The Tories have laid the foundations of disaster in London

26th April, 2012 11:39 am

And so it begins. Newham Council’s decision to attempt to rehouse 500 families 160 miles away in Stoke-on-Trent is the first in a line of much predicted fall-out events from the double whammy of the Localism Act and the Welfare Reform Act.

Welfare reform is an incredibly tricky and complicated subject. The threads of it are jumbled and complex, and the effects can be unexpected and affected by such multiple factors that sorting out cause and effect is incredibly difficult. It is an area that requires delicacy, nuance and imagination.

Unfortunately, politically there is little space for nuance and this Government has no desire to create any. The Tories have a very set attitude towards welfare and welfare recipients. They believe that reliance on welfare is damaging to a person’s moral fibre and ability to develop and grow into self-sufficiency, no matter what their circumstances. In some circumstances, I agree. Being on Job Seeker’s Allowance was not good for me and I don’t believe that any Government should be ok with the lives of its citizens being that small and confined. Welfare should be about empowering, not merely continued existence. But it also needs to be flexible enough to take account of individual needs which can vary to a greater and lesser extent.

But much as the Tories are wedded to a morality of self-sufficiency, and a doctrine based around bootstraps, they are equally committed to only ever addressing one side of a problem. Their naive belief that markets will sort themselves out without direction or level pulling from the Government has led to them implementing changes to every aspect of welfare in the blind faith that by removing benefits people will become more self-sufficient rather than simply less able to cope. They never think to apply solutions before simply declaring problems to no longer exist, which leads to measures like cutting housing benefit in the midst of a housing supply crisis.

It is hardly surprising that the first high-profile, large-scale example of the fallout from Government’s attitude to welfare is about housing. Because there are few who believe in the Tory muscular, patrician, almost bullying approach to it of our most ideological of ministers, Grant Shapps.

In many ways, Grant Shapps is the anti-Costner. In Field Of Dreams, Kevin Costner’s character is told “if you build it, they will come”. Shapps’ attitude has been “If I don’t build it, that will damn well incentivise them to build it themselves or to at least sort themselves out” (in fact, Shapps is obsessed with self-build, an extremely limited solution available only to those with at least some capital). Shapps, a minister who has said that “tackling homelessness and rough sleeping is what first got [him] into politics”, accepted – even gleefully championed – a 63% cut to social housing. By doing so at a time of ever spiralling housing need, has forced many housing providers into at least in part accepting the new 80% market rent scheme. This scheme makes “affordable” rent unaffordable in the south where rents are sky-high, and brings in little money for new housing in the north where social rents were never that far behind market rates, so no additional revenue is raised.

The Welfare Reform Act capped the amount tenants could receive in rent support, without ever addressing the amount that landlords could charge. A transaction that was going straight from Government to landlord is being used not to reduce rent or encourage greater supply, but to force people out of areas they’ve lived in all their lives because they are no longer able to afford the rent.

Given Shapps and the Tories’ childlike faith in the market, they don’t seem to understand very well how it works. They continue to insist that rents will come down as they lower the amount of housing benefit people receive without understanding or taking account for the enormous levels of demand that exist and are increasing. Basic market economics prove them wrong.

They can’t say they weren’t warned. Even Boris Johnson spoke out against the Government’s “Kosovo-style social cleansing”. With Westminster and Hillingdon rumoured to be the next councils to be forced to make this kind of move, London will be emptied of all but the very richest.

I myself grew up in an area that started out very typical of working class North London and is now so fashionable, I couldn’t dream of being able to afford to live there until I earn at least three times what I do now; an unlikely prospect with wages stagnating. This wasn’t a rich area I choose to move to, it’s the home that grew unaffordable around me until I was a forced out.

Between the 80% market rents in social housing, the bedroom tax and housing benefit capped at 30% of LHA there will simply be nowhere for poor families to live in London anymore. This doesn’t stop there being a demand for people to work jobs on low wages travelling from further and further afield and paying ever more for the privilege of doing so.

