Introduction: When Work Doesn’t Pay the Rent
As someone who lives in social housing, I know the importance of fair rent, following a change of circumstance. I see how rising private rents are making it almost impossible for people on low incomes to move forward. With news that unemployment is now at 5%, i thought I would give my perspective.
Many people will want to work, as I did following my transplant. Taking on basic jobs around the minimum wage, as a stepping stone to something else. But when rent alone can swallow most of that wage, work stops being viable. That is what we are now seeing, but are politicians seeing that?
What happens next is predictable: more people rely on benefits just to keep a roof over their heads. The welfare bill rises and then politicians and the media start pointing fingers at ‘claimants’, rather than asking the question, why so many can’t afford to work in the first place.
The Missing Piece in the Welfare Debate
We hear constant talk about the cost of welfare, but very little about what’s driving it. And a huge part of that cost is rent, particularly private rent.
Looking at the latest ONS data we see a stark divide: the average private rent in London reached about £2,243/month in March 2025, compared to the England-average of around £1,386/month. That means a London rent sits at around £857 more per month than the national average. For staff working in key sectors such as the NHS who may be on modest salaries, that difference is the difference between being able to make a job pay or being stuck in a cost-trap.
To put this in perspective, I created a simple budget for someone working full-time at the 2025 minimum wage of £12.21 per hour (37.5 hours a week). Their monthly take-home pay is about £1,722.
Rent of £1,400 a month leaves just £322 before utilities and bills. Once essentials like electricity, broadband, and phone are paid, they’re left with under £100 and that’s before buying food or paying for travel.
That’s why so many working people now rely on food banks. It’s not idleness; it’s basic money in, money out. And when you look at hospital porters, cleaners, or care workers in London on similar pay, it becomes clear why recruitment and retention are such an issue for the NHS. This will also be an issue in hospitality where I worked when younger.
When private rents rise this fast, the Local Housing Allowance (LHA) the amount of rent help claimants can receive, can’t keep up. Even with the freeze lifted in 2024, support still falls short of actual market rents in most areas. It was never sustainable,
The Cost to Taxpayers: A Quiet £70 Billion Subsidy
Few realise just how much of the welfare budget goes straight to private landlords.
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Over the five years from 2021–26, the government will have spent around £70 billion subsidising private rents through housing benefit and Universal Credit’s housing element (New Economics Foundation).
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Annual housing benefit spending remains above £23 billion.
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At the same time, social security spending overall is forecast at £316 billion for 2025–26, with a large share going to housing support.
That means taxpayers are footing a bill that essentially props up private rents, not households’ living standards. In fact, the state now pays more to private landlords than it invests in building new affordable homes.
Why People Stay on Benefits — and It’s Not Laziness
The reality: when rent is sky-high, taking a job at minimum wage often doesn’t make financial sense as I mentioned above.
Let’s take a simple example:
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£12.21 per hour (37.5 hours a week). Their monthly take-home pay is about £1,722
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Average rent: £1,300–£1,400 per month.
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After tax, rent, and essential bills — there’s little or nothing left.
So for some, staying on benefits isn’t about avoiding work. It’s about survival. It’s about making sure the rent gets paid and they keep the roof over their head.
Others will want to work, I believe its our instinct to help ourselves and be independent. But many now can’t afford the risk, if a new job doesn’t last, or hours drop, or payments change, arrears can build up fast. For those privately rent, one missed payment can mean eviction, or worse still homelessness. Having been homeless, its the last situation you want to be in.
Meanwhile, in Social Housing & Fair Rent
My experience as a social tenant has been very different.
When life changes as it did for me with kidney failure. The job loss often happens, the new diagnosis, homelessness. Back then we were rehoused after about 6 weeks, due to there being more social housing stock. That fair social rent gives you breathing space, as well as security. It’s a foundation for your own independence and good for your health, as I have proved. Coming up to 30 years post transplant, I know that foundation helped me, as it helped so many decades before.
Because the rent is affordable, taking a job doesn’t feel risky. You have security, there’s room to live, not just survive and have that disposable income we need. And for taxpayers, social housing is far more efficient: lower rent means less housing benefit paid out. Social housing, is just housing without the profit margin. Often owned by the local authority, providing an income to help pay for local services.
Shelter estimates that living in a social home is over 60 % more affordable than private renting. That’s why investment in social housing isn’t just social policy, it’s sound economic policy.
The Conflict of Interest Question
There’s also an uncomfortable question that too few are asking:
Are politicians ignoring private rents because so many of them are landlords?
According to parliamentary register data, roughly one in five MPs has declared rental property income. That doesn’t automatically mean corruption, but it does raise questions about priorities and incentives.
If the people writing the housing laws benefit directly from high rents, can we really expect them to bring those rents down?
What Needs to Change — Ahead of the Budget
With the Budget around the corner, here’s what should be on the table:
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Looking back to the Fair Rent Act.
The fair rent act worked and its also the reason poverty was lower in the 1960’s. The 2M social homes that have been sold under Thatcher and Blair for example. Have in my view contributed to the poverty levels we are now seeing. -
Reinvest in social housing.
Every new social home saves the taxpayer money long-term and gives people a stable base to work from. Its will also give local authorities income over the long term. -
Recognise housing costs in welfare reform.
If you want to reduce welfare spending, start by tackling what drives it: unaffordable private rents.
Conclusion: Fair Rent Means Fair Chances
It’s easy to blame claimants. It’s harder to confront the system that traps them. Modern politicians will turn to advisors and think tanks for answers. But if there is little or no lived experience in the discussion, they wont fully understand the problem. Nothing against academics, merely suggesting that education comes in many forms and you need balance to find solutions to problems. A think tank will look at data and run algorithms, but not see the bigger picture.
High private rents are a major reason welfare costs are rising and they’re keeping people out of work, not the other way around.
As someone who’s benefited from fair rent in social housing, I know what stability feels like. I know how it helps when life changes, when work is uncertain, or when you’re trying to get back on your feet. I just want others to have the same opportunity and I know it will work.
If we want a fairer, more affordable, and more productive society, we need to stop pretending the problem is ‘welfare dependency’ and start talking honestly about rent.
References:
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Office for National Statistics, Private rent and house prices, UK: April 2025
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New Economics Foundation, Government subsidising private landlords by £70 bn over next five years
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Joseph Rowntree Foundation, Stop the Freeze: re-link housing benefits to private rents
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Shelter England, Living in a social home is over 60 % more affordable than private renting
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UK Government, Benefit expenditure and caseload tables 2025–26
