It Really Is All About House Prices

[Timak]

I was at a council in the West Midlands this week.

Their Chief Executive posted a message on their intranet spelling out how they were basically completely financially screwed and pleading for money saving ideas.

Their annual income from all sources was roughly £80m.

However it was their costs which shocked me.

£25m on staff costs

£15m on contracting in services

This pretty much paid for everything you would expect a council to do.

Then the biggest expense by far

£40m on Housing Benefit

How can it be right that councils are having to slash services and people are losing their jobs to pay landlords exorbitant levels of rent?

This is a relatively "posh" area so rents are high.

We need to bring down the cost of housing. Every problem stems from this.

Edited September 12, 2013 by Timak

[@contradevian]

I was at a council in the West Midlands this week.

Their Chief Executive posted a message on their intranet spelling out how they were basically completely financially screwed and pleading for money saving ideas.

Their annual income from all sources was roughly £80m.

However it was their costs which shocked me.

£25m on staff costs

£15m on contracting in services

This pretty much paid for everything you would expect a council to do.

Then the biggest expense by far

£40m on Housing Benefit

How can it be right that councils are having to slash services and people are losing their jobs to pay landlords exorbitant levels of rent?

This is a relatively "posh" area so rents are high.

We need to bring down the cost of housing. Every problem stems from this.

I thought HB was paid for by central government.

[camem']

I thought HB was paid for by central government.

https://www.gov.uk/housing-benefit/what-youll-get

"From April 2013, you may also be able to get extra help from your local council called a ‘discretionary housing payment’ if your Housing Benefit doesn’t cover your rent."

Edited September 12, 2013 by camem'

[Timak]

I thought HB was paid for by central government.

It is but they count the money received from central government coffers to pay this as "income" and paying it out as an "expense" as they process the whole procedure.

[The Knimbies who say No]

As zugzwang is fond of saying, 'tick tock'. It's pretty clear nothing will change without a tax/debt/spending crunch of some sort. It'll come eventually.

[TheCountOfNowhere]

here's a money saving tip...cut housing benefit...let the people who receive it stand on their own two...like adults...and let the renegotiate their ent with their landlords...it is coming to that.

[ingermany]

And the councils are directly financing cheap home loans, in order to push up prices, which in turn pushes up the housing benefit bill. It's what Cameron calls a virtuous circle".

[MattW]

here's a money saving tip...cut housing benefit...let the people who receive it stand on their own two...like adults...and let the renegotiate their ent with their landlords...it is coming to that.

If that ever became reality then I can foresee a huge protest. However, it would certainly shake up competition in the private rental market, so I say BRING IT ON!

[MattW]

Re: council's income vs expenditure, councils are permitted to build their own housing now to rent out so there's their opportunity for income on investment. And if they choose tenants like me who don't claim benefits (well not currently anyway) then they will pay for the build costs of that home more quickly.