Ruth Cadbury MP welcomes u-turn on ‘pay to stay’ policy that would have hiked local rents by an average of £2,912 a year

22 November 2016

The Government this week abandoned its controversial ‘pay to stay’ policy, which would have imposed crippling rent hikes on working council tenants.

Dubbed the ‘tenant tax,’ the proposal would have seen the rents of those affected rise by an average of £2,912 a year in the Hounslow area.  

Tory ministers forced through the plan despite strong opposition from Labour in Parliament earlier in the year.

In a statement released yesterday evening, Housing Minister Gavin Barwell said: “Social housing has a crucial role to play in supporting those in most housing need. To that end, powers were provided for in the Housing and Planning Act 2016 to introduce an income based rents policy, requiring local authorities to set higher rents for higher income council tenants.

“Since the summer, the Government has been reviewing this policy. We have listened carefully to the views of tenants, local authorities and others and as a result, we have decided not to proceed with a compulsory approach. Local authorities and housing associations will continue to have local discretion.”

Responding to the announcement local MP Ruth Cadbury said:

“I am pleased that this disastrous proposal has been ditched, as it would have had a devastating impact on the people of Hounslow Borough.

“13,090 households would have been subject to the rent hikes, putting a strain on their finances and in all likelihood forcing many out of their homes. 

“That is why Labour has opposed this plan from the outset and I strongly welcome this change of heart from the Government.” 

Shadow Housing Secretary John Healey added:

“This welcome u-turn is a victory for Labour’s year-long campaign against the ‘tenant tax’ which was set to hike rents for thousands of households on ordinary incomes.

“Having recognised this move was a big mistake, Ministers must now re-think the rest of their failing housing policies.

“After disastrous figures last week showing that the number of newly-built affordable homes for social rent has fallen to the lowest level since records began, top of the list must to reverse the forced sale of vital council homes and the huge cuts to investment in new genuinely affordable homes.”