, thus perpetuating the myth that there’s only so much money in the world. I’m still planning on voting green.
I can live with that…
Deo gratias! It’s as if labour have been holding their breath for six months and only now decided to breath. It’s good but still, in my view, the result of utterly craven politicking. They have been living in fear of the Tory success with the bigoted vilification of the poor/needy/and ill and haven’t and were brown nosing perceived vox populi for far too long. One thing that none of them seems to
point out is that the whole idea of social housing is that it SHOULD NOT have parity with the private sector; nor have they come clean about the housing bubble that happened under them that is behind this. They should have savaged the Government for utter incompetence , infringements of basic human decency and utter callous indifference to suffering long before now. Even now Byrne is still pandering to the angry low paid who are not feeling better off than those on benefits while he should be delineating the neo-lib project to scam and rip off the populace in neon lit 3D!
“Even now Byrne is still pandering to the angry low paid who are not feeling better off than those on benefits…”
What should be pointed out to the low paid that the main difference between the low paid & benefits is only about 40 hours a week and that the problem is not that of high benefits but of low pay!
The ‘Bedroom Tax’ issue must be seen in the wider context of the overall welfare regime.
People in the UK with disabilities get social support related to their disability. That social support was/is intended to be based on need (i.e. not on the status of the beneficiary’s landlord). Some of that social support can be delivered ‘in cash’ (i.e. in the form of benefits) rather than ‘in kind’ (e.g. in the form of ‘free’ additional NHS support). The virtue of delivering ‘in cash’ was/is that the beneficiary gets to choose how to spend it; thus enhancing independence and self-respect, and avoiding the patronising and debilitating effect of having bureaucrats ‘deciding what’s good for you’ as a second-class citizen. The cost of renting accommodation with an ‘extra’ bedroom for a carer is an example of the myriad range of potential additional costs associated with disability. Some people with disability might choose to pay extra rent for an extra bedroom. However, some might choose to pay for special appliances, taxis instead of busses, respite care, or other. The primary channel for delivering the ‘in cash’ part of social support is a benefit called DLA/PIP (Disability Living Allowance, now renamed Personal Independence Payment).
The same principles (ought to) apply to HB (Housing Benefit), to LHA (Local Housing Allowance), CTB/CTR (Council Tax Benefit, now renamed Council Tax Reduction) and to subsidies built in to social housing rents. The purpose was/is to provide social support for housing costs to those with no/low income. However, the current arrangements offer (potential and actual) beneficiaries two distinct regimes:
1. For those not (relatively privileged enough to be) living in social housing, social support for housing costs is now delivered purely in the form of LHA. LHA is based purely on location and family-formation (i.e. it is based purely on need; leaving each family to spend more or less on rent, food, clothing etc. from their overall income).
2. For those (relatively privileged enough to be) living in social housing, social support for housing costs is now delivered partly through subsidies built in to social housing rents, and partly through HB related to those subsidised rents. This combination does not relate fully to means or need. If income varies, HB is means-tested, but the social housing rent subsidy is not. If needs vary (e.g. children are born, children are adopted, children leave home, a disability reduces, or a disability worsens), both types of support remain unchanged. Thus, beneficiaries have no potential to spend more or less on rent, food, clothing etc. from their overall income, and have a spurious incentive to ‘over-accommodate’ regardless of changing need.
Thus, if we take a wider perspective on social support related to needs, we should consider the following simultaneous combination of measures:
1. All current ‘in cash’ social support for those with disabilities should be consolidated into DLA/PIP. If people with disability cannot afford the support they need and deserve (e.g. including a bedroom for a carer), then we should be arguing for an increase in DLA/PIP (e.g. to enable them to pay extra rent for a bedroom for a carer; irrespective of the status of the beneficiary’s landlord).
2. HB, and the current subsidies built in to social housing rents, should be abolished, and the recovered resources should be consolidated into LHA; based purely on location and family-formation (i.e. purely on a family’s need for basic accommodation; without regard to disabilities; and without regard to the status of the beneficiary’s landlord).
Above all, we should avoid being diverted into spurious ‘populist debates/rants’ about ‘Bedroom Taxes’.
Tim
I think you are missing a lot of the issues
Richard
And there was me thinking that it was YOU that was missing a lot of the issues (like the incoherent interelationship between DLA/PIP, HB/LHA, the current subsidies built in to social housing rents, and the need to give those with disabilities control over their lives).
I have spent a day a week for the last ten years or so working as a voluntary adviser at my local Citizens Advice Bureau, advising clients with disabilities on how to make the most of their limited opportunities (amongst other things), and thought that I had acquired a pretty good grasp of the whole incoherent picture. Obviously, I was wrong (according to you). For the benefit of a lesser mortal (i.e. me), perhaps you could be a little more specific about what you believe to be the issues you have considered and I have missed?
I feel sorry for clients if that’s the patronising tone you take
It does not persuade me to engage
I was making a macro point
Clearly you didn’t appreciate it
I’m old enough to remember when “social housing” wasn’t utilised only by the poorest in society. Mrs Thatcher’s “right to buy” is remembered as a means of persuading traditional Labour voters to turn Tory, but that wasn’t the prime purpose.
The prime purpose was to demonise those that remained in Council/Social accomodation as dirty, nasty, probably criminal vagabonds who had failed to “get out”. Mrs T couldn’t have been clearer, nor can her accolytes. It was all about “aspiration” “you to can desire rubbish &, by doing so, destroy the planet”, if you don’t aspire you are, by Tory doctrine, vermin.
Social housing is subsidised housing ?
It would be better to state that social housing rents are lower than private rents. That does not mean that social housing rents are lower than the cost of running the social housing.