And this isn’t just a problem that will affect London and the South East. As rents continue to overcook here, more and more boroughs like Newham will be forced into situations where they try to move their waiting tenants, en masse, to other areas of the country, which will then put far greater pressure on their schools, hospitals and other local services. Pressures that will be exacerbated by having removed people from the support networks they had previously developed which do remove some of the need for these services.

It comes as no surprise to anyone interested in housing that the Government’s first tranche of legislation is having exactly this kind of effect. But those who think – or hope – that Newham is going to be an anomaly, that it is a politically motivated ruse, are going to continue to have their faith in this Government and their childlike faith in a wish-fulfilling market sorely tested.

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  • Rob

    Like you say Emma, Welfare reform and social housing are very difficult areas. But the trouble is, some on the Left have the same “childlike faith” in spending mor and more taxpayers money to support people who can’t contibute or won’t contribute.

    Some questions. Why should working people pay for non working people to live in central London locations that they cannot, themselves, afford? I am well aware that a lot of housing benefit goes to people on low wages, but isn’t that an argument to fight for a living wage?

    Why does no-one on the Left dare mention that 3 million or so immigrants in the last decade has increased housing demand? Do they think no-one will notice if they keep quiet? Because population growth – almost all of it from immigration – puts a hell of a lot of press on housing, health and other services.

    There is nowhere for middle income families to live in London, either. But then, Labour in government did bugger all to reign in the house price boom, and delighted in rich people buying up London property.

    Building more crap houses, making the South East more crowded, and reducing the quality of life is not a vote winner. Basic politics tells you that Emma.

    We need more concrete (sic) solutions than you are suggesting

    • pkelly1

       Well Rob – perhaps you should try fighting for a ‘living wage’ when you have no trade union to protect you from the sack. The Tories want to have people on low wages – though they prefer to call it  a ‘flexible’ labour force.

    • Quiet_Sceptic

      I have never understood the relaxed attitude that many of the Left have toward population growth, particularly in relation to the housing issue and the problems it creates.

      I’m also very surprised by the number of articles from people in London who believe there is a simple answer, normally along the lines of building some more social housing in the London boroughs, yet history would suggest these polices whilst well intended are woefully inadequate because they cannot provide housing in the quantities required.

      No one ever seems to remember or reflect on the history of London’s housing and development, a post-war history that could be loosely summarised as a state sponsored mass migration of Londoners out of the city into the new towns to relieve housing pressure and over-crowding.

      Those who cannot remember history are condemned to repeat it.

  • treborc1

    The fact is nobody has been building council houses, labour did not, and to be honest even when they did people had to move to where these houses were.

    My disability bungalow is thirty five miles from where I use to live, again the choice was simple take it or live where you were.

    London rents are high and last week on TV a young women moaned about moving out of London because of her friends and family, asked how much is the rent she said about £1,800 a week, that is way to much even for London.

    The problem is labour allowed in 4 million immigrants and built nothing to house them.

    As for the Tories moaning about welfare, let me remind you of labour words Work shy and scrounger, and Miliband still moans about welfare.

    If houses are available out side of London and  sadly it’s within commuting distance then move like most of us had to.

    Nobody can state they want to live next to friends or families we have never been able to do that, if you want a roof over your head you take what is on offer.

    be nice it Blair and his ilk had thought of that.

    But to be honest between the Tories and people like Purnell Caroline Flint, Lansley labour got nothing to say at all.

    But rents of thousand per week is ridicules

    How many times on TV have you heard labour moan about the poor or the sick or the disabled, all you get from him is the poor old squeezed middle and the people like me at the bottom are pretty fed up with it, middle class leader with a middle class voice in a middle class party.

    Nope I feel sympathy for people who have lived a life time in London, but last week it was immigrants who spoke on TV , and to tell us they are not moving into council houses, as if council houses are a dirty thing, made me smile.

