council tax Archives

A more equitable housing model for Cornwall

Hundreds of thousands visit Cornwall every year, and who can blame them? With our long beaches, hidden coves, world-famous cream teas (jam first) and stunning scenery, it’s no wonder that so many people want to enjoy everything our wonderful part of the world has to offer.

Growing up in Cornwall I know how important tourism is to our local economy, but over the last few decades the money tourism brings in is also driving people out. A dream holiday destination is turning into a nightmare for locals who are being forced out of the place they grew up in.

Right now in Cornwall there are vastly more properties on AirBnb than on RightMove – to rent or buy, and those that are on the market often come with astronomical price tags. On top of that, house prices are rising much faster than wages, which in Cornwall are already significantly lower than the national average.

This is a situation that’s been decades in the making, but has been made even worse by the cost of living crisis and historically high inflation rates.

The huge expansion in holiday lets and second homes has collapsed our private rented sector, and pushed house prices so astronomically high that even so-called ‘affordable’ properties are far beyond the grasp of those who need them.

We’ve found ourselves in the perverse situation where the very workers who support our key industries, like tourism, have been forced to move out of the county because they can’t afford to live here. It’s not simply a problem for those workers either, our already understaffed health services are struggling to attract staff when the cost of housing, and living, is so high.

The vast majority of my school friends have left Cornwall because they either couldn’t find the jobs they wanted here, or more often – they just couldn’t afford to live here any more. And for the ones that have stayed, there’s little hope of them being able to branch away from the parental home any time soon. Ask anyone of my generation down here and they’ll tell you the same story.

The huge increase in holiday lets has therefore exposed the instability and unreliability of a housing model that relies on private letting and sales, but for those who are priced out of the private market, the social housing and council housing sectors offer little to no comfort.

The housing stock lost through right to buy has never been replenished, and the urgency of the problem makes it even more shameful that over the last year Cornwall Council built just 14 council houses.

Meanwhile, waiting lists get longer and longer – almost 15,000 in Cornwall at the last count, with families being offered emergency accommodation not only out of the region – but out of the country – with the nearest help available in Wales.

Local politicians can and must take action now. As part of its “asset release” scheme the council should evaluate which sites are suitable for housing development and work with communities and local developers to build council, social, and genuinely affordable housing.

Councillors can also ensure the local development plan (LDP) prioritises housing, introducing and enforcing quotas on social and genuinely affordable housing in new developments. The LDP and neighbourhood plans also need to recognise that curbs on second homes can’t focus only on new builds, they need to include redevelopments to address housing stock in areas popular with tourists that are being decimated through a backdoor.

We also need fundamental changes to legislation, putting power into the hands of local people to ensure we have a system that works for the people of Cornwall, and one that unlocks our ability to build all types of home for all types of people.

The government makes much of its commitment to localism and levelling up, but we must challenge them to put their money where their mouth is. They must also devolve power to Cornwall to set our own housing priorities, allowing for council tax hikes on second homes, limiting holiday lets, and the creation of stronger protections for renters as vital first steps in reshaping our housing system.

The system is broken and we need radical political action now to not simply fix it, but to build a more equitable housing model that offers a secure future.

I grew up in a council house in St. Agnes, and I count myself lucky that our family didn’t simply have four walls and somewhere to sleep, but a home that gave us security – a place we could call our own, that we could decorate how we wanted, keep pets and build a future. We didn’t have to worry about our home being converted to a holiday let, face extortionate rent rises, or worry about leaving the community we’d for so long been a part of.

Our council house was a home, and everyone deserves to know that feeling.

Joe Vinson

Joe is from Truro and Falmouth CLP. He is also the National Secretary of LGBT Labour and Secretary of the Socialist Societies affiliated to the UK Labour Party.

TWITTER

Council Tax is regressive and broken, fixing it would be a progressive victory

New polling by the Fairer Share campaign hints at the huge potential gains in store for a party that is brave enough to reform our broken property taxes. With local elections around the corner, four out of ten people would consider switching their vote to a party pledging to replace council tax with a fairer property tax system with lower annual bills for most people and local services maintained at the same level. In the so called ‘red wall’ areas of the country, the figures are higher with almost half of all people questioned saying they would consider switching their vote.

It should come as no surprise to see the extent to which many people are fed up with council tax. It is outdated and highly regressive, both within local areas and between them. Council tax hits the poorest residents of our society hardest while mansions or luxury apartments in Westminster or Kensington barely notice council tax, deeming it less than a service charge.

The worst hit areas are the regions of the United Kingdom once known as Labour’s heartlands, with the North East getting hammered the hardest. Hartlepool, for example, is the worst hit local authority. Residents there pay 1.31% of the value of their homes in council tax, whereas in Westminster, the average resident pays just 0.06% of their property value in council tax. That means the average resident in Hartlepool has a council tax burden 22 times that of Westminster.

Yet to talk about the regional disparities is to underplay the full extent of the problem. Council tax is derived by bands based on 1991 house valuations. The bottom bands pay a larger percentage of property value than the top bands, and houses at the bottom of each band pays significantly more than a property at the top of it.

At Fairer Share, we propose replacing council tax and stamp duty, which has a whole host of problems that hinder economic growth, with a flat property tax of 0.48% of the value of the property.

Flat taxes usually aren’t considered great progressive victories, but that is merely a reflection of the backwardness of the current system (something that shouldn’t be surprising given that portable MP3 players are five years newer than the current council tax regime).

Replacing council tax and stamp duty would be beneficial 76% of households across the UK. There are particular benefits for the poor, nearly 90% of the poorest in society and would add nearly £300 to their average net income per year. Although, on the face of it a neutral policy, it would also have social justice implications, with our analysis showing that large majorities of households in all the UK’s major ethnic minority communities benefiting from a move from council tax to a proportional property tax.

Remarkably, this policy can be achieved without taking a penny out of the treasury’s coffers. The flat rate of 0.48% would return exactly the same revenue as that lost by council tax and by stamp duty, and helping to preserve the vital local services on which we all depend. Raising money for police or social care with regressive precepts could be a thing of the past as local authorities could flex their local rate and raise revenues more fairly from their residents.

Support for the policy is growing in Westminster. Labour’s Grahame Morris is a key supporter, having pushed Boris Johnson on the policy at Prime Minister’s Questions recently. But the policy cuts across party lines, with a number of northern Conservative MPs also supportive.

Across the UK, more than 120,000 households have signed our petition calling for a proportional property tax. A progressive Labour party should also be wholeheartedly backing the introduction of a fairer system of property tax that will deliver in real terms for the majority of voters up and down the country.

Andrew Dixon

Andrew is the Founder of Fairer Share, the campaign to replace Council Tax and Stamp Duty with a fairer system through the introduction of a Proportional Property Tax.

TWITTER