In this area the private rental cost of a one-bed house if around 470-520, the average social housing one-bed is around 340-380.Personally, I find the whole mess of housing difficult to quantify, given that government funds (local and national) flow so freely in the housing sector (social and private), and stating that one is subsidised and the other not depends on which subsidy you ignore over another. Arguably, private housing also could be called subsidised housing.
JohnM
You are right that the expression ‘subsidised’ is ill-defined and rather ‘loaded’. The meaning (of the expression ‘subsidised’) depends on one’s ‘social’ perspective. Perhaps I should not have used the expression. However, I believe my argument still stands consideration.
The first point I was trying to make was that the current overall arrangements split renting families into two classes. Other things being equal (including income and disability), a family renting from the social sector (i.e. a family renting from a local authority or housing association) is in a better place than an otherwise-identical family renting from the private sector. That is, a family renting from the social sector pays less, and gets benefits which are more comprehensive and secure. Of course, you could say that in reverse. Families renting from the private sector are in a worse place than families renting from the social sector. But the point of fact is that the (spurious) distinction exists.
The second point I was trying to make is that the above distinction is unfair. I was arguing that social provision for those on no/low income and/or disability should be based purely on need (i.e. not on the status of the landlord). More specifically:
1. Social rents should be ‘marked to market’ (i.e. levelled-up to equivalent private rents), and every penny of the recovered-subsidy/increased-income (depending on one’s ‘social’ perspective)should be redirected into a massive expansion in the supply of social accommodation and/or into more-comprehensive means-tested HB/LHA (i.e. directly-aligned to need, and regardless of the status of the landlord).
2. Means-tested HB should be replaced with means-tested LHA (i.e. directly-aligned to need, regardless of actual rent, and regardless of the status of the landlord).
3. All social support for those with disability should be consolidated into non-means-tested DLA/PIP (i.e. directly-aligned to need, regardless of actual rent and other expenses, and regardless of the status of the landlord).
I believe that we should be arguing very hard for these principles in the plans for the Universal Benefit project (and/or as a pragmatic ‘plan B’, for when the Universal Benefit project collapses). In order to do so, I believe that we should not allow this issue to be ‘enclosed’ by those who want to play party politics (with what I believe to be a spurious political focus on ‘the bedroom tax’).
But what if there is no market?
And I’d suggest there isn’t in the UK – because it is not independent of tax and other subsidies
Why mark to market when there is none?
Richard,
There IS a free market: the (private rented market. I agree that both supply and demand in that free market are distorted by myriad ill-considered taxes, tax reliefs and benefits (and in some casse by unrealistic senses of ‘entitlement’). However, the private rented market itself is ‘free’. Private landlords are anxious to keep their property occupied and earning rent. Individuals and families have to (try to) keep a roof over their heads. For some considerable time now, the ‘free’ market has been telling us very loudly and clearly that ‘marginal’ demand exceeds ‘marginal’ supply by a considerable margin; resulting in ludicrous overpricing of property. It’s omnishambles!
But what do we (try to) do about it? Give up (where were you when HB was replaced by LHA for the private rented market)? Indulge in populist rants against misnomers such as ‘the bedroom tax’ (which keep the real issues off the agenda)? Prop up and extend existing distortions? Propose more (counter-)distortions?
Or do we ‘engage with’ the WHOLE incoherent inter-dependent mess, analyse, analyse, analyse, and only then argue for a radical realignment of all of the current processes to the underlying fundamentals.
If social rent was ‘marked to the free private market’, then:
1. The capital value of social property could/should/would be ‘marked to the free private market’.
2. Social landlords would pay taxes on their capital gains and their higher profits on current income.
3. The state could/should/would redirect every penny of the increased tax revenue into increased benefits in general. In particular, they could/should would increase (means-tested) HB/LHA and non-means-tested DLA/PIP in such a way that the ‘social distortions’ were more-fairly distributed in proportion to real need (and regardless of the status of the landlord).
4. Social landlords could/should/would be encouraged to use their higher-valued assets (net of taxes) and higher profits on current income (net of taxes) to borrow to increase spending on new (now-non-social) low-rent housing.
What’s not to like?
Tim
We are clearly not going to agree
That is not a free market – not by any stretch of the imagination
Richard
I’m not sure I understand why people are renting at all. If fiat currency is backed by the wealth it’s used to create, which seems perfectly reasonable to me, then why aren’t we building new houses paid for by our central bank or government-created money and then giving them to people? It’s our government, and it’s our central bank, right? So it’s our money and these houses are our property already. Why should we be paying for them again and what’s more going to the private banking sector and asking them to create new money into the economy, money we have to give to them plus a whole lot more in return for this absurd non-favour, to do this with? This has got scam written all over it. Is it not the case that we, as a society, have been had?
“Is it not the case that we, as a society, have been had”
Yes. For a few centuries as well. Worse. The banks even lend you money they haven’t got, and then you pay them interest on the money they didn’t give you. Hmmm. So wanga loans you money at 1700% + that they borrowed at probably less than 1% from the banks who didn’t have it in the first place ?
This resembles a comedy….
A comedy John? If it is, it could only be described as an outrageous farce. Perhaps you have your tongue firmly in cheek, and meant “This resembles a tragedy”
“There IS a free market: the (private rented market. I agree that both supply and demand in that free market are distorted by myriad ill-considered taxes, tax reliefs and benefits (and in some casse by unrealistic senses of ‘entitlement’) – See more at: http://www.taxresearch.org.uk/Blog/2013/09/20/labour-and-the-bedroom-tax-a-step-in-the-right-direction/#comments“
There isn’t, and there probably never has been a “free” market!