Friday, 26 May 2017

Labour’s London mayoral candidate would also use bonds to build homes

Livingstone: I’ll cap private rents

Ken Livingstone will cap private sector rent levels in London if he wins the fight to become London mayor.

In an exclusive interview with Inside Housing about his housing plans, Mr Livingstone, who last week won the Labour Party nomination for the 2012 election, said he would regulate rents as a means of solving the crisis over the rising housing benefit bill.

Speaking on the sidelines of the Labour conference in Manchester, Mr Livingstone said he rejected alternative plans for tough new caps to housing benefit levels. Cuts announced in June’s emergency Budget will mean local housing allowance paid to tenants across the country will be capped from April 2011. From October 2011, rents will also be set at the 30 per cent of local rents rather than the median.

He said: ‘The cap [to benefit levels] is wrong. Even Boris [Johnson] has expressed concern about it because it will cause tens of thousands of people being displaced to the outer boroughs where there is no housing. Tenants should not be paying more on the rent than it costs to have a mortgage on the same property. I would cap the rents. We want to have rent control.’

Mr Livingstone said his housing policy would be characterised by house building. He plans to use the bond markets to raise money for more affordable homes rather than relying on central government for cash.

He said: ‘We would not need to have government funding. We could borrow money on the bond markets to fund housing. There would be no problem with raising money internationally because we have a flow of income from the rents.

‘We just need the government to get out of the mayor’s way. The mayor needs to have the power to say that all councils should make a commitment to build a certain number of homes.’

Mr Livingstone also attacked current mayor Boris Johnson’s record on house building, predicting he would only have built two thirds of the 50,000 homes needed in London by next year.

Vincenzo Rampulla, public affairs officer at the National Landlords Association, said: ‘It would be foolish to say ‘I’m going to cap the rents of people who can only just about afford to provide that housing’. He said the consequence of Mr Livingstone’s plan would be fewer homes available for rent because landlords would pull out.

Duncan Shrubsole, director of policy and external affairs at Crisis, said: ‘One of the many reasons the housing benefit bill has risen so high is the steep increases in rents. But the underlying reason for the rise in rents is the shortage of housing and it is that which we really need to address.’

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