Ed Miliband speaks to Labour supporters on January 17, 2014 in London. Photograph: Getty Images.
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Miliband's pledge to cap rent rises is smart politics

The Labour leader has offered relief to the millions who can't afford to buy and who long for security.

For months, Labour MPs and activists have been waiting for Ed Miliband to announce a sequel to his energy price freeze: another popular market intervention that demonstrates how the party would tackle the living standards crisis and that creates a powerful dividing line with the Tories. In the form of his new policy on private rents, Miliband may have just provided it.

At Labour's local and European election campaign launch in Redbridge tomorrow, he will pledge to cap rent rises and to extend the standard tenancy period from six months to three years. Alongside this, he will commit to banning letting agent fees, forcing landlords to bear the cost and saving the average new household £350. 

Under the plan, modelled on Ireland's recent reforms, an "upper ceiling", based on a benchmark such as inflation or the average market rent in the area, will be placed on rent increases to prevent "excessive rises", and tenants will automatically win the right to remain in their property for at least two-and-a-half years following a six month probation period. Landlords will only be able to terminate contracts with two months' notice if the tenant falls into arrears, is guilty of anti-social behaviour, or breaches their contract; or if they want to sell the property or use it for their family. Crucially, they will not be able to end tenancies simply to increase the rent. 

It is one of Miliband's most politically astute interventions to date. In the form of Help to Buy, the Tories have emphasised their commitment to expanding home ownership (although the policy will ultimately achieve the reverse), but they have had little to offer the large and growing number who are either unable (with or without state subsidy) or unwilling to buy. As Miliband will note in his speech tomorrow, there are now nine million people and 1.3 million households renting privately. There are a huge number of votes to be won from offering them a better deal.

A senior Labour source earlier denied to me that the party had embraced "rent controls" (since the market will still determine the starting level) but Miliband shouldn't run scared of the term. A YouGov poll of Londoners earlier this month found that 55 per cent support rent controls with just 19 per cent opposed - and little wonder. Renters are currently paying an average of £1,020 a year more than in 2010 and those in private accommodation have fared worst. In 2012, rent payments represented an average of 41 per cent of their gross income, compared with 30 per cent for social renters and 19 per cent for owner occupiers.

The beauty of the policy, in this era of fiscal constraint, is that it won't cost a penny of government money. Indeed, by limiting rent rises, it will reduce costs to the state by lowering housing benefit payments. By embracing predistribution (seeking more equal outcomes before the government collects taxes and pays out benefits), Miliband has found a way to reduce inequality whilst sticking to his tough deficit reduction targets.

Miliband isn't promising a reduction in rents, as some in Labour would wish, but he is promising the security and peace of mind that comes with knowing how much you will owe your landlord in three years' time. As he will say tomorrow: "These new longer-term tenancies will limit the amount that rents can rise by each year too - so landlords know what they can expect each year and tenants can’t be surprised by rents that go through the roof.

"This is Labour’s fair deal for rented housing in Britain: long-term tenancies and stable rents so that people can settle down, know where the kids will go to school, know their home will still be there for them tomorrow."

So keen are the Tories to kill the idea at birth that CCHQ rushed out a non-embargoed press release at 5:16pm, with Grant Shapps denouncing Miliband for proposing "Venezuelan-style rent controls" and caving in to Len McCluskey. But this stock leftie baiting won't resonate with an electorate crying out for relief from the ravages of the market (and with no interest in where Hugo  Chávez stood on the issue). As in the case of the energy price freeze, the Tories may denounce Miliband for "bringing back socialism", but they will soon discover that "socialism" is more popular than they think. And having performed the largest-ever state intervention in the mortgage market, through Help to Buy, they will struggle to attack Labour on libertarian grounds.

The Conservatives' aim is to present rent controls as ineffective as well as illiberal. Shapps said: "Evidence from Britain and around the world conclusively demonstrates that rent controls lead to poorer quality accommodation, fewer homes being rented and ultimately higher rents – hurting those most in need." Yet as Labour sources are pointing out, in Ireland, where longer-term tenancies and predictable rents were recently introduced, the private sector has grown, not shrunk. Forget Venezuela, Germany, New York, France and Spain all benefit from imposing limits on the market. 

"Generation rent is a generation that has been ignored for too long," Miliband will say tomorrow. But no longer - and it is Labour that will reap the political benefits.

George Eaton is political editor of the New Statesman.

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Donald Trump vs Barack Obama: How the inauguration speeches compared

We compared the two presidents on trade, foreign affairs and climate change – so you (really, really) don't have to.

After watching Donald Trump's inaugural address, what better way to get rid of the last few dregs of hope than by comparing what he said with Barack Obama's address from 2009? 

Both thanked the previous President, with Trump calling the Obamas "magnificent", and pledged to reform Washington, but the comparison ended there. 

Here is what each of them said: 

On American jobs

Obama:

The state of our economy calls for action, bold and swift.  And we will act, not only to create new jobs, but to lay a new foundation for growth.  We will build the roads and bridges, the electric grids and digital lines that feed our commerce and bind us together.  We'll restore science to its rightful place, and wield technology's wonders to raise health care's quality and lower its cost.  We will harness the sun and the winds and the soil to fuel our cars and run our factories.  And we will transform our schools and colleges and universities to meet the demands of a new age.

Trump:

For many decades we've enriched foreign industry at the expense of American industry, subsidized the armies of other countries while allowing for the very sad depletion of our military.

One by one, the factories shuttered and left our shores with not even a thought about the millions and millions of American workers that were left behind.

Obama had a plan for growth. Trump just blames the rest of the world...

On global warming

Obama:

With old friends and former foes, we'll work tirelessly to lessen the nuclear threat, and roll back the specter of a warming planet.

Trump:

On the Middle East:

Obama:

To the Muslim world, we seek a new way forward, based on mutual interest and mutual respect. To those leaders around the globe who seek to sow conflict, or blame their society's ills on the West, know that your people will judge you on what you can build, not what you destroy. 

Trump:

We will re-enforce old alliances and form new ones and unite the civilized world against radical Islamic terrorism, which we will eradicate completely from the face of the earth.

On “greatness”

Obama:

In reaffirming the greatness of our nation we understand that greatness is never a given. It must be earned.

Trump:

America will start winning again, winning like never before.

 

On trade

Obama:

This is the journey we continue today.  We remain the most prosperous, powerful nation on Earth.  Our workers are no less productive than when this crisis began.  Our minds are no less inventive, our goods and services no less needed than they were last week, or last month, or last year.  Our capacity remains undiminished.  

Trump:

We must protect our borders from the ravages of other countries making our product, stealing our companies and destroying our jobs.

Protection will lead to great prosperity and strength. I will fight for you with every breath in my body, and I will never ever let you down.

Stephanie Boland is digital assistant at the New Statesman. She tweets at @stephanieboland