The Affordable Rent Con

By Tim Hardy

Housing providers can charge higher rents than before (on average 65% of market rents in London and up to 80% elsewhere). This will affect tenants’ ability to afford the new housing and may exclude some of the poorest from accessing this new housing. Where higher rents are paid through increased housing benefit, tenants may find themselves caught in an even stronger benefit trap where it has become even harder to find sufficiently well paid employment to make working worthwhile, countering the Government’s objective of ensuring that the benefit system makes work pay.

(Conclusions and recommendations of the Public Accounts Committee, Financial viability of the social housing sector: introducing the Affordable Homes Programme)

“Affordable Rent” has always been a particularly Orwellian term to describe the precise opposite of what it pretends to be. Affordable Rents, pinned to hyper-inflated market values, are anything but affordable and the choice of name demonstrates a cynical understanding of the uselessness of a media that will repeat the words mindlessly without ever challenging the rhetoric.

High rents and house prices cause misery, limit mobility, reduce choice, inhibit enterprise, stealing time and money that could have been used productively, forcing people to make financial returns the sole criteria of their career decisions rather than seeking work that is emotionally and spiritually rewarding. Only a party of rich landowners would be so complacent to pass policies designed to increase the costs of rents and shore up hyperinflated house prices.

A society that demands its members pay an ever increasing percentage of their income on basic shelter is a society on its way to ruin.

Conservatives hate anything that stands in the way of their insatiable hunger for greater profits – be that social housing, the National Health Service or state education. In a ruthless, predatory environment, the already rich and powerful get fat on the weak so these zealots are eager to destroy any alternatives to the markets to further increase their wealth through the immiseration of the few who up until now have found a temporary harbour. Labour are fully complicit in the housing crisis and have no solution of their own.

The conclusions and recommendations of the Public Accounts Committee, Financial viability of the social housing sector: introducing the Affordable Homes Programme makes for damning reading. It concludes:

1.  The Department has not done enough to understand the full impact of higher rent levels on tenants

2.  The allocation of funds under the Programme did not fully focus on the areas of greatest need

3.  It is unclear whether the shift of public resources from capital grants to increased housing benefits will provide better value for the taxpayer

4.  The Programme has a risky delivery profile with little room for slippage.

5.  The Programme has taken advantage of the sector’s current financial capacity but this may be a one-off opportunity.

Joe Halewood, Director of Consultancy Services at HSM, goes further and accuses Eric Pickles of knowingly misleading parliament over the reforms.

AR [Affordable Rent] is and always has been a con, a point I have made consistently and wanted to hammer home; and secondly, despite the PAC [Public Accounts Committee] using unusually strong language for any parliamentary committee – that is has ‘strong concerns’ – the PAC report still doesn’t get how inept or how costly AR is.

The minimum added cost of AR in HB terms is at least 6 times the cost than suggested.  This is because reading the report and researching the remit of the PAC a political scandal emerges and Eric Pickles, Secretary of State at the CLG must resign or be sacked because of it.

Of course Pickles won’t resign or be sacked. David Cameron’s Conservative Party is a collection of selfish petty crooks, tax avoiders, con artists and snake oil salesmen. They have no decency or honour. Even then Pickles is only part of a problem that is systemic in all three major parties.

For the extremely rich cabinet members, such disastrous policies will have no consequences beyond a few red faces during PMQs.

For the millions struggling to survive on poverty wages topped up by ever-reducing benefits, this is an impending disaster that will have a grave cost on their physical and mental health.

Rather than strengthening tenants rights, taking empty properties back into use, banning the leveraged buyout of salaried wages through buy-to-let mortgages and discouraging socially destructive property speculation, Labour, Tories and Liberal Democrats stand united in their common belief that the only thing that matters is home ownership at any cost. All three parties would rather jail people seeking shelter in disused properties than tackle the vested interest keeping prices impossibly high. That tells you all you need to know about their real priorities and their real interests and should tell you why holding your nose and voting Labour is unlikely to make any difference at all.

This is another vile step from a vile government who are concerned only with increasing the wealth of the rich. We should not be surprised that they are now making the poorest in the country walk the plank into the shark-infested waters of the property market. We should be very concerned by the lack of opposition to this.