The Welsh Government is facing criticism over its scheme to charge second-home owners a council tax premium of up to 300%, with some warning it could turn tourist hotspots into “ghost towns”.
In April 2023 the amount councils in Wales could charge second-home owners rose to 300%, in a bid to free up housing stock for locals.
In addition, the number of nights holiday let owners must fill their properties to avoid the second home tax and be eligible for business rates rose from 70 to 182.
But holiday accommodation providers say the new threshold is pushing many out of business.
Image: Gwion Llwyd, represents around 200 holiday let owners in Wales
“We’ve got examples who are already realising that this is going to be a really hard target for them to achieve,” says Gwion Llwyd, who represents around 200 holiday let owners in Wales.
He says some are already selling up.
“They’re just going to give up and going to come out of the market unfortunately,” he added.
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“They’re going to take the kitchen out, rip the bathroom out so it doesn’t class as accommodation anymore, and give up on the business. So that barn will sit empty now and contribute nothing to the local economy.”
In part, holiday properties being sold because of the increased premium demonstrates the government’s plan is working.
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But in the seaside resort of Abersoch, Gwynedd, the policy is causing anger.
The area charges a 150% second home council tax premium, the highest rate in Wales.
For decades a playground for wealthy outsiders, more than 54% of properties in the village are either second homes or holiday lets, with most locals priced out.
The village is home to the most expensive street in Wales – where clifftop houses average more than £1.7m. On the beach below, a small boat shed is currently on the market for offers in excess of £250,000.
Nigel Jones runs a local shop and told Sky News the government’s council tax premium won’t do anything to increase affordable housing and only hit the local economy.
“They’re actually probably killing the market to be honest,” he said.
“It won’t do anyone any favours, it’ll just become a ghost town because the houses are so expensive here. I don’t think any local will ever be able to afford it. What Gwynedd [council] should do is build more houses for locals rather than tax the second homes so much.”
At the heart of the policy are local people unable to find somewhere affordable to live.
Image: Angharad Owen, from Anglesey, talks to Sky’s Dan Whitehead
Image: Eryri National Park
Angharad Owen, from Anglesey, was forced to stay in a friend’s converted shed, before finally finding a property to rent in the small village of Brynrefail, near Snowdon.
She told Sky News that since the COVID-19 pandemic, the area has changed.
“There were a lot of people coming here wanting to buy a piece of paradise,” she said.
“I have seen a number of houses up for sale and snapped up very quickly – and I’ve been looking myself because I’d like to buy a place but the prices have been going up scarily.”
She says it is mainly Airbnbs popping up.
“I’ve had neighbours who I’ve got to know and then they’ve left and the properties have changed into Airbnbs,” she added.
“I’ve seen a lot of change in a very short amount of time. It changes the whole dynamic, you lose that sense of community.”
Reacting to concerns from holiday let owners, Rebecca Evans, the Welsh Government’s minister for finance and local government, told Sky News: “We think that for a business to benefit from small business rates relief it really should be operating as a business for half of the year.
“We do know some property owners may find that particularly difficult, so we have provided local authorities with the discretion to either not apply the premium or reduce council tax to nothing in cases where they think that’s the right thing to do.”
Ms Evans admitted the second home premium is not the complete solution to solving the housing crisis.
“It’s definitely the case that some of these properties are not going to be affordable for first time buyers or local families necessarily – that’s why it’s really important we have a much wider approach,” she said.
“Premiums on council tax aren’t going to solve all of our housing issues here in Wales, but what we are doing is investing tens of millions of pounds in purchasing empty homes for example, putting those up to standard and a whole range of other interventions as well.”
Elsewhere, Scotland is continuing to consult on plans to charge double council tax, while in England some councils, such as Cornwall, are planning a similar measure.
The joy that filled the final weeks of Diogo Jota’s life makes his death even more devastating to comprehend for his family and millions of fans worldwide.
The most illustrious title of his career was won in May, when he paraded through Liverpool with his teammates and the Premier League trophy.
More success came with Portugal as he won the Nations League for a second time alongside Cristiano Ronaldo in June.
And then came the bliss at marrying his childhood love Rute Cardoso, watched by their three children.
Just yesterday Jota posted a video from the ceremony on social media alongside the message “a day we will never forget”.
The happiest of days was remembered before the tragedy that killed Jota and his brother Andre Felipe in northwest Spain.
Image: Diogo Jota and wife Rute. Pic: rutecfcardoso14/Instagram
Brothers – whose careers both developed at their hometown club, Porto – so tragically dying together.
“Football has lost two great men,” Porto president Andre Villas-Boas said, as fans descended on the club’s stadium to mourn.
