Exclusive: Westminster pioneers subsidised housing for higher rate taxpayers

Affordable housing: Now for higher rate taxpayers Pic courtesy BBC

Are you a higher rate taxpayer with a family? Need a three bedroom home convenient for the City and West End but can’t afford the rent charged as oligarchs and Arabs push up prices in Central London?

From next year the Tory flagship council of Westminster is to come to your rescue- they are diverting all their  new  and acquired affordable housing provided by social landlords to help what Ed Miliband, the Labour leader called the “squeezed middle”. This  includes helping  Iain Duncan Smith style Tory households where dad is the sole breadwinner, mum stays at home with the kids, but dad earns enough to put him in the higher tax bracket.

Too bad if you are among the 53 per cent in Westminster earning around £12,500 a year. From next year you are officially too poor to qualify for social housing anymore. You will have to go and live somewhere else.

Don’t believe me. See the table in  new Westminster Council documents, where the figures are revealed.

Table 1: Affordable Rent levelsBeds Sustainable for households (without benefit) with gross incomes*:  Weekly GrossAR range  Current RP rents (including service charges) 
1 £25k-32k(net 18.5k-£23.5k) £135 – £172  £132
2 £27.5-£36k(net £20.5k -£26.6k) £148-£194  £147
3+ £29k-£39k(net £21.5-£29.k) £156-£210  £152+

The  gross householder income figure for three bedroom homes actually exceeds the present 40 per cent tax band which  this year  is £35,001.

Even the document produced by the council’s housing director for  Jonathan Glanz, the Tory Cabinet member in charge of housing admits they might be a problem:

 “It is acknowledged that these rents are not currently affordable to many households with priority, without housing benefit. Income analysis indicates that in the main their incomes are low and significant proportions are benefit dependant.”

An accompanying document adds: “For some larger non working households, Affordable Rent may not be a sustainable housing option given what is currently known about the welfare benefit cap.” In other words The Conservative policy to cap benefits puts the unemployed permanently in the cold.

Even Westminster cannot stomach Grant Shapps 80 per cent market guideline Pic courtesy: Daily Mirror

What is even more amazing is that Westminster is  trying to implement  housing minister Grant Shapps’ plan to make sure housing association charged 80 per cent of market rents. The problem is that market rents are so high in Westminster, that even the Tory flagship authority is having to ignore  the Shapps guidelines. An accompanying document reveals average market rent for a two bed property is now  £564 per week in W1, £440 in the SW1  and £316 in NW8.

Even Westminster realises that to charge over  between £250 and £400 a week would hand over its entire social housing provision to higher rate taxpayers. Good policy for ” we are all in it together” from Mr Shapps. And Westminster’s market rents are lower than neighbouring Kensington and Chelsea and the City of London. Can’t wait for their housing proposals following Mr Shapps lead.

Not surprisingly Labour councillors in Westminster are pretty scathing about this.

Councillor Guthrie McKie, Labour’s Housing Spokesperson said;  “The Council is shifting its housing failures on to the most vulnerable people in our community. Due to its failure to provide sufficient social housing, the Council is doctoring its allocation policy…The Council is hell-bent on turning Westminster into a ‘no go’ area for the poor and low-income families.  These new policies will just add more misery to the lives of thousands of our residents.”

Mr Glanz disagrees: “This attack fails to understand the concept of the new affordable rent model and preys on fears of some of the most vulnerable people. Affordable rent is not a replacement for social housing. It is an entirely separate product for households that are in employment but would otherwise struggle to afford housing at market rents. ”

However this is only half the story. What was Westminster plans to do with its existing council housing is a matter for a further comment.

One thought on “Exclusive: Westminster pioneers subsidised housing for higher rate taxpayers

  1. Pingback: Tories up to their usual tricks | Red Brick

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