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Poverty rates by 2040, according to the JRF: The different levels, marked out by differently-coloured bars, show the effect if social rents rise at one per cent above inflation per year, or to meet market values.

Poverty rates by 2040, according to the JRF: The different levels, marked out by differently-coloured bars, show the effect if social rents rise at one per cent above inflation per year, or to meet market values.

When a Conservative-run government messes up your life, it doesn’t go in for half measures!

Earlier today you all read how the Conservative Party had miscalculated – badly – the effect of its ‘welfare reforms’, meaning that people were being forced into expensive privately-rented accommodation by the Bedroom Tax, then claiming more in Housing Benefit because their wages were not rising fast enough to accommodate the increase.

(Wages have, of course, been held down because the government’s insistence on cutting the amount paid to the unemployed has created an underclass of people desperate to take any job available – meaning employers can brush off calls for wage rises by saying hundreds of other people would be happy to do these jobs for less.)

The Joseph Rowntree Foundation has put flesh on the bones of these findings in a report published yesterday (November 17).

It states that “compared to 2008, private rents will rise by 90 per cent – more than twice as fast as incomes – pushing up to 50 per cent of private renters into poverty”. The average private rent today is £132 per week – it will be £250 per week in 2040 in real terms.

In addition:

  • “People who rent will be more than twice as likely to be living in poverty than homeowners.
  • “Private rents are forecast to rise by 90%, twice as fast as incomes.
  • “One in five (10.6 million people) will be living in private rented homes, up from 7.2 million today. Half of these, 5.7 million, will be in poverty (a rise of 2.6 million).
  • “One in 10 will be living in social housing, down from the current figure of 8.2 million to 5.7 million in 2040. Social rents will increase 39% to reach £92.10 per week in real terms.
  • “If social rents continue to rise towards market rates, the cost of Housing Benefit could rise by 125% – adding £20 billion to the current bill.
  • “Real median house prices for owners will increase to £263,000, a rise of 57%. 35.3 million people will be home owners by 2040 (a reduction of 820,000 people from 2008). Real household incomes will grow from £32,300 to £45,500.”

In light of these figures, JRF has called on the government and housing providers to work together to solve the housing crisis and keep poverty in check, saying poverty levels are likely to reach one in four by 2040.

“The reality facing many people is a life below the poverty line because of the extortionate cost of keeping a roof over your head,” said JRF chief executive Julia Unwin.

JRF reckons this growth in poverty can be contained if:

  • Housing supply doubles to more than 200,000 units a year;
  • Social rents continue to go up by inflation plus 1%, rather than move towards market rents;
  • Housing benefit continues to support housing costs at similar levels;
  • The fall in the proportion of affordable social housing in the overall market is halted.

Of course that is a forlorn hope under any Conservative-run government.

The increase in poverty levels to one in every four people should worry everyone – if it doesn’t affect you, then it will affect somebody in your family or somebody you know. It is clear that this is the intended result of Conservative-led government policy, and the Liberal Democrats have supported it.

Labour – on the other hand – already has a policy to increase housing by 200,000 units per year. It supports social housing. It wants to cap rent increases in the private sector, and its plan to cut the amount spent on housing benefit is based on increasing wages so that fewer people need it, rather than increasing the number of people who are homeless.

Which would you prefer?

Follow me on Twitter: @MidWalesMike

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