Council tenants are being offered £30,000 bribes or cottages by the sea to vacate their homes for credit crunch victims as Britain faces a critical social housing shortage.
Millions of pounds of taxpayers’ money is being spent encouraging people in social housing to move to the private sector — either as home-buyers or tenants. Those in larger council homes are also being offered cash payments of up to £3,000 per bedroom if they agree to downsize to a smaller social house or apartment.
Tens of thousands of people have taken up the offers but councils plan to push schemes more aggressively in another unexpected consequence of the recession.
The Council of Mortgage Lenders predicts that 75,000 more people will have their homes repossessed this year and there are already 4.5 million people waiting for social housing. That figure is expected to increase to 5 million by the end of this year.
Council chiefs are holding urgent talks with ministers about expanding cash incentive schemes. Some authorities are leafleting council homes to see if they can encourage tenants to downsize or move out. Peter Marsh, head of the Tenant Services Authority, which oversees social housing, also wants councils to make better use of under-occupied social homes. In some areas, pensioners have been living in five-bedroom council houses for decades after their children have moved out and could be happy living in smaller homes, he believes.
About 460,000 social homes are technically underoccupied as they have two or more spare bedrooms. In other cases, families have become wealthier during their council house tenure but are not legally required to give up their house.
Mr Marsh said: “We would support financial incentives to help tenants relocate . . . But it would need to be a voluntary decision and landlords would also need to provide full support to the tenant.”
Gordon Brown wants to kick-start a council housebuilding programme but authorities argue that bonuses to vacate homes are faster and cheaper.
Westminster council gives residents grants of up to £25,000 to relinquish their homes, with the proviso that they will not be rehoused should they become homeless again. Hillingdon offers up to £30,000. Kensington and Chelsea council will spend more than £700,000 this year on rental deposits and removal costs for tenants who are willing to move from social housing to private rentals. Other councils offering cash incentives include Leeds, North Hertfordshire, South Cambridgeshire, Tendring in Clacton-on-Sea, and Redbridge.
Critics warned that the system could be open to political exploitation, echoing the case of Dame Shirley Porter, the Westminster councillor who was accused of “gerrymandering” after helping to sell off council homes to potential Tory voters in the 1980s. There was also concern that vulnerable people might be encouraged to move without understanding the consequences of downsizing.
Grant Shapps, the Shadow Housing Minister, said: “We need reassurance that tenants, especially the elderly or the vulnerable, are not pressured or coerced. I am concerned there is a potential for a new mis-selling scandal.”
Matthew Elliott, head of the Tax-Payers’ Alliance, said: “Council housing should be a safety net for those fallen on hard times . . . When you have some councils dishing out £25,000 with no questions asked and very few conditions, that smacks of desperation rather than good management.”
Paul Bettison, of the Local Government Authority, said council house shortages were critical and more needed to be done to free up homes, but town halls would need more government cash for schemes. Helping only 40 people with £25,000 payments to help buy a house would cost £1 million. “By the end of 2009 one in ten families will be on council house waiting lists. Hard-pressed authorities ain’t seen nothing yet,” he said.
Source:the times
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