LibLink: Danny Alexander – Bedroom blockers and tax dodgers will pay

Lib Dem chief secretary to the treasury Danny Alexander has published a robust defence of the Coalition’s welfare reforms in The Sun on Sunday. Here’s how it starts:

Last week a young woman came to talk to me about her housing situation. Her frustration was obvious. She was working hard in a low-paid job and was stuck in an overcrowded home with a young family and desperately needed to move to a bigger home. She couldn’t understand why she had to wait so long to get a home that was the right size for her and her family. It’s a story that will be familiar to Sun readers across the country.

But this young woman’s frustration would have quickly changed to disbelief if she’d also known about Labour’s better-off bedroom blockers. Right now, there are thousands of families with children who are forced to share a bedroom with their parents. In Scotland alone, there are nearly 60,000 living in homes that are too small for the size of their family. And during Labour’s 13 years in government, waiting lists in England almost doubled — from just over one million to nearly 1.8million households.

But despite millions of people waiting for a decent home, Labour continued to hand out around £75million a year to subsidise the lifestyles of high-earning social tenants. Social tenants live in homes that are let at low rents to people in housing need. They are usually provided by councils and not-for-profit organisations such as housing associations. Under Labour’s rules, such tenants — reported to include the likes of Bob Crow, the RMT union general secretary who earns £145,000 a year — have their rent subsidised by you and me. Even Labour MPs were able to get in on the act. Frank Dobson lived in social housing when he was earning a six-figure salary as a Cabinet minister under Tony Blair, claiming he “wouldn’t be able to afford” to pay market rents.

There are about 20,000 households with an income of more than £60,000 being subsidised in this way. Each of these households receive thousands of pounds from the taxpayer every year. This is unfair and wasteful, yet during 13 years of government, Labour did nothing to bring it to an end. Where Labour failed, the Coalition is putting things right.

Danny lists the measures taken by the Coalition to, in his words, “make sure the wealthy pay their fair share”:

  1. the cap on the total amount of benefits households can claim at £26,000, the average annual income;
  2. the end of the subsidy on spare rooms (aka ‘bedroom tax’) which he says will “help free up some of the one million bedrooms not being used in this country and ease pressure on housing stock”;
  3. giving social landlords the power to charge tenants with an income of more than £60,000 a fair level of rent;
  4. a new super-duty ‘Mansion Tax’ of 15% on the purchase of homes worth more than £2 million by certain companies; and
  5. by increasing to £10,000 the amount you can earn without paying income tax.

He concludes:

If you are working full-time on the national minimum wage your income tax bill will have been cut in half. And everyone who had their tax rate doubled by Gordon Brown’s 10p shambles will be paying no tax at all. Next April, that tax cut will go up to £700. So from April 2014, there will be no income tax at all on the first £10,000 of your salary. That was the Lib Dem promise in 2010. And we have delivered.

You can read Danny’s article in full here.

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50 Comments

  • Helen Dudden 31st Mar '13 - 4:59pm

    We still do have a serious short fall of social housing. A serious view needs to be taken of the way social housing should be used in the future.

    The bedrooms situation does not include those of the age of 61 years of age, what happens here?

  • Is Danny going to ringfence the bedroom tax receipts for building more social housing? Are we just doing thia because we dont have the guts to end tenure?

  • I’ll tell you who’ll pay, the Liberal Democrats in the next election. As a former Liberal Democrat activist in my small way, I’ll make as sure as I can that they stay as far away from government and local council as is possible.

    Time and time again, whether it be on tuition fees, AV, the NHS or this bedroom tax, you have abandoned the people you represent in pursuit of your political careers. You may not all be guilty of this but you stand there collectively as a group, and as a group, a party, you will be punished by the electorate.

  • What a load of old dribble and typical propaganda.

    What will the bedroom Tax do to high earners who live in social housing?

    Answer- Nothing

    Most of the high earners who were living in social housing, ended up buying the properties under the right to by scheme, implemented by the Thatcher Government and the housing stock was never replaced.

    High income earners who are still living in “rented” council housing do not claim housing benefit so will not be affected by the “bedroom tax”

    The only people who are going to be penalized by this policy are the very low paid, poor and vulnerable, who are reliant on housing benefits.

    Until this government and future governments gets of their backsides and start building more social housing this problem will always persist and it’s the poor and vulnerable who will continue to be stigmatized

  • An article that would not look out of place on ConservativeHome. This party has well and truly lost its way.

