22 March 2002
Rents charged by councils and housing associations are being restructured over ten years according to a formula based on 70% local earnings and 30% capital values.
But Professor Duncan Maclennan from the University of Glasgow told the Joseph Rowntree Foundation centenary housing conference this week that the emphasis was wrong and would not help areas in the North and Midlands where there are surpluses of social housing.
To create a 'quasi-market' in housing, it was illogical for rents to reflect differences in earnings rather than variations in property values, he told the conference in London on March 19.
'Why don't we design a housing benefit system which reflects variations in income and have a rent system which provides an element of choice at the margins?' said Maclennan, an adviser to the Scottish Executive.
Ten years ago, a major inquiry by the foundation recommended a nationwide rent-setting system, along with the withdrawal of mortgage interest tax relief and the introduction – in place of housing benefit – of a needs-related housing allowance for tenants and homeowners.
Janet Ford, professor of housing policy at the University of York, said it was regrettable that, to date, the government had scrapped Miras without looking at the wider issue of housing subsidies. A comprehensive safety net was required, she said.
PFmar2002
