[Ignitionnet]

Times - Paywalled

Millions of houses would be “given away” to low-paid workers under Tory plans to reward people who come off benefits.

Iain Duncan Smith, the work and pensions secretary, is pushing for a pledge to “gift” tenants their council home after a year in work to be included in the Tory manifesto.

Such tenants would cease to be eligible for housing benefit and would have to pay 35 per cent of the sale proceeds in tax if they sold their property within three years, according to one model under discussion. In later years, the amount of tax paid would fall.

All money raised would be ploughed back into the housing market. Proponents argue that the saving in housing benefit and the sales tax receipts, boosted by house inflation, would almost outweigh the cost.

The plan is one of several being considered by senior Tory strategists looking for an “eye-catching” proposal to appeal to working-class voters who might otherwise be tempted to switch to Ukip. They also want to boost home ownership and reward those in work.

If many of the 4.5 million existing social homes were transferred to tenants, the scale of home ownership among poorer groups could be transformed in a matter of years.

Housing associations — private, non profit-making organisations that provide low-cost social housing — would lose a huge chunk of income under the giveaway scheme. They dismissed it as “bonkers”.

David Orr, chief executive of the National Housing Federation, said: “You can’t just give away homes without it costing a huge amount of money. It makes no sense at all.” He said that housing associations were collectively borrowing £50 billion to build homes and would be unable to pay back their debts if the policy were pursued.

Another idea being floated is to extend the Right to Buy programme to the 2.5 million homes owned by housing associations.

Mr Duncan Smith has been pushing for the Right to Buy scheme — which gives homebuyers generous discounts of up to £100,000 — to be extended. It is confined to two million houses owned by councils.

Can't wait to see what my bribe to vote Conservative will be!