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Saturday, 10 August 2013 00:00

Housing nears catastrophy

The caricature of British society favoured by multimillionaires David Cameron and George Osborne shows feckless claimants sitting on their sofa or snoozing in bed as they wait for their benefits to be paid.

Everyone knows that this is an unfair portrayal, but even critics of the conservative coalition government see the size of the benefits bill and believe that something must be done.

Benefits are certainly a burden on society, but the key questions are why they are paid and who benefits from them.

GMB general secretary Paul Kenny's comments in response to the Council of Mortgage Lenders report that 40,000 mortgages worth £5.1bn were advanced to buy-to-let speculators in the second quarter of this year are very pertinent to these questions.

Housing benefit in respect of rent payable to private landlords owning over 1.5 million homes is little more than a direct state subsidy to the private sector.

And the recent spurt in mortgages offered to buy-to-rent landlords will add a further 16,000 households to the housing benefits merry-go-round.

Claimants, whether unemployed or in low-paid jobs, cannot afford the extortionate rents demanded by private landlords, but they have nowhere else to turn since both the Tories and new Labour pulled the plug on council housing.

Margaret Thatcher's Tory government ran an aggressive right-to-buy campaign to encourage council tenants, especially in the most desirable properties and areas, to join the "property-owning democracy."

This was beneficial to the tenants involved, but, in a situation where the supply of new council homes for rent dried up, it increased council housing waiting lists.

Sales to individual council tenants were followed by wholesale stock transfers to the private sector, forced by government refusal to fund property upgrades, which has exacerbated the situation.

Neither the government nor the Labour opposition has been willing so far to promise the necessary decisive action to kill two birds with one stone - meet housing need and reduce unnecessary spending on cosseting private landlords.

Indeed, a massive council housebuilding campaign could add a third bird to the lethal stone's account by kick-starting the construction industry, providing tens of thousands of jobs and boosting government tax receipts.

Kenny wants Labour to pledge a programme to build new homes to let at affordable rents across the country, which would undoubtedly be a vote-winner.

So what stands in the way of Ed Miliband making such a bold commitment?

The GMB leader's reference to the need for compulsory purchase orders to be applied to build social housing if 177,000 new units in London with existing planning permission are not started within six months of the general election provides a clue.

Compulsory purchase orders and a mass council housebuilding campaign strike at the heart of the neoliberal orthodoxy that housing provision should be left to market forces.

That has always been the fundamental philosophy of the Tory and Liberal Democrat parties.

But Labour, for three decades after the second world war, had a different approach, seeing local authority housing as essential to working class security and social cohesion.

Miliband's One Nation Labour, in common with its new Labour forerunner, remains obsessed with the invisible hand of the market, even though its shortcomings are plain for all to see.

Breaking with the private-is-best policy for housing is an essential prerequisite to meeting people's needs and ending the state spoonfeeding of parasitic buy-to-let landlords.

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