The Housing and Planning Act became law on the 12th May 2016 and the implications for existing Council tenants and future tenants in Milton Keynes looks really bad.
The bad news is focused on 3 areas:
1) Our Council will be forced to sell larger properties and handover £5 million of tenant's rent to the government in Westminster.
The new law requires Councils to sell off its larger properties. Milton Keynes’ Labour led Council will resist that. However, the new law assumes that this will happen and places a levy on the Council’s Housing Account. This looks like being a £5 million pounds a year hit impact on Council finances.
MK Labour's lead on Housing, Cllr Nigel Long, said, “This is essentially a tax on Council tenants that has to be paid. We will not be selling off larger houses, people need them, but the law requires us to give the tenant’s money to the Government.”
2) Council tenants with higher incomes will have to Pay to Stay.
The law requires all council tenants with a household income of over £31,000 a year to pay a higher rent.
Cllr Long said, “This means a household where a couple each earn £16,000 a year will have to pay a higher rent. It will mean families paying different rents for the identical properties. Why do modest income households have to pay more when the Government keeps giving tax breaks to the wealthy?”
The law also requires all tenants to give details of their household income to the Council, who will be expected to check it with HMRC.
Cllr Long added: “This will be time consuming and cost the Council money to check information on 12,000 households, every year. We believe the money would be much better spent on repairing homes and providing services.”
Unfortunately the impact of this new law is even worse as the income threshold takes no account of costs such as childcare.
Cllr Long added, “A parent could be earning £31,000 a year by working full time. They may be paying £250 a week in childcare. So they could be hit by the higher rent charge. This is a recipe for forcing people back into low paid work or low income. It is unfair and reflects Government thinking at its worst.”
3) Fixed term Tenancies.
The Council will also be required to limit security of tenure. Tenancies will be limited to either 5 or 10 years.
Cllr Long added, “I believe that security is key to creating strong stable communities. Forcing families to move on after 5 years is wrong. It will disrupt children’s schooling and could lead to homelessness and loss of work. Secure housing seems a must to me. So we will not introduce 5 year tenancies.”
Milton Keynes Council will consider its detailed response to the Housing and Planning Act and consider the best way to limit the damage it will cause. The Labour led Council will consult with tenants and residents associations on the proposals
Cllr Long concluded, “This is a nasty piece of law that fails to address the fundamental problem of a lack of affordable housing. It promotes insecurity and aims to force the Council to sell off much needed homes. We will not do that. We will consult tenants and do all we can to limit the damage.”
It is also worth noting that both the Conservative MPs who are supposed to represent the people of Milton Keynes voted in favour of these new laws despite the impact on our local Council and on tenants.