PM Camerons salary cant afford an affordable rent tenancy!!!

Late today a blog by Steve Hilditch was released that is absolute required reading by anyone involved with housing.  The blog entitled “82,000 social rented homes hijacked to pay for ‘affordable rent” details a Freedom of Information release on the Tories flagship “affordable (sic) rent” model and as the title suggests states that 82,000 socially rented homes are to come out of having a social rent and instead will have an affordable rent.  A huge issue and one I will leave you to read Steve’s withering analysis of and which I agree with.

Instead here is my interpretation of the data released.

The first thing I was struck by was that the highest “affordable (sic) rent” naturally in London is £2142 per calendar month.  In weekly terms this is £494.45 and ALL OF THIS WILL BE COVERED BY HOUSING BENEFIT as “affordable (sic) rent” is a social housing model and so will be paid in full by Housing Benefit.

Read section 1.2 of the official document which says:

“Where tenants are eligible for Housing Benefit it will continue to be paid in full in the same way as for social rented properties at present.”

Hang on you say isn’t the cap £400pw?  No!  That only applies to LHA and the private rented sector.  So firstly dear readers you can see why I always say “affordable (sic) rent;” secondly and far more importantly you can see that this flagship policy of Shapps and the Tories sees the taxpayer paying more in benefit to a social housing tenancy than even the highest private rent figure is allowed to get in LHA.

In fact it will receive £4,922.82 more per year than the maximum permitted and £2142 per calendar month is £25,704 per year in Housing Benefit alone.

If it were a truly affordable rent in the accepted definition of being no more than 33% of net income then the tenant would need to have a net income of £6,426 per month or a gross salary of £121,000 per year!!!!

But doesn’t Shapps and his Tory cronies in London boroughs especially want to see anyone earning over £100k (initial figure) or is it £65k (revised figure) or is it £40,200 (LB H&F figure) pay full market rent if they do?  Yes.

As the London average “affordable (sic) rent” figure is just 65.1% of the market rent then following this outrageously privileged salary, the social tenant of this property should in fact be paying a rent of £3,290.32 per calendar month, which to be truly affordable by the above definition would mean the social tenant would need to have a gross salary of £206,000 per year.

Let me restate that – to afford the highest price “affordable (sic) rent” property you need a salary of £206,000 per year!!

Dear reader, as you will be aware there is so much more to be gleaned from this FOI request and a major hat tip to Steve Hilditch for getting the data.  I have a feeling there are a few more blogs in this don’t you?

Just thought I’d let you know for now that even if we gave David Cameron’s basic salary a £1000k per week increase on his £142,500 pa basic salary he still couldn’t afford his own policy of affordable rent!!

You couldnt make this up could you?  And right slap bang in the middle of the Tory Party Conference too!  What was it Shapps said about the affordable (sic) rent programme – oh yes it was a bit of a rough and ready exercise.  In fact Shapps specifically said ahead of the CIH conference this year that: –

Affordable Rent was created at a very fast rate for the Spending Review. When we got into government we realised we had to sort out this deficit so (Affordable Rent) was a pretty rough and ready exercise in all honesty. But now we’ve got the opportunity ahead of the next Spending Review to really dig into the balance sheets of the sector.”

Hahahahaha – so much thought went into affordable (sic) rent that double the PM’s salary and he still cant afford it!!!  If you think that is funny he went o to say in the same interview: –

“But I am prepared to say now that I think there is another round of Affordable Rent post-2015”

Hahahahahahahahahahahahahahahahahahaha – and there dear reader you have in a nutshell the amount of pre-thought that goes into Tory housing policy.  Would it be churlish of me to comment that Mark Prisk said today in Inside Housing that:

“Mr Prisk also said that the £1.8 billion affordable homes programme, under which providers are expected to charge higher rents at up to 80 per cent of the market rent in return for grant, is ‘ahead of schedule’.”

Oh dear! A policy that sees a doubling of the PMs salary being not enough to afford affordable rent being ahead of schedule.  You couldn’t make it up could you!

FOOTNOTE & CORRECTION

My apologies if you read the draft version of this which I posted before double checking my figures.  It said a salary of £313k was needed and the real figure is the corrected £206k figure above.  This in net terms to explain gives a monthly salary of £9904 which makes 33% of this (the affordability figure) of £3301 which would cover the £3290 rent figure mentioned above.  I made a mistake and apologise and perhaps my fit of giggles at realising this central theme is explanation but not excuse!

Still the £206k salary needed is double the original pay more to stay figure. more than 3 times the amended one of £65k and more than 5 times the London Borough of Hammersmith & Fulhams plans for those earning more than £40,200pa – you know those rich scrounging so and sos who have no right to reside in social housing!

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