    Would Miliband build more council houses, he said he would not, so live with it

  • aracataca

    There are a lot of sweeping generalisations in the commentary here. Firstly, the claim that Labour ‘let in 4 million immigrants’ is innacurate. It was the European Union that changed the rules on immigration in the early part of the last decade and the UK, being a member of the EU was obliged to comply with that change of rules. Unless the UK leaves the EU, something I do not favour, then it will be obliged to comply with immigration regulations made in Brussels. Secondly, 4 million sounds like a colossal figure and is presented here without evidence to support it. 
    The fact remains that Labour must repeal the aspect of the Welfare Reform Bill that constrains housing benefit in such a draconian way. Families being put out on to the streets was a fact of life in the nineteenth century and should remain  stuck in history. Imho nobody on the left should be advocating such a move.   

    • Rob

      Not true. Labour in government made a decision to open the British labour market to the new eastern European and Baltic EU states seven years before any other big EU state.

      Here are figures for just one year

      As you say, “4 million sounds like a colossal figure.” 

      It is. 

      And British people were not consulted. Our infrastructure cannot cope. We need lots of new houses, some of which will have to be built on greenbelt land. Cities, especially London will become yet more over crowded.

      Do you understand why a lot of people are pissed off?  

      • Bill Lockhart

         Spot on Rob. The open door to migrants from 2004 Accession nations from the word ‘go’ was a deliberate decision by Labour, in contrast to other more sensible EU countries which applied transitional employment restrictions so as to allow their economies and infrastructures time to adapt. Labour were too busy rubbing “the Right’s nose in diversity” to worry about little things like jobs, housing, school places or healthcare.

        • Rob

          Actually, I don’t think it was deliberate. It was thoughtless, and careless, and fitted in with the “free market economics but liberal on social policy (including immigration)” philosophy.

          What worries me is that some on the Left, small in number but influential, still think that any criticism of immigration is racist and beyond the pale.

          It is so obvious to everyone that London is over-crowded, and that the infrastructure is at breaking point. It is also obvious to everyone that the demographic make up of the city has changed dramatically,  in many places beyond recognition.

          And yet most politicians and Leftish commentators say nothing about this elepahnt in the room.  Do they really think that you can’t have too much immigration? Do they really think that a rapidly growing population is a good thing? That turning London into a city with shanty towns, ghettos and a population density not seen outside Bangladesh is a positive step?

          Until we address this problem we have no credibility and everything else is a minor debating point.  

          • Bill Lockhart

             MigrationWatch have some numbers about the real, measurable effects of  immigation on the London housing situation. Of course, even mentioning them on a  “left-leaning” site makes me into a fascist baby-eating satanic vampire bat, but what the hell.

            ” Official data is available on the nationality of those allocated
            social housing. It shows that at least 11% of social housing lets in
            London were given to foreign nationals. In the boroughs of Ealing and
            Haringey half of all social housing lets went to foreign nationals.”


        • aracataca

          Why do you always talk crap?

          • Bill Lockhart

            Because I have to use language you’ll understand. Get an adult to explain to you the A8 transitional employment restrictions which the governments of all the major economies in Europe applied- apart from Blair and Brown who simply opened the gates as wide as they would go. You obviously haven’t got a clue about any aspect of this discussion- you claimed above that Labour had “no choice” but to allow unlimited economic migration from the accession states. You were, as Rob pointed out, simply factually wrong. Do some basic reading and stop embarrassing yourself in public.

          • GuyM

            Labour left an open door to new EU entrants workforce and horribly underestimated immigrant numbers.

            That was important as central government allocation of funds is based upon estimated population and immigrant numbers. As a result loads of councils were hit with vast more people needing local services (housing, schools, social services, health services) etc. than had been forcasted for or funding provided.

            It overstreched local services and taxpayers and has resulted in the feelings towards immigration that became so clear in the last election.

            You really need to get your facts straight.

          • treborc1

             Might be catching from you

      • aracataca

        But no evidence to support this figure yeah? Any reliable/credible statistical references?

        • Rob

          Sure, its all fantasy figures. London is peachy and needs more people to move here from all over the world otherwise it will become a ghost town.

          Only a seriously deluded fool would doubt that London has seen a massive increase in population, and only someone totally in denial would say it hasn’t caused problems.

