Council Criticised Over Lack Of Affordable Housing

Wendy Goodwin, Cabinet Member for Homes

CASTLE POINT BOROUGH COUNCIL (CPBC) was heavily criticised this week by the charity Shelter. Its Local Housing Watch revealed that there are 1,374 households on the waiting list for affordable housing in the constituency and that, at current letting rates, this will take over 14 years to clear.

One would, the charity says, have to earn £47,727 per year to afford to buy an average-priced house in the area – almost twice the average annual income of residents, which is just £24,778.

The average selling price of a home in the borough is £175,000 (down from some £200,000 in 2006)..

Shelter’s independent experts say Castle Point needs to build 209 homes per year; but criticise the council for not saying how many homes it intends to build. Just 10 new affordable homes were in fact delivered, on average, in each of the last three years.

Just 95 lettings were made to new social tenants last year.

46 households are considered as homeless, and 66 are housed in temporary accommodation.

With just five percent of the number of affordable homes delivered, Castle Point was rated at the bottom end of the charity’s housing league table. It was number 303 out of 323 councils rated, and performed particularly badly when compared to its Basildon and Southend neighbours – who were positioned 13th and 102nd respectively. Basildon delivered 91 percent of its 208 target, and Southend managed 26 percent of its 344.

Cllr Wendy Goodwin, Cabinet Member for Homes, was contacted regarding Shelter’s criticism; but no reply was received by the time this article was published.

Last year, the local Labour Party were suggesting that 1,014 empty homes in the borough could be utilised in solving the local housing problem; but that figure, from 2008, does not paint an accurate picture. Included in that headline total are natural and seasonal movements in the area’s housing as properties become empty waiting for new owners or tenants to move in – or remain temporarily unsold in a weak housing market.

Of that headline figure, 649 private properties (693 in 2009) were identified as having been empty for more than six months; but, once again, the figure also includes properties that await being sold or renovated by their owners. Furthermore, while it is probably true that some of these properties, if money were available, could be purchased by council to add to its housing stock, the truth of the matter is that, in most cases, renovating a run-down property is often likely to be more expensive than knocking it down and rebuilding from scratch.

In short, the option of buying-up aged empty properties is not the viable solution that many would like us to believe.

With projected Council income from Government likely to be cut by some 25 percent in response to Britain’s financial crisis, the outlook for overcoming the borough’s housing crisis in the short term is bleak. If there is to be a silver lining, it is only likely to come from the private sector in reaction to the 2012 Olympics and local town centre regeneration.

On Wednesday, the Development and Control Committee will meet to examine proposals by Barrett to develop the mainland’s Kiln Road site, which includes plans for 53 affordable new homes.

Locally, the plan is opposed by the Thundersley and Daws Heath Hands Off Our Greenbelt Action Group; but the plot is actually designated as possible building space and Barrett have sought to address the outstanding nature conservation issues on the site – as well as providing for contributions towards highway and public transport improvements, early years and childcare education.

Given the current financial crisis, and the borough’s poor housing record, it is difficult to see how the plans could be refused. It is probably the only option the borough has to provide suitable accomodation for its homeless.

On the island, the Town Council has made no attempt to identify private property availability; suitable building locations or, indeed, the housing needs of its residents. Instead, in line with Canvey Island Independent Party strategy, its position is simply to oppose any new homes on Canvey.

In this, the first real test for the CIIP since the local elections, and Blackwell’s comments here to ‘work with the ruling group,’ it will be interesting to see if that promise holds any truth. As the borough’s only opposition party, will they put the needs of the constituency’s homeless first? Or will they simply adopt their Canvey Island stance and oppose the only opportunity our most deprived residents (mostly islanders) have to better their conditions?

Wednesday evening’s vote will serve to make things clear…

… (CPBC, 26/05/2010) – Barrett proposals refused

… (28/05/2010) – So Much For Barrett’s ‘Proposals’

Somali Woman With No Right To Live In The UK Must Be Given A Council House, According To EU Judges

Nimco Hassan Ibrahim - with her 36" TV

(Telegraph) – A SOMALI WOMAN WITH CHILDREN IN UK SCHOOLS is entitled to state benefits, even if she is “a burden on the social assistance system”, EU judges ruled yesterday.

