An important set of housing proposals will go before the Scottish Parliament today. Scottish Greens MSP Andy Wightman is proposing a number of amendments to the Coronavirus Bill to support tenants, including a hardship fund, that rent arrears accrued during the crisis can’t be used as grounds for eviction when the eviction ban is lifted, and rent prices frozen for two years.
These are a very modest set of proposals when looked at in its proper context: hundreds of thousands of low-paid Scottish workers taking pay cuts, being furloughed or losing their jobs altogether. A rent freeze will not exactly have any tenants getting the champagne out, doubly so when a highly likely property price crash should force down prices in the private sector rental and mortgage market. But even modest proposals to support tenants have been hard to come by in the 21 year history of the Scottish Parliament.
Devolution has overseen a huge rise in housing costs for the poorest Scots. A Joseph Rowntree Survey found that from 1997 to 2017, the burden of housing costs as a % of income rose from 24 per cent to 37 per cent for the poorest fifth, while falling from 2 per cent to 1 per cent for the richest fifth. The private rental sector more than tripled in size, while property prices boomed, increasing the divide between those with and those without financial assets. Asset wealth, which property makes up the majority of, grew from being five times Scottish GDP to seven times GDP from 2005 to 2015. Meanwhile, wealth taxes remained broadly static, meaning inheritance has grown ever more important, with the Resolution Foundation finding that what Scots “inherit, rather than what you earn, is set to become much more important determinant of your lifetime living standards in the years ahead”. Not only did the Scottish Parliament fail to seriously reform the Tory-created Council Tax (the most important tax on wealth in Scotland), it increased the burden of it on the poorest Scots by giving cash-strapped local authorities the power to increase it by a flat rate across all bands. Council tax debt, which not only bears a financial cost but a mental health one as well due to the stress of dealing with debt collectors, reached a new peak last year.
And nothing has been done to lift the burden of rapidly rising private-sector rents in the past decade. The Rent Pressure Zones introduced in 2017 have been an utter failure, with not one local authority even collecting the data so far to make an application, due to the excessive cost and bureaucracy built into the legislation, which even SNP-led Edinburgh City Council has said is “not fit for purpose”. Even in the social housing sector, rent costs have been on the rise, growing by 7 per cent in real terms from 2013/14 to 2017/18, while wages flat-lined.
MSPs talk about ideas like a Universal Basic Income sometime in the future, when people need financial relief now. The cancellation of rent in lockdown would have the financial impact of a UBI for tenants, immediately taking the financial pressure off, including preventing many getting deeper into a spiral of debt. Research has found six in ten tenants have suffered financially from the crisis in the UK, with one in five of those having to choose between rent, food and bills. An IPPR report has found that 13 per cent of the furlough money millions are currently receiving in the UK ends up in the bank account of landlords, with the sectors most affected by job cuts and furloughing, retail and hospitality, being predominantly young workers who are most likely to rent. While buy-to-let landlords can get a mortgage holiday if they need it, tenants are currently getting nothing.
“This lack of equitable burden-sharing is extremely hard to justify,” the IPPR concluded.
Even US Presidential hopeful Joe Biden has came out in support of “rent forgiveness”.
“Forgiveness. Not paid later, forgiveness,” Biden said. “It’s critically important to people who are in the lower-income strata.”
In the US, a wave of rent strikes and support for rent cancellation by left-wing Democrats has pushed the issue up the political agenda, putting Biden – not exactly a socialist – to the left of UK Labour and the SNP on supporting tenants, as it stands.
Wightman’s proposals are not as radical as rent cancellation, but they would make a tangible difference, one that if it is not delivered will surely see the burgeoning tenants’ movement in Scotland ramp up preparations for rent strikes. It is worth saying that there is a material interests issue in Holyrood that has to be overcome here. According to the register of interests, more MSPs are landlords than trade unionists. If the landlord class in Holyrood don’t want to face a wave of tenant non-payment, they should back Wightman’s amendment.
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