Curtailing Pensioner Benefits

[SideValve]

I don't think we should cut benefits for pensioners. But we do need to be aware of the problems that we are storing up for the future.

There is a lot of truth in this thread about the workshy but unless I missed it no one has mentioned the effect that losing our public housing stock has had. Selling off our council houses and not replacing them has been a huge mistake. At one time over 40% of us lived in council houses. Today its 8%.

The existence of relatively cheap housing kept private rents down.
This also kept house purchase prices sane.
Benefits are paid on rents. When those on low incomes lived in council houses this was affordable. Now over 75% of those live in private (and I include in this housing associations - they are not owned by us) rentals and the cost to the taxpayer of housing benefits has ballooned. These are benefits paid to property owners. We subsidise their profits and have removed their competition.

This has also pushed up the cost of employing people. Part of the reason we employ cheap foreign labour is that they are often willing to accept poor standards. We gave up slum housing and don't want to go back to it however we are less squeamish about paying Rumanians to wash our cars while they live in old shipping containers.

There are two ways forward with this. We can cut the benefits, let tens of thousands end up on the streets and hope that this brings some sense back to the housing market. Or we can invest in decent housing stock and make it available, as we used to, to people that need it.

Incidentally, I highlighted WE because we have relied for too long on foreign investment. We need to do this for ourselves not get the French, Chinese, Americans or whoever to fund it for us. We have the highest level of Chinese investment in the Europe. It has its benefits but it means we subsidise their profits. We should fund our own.

Finally, after the global financial crisis we were heralded as the fastest to show signs of recovery. 10 years of "austerity" (i.e. cuts to our services and sale of our assets) have led us to a point where we have more billionaires than ever but are considering cutting free TV licenses for the old at a time when, having cut the bus services to the bone, sitting and watching TV is one of the few pleasure left. The average age at which people buy their first home is now over 35, the chance of them paying off their mortgage by the time they retire is slim. If we carry on as we are, in twenty years our pensioners TV licenses will the least of their worries.

[HarryM1BYT]

[QUOTE=SideValve;2730226
The existence of relatively cheap housing kept private rents down.
This also kept house purchase prices sane.
Benefits are paid on rents. When those on low incomes lived in council houses this was affordable. Now over 75% of those live in private (and I include in this housing associations - they are not owned by us) rentals and the cost to the taxpayer of housing benefits has ballooned. These are benefits paid to property owners. We subsidise their profits and have removed their competition.[/QUOTE]


That is part of the problem, but the other side of the coin is property costs. As anyone who watches the likes of 'Homes under the Hammer' will realise the cost of property in some parts of the country is astounding - £400K for a run down tiny flat, in desperate need of massive refurbishment, is simply ridiculous (London), with a handkerchief sized garden. Buy to rent owners have to charge a sensible rent for their properties, a sensible rent has to be reflected in benefit payments.



I can understand property costs varying somewhat around the UK, but not to this extent. High prices ought to be enough of a deterent to people to move into an area and thus pull the prices down. Why do so many want to live in London squeezed into a tiny flat when for the same cost they can live in a nice big property with a proper garden.

[MSS]

Originally Posted by HarryM1BYT

That is part of the problem, but the other side of the coin is property costs. As anyone who watches the likes of 'Homes under the Hammer' will realise the cost of property in some parts of the country is astounding - £400K for a run down tiny flat, in desperate need of massive refurbishment, is simply ridiculous (London), with a handkerchief sized garden. Buy to rent owners have to charge a sensible rent for their properties, a sensible rent has to be reflected in benefit payments.

I can understand property costs varying somewhat around the UK, but not to this extent. High prices ought to be enough of a deterent to people to move into an area and thus pull the prices down. Why do so many want to live in London squeezed into a tiny flat when for the same cost they can live in a nice big property with a proper garden.

Property prices are at the centre of many of our problems. A lot pf this is driven by foreign investment as well as investment by the exceptionally wealthy in property in places like London.

Landlords often get bad press, some deservedly so, but I can say from first hand experience that it is a challenge for a responsible landlord who cares about his/her tenants' quality of life, to get a 3.5% return on the investment in places like London, Ipswich etc. When you consider the risk being taken, this is actually not very high.

Perhaps there is a case to be made for creating islands of affordable accommodation and associated infrastructure for the those on long-term benefits. It seems ridiculous to house a family where the adults have never worked and will probably never work in a city like London or Liverpool.