  • The attacks on the poor by the tory-led govt this weekend are bad enough without their LibDem enablers joining in.

    It’s been a long time since the revolting term ‘bed-blockers’ was hounded out of the NHS but Danny Alexander shows his loathing of the poor by using it with regard to their housing needs – how disgusting !

    The facts are simple – unless council & social homes are built, the situation will only get worse. Instead of concentrating on that though, this government is offering £100,000 bribes to encourage tenants to buy their social homes thus depriving councils of them on a permanent basis !

  • “Her elderly father”

    Notwithstanding the valid criticisms of this policy (and this terrible article!) he can’t be that elderly if he is being affected by this policy.

  • Silly Danny. The social housing “bedroom blockers” are not the people who have a spare bedroom, they’re the people who have set housing policy for twenty years,

  • Anthony Hawkes 31st Mar '13 - 6:26pm

    I started reading this article in the Sun without checking who wrote it. As I read on I presumed it was someone from the right of the Tories, like IDS or Theresa May, as it had all the traits of divisiveness and half truths. When I checked back I was genuinely shocked that one of our own had resorted to this.

    This bedroom tax policy is just nasty and it penalises the most vulnerable. Without sufficient smaller accommodation available for people to move into, it is bound to fail. Either the poor stay put and pay the tax or they move into the private sector where rent are higher, leading to an increase in housing benefit.

    The answer is, as others have pointed out, to build houses. I believe that Vince Cable mentioned this as one of the ways we could get growth back into the economy.

    Like many other LibDems, I increasingly despair of our representatives in parliament. We are not a ‘Tory-Lite’ party although the public seems to believe it. With tuition fees, the NHS, secret courts etc., even party members are having a hard time knowing where we stand.

    As campaigning starts for the May elections, I feel quite demotivated and not really sure why I bother.

  • “The answer is, as others have pointed out, to build houses. ”

    Indeed – I looked up the figures and in Inverness there are 2500 on the housing waiting list and 4000 properties in total.

  • I would just like to point out that the lib Dem’s didn’t actually vote for these benefit changes. The parliamentary party put them through against the wishes of the membership.
    The thing is that the people affected will not draw a distinction and you can pretty much kiss every seat with high numbers of people in social housing goodbye,
    What I find saddest about Danny Alexanders piece is that it demonstrates yet again the willingness of the Lib Dem leadership to over identify with and act as spokesmen for Tory policies. It’s going to prove very damaging in May and beyond.

  • Tony Dawson 31st Mar '13 - 7:23pm

    “Labour continued to hand out around £75million a year to subsidise the lifestyles of high-earning social tenants.”
    And we will do…..er…..exactly the same! 🙁

  • Not a Lib Dem (or any party member), but enjoy the blog.

    The bedroom tax is just awful policy – I can see the sense in trying to free up those larger houses, but doing so when there isn’t actually enough smaller social housing for them to go to fails both economically and on a basic measure of fairness. It penalises people who *through no fault of their own* benefited from a system that arguably needs reform (a bit like those school whose BSF funding had been approved then was withdrawn when the scheme ended). Lots of the detail clearly wasn’t worked out, either – foster carers and serving armed forces personnel, for example.

    As for the rest (as someone who would probably vote Labour, for full disclosure): the benefit cap is populist rubbish, although it’s complex to defend as that relies upon understanding that the welfare system is there to support, not grudgingly throw scraps at the poor. And raising the income tax threshold is one half of a good policy, but without lowering the higher-rate threshold alongside, it’s lopsided – it does benefit the low-paid (and good on the Lib Dems for that, although not the lowest), but it benefits the higher-paid more.

    (High-income tenants in social housing and the mansion tax are areas I don’t know enough about, but they probably make bigger headlines than actual differences for good or ill)

    I’m all for making work pay, but it seems like both parts of this government are more concerned with making not working unbearable, and that’s a significant distinction when there are five jobseekers for each job nationally.

  • David Wilkinson 1st Apr '13 - 7:56am

    Sadly this article by Danny shows his complete lack of knowledge in housing issues and his use of the big stick approach is utterly appalling for a so called Liberal Democrat.

  • I am appalled and ashamed at Danny Alexander’s article. Where will these ‘bedroom blockers’ move to? It seems to be an elaborate scheme to punish people without an alternative and that is very likely to be the poorest. Surely the affluent council housing tenants have already exercised their right to buy and that also explains the shortage of affordable housing. Sadly the Tory meanness of spirit is infectious in the coalition.

