Blog & Articles

Shared ownership can put a roof over the head of Generation Rent

Date: 22. November 2013
Vidhya Alakeson

With house prices out of reach for many, shared ownership could be the next big thing – but only if it makes some serious change.The gap between renting and owning with a conventional mortgage, even a high loan-to-value mortgage, has become unbridgeable for low and modest income families in some parts of the country, not just London.

Take Cambridge as an example. A couple with one child with a net income of £22,000 would have to spend 85% of their income on monthly mortgage payments if they had a 95% mortgage on a two-bedroom property. While the barriers to ownership are high, the aspiration to own remains strong, and there are good reasons to promote ownership, not least the fact that welfare spending on housing benefit and pensions will rise dramatically if large numbers enter retirement and still have to pay rent. Shared ownership can act as a bridge to home ownership for those on lower incomes, but to meet the needs of millions not a few hundred thousand, the product would need to change and be massively scaled up.

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Are zero hours contracts here to stay?

Date: 5. August 2013
Vidhya Alakeson

It is not surprising that at the end of the longest economic downturn the UK has ever faced to see an increase in the number of people on zero hours contracts. In uncertain times, employers have turned to these contracts to weather a difficult economic climate. By not guaranteeing employees a set number of hours of work, zero hours contracts allow employers to respond flexibly to demand. Local Authorities have found them similarly useful in the face of budget cuts and an uncertain future for many council services. The question for the coming years is whether, as the economy starts to recover, zero hours contracts are here to stay.

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Doing the zero sums

Date: 2. July 2013
Vidhya Alakeson and Matthew Pennycook
Pressure on public sector budgets has led to a rise in zero-hours contracts, particularly in the care sector. The biggest losers are vulnerable service-users and staff on poor pay and insecure hours. It all adds up to the next big care scandal

Over the past year, the government has repeatedly raised concerns about the quality of care in hospitals, care homes and people’s own homes.

But is it any wonder that such concerns exist given the dynamics of publicly funded social care provision in this country? Confronted with rising demographic pressures and reductions in funding, many local authorities have used their leverage as the dominant market players to force down prices and commission care more flexibly. This, in turn, has compelled providers to seek ways of maximising the flexibility of their workforce and reducing spending on wages.

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To the Point - Protecting our workers

Date: 3. June 2013
Vidhya Alakeson

This post originally appeared on the Nursery World blog

Last week, the Department for Education released analysis suggesting that relaxing ratios would reduce the cost of childcare for parents by 28 per cent. In my column last month, I suggested that the Government must effectively be spending the same money twice if it was saying it could raise quality and cut prices at the same time. So, having seen reports of the Department for Education analysis suggesting I had been wrong, I had to take another look.

Of course, cheaper childcare without a loss of quality would be welcome news for cash-strapped parents. But the sad reality is that it is only possible because childcare workers are so poorly paid and becoming more qualified does not earn you very much more money. 

 

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Budget 2013: the new childcare support excludes families who most need help

Date: 20. March 2013
Vidhya Alakeson

In a time of austerity, why is extra money being directed towards families earning £300,000, and not those on universal credit? 

The centrepiece of the budget will be a new system of tax-free childcare vouchers (deliberately misnamed tax relief by the government) for middle- and higher-income families.

Of the nearly £1bn earmarked for childcare, £750m is going towards these new vouchers. Over time they will replace existing employer-supported vouchers. As such, they are an improvement: they are available to all families not just those whose employers happen to offer the scheme.

Yet analysis by the Resolution Foundation shows that more than 80% of families that will benefit from this new support from 2015 are in the top half of the working-age household income distribution. They will be able to claim back 20% of their childcare costs up to £6,000 per child. In fact, even families with incomes up to £300,000 will be eligible for support.

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Budget 2012: George Osborne is hitting families even harder

Date: 20. March 2012
Vidhya Alakeson

 

This post originally appeared on The Guardian website

Although the chancellor will only step up to the despatch box to present his budget later today, we already know about the changes that will have the greatest impact on Britain's working families. That is because governments are in the habit of announcing changes years in advance, ensuring families are caught unaware when the changes are actually implemented. It was in his 2010 budget rather than today's that the chancellor announced a £2.4bn cut to tax credits that will take effect from this April. According to analysis from the Resolution Foundation, none of the 2 million families on low to middle incomes currently claiming working tax credits will be unaffected, with some standing to lose thousands of pounds.

This year's cuts follow hard on the heels of last April's cuts to tax credits. With the price of essentials still high, many families are struggling to see how to tighten their belts further. Heating has already become a luxury, as has the car, and they have already downgraded to value brands at the supermarket. In a survey of nearly 2,000 parents conducted by Netmums, the online parenting organisation, more than half of those surveyed felt they were living on the edge, with only a small increase in spending or a small decrease in income enough to tip them into crisis. Nearly one in five parents reported skipping meals themselves to make sure they could still put food on the table for their children.

 

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What can the chancellor do to address the high costs of childcare?

Date: 28. February 2012
Vidhya Alakeson

This piece first appeared on the Guardian's Comment is Free site.

Laura works 25 hours a week as an accounts administrator. After paying for childcare, she takes home only half of what she earns. This is an all too familiar picture for working families in Britain and, according to Monday's report by the Daycare Trust, things are getting worse. The average part-time nursery place for a child under two now costs more than £5,000 a year, and more like £6,500 in London. Lower income families feel particularly hard hit this year because of last year's cut to support for childcare costs, and will find themselves even worse off after this April's change to tax credits. Eligibility for working tax credits will be tied to working longer hours and that will mean paying for more childcare.

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childcare slider

Universal Credit: winners and losers

Date: 17. November 2011
Vidhya Alakeson and

This post originally appeared on the Public Finance blog

Iain Duncan Smith has found an extra £300m for childcare in his Universal Credit, but women who want to work longer hours will lose out. The result is only going to make households worse off

Earlier this month, the government announced the level of support that would be available for childcare under Universal Credit when it is introduced in 2013. This is equivalent to the support currently available to low-to-middle income families through the childcare element of the Working Tax Credit.

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Housing

‘Generation rent’ needs a helping hand

Date: 1. September 2011
Vidhya Alakeson and

This blog originally appeared on Public Finance

Yesterday’s report from the National Housing Federation predicted that by 2021 home ownership in Britain will have fallen to its lowest levels since the mid 1980s. 64 per cent of people will own a home compared to a peak of 73 percent ten years ago.

The government’s response to these predictions was half right. The minister for housing, Grant Shapps, talked about the need to build more homes. This would of course help address the chronic undersupply of housing, with the number of new homes being built at a post-war low. But it was also half wrong by continuing to focus exclusively on meeting people’s aspiration to own and ignoring the potential for the private rented sector.


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