Nimco Hassan Ibrahim, who has four children, was told she must be given a council house because she was once married to a Danish citizen who briefly worked in Britain.

A verdict in Luxembourg said parents caring for the children of migrant workers, and resident in EU countries are covered under EU rules on freedom of movement – including those who cannot support themselves.

Ms Ibrahim, a Somali national who separated from her Danish husband and is entirely dependent on UK welfare payments, was initially turned down for housing assistance – a decision which she then appealed.

Ms Ibrahim, who is currently living in temporary accommodation in Harrow, told the Daily Mail: “I deserve to be given a proper house. This one is too small for all of us.

“I don’t think it’s fair that the council has put us up in temporary accommodation. All these threats of eviction have made me feel very ill. The law says that I can get a better house so I’m looking forward to a better life.”

Ms Ibrahim arrived in the UK in 2003 to join her husband, named in court as Mr Yusuf.

The couple have four children of Danish nationality, the fourth of whom was born in the UK. Two are in UK state schools.

After working in the UK for five months, Mr Yusuf claimed incapacity benefit, and left the country after being declared fit for work in March 2004. He then “ceased to satisfy the conditions for lawful residence” in the UK, said the judgment.

Ms Ibrahim remained in the UK, separated from her husband, and, said the court, “was never self-sufficient, and depends entirely on social assistance”.

“She does not have comprehensive sickness insurance cover and relies on the National Health Service,” the judgment added.

Her application for housing assistance for herself and her children was rejected on the ground that only people with a right of residence under EU law could apply, and neither she not Mr Yusuf were by then considered resident in the UK under EU law.

Today’s judgment said: “A parent caring for the child of a migrant worker who is in education in the host Member State has a right of residence in that State.

“That right is not conditional on the parent having sufficient resources not to become a burden on the social assistance system.”

EU rules say that members of the family of a migrant worker who is a national of one EU country and employed in another have residency rights with that worker, whatever their nationality – a right that continues even if the migrant worker no longer lives or works there.

The Home Office said it was studying the potential impact of the judgment this afternoon.

A UK Border Agency spokesman said: “We are disappointed with today’s ruling. We will now consider closely the European Court judgments and their implications.”

Harrow Council, the local authority to which Ms Ibrahim applied for housing benefit, slammed the verdict as a potential “floodgates judgment” opening the way for state support for people who had put nothing into the country.

Councillor Barry Macleod-Cullinane said: “We are now seeing a European Court determining British immigration policy.”

He said: “We are very concerned with this outcome, as it appears to establish a major new legal precedent over benefit claims.

“Harrow Council is studying the full implications of the ruling, but it could well prove to be a floodgates judgment in that people who have not yet contributed to this country or who do not have the means to sustain themselves can now seek immediate help from state welfare services.”

Council Tax 2010 To Rise By Just 2.99%

CASTLE POINT BOROUGH COUNCIL is set to increase its proportion of the Council Tax by 2.99 per cent from 1 April.

The Council’s financial management which has been recognised as performing well in an independent assessment, means it is able to maintain priority services for the coming year and hold £1.1m in reserves for unforeseen circumstances.

Taking into account requirements from Essex County Council, Essex Fire and Police authorities and Canvey Island Town Council, the Council Tax for a Band D property will be £1,535.85 for residents of Canvey Island and £1,514.88 for other Castle Point residents. Castle Point Council receives just under £230 of this sum – with the remainder going to the other authorities. The rise equates to around 13p a week for a family for services provided by the Borough.

The Council has agreed a £2.7m refurbishment programme to revitalise the Borough’s leisure facilities, including £1.3m for Waterside Farm, Canvey Island, £723,900 on Runnymede Pool, Thundersley, and £76, 000 at the Paddocks, Canvey Island, and £10,300 for a new crabbing pool and ramp at the New Sea Water Paddling Pool at Canvey Seafront.

Council Leader Pam Challis OBE said: “The Council, like local residents faces tough challenges as we balance our budget in these difficult times, yet through prudent financial management we have also been able to make significant investment in Castle Point’s future.

