Havering housing squeeze fears after Chancellor's cuts
PUBLISHED: 19:08 20 October 2010 | UPDATED: 19:10 20 October 2010
Councillors fear an exodus from central London
NEW social housing tenants in Havering will pay twice as much as existing tenants, under spending cuts revealed by the Chancellor today.
Councillors have also expressed fears that a cap on benefits will force more families out of central London, putting extra pressure on outer London boroughs.
The cuts to the social housing and welfare budgets were part of George Osborne’s Comprehensive Spending Review, announced in Parliament this afternoon.
Mr Osborne pledged to restore “sanity to our public finances and stability to our economy”.
The organisation responsible for managing the council’s housing stock, Homes in Havering, could face a difficult job explaining why tenants living next door to each other must pay radically different rents.
Mr Osborne announced an increase of rents for new social housing tenants to 80 per cent of the local market rate, rather than the 40 per cent they currently pay, but said that existing tenants would see no change in their terms.
Havering Councillors have also expressed fears that a benefit cap of £26,000 a year per family would not be enough to pay market rents in central London.
Leader of Havering’s Labour group, Cllr Keith Darvill said: “I’m very concerned. People could be forced out of properties, it’s likely to mean a migration from central London to the suburbs, where housing is cheaper. That’s going to put increasing pressure on boroughs like Havering.”
He added that cutting security of tenure for new tenants would mean people would be encouraged to hang on to their social housing properties, which would slow up movement around the system.
He said: “It’s a real worry, I don’t think politicians have really considered it.”
Leader of the opposition, Cllr Clarence Barrett also said this was a real issue for Havering, which, like all other local authorities will see a 7.1 per cent cut in its Government funding over the next four years, an equivalent of £15.6 million of this year’s budget.
This comes on top of a four-year plan by the ruling Conservative administration to slash £19 million from the budget agreed in July.
However he welcomed the Chancellor’s commitment to retain decent homes funding.
“The condition of our council houses is the worst in the country. This money is so important.”