The Welsh Assembly Government could do more to reduce poverty among
homeowners according to a research report showing that Welsh
owner-occupiers are more likely to live on low incomes than those in
England or Scotland.
The study for the Joseph Rowntree Foundation uses a number of different measures to show that around half all households in the bottom fifth of the income distribution in Wales are owner-occupied. This is especially the case when full account is taken of homeowners’ mortgage and repair costs.
The research finds that three out of five pensioners living on low incomes are homeowners – a proportion that is especially high compared with England or Scotland. However, it also shows that many children from low-income families in Wales have parents who are homeowners. For example, four out of ten children whose families are in the bottom fifth of incomes live in owner-occupied properties. More generally, the research confirms that poverty is more common among owners who are unemployed, living alone, are lone parents or come from Pakistani or Bangladeshi communities.
Prof Steve Wilcox and Prof Roger Burrows of the University of York, the report’s authors, note that when last assessed six years ago, 72 per cent of officially ‘unfit’ properties in Wales were in homeownership. The average repair cost per unfit home was estimated at £4,800, making a total of £439 million for the sector across Wales as a whole. Three-fifths of households without central heating and half those without double glazing were owner-occupiers. Homeowners also accounted for over half all households living at high densities (more than one person per habitable room).
The researchers calculate that a decline in spending on home improvement grants and support for low-cost ownership, coupled with cutbacks in the Income Support Mortgage Interest scheme, means that government support for homeowning, low-income households in Wales has fallen from over £200 million a year in the early 1990s to £84 million in 2002 / 03.
Although acknowledging that the major responsibility for tackling poverty and poor housing lies with the Westminster Government, the report argues that there are a range of policies that the Welsh Assembly Government could adopt to improve support for low-income homeowners.
This includes action to increase the take-up of unclaimed tax credits for working families and pensioners. This would not only improve the safety net for homeowners who suffer a sudden loss of earnings, but also increase the number of households eligible for help to increase the energy efficiency of their homes under existing Welsh schemes.
The report also calls on the National Assembly to review the effectiveness of the recently introduced discretionary scheme for home improvement grants to assess whether it is capable of delivering the Government’s target of halving the number of private sector homes in a state of disrepair by 2005.
Prof Wilcox said: “ If the new policies fail to significantly reduce the extent of poor housing conditions for vulnerable and low-income homeowners in Wales, then the National Assembly should not hesitate to use its devolved housing powers to introduce policies designed to be more effective. Wales stands out in the UK for a specific combination of higher than average levels of homeownership, lower incomes and a relatively elderly population. While it is true that the most critical policy levers for improving people’s lives belong to the UK Government, our study demonstrates that the National Assembly could, and should, make more use of its powers, to make a difference in key areas.”