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Byrne: We spend £bns on HB but don’t build houses. It can't go on.
the_flying_pig
Posts: 2,349 Forumite
Thoughts?
http://www.standard.co.uk/news/politics/liam-byrne-we-spend-billions-on-housing-benefit-but-dont-build-houses-it-cant-go-on-8587548.html
High on the rooftop of Portcullis House, Liam Byrne’s office reflects the precarious position of the Blairite tasked with Labour’s trickiest policy area — the future of welfare benefits.
It is an isolated spot, cut off from the mainstream, and “a bit dark in bad weather”. The past few weeks have been relentlessly stormy for Byrne, the shadow work and pensions secretary.
He is under fire from Labour’s Left, who demand blanket opposition to Coalition cuts; goaded by Tories who say Labour is funking big questions; and loathed by union leaders such as Len McCluskey, who called for his removal yesterday, saying: “Liam
Byrne certainly doesn’t reflect the views of my members. I think some of the terminology that he uses is regrettable and I think it will damage Labour.”
In an exclusive interview with the Standard, the former Accenture business consultant gave the first hint of what could be Labour’s Big Idea on welfare: a radical new use for the billions spent on housing benefit.
“We’ve got to show we are the party that believes in responsible decisions, and decisions that put social security on a long-term sustainable basis,” said Byrne boldly. “There’s nothing Left-wing about leaving big social security liabilities to the next generation. We wouldn’t say it was okay to leave environmental liabilities to the next generation. We should say the same about social security.”
Housing benefit, despite contentious cuts, has soared in cost from £12.6 billion in 2003 to £24 billion now. “Is it a difficult issue? Yes it is. But have we got to make savings, yes we have.” Byrne argues that most of the 71 per cent rise is down to higher unemployment, and the initial step must be to get people into jobs through Labour’s compulsory jobs guarantee. He adds: “But we have also got to look at how we increase the supply of housing.”
His top priority over the next six months, he said, would be “to show how savings can be made on housing benefit by increasing the amount of homes there are for people to go to”.
He did not go into details, but a study by the Institute for Public Policy Research has proposed phasing out housing benefit in favour of affordable housing grants to local authorities.
“Billions are spent with private landlords yet we ask nothing in return,” said Byrne. “We are spending £24 billion on housing but hardly building any houses. No wonder rents are soaring. We simply cannot go on like this.”
Byrne, 42, talks in a businesslike manner, reflecting his background. He is quick to laugh (“These days I buy the coffees,” he grinned when reminded of a leaked memo to civil servants setting out hilariously detailed demands for refreshments).
A photograph of him smiling with Tony Blair sits on his shelf, proclaiming moderniser roots. A place-card with his name in Chinese characters reflects the fascination of this former Fulbright Scholar with the economic challenge from the Far East (he has a book coming out in the summer). A bowl inscribed “Minister to Watch” is a reminder of his boy-wonder rise up the ministerial ranks following a 2004 by-election victory.
However, pinning Byrne down on more immediate welfare arguments is like grasping at a wet bar of soap. For example, is a benefits cap of £26,000 per family too high or low on average? “We’re not going to play politics, we would rather get some independent advice,” he sidestepped smoothly.
But the £500-a-week cap has already been imposed in Bromley, Croydon, Enfield and Haringey: are families there being cut too hard, or not enough? “We have just not seen enough evidence,” stonewalled Byrne. He gives a hint of ambition to make the £8.55 London living wage compulsory for public bodies: “We are not quite at that stage yet but it’s an idea we are looking hard at.”
And he confirmed that Labour is looking at making the benefits system reflect people’s contributions more closely. But rather than higher cash benefits — which would cost more — he focuses on employment support for over-fifties who lose their jobs. “Frankly, there’s !!!!!! all there for them,” he said.
Byrne’s caution over spending hardened during his time as Treasury chief secretary. Infamously, however, he left a disastrous note to his successor that read: “I’m afraid to tell you there’s no money left.” It caused uproar, and only last week shadow chancellor Ed Balls muttered darkly on live radio that Byrne would regret the joke “for the rest of his life”. Byrne does not demur. “It was a stupid thing to do,” he said.
