The Impact of Structural Changes in Rents on Different People Research Paper

The Impact of Structural Changes in Rents on Different People - Research Paper Example The previous Conservative government up to 1997 had a policy of allowing social rents to increase with the intention of reducing public expenditure on subsidies with little regard to the impact on affordability or work incentives for tenants. They argued that rent increases allowed help to be diverted to those in greatest need. Better-off tenants met rent increases out of their own pockets while Housing Benefit 'took the strain' for the poorer tenants. This, however, created serious problems of benefit dependency and work disincentives throughout the country. The present Labour Government has already introduced the national minimum wage and Working Families Tax Credit (WFTC) in order to tackle poverty, promote work incentives and reduce benefit dependency. Realignment of rents in line with this thinking has been taken up on priority. The Office of the Deputy Prime Minister (ODPM) now changed to the Department of Communities and Local Government (DCLG) [since May 2006] has issued seve ral guidelines on the calculation and setting of rent for different social housing properties. Since April 2002 rents are calculated according to a formula based on relative property values, local earnings and property size. Restructured rents are calculated using the formula and data set out in the DCLG guide to Social Rent Reforms. Circular R2-27/01: ‘Rent Influencing Regime – Implementing the Rent Restructuring Framework’ also sets out the calculation of target rents. The complex mosaic of rental patterns in the social rented sector begins to make sense once the nature of individual rent schemes is explored.