Mary Dejevsky: You should be able to live where you work

Anyone in paid and steady employment is by someone's definition a key worker
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The Independent Online

So, reasonably enough, George approached the council - not the council where he currently lives, a long commute from his job, but the City of Westminster, where he works. He hoped that as an established employee in the borough with excellent references from his employer, he might have a chance of being placed on a council or housing association list.

The answer - as anyone will know who has had any dealings with council housing departments recently - was swift and negative. Without two years' residence in the borough, he had not the slightest prospect even of joining a waiting list for subsidised housing in Westminster. Were he and his family homeless, were they local residents with an aged parent or a handicapped child, the council might have an obligation to do something, but for a family man with a steady, but low-paid job, the chances of subsidised housing were zero.

And Westminster's practice is more the rule than the exception. Wherever housing is out of range of low-paid workers - which is, according to a recent Halifax survey, in more than 90 per cent of the country - the lists are effectively closed to those not already resident in the borough. So-called "key-worker" schemes, usually run by agencies and not the council, might offer an eventual solution to those groups identified as key workers, such as nurses, teachers and social workers, but here, too, demand exceeds supply hundreds of times over.

In their own terms, the councils are not being unreasonable. They are legally required to house the homeless; next come those currently in overcrowded or substandard accommodation and those in special need. This more than exhausts the annual vacancies in most councils' housing stock. Depleted by tenants' right-to-buy, decent subsidised accommodation has been whittled away. Lack of building land and councils' disinclination to invest in housing have done the rest.

In principle, it is hard to dispute the priorities imposed by the Government or set by the councils. In areas where house prices, rents and demand are all high, the councils' room for manoeuvre is negligible. But the effect of closing housing lists to low-paid workers is to bar families on low incomes from living in a large number of areas - not just in London, but in other cities and desirable rural areas.

The consequence in the short term is that those in low-paid, often service, jobs can rarely live anywhere near where they work. Proximity to work - with all that means for free time, quality of life, work-life balance - is simply not rated by councils or housing associations as a prime qualification for housing. The little subsidised housing that becomes vacant is allocated to those who are not working, or cannot work.

The longer-term effect is two-fold. The first is a shortage of needed skills and an instability in the working population as low-paid workers look for areas where their salaries go further and they have a shorter commute. The second is the removal of the social "middle" from increasingly well-to-do areas, leaving islands of social housing where precious few are employed, and the exacerbation of a kind of social apartheid.

Successive schemes to make housing affordable for so-called "key-workers" are one way in which the Government and some local authorities have tried to address these dilemmas. Nurses, teachers and social workers are among the intended beneficiaries. Singling out workers in these sectors, however, does not solve the problem and is in many ways invidious. Anyone who is in paid and steady employment is by someone's definition a "key-worker". In some ways it is those with fewer qualifications who need help the most, because their prospects of advancement and higher pay are lower.

To this extent, the proposals set out by the Chancellor, Gordon Brown, earlier this year were a welcome recognition that the "key-worker" concept needed broadening. He suggested a new scheme for shared-ownership that would help low-paid workers to buy a part of a house or flat and pay rent on the rest. A study being conducted by the Institute for Public Policy Research, however, suggests that they are unlikely to have the desired effect. Not only could they have the effect of pushing up house prices at the lower end of the market, but they are likely to require a higher income than most potential beneficiaries will have. At present, the gap between the salaries of the lower paid, whether in the public or private sector, and the cost of accommodation in the high-cost areas where many are employed is just too great to be bridged.

The trouble is that any solution is as unpalatable to large numbers of people as it is improbable: a sharp fall in house prices in the most desirable areas or a drastic diminution of the pay gap by dint of much higher salaries for those who are currently low paid. Given these alternatives, perhaps an appeal to councils to rethink their priorities and consider a person's place of employment when allocating subsidised housing is not so unreasonable after all.