Chancellor's Autumn Statement bans letting fees
Today Chancellor Philip Hammond presented his first Autumn Statement. There was lots of speculation about what might be included and whether Theresa May’s Government would continue in the same vein as the previous administration. Although the Chancellor confirmed that the Government would no longer be pursuing a surplus by 2019/20, a key driver behind the austerity principles of recent years, there was still a lot of caution in the face of wider of economic uncertainty.
Below we have highlighted some of the relevant key announcements from today’s speech:
Banning letting fees
Letting agencies will no longer be allowed to charge fees to tenants, instead these should be met by landlords. In addition to reducing the costs renters have to pay up front, and offering greater clarity about what they are paying for, this also signals a willingness by Government to intervene in the private rental sector. Given that the end of assured shorthold tenancies is the leading cause of statutory homelessness it is encouraging to see some acknowledgement of challenges in the private rental sector and a readiness to do something about these. The Department of Communities and Local Government (DCLG) is planning to consult on these changes before any legislation is introduced.
There were a number of announcements made in the Autumn Statement regarding affordable housing:
- A £1.4bn investment to deliver 40,000 new affordable homes
- A £2.3bn housing infrastructure fund to ensure the infrastructure is in place to support 100,000 homes in high demand areas
- A relaxation of restrictions on grant funding to allow providers to deliver a mix of homes for both affordable rent and low cost ownership
This last announcement in particular indicates a move away from a narrow policy focus on home ownership to a wider discussion around low-cost rental housing. The Chancellor also indicated that a Housing White Paper will be published imminently, focusing on increasing supply and addressing the issue of affordability. However there does not seem to be a clear idea of what affordable means in this context, and where this development might be targeted.
There was also a separate announcement about the devolution deal with London, which includes £3.15bn for the city as its share of the national affordable housing funding to deliver over 90,000 affordable home starts by 2020/21.
Rough Sleeping Fund
The Government also announced an additional £10 million over the next two years to double the rough sleeping fund. There is no further detail available at this stage around how this fits with previous funding announcements and initiatives. While additional funding is welcome, it is important that funding announcements are also backed up by a joined up national homelessness strategy to ensure everyone has the support they need.
The Chancellor announced a reduction in the Universal Credit taper from 65% to 63% from April 2017. This means that for every £1 someone earns above their work allowance under Universal Credit, 63p will be taken off their benefit payment, rather than the 65p currently. The Government suggests that this change will be worth £700million a year by 2020/21 and will benefit 3 million households.
The Chancellor confirmed that, aside from those policies already announced, there will be no further welfare cuts announced up until 2020/21. Alongside this, there was a commitment to keeping welfare spending within a specified cap and monitored by the Office of Budget Responsibility.
The full set of Autumn Statement documentation is available here. We will be keeping members updated as further details are released.