Monday, October 22, 2012

Housing benefit will eat the world…

Housing bill doubles

Rents will go up for ever even as house prices fall. The taxpayer has limitless money to give away. Nothing can ever go wrong with this new business model which will save us all from the nasty Tory cuts and the horrid Labour overspending.....

Posted by chrisch @ 03:07 PM (2109 views)
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6 thoughts on “Housing benefit will eat the world…

  • mark wadsworth says:

    Aha, read the article, it says “doubled in the last decade”, which is correct if you look at the total £21 billion.

    However, two-thirds of this is payments from one government department to another and is not really government spending at all. Thought experiment: councils see a £10 billion reduction in Whitehall grants but put up their council house rents by £10 billion and the DWP then pays them an extra £10 billion in housing benefit. Has total government spending increased? Of course not (unless you are an idiot) – remember, Whitehall, the DWP and local councils are all just parts of the same government. Cash transfers between them are nigh irrelevant.

    The real comparison is HB given to private landlords – I wouldn’t be surprised if this had doubled in a very short space of time because of more people claiming, more people in private rented sector, higher rents in private rented sector and larger proportion of rents paid being eligible, so if each of those goes up by 25% in two or three years, then the total REAL COST to the taxpayer has more than doubled.

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  • Housing Associations (Registered Social Landlords) aren’t a branch of Government. They receive most of the HB.

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  • But they are non-private and non-profit and put trading surpluses into maintaining/augmenting the housing stock.

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  • This is the main cause of the housing problem. You can forget a crash, the model is so very different now. Work hard, pay taxes, a large percentage of those taxes then finds its way back to the landlords/property owners via housing benefit.

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  • mark wadsworth says:

    GM, HA’s are very much part of the government, their shareholders are the government, they get loans from the government, they get a lot of income from the government (housing benefit) and by and large, they don’t pay corporation tax. HA’s are a creature of statute and under the ultimate control of the DCLG or whichever department, but otherwise with very little democratic accountability.

    Whether they do a better or worse job at providing housing than the private sector or local councils is a separate debate.

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  • This is the main cause of the housing problem. You can forget a crash, the model is so very different now. Work hard, pay taxes, a large percentage of those taxes then finds its way back to the landlords/property owners via housing benefit.

    Quite. But the high cost of UK housing, rents etc will continue to prove a massive drag on the economy – it will stop the UK from competing in the world economy, in almost EVERY sector…as the cost on UK living is simply too high.

    That situation cannot continue, who is going to pay the HB for all those who wish to claim it – once UK government has finished raiding the UK savers/pensions/ and whatever else via QE?

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