Pressed on whether Labour should repeat its 1997 pledge to stick to Tory spending levels after 2015, Byrne deferred to Balls but said the economic circumstances were very different today. “What our economy needs now is a shot in the arm. Growth is draining away.”
Byrne praised Ed Miliband’s leadership repeatedly, saying he had united Labour and put the party back in touch with supporters. The polls, he predicted, would turn against the Tories on welfare in the next few months as cuts in child benefit and tax credits bite. “The real kick in the ribs is only just biting,” he added.
Last year, he decided to quit Westminster to run for mayor of Birmingham — a plan that flopped when the city decided not to have its own Boris. Byrne is philosophical, although the episode may have undermined his standing in the Commons. “Politicians exist to change things,” he insisted. “If there’s an opportunity to shape the destiny of a million fellow citizens, you’ve a responsibility to take it.”
The next six months will put his hopes of reshaping the welfare arguments to the test.
http://www.standard.co.uk/news/politics/liam-byrne-we-spend-billions-on-housing-benefit-but-dont-build-houses-it-cant-go-on-8587548.html
High on the rooftop of Portcullis House, Liam Byrne’s office reflects the precarious position of the Blairite tasked with Labour’s trickiest policy area — the future of welfare benefits.
It is an isolated spot, cut off from the mainstream, and “a bit dark in bad weather”. The past few weeks have been relentlessly stormy for Byrne, the shadow work and pensions secretary.
He is under fire from Labour’s Left, who demand blanket opposition to Coalition cuts; goaded by Tories who say Labour is funking big questions; and loathed by union leaders such as Len McCluskey, who called for his removal yesterday, saying: “Liam
Byrne certainly doesn’t reflect the views of my members. I think some of the terminology that he uses is regrettable and I think it will damage Labour.”
In an exclusive interview with the Standard, the former Accenture business consultant gave the first hint of what could be Labour’s Big Idea on welfare: a radical new use for the billions spent on housing benefit.
“We’ve got to show we are the party that believes in responsible decisions, and decisions that put social security on a long-term sustainable basis,” said Byrne boldly. “There’s nothing Left-wing about leaving big social security liabilities to the next generation. We wouldn’t say it was okay to leave environmental liabilities to the next generation. We should say the same about social security.”
Housing benefit, despite contentious cuts, has soared in cost from £12.6 billion in 2003 to £24 billion now. “Is it a difficult issue? Yes it is. But have we got to make savings, yes we have.” Byrne argues that most of the 71 per cent rise is down to higher unemployment, and the initial step must be to get people into jobs through Labour’s compulsory jobs guarantee. He adds: “But we have also got to look at how we increase the supply of housing.”
His top priority over the next six months, he said, would be “to show how savings can be made on housing benefit by increasing the amount of homes there are for people to go to”.
He did not go into details, but a study by the Institute for Public Policy Research has proposed phasing out housing benefit in favour of affordable housing grants to local authorities.
“Billions are spent with private landlords yet we ask nothing in return,” said Byrne. “We are spending £24 billion on housing but hardly building any houses. No wonder rents are soaring. We simply cannot go on like this.”
Byrne, 42, talks in a businesslike manner, reflecting his background. He is quick to laugh (“These days I buy the coffees,” he grinned when reminded of a leaked memo to civil servants setting out hilariously detailed demands for refreshments).
A photograph of him smiling with Tony Blair sits on his shelf, proclaiming moderniser roots. A place-card with his name in Chinese characters reflects the fascination of this former Fulbright Scholar with the economic challenge from the Far East (he has a book coming out in the summer). A bowl inscribed “Minister to Watch” is a reminder of his boy-wonder rise up the ministerial ranks following a 2004 by-election victory.
However, pinning Byrne down on more immediate welfare arguments is like grasping at a wet bar of soap. For example, is a benefits cap of £26,000 per family too high or low on average? “We’re not going to play politics, we would rather get some independent advice,” he sidestepped smoothly.
But the £500-a-week cap has already been imposed in Bromley, Croydon, Enfield and Haringey: are families there being cut too hard, or not enough? “We have just not seen enough evidence,” stonewalled Byrne. He gives a hint of ambition to make the £8.55 London living wage compulsory for public bodies: “We are not quite at that stage yet but it’s an idea we are looking hard at.”