[topman]

Originally Posted by HarryM1BYT

Why do so many want to live in London squeezed into a tiny flat when for the same cost they can live in a nice big property with a proper garden.

Mainly due to the wages that are possible, although not necessarily earnt straight away, the job opportunities for many are much better there than anywhere else.

Although that in itself is a symptom of a bigger problem. This country is very much unbalanced when it comes to investment. London is too big and has too many levers of power concentrated and that's in all aspects from finance to political power etc.

The UK has this concentration like few other western countries, the US has several centres spread out from NY to Washington to LA. Germany, Switzerland are similar with political, business and financial centres spread out. We don't, this isn't good. We have created a country where there are large gaps between those with and those without these centres of power. It's never particularly good when there a lack of social cohesion, put simply when one part of the country doesn't recognise another.

A good example would be HS2, good idea but should be built after HS3 not before. Don't get me wrong it's needed but I do worry if it'll just turn somewhere else into a London commuter line.

Or the Elizabeth line and crossrail and a time when many areas across the country are crying out for investment in their infrastructure. There's an argument that London needs these to stay ahead in the capital city race and that's true but it does become self fulling hoovering up more and more. And that's not good.

[HarryM1BYT]

Originally Posted by mss

Perhaps there is a case to be made for creating islands of affordable accommodation and associated infrastructure for the those on long-term benefits. It seems ridiculous to house a family where the adults have never worked and will probably never work in a city like London or Liverpool.

I agree with your London, but I always considered Liverpool to be one of the low cost housing areas of the country? Are they not doing a little of the 'moving out', in some less popular seaside towns?

[HarryM1BYT]

Originally Posted by topman

The UK has this concentration like few other western countries, the US has several centres spread out from NY to Washington to LA. Germany, Switzerland are similar with political, business and financial centres spread out. We don't, this isn't good. We have created a country where there are large gaps between those with and those without these centres of power. It's never particularly good when there a lack of social cohesion, put simply when one part of the country doesn't recognise another.

The UK has attempted to spread various centres around the country - DVLA Swansea, DWP Belfast Liverpool, then the massive expensive new building in Leeds - where they struggled to get staff to move away from London to man it.



In one job, I spent during the week commuting down to London, then back home for the weekend. I hated every minute I spent there.

[topman]

Originally Posted by HarryM1BYT

The UK has attempted to spread various centres around the country - DVLA Swansea, DWP Belfast Liverpool, then the massive expensive new building in Leeds - where they struggled to get staff to move away from London to man it.

Yes it's a start but it's still a long way to go. And that's assuming that those moves are part of a strategy.

[wraymond]

Would have thought the ridiculous property prices are possibly a disincentive.

London property, largely due to population density, is disproportionately expensive and the availability of suitable sites for extensive new building for domestic use at manageable costs is vanishingly small.

Brown field sites might offer an opportunity but as transport links in and around the city are so good the knock on effect comes into play. Urban sprawl can only go so far.

Prices are much more affected by job opportunities and career progression for early and mid-career ambitious job seekers. In these cases the new flat, although seen as temporary lodging with increasing value, is irresistible. Especially if funded by employees’ cheap staff mortgages. Foreign investors, particularly in finance organisations, make up a high percentile of incomers.

I shouldn’t think there has ever been a complaint that one’s own house price has risen too much so, as ever, you can’t buck the market.

[HarryM1BYT]

Originally Posted by wraymond

Would have thought the ridiculous property prices are possibly a disincentive.

London property, largely due to population density, is disproportionately expensive and the availability of suitable sites for extensive new building for domestic use at manageable costs is vanishingly small.

To live there, as I live here in Yorkshire, in the house which I own, in London terms is a relatively large place to live, you would need to be quite a high earner. Most people are not high earners, yet London needs its plumbers, cleaners, bus drivers, nurses etc. Yet those people do have to be their to support the cities business and the cities business and success is the cause of its own problems the astronomic cost of housing.



Nothing would persuade me to go live down there, even if I were offered a home of a similar size to what I have, with similar running costs. I like being a few minutes walk of open countryside and relative silence on a night.

[mbev51]

In my break from working in the garden, I'm just listening to a parliamentary debate re governments plans not to honour over 75 pensioner free tv licenses. I hate to think what may become vulnerable to being cut in the future.