          If you want to live in la la land, fine, carry on. If you want to actually start addressing problems (and recognising that the London electorate is getting pretty pissed off) then you have to admit that there is a growing  population problem in London.

          I really don’t see how that can be controversial unless you are wilfully stupid 

          • Then ask yourself why. Because it certainly isn’t the public sector’s fault! There are other places than London, but this country is far too London-centric – and having the Olympics there is making it far worse too. Why are people not looking past London for opportunities? Could it be because the vast majority of private sector opportunities are in London and the south-east?

          • GuyM

            Yes the vast majority of private sector opportunities are in London and the SE, but that’s in large part down to people like myself who refuse to relocate out of the area.

            I’ve had three previous jobs where employers have tried to mass move a London workforce to the north and west and on each occasion I (and most others) refused to move. We took our redundancy money and got other jobs in London.

            The employers were faced having to recruit entire teams in the regions when the skillsets were in short supply. The NHS who offered me a lot to move to Leeds were still looking to appoint someone to fill my position 6 months after they moved the job and I left.

            I’d not relocate north under any circumdstances or for any realistic salary offer. Employers know this sort of attitude exists, so a concentration of experience and skills exists in a determindly static London workforce which they want to tap into… hence they locate in London and the SE.

          • aracataca

            But no stats to back up the 4 million number up? It is made up isn’t it?

          • treborc1

            It’s made up of 3.2 million people who have come here legally and about 500,000 who are here illegally.

            But it has nothing to do who is here or who is not here, lets say ten people have come here and those ten want a home, they cannot have one because in London alone the waiting list is 32,000 in my area it’s 9,000 with no new social housing being built.

            And a Middle class labour party talking about building homes for workers, we would have to have scroungers like legless soldiers having a home

      • And given that most of those who came arrived during the boom years, isn’t it just as well? Because after seven years there would be nothing which could be done in any case – so they would have arrived under far less optimistic circumstances.

        The South-East is far too overheated and unless relocation of jobs takes place I don’t see it improving. And we can’t leave that to the private sector….

        • Bill Lockhart

           If  Labour had imposed transitional arrangements as they could and should have, mass economic migration from the Accession countries wouldn’t have depressed wages in un- and semi-skilled employment and  fewer British people might have opted for life on benefits.

        • aracataca

          Mike- there is an implicit recognition here that under EU law we would have had to grant entry to these immigrants anyway. What they are saying is we could have done it 7 years later. Right wing parties all know that in order to prevent large scale immigration into the UK we  would have to leave the EU (eg UKIP and the BNP both have EU withdrawal as a central plank of their policies).

      • aracataca

        From your own figures Rob 
        Since the year 2000. It shows that 518,000 People came into the UK in the year to end June 2009 – down by 3% on the previous year. 317,000people left the UK in the same year. Of that number coming in, 68,000were from Eastern Europe (the A8 Accession countries), 58,000 left – the difference between the two (the migration balance) being 10,000.SOURCE: ONS4 million? I don’t think so.

    • treborc1

      Then you tell us how many they left in, please do not tell me 250,000

      Campaign group MigrationWatch said figures to be published by the Office for National Statistics on Thursday will show that by mid-2010 that total had reached 3.2million.

      In recent years, migrants have been arriving at the rate of around ‘one every minute’, the group’s report says.

      It comes as a poll found, for the first time, that those in the 16-24 age group were more worried about migrant numbers than those in their 30s.

      The 3.2million population increase does not include illegal immigrants – of whom there are around one million in the UK.

      MigrationWatch says the ‘three million-plus extra people on this island equates to the creation of three cities the size of Birmingham’.

      The open-door policy was pursued with no public consultation, the study says.

      Sir Andrew said: ‘We would agree, the sheer scale of what has occurred is changing Britain fundamentally and irrevocably and in ways the majority of the population did not ask for, were not consulted about and did not wish to see.’

      The MigrationWatch report estimates that 5.5million foreign migrants arrived in 13 years of Labour government, not accounting for those who left.