And he confirmed that Labour is looking at making the benefits system reflect people’s contributions more closely. But rather than higher cash benefits — which would cost more — he focuses on employment support for over-fifties who lose their jobs. “Frankly, there’s !!!!!! all there for them,” he said.
Byrne’s caution over spending hardened during his time as Treasury chief secretary. Infamously, however, he left a disastrous note to his successor that read: “I’m afraid to tell you there’s no money left.” It caused uproar, and only last week shadow chancellor Ed Balls muttered darkly on live radio that Byrne would regret the joke “for the rest of his life”. Byrne does not demur. “It was a stupid thing to do,” he said.
Pressed on whether Labour should repeat its 1997 pledge to stick to Tory spending levels after 2015, Byrne deferred to Balls but said the economic circumstances were very different today. “What our economy needs now is a shot in the arm. Growth is draining away.”
Byrne praised Ed Miliband’s leadership repeatedly, saying he had united Labour and put the party back in touch with supporters. The polls, he predicted, would turn against the Tories on welfare in the next few months as cuts in child benefit and tax credits bite. “The real kick in the ribs is only just biting,” he added.
Last year, he decided to quit Westminster to run for mayor of Birmingham — a plan that flopped when the city decided not to have its own Boris. Byrne is philosophical, although the episode may have undermined his standing in the Commons. “Politicians exist to change things,” he insisted. “If there’s an opportunity to shape the destiny of a million fellow citizens, you’ve a responsibility to take it.”
The next six months will put his hopes of reshaping the welfare arguments to the test.
FACT.
0
Comments
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Byrne argues that most of the 71 per cent rise is down to higher unemployment,
True.He adds: “But we have also got to look at how we increase the supply of housing.”
Also true.
The housing shortage is one of the bigger problems facing Britain.
It's worsening at an alarming rate, and there is no sign of it getting better any time soon.“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
I think diverting HB spend towards more social housing provision makes sense. The need isn't going to go away. The cost of provision in the private sector won't reduce long term. There would be a transitional challenge.
The private sector alone cannot make up the shortfall. It hasn't since the 80s and there is no sign that it has the appetite on it's own.
It would provide employment, that could be focused, with training and skills development opportunities.
I didn't appreciate he was an ex Accenture consultant"If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
Housing benefit is a venal and corrupt method of pumping public money into the private banking system, disguised as a way of helping the poor. Nothing more.0
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It is still a subsidy whether you pay for housing via housing benefit or through below market rentals for social housing.
Not that I disagree that there is a housing crisis as evidneced by housing in may parts of the country costing much more than agricultural land plus build costs. As well as VIs what is stopping this beign fixed by increasing the supply of housing land is that any quick adjustment of house prices to building costs would destroy the eoconomy through wealth effects and a collapse in the banking sector so any improvement will have to be incremental.I think....0 -
It is still a subsidy whether you pay for housing via housing benefit or through below market rentals for social housing.
"Housing Associations" need to be constructed in such a way as to become self financing not for profit organisations. Will require high levels of capital initially to build property. Thereafter in the years to come a return will made to recoup the construction and ongoing maintenance costs.
When the UK's High Streets are redeveloped the incorporation of residential accommodation in the mix. So as to make them living breathing areas.0 -
PasturesNew wrote: »If I by a house for £150k, with a commerical mortgage, and rent it out for HB ..... it costs the Council a lot more than if the Council/similar had simply built it for £100k at Govt interest rates and rented it out.
maybe, maybe not
it all depended upon how efficient the state run building programme is and how efficient the state run subsequent management.0 -
They already are."Housing Associations" need to be constructed in such a way as to become self financing not for profit organisations.
http://www.housing.org.uk/about_us/about_the_federation/about_housing_associations.aspx0 -
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PasturesNew wrote: »If I by a house for £150k, with a commerical mortgage, and rent it out for HB ..... it costs the Council a lot more than if the Council/similar had simply built it for £100k at Govt interest rates and rented it out.
Once the Council has built it, it has an asset that may well be worth more than the £100k build cost and will probably also command a higher rent than the council will charge for it. Thus by renting it out to a council tenant the council is giving up extra money it could have by renting it out at market rate or selling it. Thus it is actually costing just as much as the housing benefit payment to the private landlord.I think....0
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