Why France is going to reform its housing benefit system

The French government has announced that their system of housing benefit will be reformed this autumn.  The minister, Jacques Mézard, is reported in Le Monde as saying:

We have a budget for APL (Aides personnalisées au logement) of 19 billion euros, a budget for all housing benefits of 30 billion euros, the highest in Europe, with a corollary: not enough housing and rents that are too high.  … For one euro more spent on APL, 78 centimes goes on higher rents.  We have to get out of this perverse system.

When housing benefits were first introduced in the UK, in the form of “Rent Allowance” and “Rent Rebate”, policy makers had been impressed by the French argument for subsidising low incomes rather than bricks and mortar – “aide à la personne” instead of “aide à la pierre“.  As in France, it’s led to higher costs, more complex administration, higher rents and often the exclusion of low income families from decent housing. It was a mistake then, and it’s still a mistake now.

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