At Anfield, Liverpool fans are grieving the versatile forward who was so often in the shadow of Mohamed Salah, as he was under Ronaldo at Portugal.
But he knew how to sacrifice stardom to contribute to the squad.
Image: Diogo Jota holds the Premier League trophy with Wataru Endo and teammates. PIc: Reuters
The last of his 65 Liverpool goals was the winner in the Merseyside derby against neighbours Everton in April – helping the club become the record 20-time champions of England.
A Premier League winners’ medal joining those from the FA Cup and League Cup, won by the 28-year-old after he joined the Reds in 2020.
It was Wolverhampton Wanderers who gave Jota a platform to shine in England after he joined from Atletico Madrid.
Promotion was gained to the Premier League in 2018, and they more than just avoided relegation, but secured back-to-back top-seven finishes.
Jota was a reason why.
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Fans react to Jota death
He was also why Wolves could embark on such a memorable European campaign, and scored two hat-tricks in the run-up to the Europa League quarter-finals in 2020.
“The memories he created will never be forgotten,” Wolves said.
For the football world, the loss of such a talent so young will be hard to comprehend.
And so many are reflecting on the fragility of life as football grieves from Liverpool to Portugal – and beyond.
The father of a grooming victim who was raped by more than 60 men has said she still lives with the “trauma every single day”.
Marlon West, 51, said Scarlett, now 20, was an academic student at a school in Greater Manchester.
She was happy with a good friendship group and enjoyed riding her horse, Jasper.
But her life changed after she was attacked by a gang at a bus station – they started bullying her and she decided it was better to become their friends.
An older female member then started grooming her for rape gangs made up of Muslim men, her father told Sky News.
Image: Scarlett before she was groomed
Mr West said six men were involved in grooming her from the age of 14 but she was raped by more than 60 before the abuse finally stopped shortly before she turned 18.
By then, she was too terrified to leave home.
“Scarlett isn’t a survivor and a lot of these other girls aren’t survivors,” he said. “The reason being is they’re still living with the trauma every day.”
Mr West, an advanced nurse practitioner for mental health services at the NHS, said his daughter was thrown out of school aged 14 and would go missing for weeks at a time.
On one occasion, he tracked her down to a property in Derbyshire, but when he eventually persuaded police to attend, he was told Scarlett was “safe” with the woman who groomed her and “her friends”.
Image: Scarlett enjoyed riding her horse
Mr West said he was “absolutely furious” when police and social services dismissed the abuse as “a lifestyle choice” and was so desperate he put Scarlett into care when she was 15.
“I couldn’t keep her safe,” he said. “It’s the hardest decision of my life.”
But within a week of her returning home, when she had to leave the care system after turning 16, she was going missing again.
Mr West said the female groomer had stayed in contact with Scarlett and “was literally waiting for her” when she came home.
She was then trafficked all over the country, including Bradford, Birmingham and London.
Image: Marlon West and his daughter Scarlett
Mr West said he had to “scream” at police to track her down before they raided a property in Rochdale where she was found along with heroin and crack cocaine.
Scarlett was arrested and released on bail, but wasn’t charged because she was on a Home Office database as being at risk of trafficking, he said.
“Even though that [arrest] was inappropriate, that stopped it because she was terrified of going out of the house, which she still is now to a certain extent.”
Mr West believes the abuse also came to an end because she was getting older and her abusers were no longer interested.
“This is not just about child sexual exploitation but also criminal exploitation – she was doing county lines, she was picking up firearms for them,” he said.
Image: Scarlett and her dad Marlon
Mr West said any child can be at risk of grooming.
“They’re stereotyping a lot of these survivors, that they’re coming from broken homes, or they’re in care,” he said.
“A groomer doesn’t stand outside a school gate and think, ‘I’m not grooming her because her dad’s a doctor or her dad’s a GP’ – they don’t care. Once they target, that’s it.”
Mr West was speaking as a report by police watchdogs revealed Greater Manchester Police has live grooming investigations involving 714 victims and survivors.
The force said it has 1,099 lines of enquiry relating to potential suspects but only 269 who are confirmed.
“I think there’s more – a lot of survivors haven’t come forward. One, because they’re probably still being groomed and secondly because they’re terrified of GMP and how they’ve been treated in the past,” he said.
“It’s higher than it’s ever been. Services such as police and social services are terrified of political correctness.
“The groomers know they can get away with it because there aren’t many arrests and so it’s increased.”
GMP Chief Constable Sir Stephen Watson promised to go after child rapists and paedophiles “relentlessly” after the publication of the report, which was largely positive about the force’s turnaround in tackling the gangs.
