Arthur investigates how the government is choosing to spend tax payers money when it comes to social housing.
The National Housing Federation’s chief executive David Orr called for Theresa May to rethink her social housing strategy in a recent report. The report showed that the amount of money the government is spending on social housing has increased from £16.6 billion in the 1990’s, to £25.1 billion in 2015-16. On the face of it, this seems good. But the report shows that this is not the case. This is because the money is being spent in the wrong way, according to David Orr. The government is spending a lot of the money on ‘affordable homes’. This means that they are marketed at 80% of the market rate, rather than social housing which is payable at 60% of the market rent. This, the National Housing Federation say, costs the taxpayer an extra £21 a week per property.
The reason the government is having to do pay this much is because they are paying private landlord’s to rent their property to social housing tenant’s due to a lack of social housing.
Why not build more?
The government has not allocated any new money to building social housing since 2011. This, David Orr believes, is wrong:
“We know we need more, better quality social housing. And yet, rather than putting public money into building the homes we need, we are propping up rents in a failing market.”
In fact, after the Grenfell Tower disaster, Theresa May admitted that the social housing stock in the United Kingdom had been neglected. Therefore, the Prime Minister pledged over £1 billion of investment…into ‘affordable homes’. Despite over one million families being on the waiting list for a home, the government refuses to build new homes and is only investing 0.2% of national GDP into home building.
The National Housing Federation represents Housing Associations and other social housing providers; they have vowed to fight the government on their current housing stance to try and increase the amount spent on infrastructure.