Submission: Budget 2020

By: Rose Grayston, Stephanie Kleynhans and Alex McCallum  Published: February 2020


Summary

Decent homes affordable to households on low incomes are a crucial part of how our country functions. They can eliminate rough sleeping and homelessness by ensuring affordable alternatives are always available. They can anchor local communities and labour markets, enabling workers on low wages to live close to the jobs that need their skills and to family and care networks. They can improve people’s lives, giving people freedom from financial stress, bad housing and insecurity, and more choice over where to live and how to use their skills. When thinking about how to invest in the infrastructure that people across the country need to thrive, the government must think about social housing.

Our submission to the government’s Budget evidences the costs of our current housing emergency, the consequence of a severe shortage of social homes at rents affordable to low-income and low-wage households on the one hand, and the failure of Local Housing Allowance (LHA) to cover private rents on the other. Increasingly, low-income households are slipping through the growing cracks in social and market provision.

Shelter's recommendations: 

  1. Government should use its Budget to commit to increasing capital investment in social rent housing.
  2. Government should use its Budget to commit to ensuring Local Housing Allowance (LHA) payments cover the costs of private rents by re-aligning LHA rates with at least the 30th percentile of local rents from financial year 2020-21.

A commitment to increase capital investment in social housing should also be backed up by other measures to support the delivery of social housing, such as lower borrowing costs for council housebuilding from the Public Works Loan Board, allowing local authorities to use grant funding to play their full part in ending the housing emergency.

These recommendations will:

  • Tackle affordability pressures for low-income households at source, producing savings for local and central government over the long-term.
  • Reduce and prevent homelessness and underpin the government’s plan to end rough sleeping by the end of the parliament in 2024, delivering a step change in security and stability for many households.
  • Contribute to economic growth through housing development activity and by underpinning local labour markets.
  • Allow government to achieve its target of 300,000 net additions by the mid-2020s.

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