But Mr West believes they are “still failing”, although he welcomed the investigation opened into his daughter’s case.
He said he is “hopeful” the national inquiry into grooming gangs by the government last month “will expose a lot of the cover-ups and give accountability” but is worried about the involvement of services such as councils and police forces because of a lack of trust.
A GMP spokesperson said: “We have met with Scarlett and her father and we’re conducting an extensive investigation into their allegations.
“While we understand the impact of their experiences cannot be undone, we aim to ensure that the experience of the GMP of today would be much improved from that of previous years.”
A Tameside Council spokesperson previously said they were legally unable to comment on Scarlett’s case.
But they said: “Where any concerns or issues are raised we work closely with individuals, families and our partners to provide support and resolve, as appropriate.
“Where individuals aren’t satisfied with the services received, we do have a statutory complaints procedure and individuals can ultimately take their complaint to the Local Government & Social Care Ombudsman.”
You’re probably tired by now of hearing all about “black holes”.
It’s one of those phrases trotted out by journalists in an effort to make economic policy sound a little more interesting. And in some senses it’s a massively misleading image.
After all, when people talk about fiscal holes, what they’re really talking about is something rather prosaic: the amount of money it would take for the chancellor not to break her fiscal rules.
Those fiscal rules are not god-given, after all. They were confected by the chancellor herself. Missing them will not really result in Britain sliding into infinite nothingness. Even so, whatever you choose to call the dilemma she’s faced with right now, it’s certainly quite a big deal.
Image: Rachel Reeves speaks at the NHS’s 77th birthday
And understanding this helps provide a little context for the extraordinary events of the past few days, with markets sliding in the wake of Ms Reeves’ teary appearance at Prime Minister’s Questions.
Following that moment, the yield on UK government debt – the rate of interest we’re being charged by international investors – suddenly leapt higher. Granted, the jump was nothing like what we saw in the wake of Liz Truss’s mini-budget. And those yields dropped down after the prime minister backed the chancellor.
UK’s a global outlier
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Even so, they underline one very important bit of context. The UK has become something of an outlier in global debt markets. For years, the yield on our benchmark government bonds was more or less middle of the industrialised-world pack. But since 2022’s drama, it has hovered unnervingly high, above every other G7 nation.
That speaks to a broader issue. Britain might not have the biggest deficit in the G7, or for that matter, the highest national debt. Others (most notably France, and to some extent, too, the US) face even more desperate fiscal dilemmas in the coming years. But markets do still seem nervous about Britain.
Perhaps that’s because of what they (and we) all endured in 2022 – when British gilt markets stepped briefly over the precipice, causing malfunctions all around the financial system (most notably in obscure parts of the pensions investment sector). But it also owes something to the fact that the chancellor’s own fiscal plans are sailing worryingly close to the wind.
Reeves made fiscal rules matter
The main piece of evidence here is the amount of leeway she has left herself against her fiscal rules. As I said at the start, there’s nothing gospel about these rules. But having created them and banged on about them for a long time, even those of us who are a little sceptical about fiscal rules would concede that breaking them is, as they say, not a good look.
Back in spring, the Office for Budget Responsibility thought the chancellor had about £9.9bn in leeway against these rules. But since then, she has u-turned on both the cuts in winter fuel payments and on personal independence payments. That reduces the £9.9bn down to barely more than £3bn.
But the real issue isn’t just these U-turns. It’s something else. The stronger the economy is, the more tax revenues come in and the more her potential headroom against the fiscal rules would be. By the same token, if the economy grows less rapidly than the OBR expected, that would mean less tax revenues and an even bigger deficit.
And if you compare the OBR’s latest forecasts with the current average of forecasts among independent forecasters, or for that matter, the Bank of England, they do look decidedly optimistic. If the OBR is right and everyone else is wrong, then the chancellor “only” has to fill in the hole left by those U-turns. But if the OBR is wrong and everyone else is right, things get considerably more grisly.
Even a small downgrade in the OBR’s expectations for productivity growth – say a 0.1 percentage point drop – would obliterate the remaining headroom and leave the chancellor with a £6bn shortfall against her rule. Anything more than that (and bear in mind, most economists think the OBR is out by more than that) and she could be £10bn or more underwater.
Now, there are plenty of very reasonable points one could make about how silly this all is. It’s silly that so many people treat fiscal rules as tablets of stone. It’s silly that government tax policy from one year to the next seems to hinge on how right or wrong the OBR’s economic forecasts are.
Yet all this stuff, silly as it might all seem, is taken quite seriously by markets right now. They look at the UK, see an outlier, and tend to focus more than usual on black holes. So I’m afraid we’re going to be talking about “black holes” for quite some time to come.