Two recent reports from Community Housing Cymru highlight the contribution housing associations can make to delivering affordable homes – and the damage caused by the ‘bedroom tax’. Nick Bennett explains what can be done
Late last year we welcomed an independent report by the Welsh Economic Research Unit (WERU) that showed that despite austere times Welsh housing associations were bucking the economic trend and boosting the Welsh economy in 2012/13, to the tune of £1,034 million. That is an increase of 8.7 per cent from the previous year, with 81 per cent of this spend retained in Wales.
The report also showed that:
• Housing-led regeneration and building and employment opportunities delivered by housing associations play a key role in contributing to the Welsh economy
• 30 per cent of the overall spend was on maintaining, repairing and upgrading properties to bring homes up to the Welsh Housing Quality Standard (WHQS) as set by Welsh Government
• £227.5 million was spent on the construction of new affordable homes and
• An estimated £509 million was spent on the regeneration of communities, which might not have otherwise received investment.
WERU figures also indicated that 1,862 additional affordable homes were delivered during 2012/13 – more than 50 per cent of the Welsh Government’s affordable housing target in 40 per cent of the allocated time, with 41 per cent built without any grant.
Double whammy
This might paint a good picture, as illustrated by the infographic, but in October we also surveyed our members to measure the impact of six months of the bedroom tax and the findings, although not surprising, revealed the policy is affecting affordable housing supply and causing misery across Wales. The findings reveal
a double whammy affecting supply, with arrears from the ‘bedroom tax’ costing the sector enough to service around £40 million worth of debt, which could deliver 400 new affordable homes and housing associations seeing a surge in void properties as a direct result of the policy.
The moral and ethical arguments against the bedroom tax have always been weak. While ideology may lead you to divide between the ‘deserving’ and the ‘undeserving’ poor, ideology cannot deny the evidence, and it is ultimately evidence which should dictate government policy. We believe the evidence is clear – if this policy continues, it will not only cost Wales much-needed affordable homes and affect the investment housing associations make to the local economy but also drive those affected by the policy into debt as they struggle to make up the shortfall in their rent as there are a shortage of smaller properties to move to.
We need to stand back and realise that the only solution is to take power closer to the people and devolve welfare reform to Wales. In an asymmetric union, we can now look to Northern Ireland and see them use their powers in welfare policy to do something different for the first time ever! They have legislated to stop the bedroom tax affecting existing tenants. Like Wales, it is affected to a far greater degree than England and Scotland, but their devolution settlement has allowed them to protect the people of Northern Ireland from the policy, and also to adapt the upcoming changes to universal credit and direct payments to fit the needs of Northern Irish tenants. With the Silk Commission due to report early this year on further powers for the Assembly, what chance they listen to our recommendation that Wales is given parity with Northern Ireland on welfare powers?
Nick Bennett is group chief executive of CHC