“We are maintaining essential services that are important to the local community, like refuse collections, doorstep recycling and concessionary bus travel, yet we cannot spend more than we receive.”

Presenting the budget, Councillor Jeffrey Stanley said: “We continue to strive to work more efficiently and to provide high quality and value for money services to residents.”

The budget means the Council will continue to fund key priority services for residents, including  £57,400  to part fund four Community Support Police Officers, contributions totalling £161,500 to local charities, the Citizens’ Advice Bureau, Castle Point Association of Voluntary Services and Crossroads, £12,200 to renew bus shelters, £15,000 for an out of hours noise patrol service during the summer months, £70,000 for Neighbourhood spending and £248,000 to help disabled residents adapt their homes.

Full details of how the new rates will effect you can be found on the Council’s Website.

UK House Prices To Slump As Credit-Crunch Returns

(Telegraph) – A SECOND MORTGAGE CREDIT-CRUNCH that will send UK house prices into a new tailspin is looming, economists and credit experts have warned.

The squeeze on debt will begin to be felt in January next year, when lenders are due to start repaying £319bn borrowed from the Government during the original crisis in 2007 and 2008 – a quarter of the UK’s entire £1.3 trillion stock of mortgages.

To pay the money back, credit-rating agency Moody’s said, banks and building societies may “limit their lending through tighter credit criteria” – in other words reducing availability and making mortgages more expensive.

Capital Economics added: “The prospect of a fresh mortgage credit squeeze later this year or during 2011 hardly inspires confidence in the durability of the housing market recovery.”

Credit is already tight. In 2009, societies removed £7.4bn from the mortgage market and approvals dropped to 1.3m, compared with 3.4m annually from 2005 to 2007.

Lobby groups have called on the authorities to delay the timetable but, last week, Mervyn King, Bank of England Governor, confirmed that the main state-backed liquidity scheme, providing £185bn of funding, would end in January 2011 as scheduled. The full £319bn must be repaid by April 2014.

Echoing a warning from the Council of Mortgage Lenders (CML) that removing Government support will choke off lending and raise mortgage costs, Moody’s said yesterday: “If debt markets cannot take up some of the funding gap left by Government schemes, the impact on the UK mortgage market will be significant… The contraction will put pressure on house prices .”

The £319bn “funding gap” is the difference between the amount the banks hold in retail deposits and the sum they have loaned. The gap used to be financed in the wholesale markets, which froze in August 2007. They have been replaced with emergency state schemes.

Illustrating the scale of the crisis, CML data shows that UK lenders raised £130bn in the markets in the 12 months before the crunch but just £11.5bn in the past two years.

Moody’s added that the benign environment of low interest rates and “other Government stimulus [which] have helped borrowers” may just have been “transitory”.

Rising bad debts would be particularly severe for building societies, which lost £7.6bn of deposits last year. Their credit ratings have also been slashed, effectively barring all but Nationwide, the largest society, from using the wholesale markets.

“Building societies have been the main victims,” Moody’s said. “Without access to cheaper Government-backed funding, many will find it increasingly difficult to survive.”

Societies are in discussions with the Financial Services Authority about creating a new debt instrument to shore up their balance sheets. Called mutual ordinary deferred shares (MODS), the debt will not mature and will pay an annual coupon that can be axed to preserve capital in extreme circumstances.

The FSA has not yet approved the instruments.

£7,000 A Month Rent For Mansion Paid For By The Taxpayer

Essma Marjam with one of six children

(Daily Mail) – A SINGLE MOTHER OF SIX is getting more than £80,000 a year from the taxpayer to live in a £2million mansion in an exclusive London suburb.

Essma Marjam, 34, is given almost £7,000 a month in housing benefits to pay the rent on the five-bedroom villa just yards from Sir Paul McCartney’s house and Lord’s cricket ground.

She also receives an estimated £15,000 a year in other payouts, such as child benefit, to help look after her children, aged from five months to 14.

The four-storey house in Maida Vale has five bedrooms, two bathrooms, a double living room, large fitted kitchen-diner with French doors on to the landscaped garden and a state-of-the art buzzer entry system.

