There are maxims worth following whenever a politician makes use of statistics. In particular, in whose interest are the statistics prepared and published and are they being interpreted acurately and fairly. Let us consider the thorny issue of the effect on families in Greater London of ceilings and cuts in Housing Benefit. According to Government statistics, and let us say they are right, there are 17,500 families and some 82,000 people. The London Boroughs speaking collectively are preparing plans for what to do if all these people could not pay higher rents, could not make other provision and were therefore forced to move.
Ask some questions:
1. Would all these tenants be forced to move? No, but no one has bothered to find out. Come on Government, survey them first and give us the answer. 2. What proportion of these tenants are short stay anyway with agreements running up to 3 years.? Up to 40 percent of landlords, according to the Landlords Association but they would say this wouldn’t they. 3. Up to 30 percent of landlords according to the Landlord’s Association They don’t tell us by how much. There are other estimates ranging fr0m 30-50 percent some of which come from Tory Councils. They would say this wouldn’t they. 3. Some of these tenants might be given social housing by their Councils. Source Tory Westminster Council. What is the current waiting list? Not given. It must be lengthy, say up to ten years. No chance. 5. Not to worry anyway the Government has put aside £130 million to mitigate hardship. Sounds a lot. Let’s say every family affected was a hardship case. If this was true 17,500 familes would each get £742 pounds. Enough to pay 2 weeks rent. Whacko. Lets be fair. Reduce the number forced to move by 20 percent as a result of lower rents that they could afford, and a further 20 percent for their own ingenuity, and ten percent for short term rentals and a willingness to move on. (Statistical point. These percentages are not additive) and we might say that 50 percent of families, 8,750, will have to leave their homes and most will go into boarding accommodation on the South Coast. 5.. At what cost? Not known. Leaving this aside the Government could give the families concerned and the Councils bearing the cost £130 miillion towards the cost of this, that is £1,484. How long would this last? Are there jobs for them in places like Hastings with very high rates of unemployment? I have not seen any figures. Come on you Council’s, tell us.
You might say that the Coalition Government, in the interest of transparent administration should tell us. If Labour MPs were smart enough they could ask the Parliamentary questions that would give us all the answers. Come on you Labour MPs and Labour C0uncillors. Do your job.
Filed under BBC, Benefits, Big society, Cameron, Coalition Government, Conservative Home, Disability Allownce, Economics, George Osborne, Guardian, Housin in London, Housing Benefit, Job Seekers Allowance, Labour Blogs, Lib Dem MPs, Nick Clegg, Parliament, Politics, Poverty, Spending Review, Statistics, Treasury, Unemployment
Everyone is an economist these days and many of these new pundits have never read an economics text book. Alan Johnson is not the first to admit it and rumour has it that James Callaghan was sent on a course at Nuffield College. Of course, some of their advisers have read something along the lines of economics . So it was a relief to me to tune in to a debate in the House of Lords on the proposed rise in tuition fees and hear economic terms being used.
An issue discussed was would an increase in tuition fees reduce the number of people applying for a university place particularly the ‘deserving poor’. The Coalition argues that when Labour did it applicants dropped for a short time and then the rise resumed. Well as any economist knows whether it rises or falls depends on the elasticity of demand for university courses and their supply in the past and in the future. It is possible to calulate the numbers for the earlier period and make some reasonable forecasts now when the determinants of demand have changed. Has any one done that? if so please speak up. Obviously when Labour did it the demand for university places was rising and their provision expanded to meet this demand. The total number of applicants were on that part of the demand curve that was rising quickly. The potential supply of students is not infinite and we would expect the rise in the percentage of the population going to a university to level off within its limits. Of course there is the issue of rising population and overseas students. No one said that forecasting was simple?
Then there is the issue of rents in London the elasticity of demand for the properties occupied by 17, 500 hapless Housing Benefit families. What we might wonder are the demand and supply curves for this accommodation in London. There is no doubt the population of London has been growing fast and the demand for rented accommodation has been rising. What is the percentage of these 17,500 homes to the total number of such properties in the whole of London by segment? Let’s guess. Pretty small I hear you say. And what is the demand for them? Well, you might say, getting into the swing, the curve must be rather steep. After all who can get a mortgage these days? Atta boy you are getting the idea. What we need to predict are the growth rated in family establishments and the need and aspirations of people to settle in London. Look, you can stop at this point. I think you get the drift of this. What I am saying is that when you are seeking to change Housing Benefit it is reasonable to predict the consequences and not make up fairy tales.
I am a prodigious borrower of books from my local library most of which comes from the British Library at £3.50 a book. My librarian tells me that the charge is to rise to £10 a book which is the real cost of the British Library lending it. I consult these books rather than read every word in them. At the British Library there is no limit to the number of books I can borrow in a day. Let us assume I work in the British Library on ten books free of charge which is quite usual for me. I can get there by train for £25. I resolve not to borrow these books through my local library. It is a matter of elasticity of demand you see. Anyone know what it is? At the end of the year some accounting Wally will argue that there is no local demand and the Council should withdraw the facility. And so on.
What is my gripe? The illiteracy of many people, and especailly, the politicians who debate these important public issues.
Filed under Alan Budd, BBC, Big society, Cabinet, Cameron, Deficit, Economics, George Osborne, House of Lords, Housin in London, Housing Benefit, IFS, Job Seekers Allowance, Labour Blogs, Lib Dem blogs, Liberal Voice, New Stateman, Nrew Stateman, OBR, Politics, Statistics, Treasury