MP Nicky Morgan: Fairer on rent and care bills
Last Friday, a constituent came to see me. She is a single parent with children aged one and 15. She lives in a two-bedroom flat and needs more space – she shares her bedroom with her youngest child.
The overcrowding is affecting family relationships. She was quite desperate. She cannot afford to live in the private rented sector, social rented housing is her only option.
She is being as flexible as she can in looking for a place to move to but it has to be somewhere her oldest child can get to school fairly easily.
Almost every month since my election, I have been contacted by families who have outgrown their homes.
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We need to build more social housing and that is happening.
Local authority housing waiting lists rose from one million in April 1997 to 1.8 million in April 2010.
By April 2010, house building had fallen to its lowest peacetime levels since the 1920s, with the social rented housing stock falling by 421,000 units from 1997 to 2010.
These are problems we are trying our best to resolve.
We have invested £19.5 billion in affordable housing and will deliver 170,000 new affordable homes by 2015.
But we also need to see more movement within our social rented sector and that is the premise behind our plans to limit how much housing benefit is paid to tenants whose homes are under occupied.
Nearly one third of working-age social housing tenants on housing benefits are in accommodation that is too big for their needs.
That equates to nearly a million spare rooms being paid for by taxpayers and is denying hundreds of thousands of people the chance to adequately house their family.
It is likely they needed that extra bedroom at some point. But often the tenant is still in a property which is now too big.
I can already see in Charnwood that there are now more three-bedroom properties being marked as available on the choice-based lettings system.
I hope with these reforms we will begin to see the same flexibility in the social rented sector seen in the private sector.
Also this week we announced our proposals for social care funding.
At the moment, many older people and people with disabilities face paying the limitless, often ruinous costs of their care with little or no assistance from the state.
While those with assets of less than £23,250 receive support, those with assets above this level receive none.
This is desperately unfair, particularly for those who have worked hard all their lives to pay their mortgage, save for their future or to have something to pass on to their loved ones – only to see their property sold and their savings wiped out.
This happens to more than 30,000 people every year.
There are two key elements to the package to address this unfairness.
First, a cap on reasonable care costs at £75,000.
Currently, the lack of a limit on costs and the unpredictable nature of care needs leave many people facing vast bills, with almost one in five older people facing bills over £75,000.
So, from 2017, the Government will pay for care costs incurred by individuals over this level. This equates to £61,000 in 2010-11 prices, compared with the Dilnot Commission's recommended cap of up to £50,000.
We have come as close to this as possible but have to recognise the extremely tough economic situation.
It's important to stress the intention is not that people should have to pay up to £75,000.
But by creating certainty this is the maximum, they can make provision through insurance or pension products so they are covered up to the cap.
Second, we will introduce new financial protection for those with modest wealth.
The Government will step in earlier to pay a proportion of residential care costs, with the threshold more than quadrupled, from £23,250 to £123,000.
Taken together, the measures are expected to directly benefit an extra 100,000 people.
The vast majority of state support will be provided to the 40 per cent of older people with the lowest income and wealth.
This is about protecting people with the greatest lifetime care needs, not the greatest wealth.
The package will cost the Exchequer £1 billion a year by the end of the next Parliament and will be met in part by extending the freeze on the Inheritance Tax threshold.
Only 5,000 additional estates will be brought into inheritance tax and this package is all about ensuring people do not lose an inheritance they have worked hard to pass on.
The remainder will be funded from public and private sector employer National Insurance contributions associated with the end of contracting out as part of the introduction of the single tier pension.
I am sure there will be those who argue these plans do not go far enough – and of course there is always more we would like to do and like to fund.
But I hope readers will recognise this Government is facing up to problems which have not been addressed for years and there are no quick fixes.