You may have recently read about Nasir Muhsen, an 18-year-old gang member, who was jailed for his part in the riots last year. He was part of a 15-strong gang who, armed with bats and knives, carried out a mass mugging of people in a restaurant. His case made the headlines because he and his family had been given a £6,000-a-month basement flat worth £3 million in a Victorian mansion block in Kensington. Residents described his family as “neighbours from hell”, who reportedly trashed their home and were evicted at Christmas for not paying their subsidised rent. Despite this, his lawyer claimed that he had taken part because he was poor and “the money he took was to buy food.”
His case raises a wider question. Why was he living in Kensington in the first place? Should we really be using taxpayers’ money to house social tenants in some of the most sought-after streets in the UK?
In a report published today, my colleagues at Policy Exchange argue that housing one lucky family in a million-pound property while millions of others languish on the housing waiting list is unfair, and a poor use of our resources.
Fortunately, there is a solution. At present, around a fifth of the social housing stock in this country is “expensive” – worth more than the average for that size of property within the same region. We propose selling off this expensive social housing stock when it becomes vacant – when people die or move away – which could raise £4.5 billion a year.
That money could pay for us to build up to 170,000 new social homes a year, creating the largest social house building programme since the 1970s. That in turn could create as many as a third of million much-needed jobs.
The current situation is unfair and wasteful in several ways. One single family can be given a house that most taxpayers could never afford. And that means that others will have to wait – possibly for years in overcrowded conditions.
Polls show that 73 per cent of people think that social tenants should not be offered new properties worth more than the average in their local authority. And 60 per cent think that social tenants should not be offered new properties in expensive areas. Even social tenants themselves agree with changing the current system.
Some people on the Left will, nonetheless, say this is unfair, and will lead to “ghettoisation”. I can predict this because when the government recently capped housing benefit payments (at £1,480 a month for a three bed house) Guardian columnist Polly Toynbee accused the Coalition of coming up with a “a final solution for the poor” which would meaning sending them to “distant dumping grounds where there are no jobs.”
To be clear, what I’m proposing wouldn’t mean a single person having to move house. We are only talking about selling off houses that become empty. Nor would it mean that social housing would disappear from expensive cities like London, because the definition of “expensive” I am using is specific to a particular region, not the national average.
Lots of expensive social housing has come about unintentionally. In the 1970s Britain’s big cities were on their knees. London boroughs in particular took the opportunity to snap up terraces of housing in run-down places like Islington at bargain prices. But Britain’s inner cities – particularly London – have been transformed. What were slums are now eye-wateringly expensive places to live. Two thirds of the heads of households in social housing are not in work, and when you’re living on benefits, it’s not helpful if your nearest shop has been turned into a mini-Waitrose.
Selling off the most expensive council houses in a region might indeed mean that people would be less likely to get given a house in the most expensive parts of expensive cities. But I don’t think anyone has a right to live in Kensington at taxpayers’ expense.
Would it make it harder for the minority of people in social housing who do work to get jobs? Actually there doesn’t seem to be any strong link between local house prices and the employment of people in social housing.
Of course, this is only a small part of the answer to Britain’s housing crisis. Over the last decade, the cost of housing has growth three times faster than wages. That’s because we make it much harder to get planning permission than in other countries like Germany.
Politicians need to do everything it can to make housing affordable. Perhaps we could give local people a right to buy a plot of land on which to get a house built – about half of houses in France and Germany get built in this way. Government has been talking about building new “garden cities” to get a lot of housing built with minimal disruption – but it needs to get on with it.
Reforming social housing in this way is a rare opportunity to do something that boosts jobs and growth, makes people better off, and is overwhelmingly seen as fair. Recycling the value of expensive social housing is an idea whose time has come.
This article originally appeared on The Daily Telegraph’s website