'Bedroom Tax' and building Social Housing

Met with Mid Wales Housing Association today. Two important issues to discuss - which though local have a wider relevance. I wanted to discuss the background to them. Montgomeryshire AM, Russell George came along as well. First issue is construction/repairs contracts letting. Second issue is what's become known as 'bedroom tax'. Lets look at them in turn, against a background of how I see things. Other eyes will see things differently.

Over recent years its become fashionable for Housing Associations (and Councils) to come together and form a 'purchasing' group. The theory is that the 'bulk buying' aspect of this will lead to lower prices for contracts. I never thought this process would deliver - for several reasons. One problem in a sparcely populated area is that local contractors would not be big and flashy enough to put in glossy tender documents that impress. And that the winning tenders would sub-contract the work back to local contractors instead. And so its turned out. One recent substantial Newtown contract was let to a North Wales firm, Waites, who then sub-contracted to local firm, J U Bowen, who in turn used local contractors to do most of the actual work. Where we are now is that Waites are sitting pretty, Bowen's has gone bust and local contractors have lost very large sums of money. I wanted an assurance that the Housing Association would try to ensure Bowens had been paid for all work done - and if not to try to ensure it was recovered from Waites and passed on to local contractors. The Association take the same view, which was good. Not sure how successful they'll be though. I was also pleased that a different way of tendering projects in future is being considered.

The second issue is more problematic for me. First the background. There are lots of people in our country with nowhere to sleep. There is a huge surplus of bedrooms - often in properties occupied by single people. And there is a need for the social welfare bill (including Housing Benefit) to be brought under control. So the Government intends to reduce the housing benefit for occupants of housing with unused spare bedrooms. At least, it sees no reason why the taxpayer should pay housing benefit to support them. The issues surrounding this policy change are fairly obvious. I wanted to get an idea of what it all means 'on the ground'.

Mid Wales Housing Assoc. has about 10% of its properties with spare bedrooms. No reason why other social landlords wouldn't be about the same. Some of these tenants will find a way of coping with reduced housing benefit; some may let out the spare bedrooms; and some may try to find a single person property. Inevitaby, its going to make life more difficult for some. Today, we agreed that future building should include more single person properties, which seems blatantly obvious. My view is that almost no other form of social housing should be built in the near future. Homes for families would be freed up by those moving into single person properties. Obvious problems though - particularly from delays. Houses can't be built in a day. Another related issue is that the level of social housing grant available to the housing association is being cut from 58% to 25%. Inevitably rents are going to have to rise substantially to deliver a return on investment.

Left the meeting chewing hard on the food for thought I'd just been fed. Gov't and public bodies have no option but to cut spending and secure value for money. But lets not pretend there are not unwelcome consequences.