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Why are Labour defending rent subsidies for the richest in society?

Glanz Cllr Jonathan Glanz the new Cabinet Member for Housing on Westminster City Council is astonished by Labour's defence of rent subsidies for households earning over £100,000

Over the weekend, Grant Shapps revealed that the Government are considering new restrictions on social housing for households earning £100,000 per year. Here in Westminster, we have argued for this for some time. As the Housing Minister has said, curtailing benefits worth up to £70,000 a year for the likes of RMT General Secretary, Bob Crow would seem to be a “no-brainer”.

Surprisingly however, some on the left have criticised the move. Indeed, the Labour Leader on Westminster City Council railed against the minister’s ‘plan to evict middle earning families from Council and Housing Association homes’. I have today written to Cllr Dimoldenberg asking him to justify his resistance to this proposal.

First, to describe £100k a year as ‘middle earning’ suggests that the Opposition has rather lost touch with the country it seeks to govern. Second, Government sources have actually said that families will not be evicted. Instead they would be asked to pay a rent much closer to the market rate. This would generate additional revenue which could be used to build more affordable housing, help young people onto the housing ladder or give more support to the very poorest families.

Another criticism made by the Labour Party has been that this new condition would act as a disincentive to work for families in social housing. They argue that households with incomes near the threshold will not strive to work harder, earn promotion or increase their incomes. That’s a fundamentally negative view of human nature. Despite the apparent desires of the last Government people don’t want to be dependent on the state. They want the best for themselves and their children. It does not bode well for the Opposition that they seem not to have realised that.

It is true that in reality this measure would affect relatively few households but that is not a reason to maintain an inherent unfairness. We estimate that there are around 200 social housing tenants in Westminster with annual salaries of £100,000 or more. To put this into context, these 200 households – amongst the top 2% highest earners in the country – are effectively receiving a state subsidy of (depending on the size of home) between £14,000 and £76,000 per year. Charging these high earners a market rent could yield an extra £7 million which could be spent on housing for those who really need help.

After decades in which the country has failed to build the homes required for Britons, 1.8 million families languish on the waiting list for a social home. If we truly are all in this together it simply cannot be right that the richest in our society are receiving support which is denied to those who most need it.


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