Despite the government’s claim to represent hardworking families, ‘pay to stay’ will force some social housing tenants to actually work less
Go back and listen to any of the speeches by David Cameron or George Osborne from the election period and, if you’ve no responsibilities, play a drinking game: neck a shot every time they allude to “hardworking people” or decry a “something-for-nothing culture”.
One such hardworking person is Gary, a man I met recently, who lives in central London in a housing association flat that his parents, and grandparents, lived in before him.
Gary has worked for decades in a nearby business. His pay has never been exorbitant, but Gary’s persistence and loyalty to the same company for decades means that, including workplace benefits, his income just broaches £40,000. So, as a reward for being exactly the kind of “hardworking person” Osborne praises, Gary and his wife are facing a hike in their rent under the “pay to stay” clause in the housing bill – which will allow social landlords to charge tenants market rents if they earn above £40,000 in London or £30,000 elsewhere.
The flat has been extensively adapted for Gary’s wife, who has multiple sclerosis and severe mobility difficulties. As well as his day job, Gary cares for his wife – saving the state a huge sum. Now, with a looming rent hike that will make their flat unaffordable, they’re considering the prospect of being forced to leave a home that’s been in their family for generations, and move away from Gary’s job.
Looking in estate agents’ windows in the local area, Gary tells me flats range from £750 to £2,000 per week – simply unaffordable for a couple earning the equivalent of £20,000 each. As with the bedroom tax, housing professionals and anyone with an ounce of common sense who has considered the policy for more than two seconds have warned that it is both unfair and unworkable. The cost of chasing supplemental rent, and the fact that HMRC will be passing tenants’ details on to housing associations, have caused understandable worry throughout the sector. Tenants are worried about eviction and data security, and landlords are baffled at the amount of admin and guesswork they’re expected to wade through.
It would cost a lot to adapt a new flat further away, and would mean upheaval for the couple, and much higher commuting and rental costs. Gary can see only one solution: reducing his hours, so he and his wife can stay in their home.
“I have spoken to my employer who is ready to reduce my working week sufficiently to bring my salary under the £40,000 threshold,” he tells me. “This does not seem fair or logical. It is surely counterintuitive that I can save more money by not working than I could by working. How can it be in my interests to work less hard?”
So much for rewarding “hardworking people”. The pay to stay policy has all the hallmarks of the bedroom tax: an ideological policy designed to wage war on social housing, with no thought as to the human costs. If social rents are cheaper than market rents, maybe, just maybe, it’s not because social rent is subsidised – a lie debunked over and over again – but because private markets are rapacious and volatile, and will happily spew out the poor after making as much profit as possible.