Lies, damn lies … and NHF Housing Benefit reports

The National Housing Federation issued a report on Housing Benefit spend containing deceit upon deceit and is riddled with schoolboy research errors and replete with sophistry yet it was reported as fact in Inside Housing, the Guardian, the Independent and the BBC – Oh dear!

Some highly selective charts and figures are used throughout in an overall attempt to say private landlords have been taking advantage of Housing Benefit spend yet the actual data reveals a very different picture; one of HB largesse to housing associations in both the overall amount paid and the way in excess of inflation increases housing associations (and council landlords) have received.

The Aggregate Picture

hbtoHAs1

As you can see Housing Associations at £9.3 billion per year get almost 10% more in Housing Benefit than private landlords at £8.4 billion per year.

Notice the left hand side of the graph which shows the position at November 2008 and how similar the yearly amount of Housing Benefit each landlord type received was and then compare to right hand side!

hbtohas3

As you can see above Council Landlords receive 7% less of the overall HB spend in May 2016 (the latest figures) than in November 2008.  Of that 4% has gone to Housing Associations and 3% to private landlords.

Yet the real issue on Housing Benefit spend that the NHF report highly conveniently omits is the average amount of Housing Benefit per week as the chart below reveals

hbtohas2

Look at the amounts per tenant per week and you find that the private landlord in May 2016 receive two pence per week more than they did in May 2010 an actual increase of 0.4%. Housing Associations meanwhile have seen an increase of 21.6% from May 2010 to May 2016 and both against an inflation of around 12% in that time.

Private landlords actually get £1.81 per week LESS in Housing Benefit per tenant now than they did in May 2011!  Housing Associations get £13.73 MORE in Housing Benefit per week in the same 5 year period (and councils £11.47 per week more in the same period.)

All figures come from the official HB figures released by DWP each quarter and the last data set was published on 17 August 2016 that you can access here and for example Table 4 Cell F106 reveals 1,889,108 HB recipients in HA’s which when multiplied by the average weekly HB paid to HA tenants of £93.96 (Table 5, cell F107) gives the £9,261,727,093 or £9.3 billion per year that HA landlords get in Housing Benefit.   May 2013 saw PRS landlords get £9.27 billion, their highest ever figure with £9.315 billion being the highest received by Housing Associations in June 2015 (all figures exclude tenant on Universal Credit where housing payment has replaced HB.)

The NHF are correct in saying that we spend too much on HB to the private landlord and the private landlord still receives 17% more in HB per week than the Housing Association landlord and a staggering 33% more than a council landlord – and note the NHF report merely says the private landlord gets 23% more in HB than a social landlord which deceitfully masks the real figures.

Housing Association landlords receive 13.4% more in HB than a council landlord at £93.74 to £82.66 per week.  Take this £11.08 per week and multiply by the 1.89 million HA tenants receiving Housing Benefit and we find that Housing Associations receive £1.1 billion per year more than council landlords would for the same number of HB recipients.

Note well this figure excludes tenants on Universal Credit so the actual figure will be higher when it includes HA tenants receiving housing costs payment in UC when formerly they received Housing Benefit.  Further note that the £11.08 per week more in rent Housing Associations charge in rent over and above what a council landlord does and we find Housing Associations receive £1.56 billion more in rent per year – a total of £11.7 billion over the period – and enough just in excess rent to build 80,000 new properties per year!

So in the 7.5 years of this period Housing Associations had enough excess rent over council landlords to build some 600,000 new properties. They built no more than 241,000 in this period – or around 50,000 per year less than they could have done!

The reason for this latest nonsense from the NHF becomes clear as their members simply (a) do not have the capacity as the maximum output has been 40,000 in this last year and; (b) the inclination to build as the figures show that just their excess rental income over council landlords could deliver.

The same NHF are crowdfunding for an IT estimating tool to see how much more income their members can glean from tenants in pay MORE to stay (on top of the £360 million pa charged in affordable (sic) rents) and they are now haranguing government to give them the £7 billion or so over this parliament and to trust them to build more homes with it rather than just for starter homes and home ownership!  Yet their past history shows starkly they do not have the capacity or inclination to build at the volume they can – while making record surpluses in that period too!

One interesting issue that, surprise, surprise, the NHF left out of this report on Housing Benefit is that many of their members charge the Housing Benefit bill MORE in HB in the affordable (sic) rent model than private landlords are able to receive in LHA, the private sector version of Housing Benefit.  I did some digging into the official SDR figures from the housing regulator and found that some Housing Associations charge more in AR than the private landlord can receive in LHA.

In Cambridge, Coventry and many other places the affordable (sic) rent charged is above the LHA maximum and the affordable (sic) rent product can receive 100% of rent charged in HB (there is an agreement in London not to go above it but that is voluntary and just for London before any denial of that premise and fact) which means housing associations DO receive more in HB than private landlords receive in LHA in some areas – and in some cases 18% more that private landlords too.

This is especially common with 1 bed AR units and less so the higher the number of bedrooms and I have found examples in every region outside of London so it could be tens of thousands of cases given HA’s have over 100,000 AR properties at end of 2014/15.

There are even a few isolated cases when housing associations charge more than full gross market rent (GMR) in some areas with their AR products which is set at a maximum of 80% of GMR – clearly a mistake yet one that exists nonetheless.

All of the above ‘peccadilloes’ of Housing Associations and Housing Benefit receipt are out there in the public domain if you know where to look, which clearly is not where NHF researchers look or at least those who can operate a calculator or simplest spreadsheet.

It seems that the NHF is now so entwined with this Conservative government that are now practising the tell a lie often enough and people will believe it technique …

 

 

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5 thoughts on “Lies, damn lies … and NHF Housing Benefit reports

  1. But Joe, don’t RP rents get set by formula dictated by Government? And now they have to decrease by 1% per year, don’t they? So if RP rents have increased, it’s not because the RPs have greedily decided to soak their tenants for every penny, but because these are the rents they have had to charge; whereas PRS landlords charge whatever the market allows. And the fact remains that PRS rents are still substantially higher than RP/Council rents. So if we are going to subsidise rents (though I’d rather subsidise building houses) then it’s still vastly preferable to subsidise RP/Council (preferably Council social) rents than PRS ones. We’d still get far more properties/housed tenants for the same amount of money.

    1. Yes to much of that… however don’t ‘social’ landlords have responsibility to use that inflation busting rental income over many years to invest in being social, as in not ‘affordable’ and not for private rent and private sale and other asocial products?

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