  • Michael Parsons 1st Apr '13 - 8:15am

    Let’s hope that even if Alexander can’t be checked should some MP’s of all parties have enough courage to stand up against this proposal, then at least the Scots will know how to deal with their very own”Ginger Rodent” and kick him out at the next election, ably assisted by his local LibDems. How ever did he get selected anyway? Does anyone know the story of how he might have arranged his apparent ‘succession’ to the seat?(if he did)

  • jamessandbach 1st Apr '13 - 8:17am

    Danny seems to imply that high earning social tenants claim HB so the bedroom tax is sorting them out – nonsense as high earners don’t qualify for HB anyway, it’s the low earners who are clobbered. Today is a day on which I feel ashamed to be a lib dem, and ashamed of what my Party have done and supported, as so many bad government policies are implemented today – welfare reform, legal aid, NHS, local govt, high rate tax cut etc

  • Michael Parsons 1st Apr '13 - 8:23am

    We can only hope MP’s of all parties will stop this proposal and bring Alexander down. Failing that no doubt the Scots will deal with their very own “Ginger Rodent” by kicking him out at the next election, aided by all men of good sense and decency. How ever did he get selected for the seat anyway? Is he about to change Party?

  • Dave Eastham 1st Apr '13 - 8:42am

    If you can stomach it, a flick through the BTW comments to this article from the Sun readership may prove instructive. It would appear that the only one that Danny is fooling would be himself, with this frankly shameful article. Be warned though, some of the comments have all the usual memes about immigration et. al. But not as many as there are sometimes to be seen on even the Gruniad’s CIF comments.

  • Helen Dudden 1st Apr '13 - 8:55am

    No one has been brave to answer on the subject of those over 61 years of age who have, in some cases, three bed houses.

    Of course, as the many comments here highlight, lack of housing is the problem, suitable housing.

    Will this end up as the “Poll Tax”?

  • Danny Alexander is a hypocrite of the worse possible kind.

    Before the 2010 General Election he was championing the sick and disabled, he was extremely critical of the DWP and ATOS, he took part in a Chanel 4 documentary which was highlighting the failures of both ATOS and the DWP, promising
    to take them on if he got into government.

    Since entering the Government in 2010, he has done exactly the opposite, he has supported the draconian policies introduced by this government and he has been party to vilifying the very people who he was promising to help.

    No wonder he was given the nick name of the colored rodent.

    I still have not decided who I am going to vote for at the 2015 election, I am not entirely convinced that Labour will get my vote back as yet. But one thing is for certain. Libdems will not get my vote whilst Danny Alexander and Clegg are holding the reigns and cracking the whip. I live in a Libdem/Labour marginal where there was only a majority of 310 votes.
    So far, I have been happy with my MP, Simon Wrights, performance in Government, especially since he was one of the MP’s who stood his ground and kept his pledge and voted against the rise in tuition fee’s. But the reality of the situation is and will be for a lot of people, no matter how good their local MP is, they will be penalized for the incompetence and despicable behavior of their parties leaders.

  • Michael Parsons 1st Apr '13 - 9:24am

    Helen I think the answer is that people over 61 like any have a need for spare rooms to offer visitors, family and friends and should noit have their lives disrupted arbitraly. If they are paying rent they have a tenancy right and have met the costs of the house as completely as any mortgage holder, more so where Council rents cover streets and lighting costs as well.

    The problem is not to disrupt people’s lives and social contacts, but to provide decent housing, pubs, medical and school faciliies near areas of growing employment by planned State expenditure. That means constraining the good old British Tory tradition of selling out the waterways to the railways, then selling out the railways to roads, and now selling out new rail, road and energy construction to their overseas chums and supporters.

  • Surely you’re only a bedroom blocker if you have resonable opportunity to move somewhere else… Not that that matter to Danny he will charge those who have no choice… This could so easily have been fair if it could only be levied where an alternative has been offered.

    Shocking policy

  • Tony Dawson 1st Apr '13 - 9:46am

    @matt

    “Danny Alexander is a hypocrite……. (who) ………took part in a Chanel 4 documentary ”

    That should have covered up the stench of hypocrisy? 😉 I prefer ‘Coco’.

  • David Blake 1st Apr '13 - 10:01am

    Things just get worse and worse.

  • Helen Dudden 1st Apr '13 - 10:43am

    Michael, does any other person have that right? This is what it is all about, the unfairness. I know of several people older people that have extra rooms they do not use, they are over 61 years of age.

