Home More News Higher Earners To Lose Thousands In Social Housing Subsidy

Higher Earners To Lose Thousands In Social Housing Subsidy

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Higher earners living in social housing are to lose thousands of pounds a year in subsidised rent, it has been reported.

The move would effect tenants earning £40,000 a year in London and £30,000 outside of the capital, increasing the amount they’ll be asked to pay by around £70 a week.

Local authorities and housing associations are already allowed to charge market rent to tenants earning over £60,000 a year. But plans expected to be announced by George Osborne on Wednesday will see an additional 300,000 social housing tenants affected for the first time.

Those people will be expected to pay the full market rent, raising an estimated £250 million in 2017/18 for the Treasury.

Approximately 9% of all social housing tenants in England will be ordered to “Pay to Stay” or find somewhere else to call home.

The Chancellor will argue that 40,000 tenants earning over £50,000 are benefiting from subsidised housing.

According to the government, higher earners have saved over £3,500 per household from reduced rent. Sky News describes the government’s plan as a “purge on rich council house tenants“.

The Tory government has committed itself to cutting £12bn from the welfare bill. Under consideration are cuts to Housing Benefit, Tax Credits and a lower Benefit Cap – among others.

PM David Cameron has also failed to rule out slashing disability benefits. A leaked document suggested that Tory ministers are considering slashing Employment and Support Allowance (ESA) for claimants in the Work Related Activity Group (WRAG), affecting thousands of sick and disabled people.

It’s also understood that George Osborne wishes to reduce the higher rate of tax from 45p to 40p. However, this is unlikely to happen in Wednesday’s ’emergency budget’.

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  1. The long and short of it is that the majority of the 400,000 it will affect will most likely purchase the houses which would have returned to the council once tenants pass away or move. This will have a negative effect on housing as any sold will likely not be replaced.

    There is no logic in moving say 150,000 full rent paying tenants out just to replace them with 150,000 needing all or part of their rent paid. Like it or not, council estates that are made up with tenants that pay little or nothing toward their rent are the ones that end up becoming ghetto’s, there are a few exceptions to the rule but on the whole that is what happens.

    An internal survey here a year or so back revealed that damage to social housing was much more prevalent among non or low paying tenants than those that paid rent in full so there is little or no logic in having to go from rental income to providing HB and/or forking out for repairs….seems more like a punishment for having the audacity to have a job. The housing shortage is due to successive governments from thatcher and their ineptness in failure to rebuild sold stock but as usual it is easier for those above to blame those below rather than face up to their own failings.

  2. Many with think this a reasonable move I think £70 per week extra is too high. He is supposed to be on the side of the hard working families of Britain

  3. I’m surprised to learn that people earning over £50,000 p.a. are actually entitled to receive housing benefits. I won’t cry too much when they have to contribute a bit more to their own accommodation.

    • They’re not getting housing benefit, they are simply benefitting from the fact that the government subsidises social housing to keep rents down. Two different things. Nevertheless, I agree that high earners should not benefit from this, especially at a time when there is a general shortage of social housing for those who can’t afford to rent privately or buy their own property.

      • As far as I am aware, council housing is not subsidised. On the contrary, I believe it makes a small profit. Rents are indeed below market rents but that is not the same thing as a subsidy. The ‘general shortage of social housing’ has been created entirely by government policy of selling it off and not replacing it. This latest move is another step towards getting rid of social housing altogether.

      • it will increase the number of people buying their council house This is another element of Cameron double mindedness. He previously said that he would facilitate the building of more affordable social housing. This is ehat happens when the country has the master of lies running it

      • The government is not subsiding the rents of social housing what is doing is allowing private landlords to charge whatever they like for the properties they own because there is a housing shortage. This government is protecting and supporting the predators while serving up the prey. For example forcing the unemployed to work for their benefits allowing employers to have even an even cheaper workforce. The government allows employers to use loophole like zero hour contracts so that employers can avoid employment law and national insurance. The government doesn’t want people paying fair rents in social housing but are happy to subsidise people buying their council home.
        For those of you who believe that they will be unaffected by the changes this government are making dream on.

    • People on £50k in this area don’t receive housing benefit and probably not in London either as gentrification sees tenants forced out and the social housing sold to landlords/overseas with many of them being mp’s.
      Those on 30k are a little above the so called cap but are not much better off as they have to pay for prescriptions, glasses, teeth and so on.

      The benefit cap is not about making things fair but all about being the easiest way of moving people with little away from places like London. Those unlucky enough to be on benefits or in receipt of HB don’t actually receive the swathes of money that the media want you to think they do.

      A family of three would receive nowhere near the current benefit cap, they would get their “what the government says you need to live on” cash but what bloats that amount is what is being charged for rent which is down to the landlord and it won’t be tackled as HB is a honey pot which many of our mp’s have their sticky fingers in.

      Current rent here are around £110pw for a 70 year old council house, many of which need serious attention.

      There is not a week that goes by without us hearing that the poorest are going to be made better off by having help reduced or taken away and the answer is to reduce tax for the wealthy by 5p.

      £30k isn’t poor but it’s far from rich, break even is more where it is with maybe the chance of a holiday.

    • will they don’t receive housing benefit This is about the fact that council house rents are cheaper than the private rental market, What this means is anyone earning over £30 will have to pay an extra £70 per week.

  4. In my part of the world, the council rent for a three bed is about £400 a month, and the commercial rent for the same type of property (a lot of right to buy houses, sold eventually to landlords) is £1,200 pcm. So, that would be an extra bill of £9,600pa – ouch.
    How do councils find out the income of their existing tenants?
    People wouldn’t choose to move, because they’d be no better off in the private sector with 6 month tenancies..
    Who would keep the cash? Councils?

  5. What about getting rid of the private agencies that take £1 billion of tax payers money – yes the nursing agencies and teaching agencies and social care agencies, get rid of them , always taking the poor or lower middle class whens the rich getting a turn. Tory Poor-y people bashing.

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