Astonishingly, it is understood Miss Marjam found the house on the internet through a private letting agency, rather than waiting for Westminster council to give her a vacant property on their books.

She then applied to the council for the £1,600-a-week benefit – the maximum amount the council allows.

Miss Marjam said: ‘I moved here at the beginning of the month as I’m entitled to a five-bedroom house.

‘I was in a three-bedroom council house but I needed a bigger place once my new baby came along. So the council agreed to pay the £1,600 a week to a private landlord as they didn’t have any houses big enough.

‘I’m separated from my husband. He’s a solicitor in Derby, but I don’t know if he’s working at the moment. He doesn’t pay anything towards the kids. Things are quite difficult between us.

Mrs Marjam's new home is yards from Sir Paul McCartney's house

‘The house is lovely and very big, but I don’t have enough furniture to fill it.’

She does, however, have two large flat-screen televisions and several leather sofas, plus a large amount of children’s toys scattered over the wooden floorboards.

During the week, vans from Argos and other home stores dropped off large purchases.

Miss Marjam does not work, as she spends all day looking after her children – Zekia, 14, Abdulhakim, 13, Jihad, 11, Hamza, ten, Ayman, two, and five-month-old Nasir.

The four eldest have the surname Benjamin, while the two youngest have the surname Khan.

Labour’s controversial Local Housing Allowance enables council tenants to receive such high benefits to pay private landlords.

The maximum that can be claimed is set by central government and the allowances can be huge, leaving the taxpayer to foot the bill.

The Daily Mail has highlighted other outrageous examples, such as the single mother of eight receiving £90,000 a year to live in a £2.6million Notting Hill mansion.

Taxpayers are also picking up the £6,400-a-month bill to house Nasra Warsame, her seven children and her elderly mother in central London, with Westminster council also providing Mrs Warsame’s husband and their eighth child with a two-bedroom flat nearby.

In total, 16 families are living in million-pound-plus London properties funded by the Local Housing Allowance.

Phillipa Roe, a Westminster councillor, said: ‘We would like to see the entire system changed as the current rules are wrong and do not offer taxpayers value for money.

‘We want to have more control to limit the amount of money which is paid out. Local councils are far better placed to determine benefit levels than ministers in Whitehall who won’t know the facts on the ground.

‘The Government has repeatedly pledged to reform housing benefit but failed to do so. The whole system needs a radical review and ministers should stop dragging their heels and get on and do it.’

A Department for Work and Pensions spokesman said: ‘It is not right that in London high rents have been able to distort the system, resulting in a small number of people getting excessively high payments.

‘We took immediate action and capped the Local Housing Allowance in April. The plans we published in December go even further and will exclude high rents from LHA rate calculations.

‘Only a very small minority of people receive such high rates of housing benefit. The average payment is £81 a week.’

2014: The Mother Of All Mortgage Famines?

READERS OF THE CANVEY BEAT and my own personal blog will have noted that I have been totally bemused by this government’s financial strategy since the sub-prime market collapsed and presaged the impending credit crunch. So far Labour has propped-up the banking sector to the tune of over one-trillion pounds, which is enough to make anyone’s head spin.

If you earned a pound every second, you would have one-million pounds after two months. After 32 years you would have amassed a one-billion pound fortune; but to hit your target of one-trillion pounds: it would take you 32,000 years…

Of course, this one-trillion pounds does not form part of the government’s debt – because it is offset by shares in the supported banks and other ‘securities.’ Only the 178 billion pounds that the government has spent (some would say wasted) on printing further money and devaluing the pound is often mentioned. But even that palls into insignificance when you consider that the financial prop holding up the inevitable collapse in the housing market is 300-billion pounds. In effect, that is the amount of money thrown at the mortgage market by this government to dull the impact of the US sub-prime collapse on the city.

But that three-hundred-billion pounds is quickly being eaten-up. £300,000,000,000 does not go far in meeting demands for mortgages on properties that are, by any measure, significantly over-priced.