    How can we charge someone for a bedroom and there is no where to move? We have that situation in Bath. Hardly fair.
    I have just heard about a young couple given a two bed flat because the birth of the baby due in two weeks, until that baby is born, they pay bedroom tax. They were living with parents, high rental costs in this area, shortage of housing that the first time buyer can afford. But then mortgage’s are out of the question in some areas of life.

    Is this a fair situation? I have been involved with highlighting the problems here in the city with social housing, it will take years to make a difference.

  • Odd use of terms here : ‘tax’ is being used to mean something which is simply an adjustment and ‘fair’ seems to mean ‘the state isn’t giving people I know as much subsidy as they were used to for something they were used to but can’t show that they need any more’. Too much phoney hand-wringing too given the £26,000 pa benefit ‘cap’!

  • Nigel Jones 1st Apr '13 - 12:20pm

    Danny puts the problem of current unfairness very well, but I just do not understand how he can think that things like the so-called bedroom tax will help. If it is intended to force poorer people to move to accommodation more in line with their family size, then why not introduce a law to force people on good incomes to move out of social housing?
    Would it not be appropriate to introduce a rule that social landlords find appropriate accommodation for people with spare rooms and after a certain period of time, their benefit can be cut if they refuse to move without good reason ?
    I must say that my view of Danny has gone down even further since reading this piece from the Sun. In answer to a question from me at last Autumn conference, he said that we must not be seen to be squabbling with the Tories; it now looks as though he is not only joining the Tories, but becoming remote from real people’s lives.

  • Ray Cobbett 1st Apr '13 - 12:49pm

    This sort of barely disguised IDS apologia probably explains why we’ve lost so many members

  • Tony Dawson 1st Apr '13 - 12:50pm

    @Nigel Jones:

    “……it now looks as though he is not only joining the Tories, but becoming remote from real people’s lives.”

    Essential qualifications for a post-election Murdoch directorship?

  • Helen Dudden 1st Apr '13 - 12:53pm

    In social housing there are different categories. General needs that is for anyone , includes anything up to a three bed house. Things then can go into two more categories, over 50’s and then sheltered. Over 50’s for obviously those over 50 years of age, The sheltered is intended for those over 60 years of age. If you apply for the last two categories then you will be housed quicker, but of course age is the criteria.

    I wished to live in general needs I cant, even though the general needs in my area cover up to 125 years. Not enough housing. My point is clear, position is 9/10 ths of the law. So if you are over 61 years of age, have a three bed house then you do not pay bed room tax, nor do you have to move. I would love my family to stay, but I even have to wait to move to a single bed roomed bungalow. I was not even allowed to have a warm brand new property, not in my group, even though marked as up to 125 years.

    If this seems complicated, then add the bed room tax, and ask about fairness. Nothing at present to do with social housing is fair, until there are enough property to run a system that works, I suggest the bed room tax it shelved and we take a more sensible approach to the problems there are.

  • @Dave Eastham
    I think I can stomach reading the comments on Danny Alexander’s article without being warned, thanks. Unlike one or two on here who try and equate the tax on under-occupancy in social housing with cheating the system, most Sun readers seem to know perfectly well that those on above average wages up to £60,000 p.a. and living in social housing are the ones who will be left untouched…..and they are often the ones with more than a single spare bedroom.
    In fact the situation in social housing is even worse than the point that matt made in his earlier post: not only did those with a right to buy move out of housing stock never to be replaced, but many of those who did buy at a substantial discount have re-let these properties at considerable rents. (Witness the instance of a listener to Radio 4’s ‘Moneybox’ prog. who perfectly legitimately lets out her ex-council flat for £500 per week, having retired to Portugal.)
    This article by Danny Alexander reminds me of the rumour (it was in the Telegraph, so to be fair…) that the Chief Secretary to the Treasury has had to be restrained of late by fellow members of the ‘Quad’, because his ideas are so “off the wall” – presumably, off the wall right-wing.

