A positive Autumn Statement for renters?

autumn statement

In a low key, ultra-cautious budget, the chancellor presented a dramatic picture with the government still in the red! The news that the UK government will continue with their austerity programme impacting on millions after 6 years is depressing.

In housing terms there were a few anticipated announcements:

Building homes –Housing has finally been recognised as being high on the UK populations agenda and has had a response from the UK government. Tenants broadly welcome the chancellor announced for a push on infrastructure committing £1.4bn for the building of an additional 40,000 homes to add to the commitments already made.

[The Homes for Wales campaign received widespread support in Wales, with a recognition from all political parties of the need to build more homes, as a consequence the Welsh Government has responded with a commitment to provide support for the sector to deliver 20,000 homes of which 16,000 has been earmarked as being affordable homes]

Universal Credit –At least some recognition that the ‘taper rate’ for those in work and on UC is too harsh and not a sufficient incentive to take on additional hours. UC taper rate being reduced from 65p to 63p or 2p in every £1 will be welcomed from April 2017 but will be quickly swallowed by rising rents and prices. The injection of £700m is less than was asked by back benchers whose communities are feeling the impact. It was also disappointing not to see the Employment Support Allowance (ESA) get a reprieve for the planned cuts coming into force April 2017.

Letting agency fees – A triumph for greater consumer transparency   

The government brought in consolidation changes in the Consumer Rights Act 2015 that also included the requirement for letting agencies to display their fees. What it exposed in a relatively short time, was the range of fees letting agencies were charging. The move was a triumph for those who argue for greater transparency because what it demonstrated was the extortionate charges to consumers, ranging from £40-£700 – and some argue that this information would have been more difficult to obtain without the Act.

The scope of re-chargeable costs were also imaginative and could include; tenancy agreements and fees for additional copies, administration fees, referencing charges, check in – checkout fees, inspections, solicitors fees for processing guarantors, deeds of guarantee, non-attendance fees for repair call-outs and others. There were also a range of dubious charges for repairs and call outs not deemed to be a landlord responsibility. What was more annoying for both landlords providing the properties and tenants who rent them, was that some of these fees were also being charged to the landlord.

Welsh Tenants supported the campaign spearheaded by Shelter Cymru in Wales to ban letting agency fees along with Vicky Spratt from Change.org where the petition received more than a ¼ million supporters. The evidence from Scotland (who introduced a ban in 2012) suggests there were no significant rent increases as a consequence of the Scotland ban. However, this is disputed by letting agencies who suggest landlords have passed on their costs to tenants through rent increases.

We will no doubt have to wait for further research of the impact. Letting agencies who are unable to spread their costs suggest that business rate increases, a rise in the minimum wage to £7.50, and registration charges for Welsh landlords/ Letting agents will find it difficult to survive and could look to have on-line presence only potentially giving up their often costly high street presence.

No assistance for the disabled and vulnerable

I suppose we were not going to have mentioned any role back of austerity programme for the tens of thousands of people hurt by austerity, particularly the disabled and vulnerable. It was however still disappointing there were no announcements to ease the burden being carried by these groups, particularly in light of the recent supreme court ruling.

Many tenants would have seen the results of the FOI (freedom of information) request conducted by the BBC Victoria Derbyshire show that detailed;

  • Multiple sclerosis (MS) – 93% of DLA claimants got the higher rate of the mobility component, but under PIP this has dropped hugely to 50%.
  • Parkinson’s suffers – 82% of DLA claimants got the higher rate of the mobility component, but under PIP this has more than halved to 40%.
  • Rheumatoid arthritis – 83% of DLA claimants got the higher rate of the mobility component, but under PIP this has plummeted by more than two thirds to 24%.
  • Early onset Alzheimer’s – Award of PIP, eighteen months later are found to have improved to the extent that they no longer qualify for anything.
  • ESA sanctions almost doubled in the 6 months between Jan 16 and June from 900 to 1,750 (DWP’s statistical release)

For many campaign groups like ‘DPAC’ and ‘Benefits and work’, it was clear at the outset that PIP’s main purpose was to cut costs, irrespective of the condition of people receiving DLA. Or, additional funding to cover the bedroom tax and people who look after a person with severe life threatening illnesses and disability that save the government 100s of millions yet penalised through the unfair bedroom tax. These are not a ‘just about managing’ (JAMs) group, but people struggling to sustain their homes. We want to see the government introduce an exemption for people who require a spare room to rest where they have a disabled partner and are unable to share a bed and require an overnight carer, as won in the supreme court decision Rutherfords.

Even the basic calls have gone unheeded. On making legitimate appeals and enquires to the DWP, we were expecting a compassionate statement to provide some reprieve for tens of thousands making high cost calls to the DWP.

Many people on benefits can’t afford a landline, having to resort to pay as you go mobile contracts that charge 45p a minute to call the DWP 0345 enquiry number. The government refused the requests from campaign groups and the Social Security Advisory Committee who urged the DWP to provide free 0800 numbers, but they have consistently refused stating it would cost them £7m.

It would appear therefore, that if you aren’t on the web, or you don’t have the internet because of rural connectivity or land line connectivity you are being unfairly penalised.

The government also seemed to hint at ending the “triple lock”[1] in 2020 that has safeguarded pensioners. As this is unlikely to be implemented before an election, given the size of the constituency, this may be a hint that an election is more likely in 2019.

From a Wales perspective, it was encouraging to see a consequential of a £400m capital boost for 2020-21 and commitment to support for the Swansea and North Wales city deal projects that will help regeneration in those areas, but the real hurt for Wales is austerity. With a benefit cap being maintained with no inflationary rises wales is sure to continue to feel the hurt with little gain.

[1] The triple lock is the mechanism currently used by the government for uprating the Basic State Pension (BSP). Under the triple lock, the BSP is increased each April by the higher of the growth in average earnings, the Consumer Price Index (CPI), or 2.5%. The triple lock was introduced by the Coalition Government in 2011.

 

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