ISLINGTON

INDEPENDENT WORKING CLASS ASSOCIATION

New Labour share responsibility for inflation-busting rent increases

Letter to Islington Tribune, 20th March 2009

31st March 2009

Tim McLoughlin gives credit to Emily Thornberry and other MPs for the recent government decision to halve council rent increases this year, from 6.2% to 3.1% (letters 13.03.09).

But it is New Labour's national rent setting policy, implemented so obligingly by Islington's Lib Dems, that has resulted in such sharp council rent increases over the last eight years. Notably, further away from local elections, neither party took issue with imposing a similarly high 5.7% increase last year.  

New Labour's rent setting policy is designed to fudge the differences between councils and housing associations by raising council rents up to the higher housing association ones, specifically to encourage more council housing privatisation. 

Through linking rents to local market property values, it aims to increase rents sufficiently in areas like Islington to force ordinary working class people out, to make way for more middle class Tims and Emilys. Over the last five years Islington council rents have risen 29%, while the minimum wage has increased by only 18%.

The increases will bring minimal benefit to Homes for Islington who manage Islington's council homes, since around two thirds of the extra rent paid will end up in government coffers, rather than in increased services for tenants.

On top of this, what New Labour members like Tim McLoughlin don't like to let on is that their government is on the take from council tenant rent payments.  Effectively this is an extra tax on ordinary working class people, which has provided around £3 billion for the treasury since New Labour came to power.  Despite halving the rent increases this year, they will still take around £240 million, which is more than they took last year.

If the New Labour government were not on the take from council rents, there could be a rent freeze this year.  Presumably this is something that didn't enter Emily Thornberry MP's mind when she was ‘lobbying' the housing minister.

31 March 2009 15:42