      • aracataca

        The correct figures can be found via the ONS. But here are some rough outline figures  ‘The number of foreign workers increased by 1.7 million in the last decade.’ (1.7 not 4)
        In addition during the first year of a Tory/Fib Dem government (May 2011) ‘Net migration in to the UK soared by almost half last year and is now close to  record levels’.
        IMHO this suggests that changes to the migration figures have little to do with the colour of the UK govt and more to do with migration laws made in Strasbourg/Brussels.
        BTW thanks for the gratuitous abuse Treborc. it’s nice to know that some things don’t change.

  • madasafish

    Well blow me down with a feather.. Money is not free. And housing in London costs a fortune…

    Anyone who thinks they are entitled to free housing costing £50,000 a year or so obviously lives in a  paradise where  taxes are paid by people earning £25,000 a year to pay for housing  for others they themselves could not afford.

    And  Emma complains about it…. strange sense of priorities..

    • Bill Lockhart

       Effectively, taxpayers’ money is being used to subsidise poorly-paying employers. They are able to pay as little as they do because the rest of us pay tax which is then recycled as housing benefit to their low-paid employees, enabling them to stay in central London despite not earning enough to afford housing there. The employers can thus employ cheap labour at taxpayers’ expense. I’m surprised that Leftists think that (largely) private sector employers should be subsidised in this way

      • ” Effectively, taxpayers’ money is being used to subsidise poorly-paying employers.”

        Well said, Bill. The quickest way to lift basal wages is unionisation – let’s put our shoulders to the wheel!

      • RedSetter

        Hear, hear. Like Bill I would wholeheartedly support a substantial rise in the minimum wage rates for every citizen forced to work for the minimum wage.

    • geedee0520

      I listened to the Newham Council Leader who was clearly trying to support what is a political move.

      As I understand it the max HB limit is £20k pa – a quick search on Rightmove shows hundreds of properties in Newham available for rent up to this level. The council Leader had no answer to this.

      • Your claim that the Newham Council Leader is playing politics doesn’t stand up. Tory run Westminster are doing the exact same.

      • RedSetter

        There may be hundreds of private properties available but how many of those private landlords will actually rent to benefit claimants?

        • GuyM

          Very few it seems from local reports. Given the shortage of housing in the private rented sector for people in work in london at reasonably good income levels they is a lot of demand anyway.

          I’d certainly prefer to rent to a “professional” (as adverts used to say when I was renting years ago before I bought) than those in receipt of benefits.

          • RedSetter

            This in fact is a real problem. The same thing can be said about employment. Private employers obviously favour applicants who possess desirable qualities, e.g., qualifications, experience, references and a history of continuous employment with few breaks etc., which excludes many of the people that he Coalition want to place in gainful employment from securing work. So we end up in a situation where there may be many advertised vacancies and a lot of affordable housing in some area both of which remain permanently denied, even in possibility, to hordes of welfare claimants that the government wants to move off benefits and encourage into supporting themselves.

            Homes are useless to people who are prevented from renting or leasing them by private landlords: work is meaningless to people who are unable to secure it because employers reject them at the application stage or occasionally after being interviewed.

            Thus Emma is correct.

            Disaster looms.

        • treborc1

           Not many, some will not allow children and some are on short tenancies.

  • Ray Steele

    Emma have you read Labour’s 2010 manifesto?
    Page 2:3″Our goal is to make responsibility the cornerstone of our welfare state. Housing Benefit will be reformed to ensure that we do not subsidise people to live in the private sector on rents that other ordinary working families could not afford. And we will continue to crack down on those who try to cheat the benefit system”Why are all you lefties such hypocrites?

  • AlanGiles

    “The Tories have a very set attitude towards welfare and welfare recipients. They believe that reliance on welfare is damaging to a person’s moral fibre and ability to develop and grow into self-sufficiency, no matter what their circumstances. ”

    As did – and presumably do – Hutton, Blair, Brown and Purnell. Not forgetting Liam Byrne and  Mad Frankie Field, bosom pal of the loathsome Duncan-Smith.

    I’m afraid we are not innocent of this charge Emma

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