Today Rachel Reeves made a speech that exposed the failing of this government policies on housing and welfare. The remodelling of employment, where a growing number of workers are in insecure jobs, that are part time and low paid has resulted in tax payers having to pay for this governments failure. Wells PPC , Chris Inchley, explains why.
The recent figures that showed in the Wells constituency 38% of workers earned less than a living wage, with the average wage around £17000 pa.
Rachel Reeves, the shadow work and pensions secretary, says that the number of working people claiming housing benefit is due to double between 2010/11 and 2018/19. Her figures, which are drawn from the House of Commons library, show that an increase in working people claiming housing benefit would cost £12.9 bn – or £488 for every British household between 2010/11 and 2018/19.
The bulk of the increase will come in rent subsidies in the private sector and, in part, reflects the number of people in part-time or low-paid work. Housing benefit makes up about 14% of welfare spending, much of which goes into the hands of private landlords.
It is likely that the number of working people claiming housing benefit is set to double, this because the Tory government has failed to tackle low pay, insecure work and the cost-of-living crisis, with the consequence of thousands more people are being forced to rely on housing benefit to make ends meet.
‘Taxes Handed to Private Landlords’
The tax payer is effectively handing their taxes to private landlords with no assets accrued for the tax payers investment, just redistributing wealth from those who do not have to those with wealthy assets.
To continue on this course of low pay insecure work will lead to higher welfare payments. It is obvious that a change of approach is required. We need a government that will tackle low pay, raising the skills of workers, which in turn must lead to an increase in the minimum wage and a move towards the living wage, a basic requirement in making work pay.
The housing market needs to be rebalanced. It is unsustainable for the current (over) ten times annual salary for the average house price, with the gap between wages and house prices increasing.
It is clear many, many more affordable houses need to be built, without action the current housing crisis, will get worse, with the welfare budget increasing with little benefit to the tax payer or for the local communities.