The Help to Buy ISA scandal shows how the Tories are failing everyone but the already wealthy

Back in March 2015, the then Chancellor of the Exchequer George Osborne unveiled the Help to Buy ISA during his Budget speech, promising that “for every £200 you save for your deposit, the Government will top it up with £50 more”.

“It’s as simple as this”, he told us.

But it wasn’t, and the devil, as always, is in the detail.

When the scheme was launched last December the Chancellor told savers that the scheme provides “direct government support to anyone saving for the deposit on their first home”. But savers cannot actually use the promised 25 per cent bonus towards their deposit because it is not paid until the sale is completed – they still need to be able to pay their deposit in full to purchase the home in the first place. So the scheme is totally useless to all but the already wealthy, whose pockets will be lined with a timely bonus.

It is clear beyond doubt that the Government has misled the public. All those young people saving in the hope of getting on the property ladder – the very people the Government claims to be helping – have every right to feel conned and let down.

It is almost inconceivable that an ordinary young person living in London will ever be able to own their own home without huge financial support from their family to the tune of tens or even hundreds of thousands of pounds. This is all well and good for those with wealthy parents who happen to have huge sums of money lying around, but it doesn’t really fit with the Prime Minister’s promise to not “entrench the advantages of the fortunate few” but lead a Government that is “driven not by the interests of the privileged few, but by yours”.

Yesterday, I wrote to the Minister of State for Housing, Planning and London, Gavin Barwell, to call on him to apologise for misleading savers and clarify the details of the scheme once and for all. It really is the least that he could do, right after updating the Government’s own "affordable home ownership schemes" page, which still states that the Government can “help with a deposit, through a Help to Buy ISA”.

To everyone that has looked at this Government’s housing policies in any detail over the last few years, it sadly won’t come as any great surprise that yet another flagship policy has been shown to be nothing more than hot air, false advertising and spin.

Paying no heed to common sense or reason, the Government is still pressing ahead with the extension of Right-to-Buy, promising ‘one-for-one’ replacements for all homes sold off at discounts of up to £100,000. Last year over 12,000 council homes were sold but only 2,055 replacements were started by councils – "one-for-six". According to the Chartered Institute of Housing, we are set to lose up to 370,000 social homes by 2020. Taxpayers are already paying over £9.3bn in housing benefit to private landlords and as social housing is decimated more and more households will be forced into the private rented sector and this bill will skyrocket.

I’ve lost count of the number of times that "affordable starter homes" have been held up as the solution to the housing crisis, but in London a cap of £450,000 means that the Government’s definition of affordability means absolutely nothing to the ordinary first-time buyer. According to Shelter, an income of £77,000 and a deposit of £98,000 is needed for one of these affordable Starter Homes. So we’re back to where we started: home ownership remains totally out of reach to all but the highest earners with access to a huge deposit.

Over the course of the last few days, ministers have been conspicuous by their absence in defending the policy. Instead of issuing an apology, a Treasury spokesperson has even sought to deny that the scheme was ever intended to boost deposits. Irrespective of whatever happens next, the unavoidable truth that must be learnt from this debacle is that the housing crisis won’t be tackled by press releases or gimmicky initiatives and it is about time that the Government actually invested to build the genuinely affordable homes we need.