The amounts/triggers/thresholds whatever could well be wrong, but in principle the contribution is there precisely to allow low-cost housing for people who cannot afford to pay 6x their income for a mortgage and who cannot find local-authority owned housing because to satisfy a destructive political ideology councils were forced to sell theirs off and then forbidden to use the money to build more.
There are huge quantities of houses available that every full time worker could afford on minimum wages. The problem these days is people don't want to start at the bottom and work up. We live in an society that expect instant gratification and so they don't want to move into a £25k terrace house they want to move into a £200k new build with nice granite worktops, 60" plasma TV, American fridge and god forbid if it doesn't have an en-suite.
To get onto the housing ladder they're unprepared to cut unnecessary spending out of their lifestyles. They still have their new car on HP sat outside their rented house, they still go abroad at least once a year, they have satellite TV and eat out at least once a week. Surely you can't expect them to cut all that out to save 3-5 years for a deposit on a house can you?!?!? You don't expect them to loose face with their friends and neighbors, who think that that nice 4 bedroom house they live in is actually owned, not rented, so how do they buy a similar house that they simple can't afford without going down the ladder?
Social housing is another issue and I have mixed opinion on those who really need to be housed and those who are just too lazy to get of their behind and work for one.
I've heard stories of Local Authority housing departments suggesting that private renters don't pay their rent so that they eventually become homeless, at which point they can then qualify for a social housing. I'm a private landlord and that's exactly what's happening with me. One family (two adults with a 20 year old who's also on the tenancy agreement) always miss a payment every year and it's always the first one after Christmas. I'm still owed 3 of these payments so they pay for 11 months and get 1 month free?!?!. In addition, they are now behind by 2 months - we've served a section 8 but that will take 2 months to be processed - to which they will be expected to leave the property and if they fail to leave then it's back to court to get the bailiffs to evict - costing more money and a further month+. So now they'll owe over £5000, not including court costs. To get this back they have to have the means to pay or assets to the value of - what's the likelihood that I'll get anything more than £5 a month from them? If the property needs refurbishing then that's another cost. All in, it could cost me £10k which is over a years rent.
So, why should I pay the Local Authority 25% of my development when they've already cost me £10,000. I've already made a contribution to the social housing sector by letting them stay in my house, rent free for the equivalent of a year.
