Tenants forced to give up pets.

Wednesday, 25 April 2007, 15:09 GMT 16:09 UK People who rent property in Jersey have been forced to give up their pets because of restrictive contracts, said Jersey's Animal Shelter (JSPCA). Residents who rent houses or flats have to obey a clause not to keep pets. JSPCA's chief executive Stephen Coleman said the amount of animals left in their care had risen by 15-20%. He said there was a significant rise in cats. But letting agent Julian Cubbage said he did not think renting contracts were becoming more stringent. He said there had always been an historic sensitivity to animals and that pets were not allowed in homes because of the damage they may cause. "There's also a nuisance factor to other owners - it's not very satisfactory if every time you walk past a flat door you have a dog barking at you from the other side," he said. Mr Cubbage advised residents to question the contracts as compromises could be made.

Lyons' lost pride

By shelving Sir Michael Lyons' recommendations on council tax reform, Gordon Brown has turned his back on a historic opportunity.

March 23, 2007 11:30 AM | Printable version

Gordon Brown should hang his head in shame. Not for the budget, but for the government's response to yesterday's side show, the convenient launch of the report he commissioned three years ago, calling for a radical reform of local government finance and powers.

The man who would be prime minister threw away an opportunity for a real change that would have hit the rich and helped the poor. Sir Michael Lyons, professor of public policy at Birmingham University, in a well-argued report, said the time had come for a radical overhaul of council tax. He proposed a really big increase for the multi-millionaire class in the amount - some 100-200% more - they contribute to the local community and some much needed help for the poorest first-time buyers, scraping to buy the last remaining homes worth less than £102,000 in England.

Phil Woolas, the local government minister, with Treasury backing, within hours of its publication threw out the plan for at least the next five years. This was great news for Russian oil tycoon and Chelsea football club owner, Roman Abramovich, and Labour donor and Indian steel magnate, Lakshmi Mittal, to name but two people with property worth in excess of £2.5m. They have saved paying anything up to an extra £3,000 a year - a cool £15,000 for the next five years. For magnates like them, this is loose change compared to the billions they spend every year, but no doubt they would be delighted that a Labour chancellor is so keen to make sure they avoid any unnecessary tax.

Rather surprising, though, is the reverse side of the coin of Gordon Brown's decision. By not doing anything, he has also mugged the wallets of the inner-city poor. For a chancellor who makes such a issue of taking millions of poor people and their families out of the poverty trap, he has actually thrown out, on Michael Lyons' figures, the chance of rebating £150 a year in council tax to those living in the cheapest property. Unlike the other group, I have a feeling they could find quite of lot of uses for the extra £750 they would have had for the next five years.

No doubt, Gordon will say that the poorest would be able to claim council tax benefit, anyway. But that case is crushed by Sir Michael as well, when he points out that there is £1.8bn unclaimed council tax benefit because of complications and stigma in filling in forms. He has a good answer for that: give them an automated rebate instead. But guess what? The government, faced with paying out with almost as much as they can raise on a 1p income tax, isn't keen on doing that immediately either.

If Gordon has wimped out on doing anything redistributive on council tax, the Tories have even been worse. Caroline Spelman, their spokeswoman, issued hysterical statements warning the middle class, Daily Mail readers, of tax bombshells if they repaved their patios. She appears to want to preserve the ludicrous 1991 valuations, which are presently used to work out council taxes (even for homes built in 2007), in aspic. No doubt, if council taxes had not been invented, she would still be defending medieval tithes, as the best way of raising taxes.

The Liberal Democrats' plan to replace the council tax with a local income tax is also exposed in the report as not being properly thought-out. This left Labour with a chance to be bold, to go out and argue that those who have made the most out of England's obession with ever-rising property prices should pay a little more tax. The change would have left those in the middle neither better-, nor worse-off. But I was forgetting that the old "s" word, socialism, is only used by Gordon as a bit of rhetoric at trade-union rallies.

sirmichaellyons gordonbrown philwoolas counciltax treasury chancellor carolinespelman propertyprices propertyvaluations

British banks told to plan for 40% crash in housing

By Patrick Hosking The Times, London Thursday, November 16, 2006 Banks in the United Kingdom have been ordered by financial regulators to assess how they would cope in the event of house prices crashing by 40 percent. The instruction to include a housing slump scenario in their stress-testing models comes after the Financial Services Authority found that some banks were failing to include gloomy enough assumptions in their modelling. The FSA said yesterday that an "appropriate" benchmark was to assume property prices fell by 40 percent and that 35 percent of mortgages in default ended with homes being repossessed. It stressed that this was not a forecast but a "severe but plausible scenario" and one that banks should examine when deciding how robust their balance sheets were. In a speech to the British Bankers' Association yesterday, Clive Briault, the FSA's managing director for retail markets, remarked on banks' differing views over the size and impact of a house market downturn, and hence the need for reference points. He also warned bankers to ensure that they have properly stress-tested their mortgage portfolios in the wake of decisions by some to lend people greater multiples of their incomes. In a letter to bank chief executives last month the FSA accused some of failing to consider scenarios in which they might be forced into losses, dividend cuts or capital shortfalls. "We were struck by how mild the firm-wide stress events were at some of the firms we visited," wrote the FSA's director of major retail groups, David Strachan. A few banks were "weak in all respects" in stress-testing. House prices fell about 15 percent nationwide in, and in parts of East Anglia by 40 percent, leading to repossessions, write-downs, and bank losses. Banks are obliged to stress-test hypothetical adverse movements in asset prices, interest rates, and exchange rates to ensure that they have a sufficient capital cushion. But stress-testing is only as robust as the assumptions made. The FSA move came as UK house prices grew at their fastest for four years, according to new figures from RICS.

Housing Plot

Letter to editor The Independent (London) Sir: The solution to the problem of 770,000 empty homes is simple ("When a house is not a home", 12 August) - introduce site value rating. If owners had to pay an annual rate for the plot on which their house stood, irrespective of whether it was empty or not, they would not leave properties empty for years. There would be no point in "riding the boom", as Fiona Brandhorst puts it, because there would be no boom (or indeed any slumps). A house's real price is whatever it costs to build it. If it is not maintained - as empty houses often are not - then it is a depreciating asset. What goes up in value is the site. Site values are created by the community. In particular, it is the local authorities and the Government that finance roads, railways, schools, hospitals, police forces, fire brigades, street lighting, drainage, refuse collection etc that make building land so valuable. To collect this as an annual rate merely returns to the public authorities the money they have spent in creating this value. Geofrey Lee