The inevitable grim toll of George Osborne’s housing and benefits policies
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Version 0 of 1. The briefing by George Osborne ahead of the budget in respect of government housing policy (Opinion, 5 July) reveals both ideological intent and deep-seated contradictions. It has to be presumed that the government, in seeking to push up rents in the social housing sector, has more in mind than pushing those on middle outcomes out of the rented sector. Clearly the intent is to engineer a situation where they bring pressure to bear on housing associations or the local authority so they can buy their property at a 70% discount rather than pay the artificially engineered higher “market” rent. However, the law’s unintended consequences, or basic economic theory, will undoubtedly kick in. In simple terms, if rents are artificially pushed up in one part of the sector, it will inevitably increase rents as a whole. The consequences of this will of course be a necessary increase in housing allowance and housing benefit (unless there are draconian reductions coinciding with the policies announced so far), which will increase rather than decrease the expenditure necessary for people to be able to survive in rented accommodation. But underlying all of this is the belief that rented accommodation is for the poor only. As Richard Titmuss put it 50 years ago, services that are solely for the poor will inevitably be poor services. They are, in other words, about to create ghettoes, which will have other very serious social consequences.David BlunkettSheffield • In March, the deputy president of the supreme court, Lady Hale, declared that the benefit cap “breaks the link between benefit and need”. It was depriving children of the “basic necessities of life”, agreed Lord Kerr. The benefit cap forces children into sub-poverty or homelessness, delayed only by parental debt. Nevertheless, both main political parties bow to the public’s indignant horror at a workless family receiving £26,000 in benefits, disingenuously ignoring the facts: similar hard-working families earning £26,000 additionally receive benefits totalling £22,900 (two-parent family with four children in a high-rent area outside London), supplementing their take-home pay of £20,600 to give an actual income of £43,500. Overwhelmingly the major – sometimes the only – beneficiary is in fact a private landlord. In my own home town, for example, the proposed £20,000 cap would leave a single mother of four paying LHA rent of £15,178, with £4,821 a year for five people (£2.65 per person per day). Regardless of their parents’ family-planning proclivities, children are citizens in their own right; furthermore it does not seem “fair” that, in such an example, their unemployed estranged fathers’ benefits would not be capped. That many of those who are benefit-capped do actually work is invariably completely disregarded. Less than a century ago, Attlee’s The Social Worker identified three options for a civilised community’s response to a citizen’s needs. Yet now the Labour party has chosen neglect rather than care, delegating goodwill to the Trussell Trust.Dr Georgina ToyeBath • After a series of previews of the content of George Osborne’s first Tory budget, the direction of travel is clear, and it is equally clear that some of us may have underestimated the Lib Dem influence over the past five years (The benefit cap is a disgrace. Labour should resist the latest cut, Editorial, 7 July). Despite “a depressed opposition [that] is in no mood to challenge anything”, your call for Labour to resist “this cynical assault on social security” could become a litmus test of the leadership contenders’ credentials and fitness to lead the party. Someone – acting leader, acting shadow chancellor or one of the four candidates – should be proactive in calling for rent controls rather than going along with cuts to the housing benefit necessary for the working poor, people with disabilities and victims of the restructuring of the labour market to have a decent home.Les BrightExeter • Matthew d’Ancona writes of this week’s budget (This week Osborne can show us austerity has a purpose, 6 July) that “it would be idle to pretend that what lies ahead is going to be painless”. He says the question is thus “what motivates it”, ie the cuts in benefit? His answer is that it is a welcome move to a “lower-welfare, lower-tax and higher-wage” economy. No, the question is who (almost exclusively) suffers the pain for the move, and what consequences follow from the achievement of the low-tax, high-wage economy? Answers are that the working poor pay the price, and secondly that the new economy further entrenches exactly the same inequalities as at present, with inflated figures as a camouflage to fool the unwary. Thus “the nasty party” and City financiers score again.Paul AndertonNewcastle-under-Lyme • George Osborne would do well to read properly Elizabeth Gaskell’s Cranford, based on his Knutsford constituency (Helen Pidd: I feel like a wally for believing George Osborne’s flashy promises, G2, 7 July). The plot does not, as he seems to think, revolve around a campaign to stop the construction of a railway line to Manchester. In the second chapter, a much-admired character is “killed by them nasty cruel railroads” as he rescues a child who has strayed on to the tracks. Like HS2, the new development damaged the community. Much more central to the novel is the failure of a local bank, of which Miss Matty, the tender-hearted and unworldly heroine, is a share-holder. Witnessing the distress of a young farmer when a shopkeeper rejects a note issued by the bank, she insists on personally reimbursing him: “It will only have been common honesty in me, as a shareholder, to have given this good man the money.” What would a 21st-century shareholder or chancellor have done?Florence RaynerSheffield |