Question
The independent Office for Budget Responsibility’s “Economic and fiscal outlook”, published alongside the Budget, says on page 77 that the consequence of the 4% hike in property income tax will be fewer rental properties and higher rents as landlords pass on those costs. Does the Minister think the OBR is wrong? If not, does he accept that rents will go up as a result of those measures?
Answer
I refer the right hon. Gentleman to my opening remarks. At the Budget last year, the OBR assessed that there would be a small impact of 0.2% on rental prices as a result of that increase, and we expect a similarly small impact from this increase. The obvious answer to affordability challenges in the private rented sector, as well as everywhere else, is to build more housing supply. That is why it is so disappointing that Opposition Members, despite what those on their Front Bench say, consistently complain about new housing developments coming forward in their constituencies.20% point-scoring
Verdict: AMBER (62/100)
The reply responds directly to the question about rents. It cites the OBR's estimate that the previous Budget raised rents by about 0.2%, and it expects a similarly small rise from this increase, which accepts that rents will go up, though only modestly. It does not address the OBR's finding that there would be fewer rental properties, so that part of the question is left unanswered and the asker may need to follow up on supply.
How we got there
| Question item | Coverage | Specificity | Rationale |
|---|---|---|---|
| Whether the Minister considers the OBR's analysis, in its Economic and fiscal outlook, that the 4% increase in property income tax will lead to fewer rental properties and higher rents to be wrong | Addressed | Direct | The reply does not dispute the OBR's analysis but cites it, stating the OBR assessed a 0.2% rental price impact at the previous Budget and that a similarly small impact is expected from this increase, which implicitly places the Minister's view on the OBR's rent finding. It says nothing specific about the 'fewer rental properties' element of the OBR's conclusion, so the coverage is not complete. |
| Whether the Minister accepts that rents will rise as a result of the property income tax measures | Addressed | Direct | By citing the OBR's 0.2% rental price impact and expecting a similarly small impact from this increase, the reply effectively accepts that rents will rise, though only modestly. Statements 4 and 5 concern housing supply and point-scoring and do not bear on the item. |