Today saw the first report, in The Daily Telegraph, warning of the inevitable unravelling of the government’s financial strategy:-

The Council for Mortgage Lenders (CML) said a £300bn funding gap – the difference between what property buyers wanted to borrow and the funds available to lenders – would open up when existing government support schemes expire in 2014.

“The collapse of wholesale funding markets has left a £300bn gap in mortgage funding,” the CML said. “That gap has been filled temporarily by government funds through the special liquidity scheme and the credit guarantee scheme. By 2014, however, both of these schemes will have expired. Hanging over the mortgage market therefore is a major uncertainty about how lenders will be able to refinance this £300bn over time.

“Unless there is a policy approach intended to encourage the development of wholesale funding, we are likely to see a long-term decline in choice for UK mortgage customers.”

It added that, without support from government policy, it might be difficult to re-establish a sustainable, long-term “securitisation” market on the scale needed to plug the funding gap. Securitisation involved parcelling up existing mortgages and selling them as interest-bearing bonds to institutional investors, raising funds for new lending.

“That would leave firms continuing to rely on government funding, and the UK at risk of a chronic undersupply of credit – and the rationing of mortgages for customers – for many years to come,” the CML said.

Even if wholesale markets did start functioning again on the scale seen before 2007, which the CML said was unlikely, there was “considerable uncertainty” over whether lenders would be able to repay government funding in full to the timetable currently envisaged. “It is likely therefore that an extension of the period of government support will be needed,” it added.

“One of the consequences of the closure of wholesale debt markets since 2007 – and the ensuing funding gap – has been a dramatic reduction in competition in the UK mortgage market,” the CML said.

“Emergency government action to fill the gap has been welcome. But government support has focused almost exclusively on larger deposit-takers, reinforcing the lack of overall competitiveness in the mortgage market.”

It is clear from this that government intervention has had no impact on solving the economic problems faced by the UK economy. All it has done has been to put-off the problem until after the general election – to delay the day of judgement. The fact is that, whichever party is elected this year, its government will not have access to another £300 billion to help meet mortgage demand and, with so few buyers, property prices will finally fall off the cliff.

But, unfortunately, it does not end there…

What property developers, in their right mind, are now going to construct ‘affordable housing’ in the face of a mortgage famine? And what young couple are going to gamble their hard earned money on buying a property whose inherent value will not allow them to sell at a profit to move up the housing ladder as their family grows?

More importantly, for over-crowded islanders, is how long will it actually be before we obtain the additional housing that we so desperately require?

It is not the Tories that are killing home-owning ambitions. It is the economic incompetence of the Labour government, which is incapable of understanding the basic relationships between financial policy and its own housing programme.

Exactly the same incompetence that it showed in its disastrous immigration policy, which led to the housing crisis in the first place…

… (16/02/2010) – UK House Prices To Slump As Credit-Crunch Returns

‘The Tories Are Killing Home-Owning Ambitions’

(Julian Ware-Lane) – THE TORY THREAT to scrap the Government’s housing targets is a double kick in the teeth for the community of Castle Point. This odious promise was made by Caroline Spellman on her recent visit to the constituency.

Not only does this charter for NIMBYism not protect the greenbelt, it positively threatens it through this local Tory council’s obstinate refusal to explore alternative solutions. We must be clear that the decision to build on greenbelt on Canvey and in Daws Heath is very much a local Conservative decision and not the Government’s.

With something like two million extra homes required at present I am not sure where the Tories think these people are supposed to live. The millionaire friends of the Conservative Party will always be able to buy; the hoi polloi will have to put up with their children staying at home for longer than ever, or face them moving some distance away.

Using the council housing waiting list as evidence is laughable. The 1500 currently on the list are those in desperate need; most do not go on the list as it is a pointless exercise. All those seeking starter homes in Castle Point will have to accept disappointment and practice extreme patience.

As for those who work in construction, well, perhaps Caroline Spellman can suggest alternative avenues of employment. Bricklayers, electricians, plumbers, joiners, painters and decorators, etc, and all the businesses who serve the industry will not welcome this decision. No home-building means no work for them.

No building means no new homes, and less employment – a far from fine promise for the future.

… (03/02/2010) – 2014: The Mother Of All Mortgage Famines?