InsideHousing has a fantastic scoop on quite how broken the government’s “pay to stay” proposal is. The scheme is designed to tackle the “Bob Crow problem”, when people who were given social accommodation in the past end up earning significantly higher salaries while still having subsidised rents. That aim is questionable enough as it is – the Guardian‘s David Walker argues compellingly that it would lead to ghettoisation – but in some parts of London, it is impossible.
The way the scheme, as proposed, will work is that any person earning more than £60,000 will have to pay the full market rent on their property, or leave.
But InsideHousing explains:
Exclusive data from consultancy Hometrack reveals that in four boroughs this will not be possible for tenants paying affordable rents.
This is because tenants would need an income of up to £82,226 to pay the rent even if it is set at 63 per cent of the market rate – the average proportion charged under the scheme – rather than the 80 per cent maximum allowed.
In other words, there are councils in London (Kensington and Chelsea, City of Westminster, City of London and Camden) where the income required to pay the average affordable rent is higher than the income which the government says is enough to throw people off social housing schemes entirely.
It gets even worse if you break it down by area; InsideHousing reports that there are “88 wards across 16 boroughs with a total of 131,000 social homes that could only be afforded by households earning more than £60,000 a year if rents were set at 63 per cent of the market rate.”
The full table of incomes required to pay “affordable” rents is quite something; head to their site to take a look. But in the affected boroughs, at least, it’s pretty clear that “pay to stay” means little different to “ask to leave”.