  • Peter Chivall 1st Apr '13 - 2:07pm

    Added to which all the evidence I have seen in both this city and surrounding countryside is that the only housing getting built by the private sector is of the 5-bedroom/ 2+ bathroom type while the amount of social housing being built, of any sort, is almost non-existent.
    Not only is Danny totally wrong on this issue, he completely overlooks the fact that Labour ran such a high deficit, not because of a putative socialist set of policies, but to disguise with sweeteners the fact that their economic and taxation policies were almost wholly Tory.
    Labour failed to build any significant amount of social housing, they cut taxes for the better off, they allowed the City to run riot and when they crash came they bailed out the banks without sacking the top tierof failed executives and should have put through legislation forbidding pay rises and bonuses to directors and CEOs of loss-making. They totally failed to introduce any employee democracy, even of the German model.
    Despite the Coalition Agreement being a reasonable and positive document, it has been repeatedly trashed by well organised and idealogically motivated Tories, with the acquiescence of Clegg and Alexander. I doubt if the ‘Quartet’ ever meets: the Tories just send their latest evil, crackpot scheme on a sheet of A4 to the Lib-Dem members with the instruction ‘Sign this immediately’.
    Despite the heroism of the 1000s of real Liberal Democrats who managed to hold Eastleigh when Clegg so nearly blew it, and have won dozens of Council byelections in the last 6 months, I have reluctantly concluded that a Parliamentary Party that votes by default or otherwise for Bedroom Tax, Secret Courts, the destruction of Legal Aid, compulsory Academies for everyone, de facto privatisation of the NHS, ATOS persecution of the sick, disabled and vulnerable and numerous other illiberal and anti-social measures, is not one that Members of the Party should have any confidence in.

  • This is dishonest. There are parts of the country where, for example, a few overoccupying and underoccupying households could simply swap, to some effect. But the majority in each category have no such deal available. Bundling together the subsidy to social housing as if it’s a subsidy for spare bedrooms is breathtaking.

  • Ray Cobbett 1st Apr '13 - 6:17pm

    Alexander’s metamorphosis somehow fits the example found in Orwell’s Animal Farm you know the one about 4 legs good,2 legs bad, Now its Tories good, Lib Dems better.

  • You aren’t fooling anyone Danny, least of all yourself by the sound of it. Please listen to Conference, we understand the national mood much better than your political advisers. We wouldn’t have let you do this, or treble tuition fees, and these are the two things the public will remember about our first (and if you carry on like this, only) time in Government.

  • Helen Dudden 1st Apr '13 - 7:43pm

    You tend to forget the record of the Conservative Party, they are not a party for the working class, so what do the Lib Dems represent now? I think they have sort of blended. More now, than a marriage of convenience.

  • On top of this tenants now also have to pay a percentage of their council tax. It is a blatant attack on the poor and the vulnerable.

  • Helen Dudden 2nd Apr '13 - 11:28am

    I was once a party member, but that changes as with the comments above.

    It would take quite a change in the situation to make me rejoin what I feel is just an arm of the Conservatives.

  • Where does it stop – note the last part of the article…

    If you are working full-time on the national minimum wage your income tax bill will have been cut in half

    Now we know that Swinson is on the record as implying that the minimum wage may be too high.. so is this the the second part of the warm up act that sees an an attack on those least able to afford it? Nothing at the moment would surprise me.

  • Matthew Huntbach 2nd Apr '13 - 2:49pm

    Danny Alexander

    But despite millions of people waiting for a decent home, Labour continued to hand out around £75million a year to subsidise the lifestyles of high-earning social tenants

    No they don’t. Council housing is let out at cost price, it is not subsidised. As any councillor knows, there is a separate Housing Revenue Account, and it is not permitted for this to be subsidised from the general account. If the argument is that the market rent for these properties would be much higher, therefore it is a “subsidy”, well there are many other public services where if costs were set at market level they would be much more, but we don’t try to estimate what they would be and then claim whatever it is is a “subsidy”. Danny Alexander’s words will be read by most people as suggesting the people he mentions get paid an actual cash sum from the taxpayer. They don’t.

    Now, what these people COULD have done is use their high earnings to buy their council properties under right-to-buy. By refusing to do this and benefit from the huge sums of money that can thereby be made, these high-earning tenants are actually acting philanthropically. If they die, their property will go back to the council so it can be re-let to people like the young woman Danny Alexander mentions. The reason people like her cannot get housing to suit their family needs is that much of it has been sold off under right-to-buy. So why not abuse all those people who have exercised their right to buy instead of those who have refused to do so? Yet the right-to-buy is STILL being put forward as a hugely successful policy which is somehow supposed to have “helped” people get housing. George Osborne increased the subsidy for it still more in the Budget. Sure, it helped those who were lucky enough to become tenants in the days when there was still council housing for those in need. It did this at the expense of the next generation, who are now suffering – and the taxpayer who must now pay the extra cost of housing benefit to private landlords who have taken over with market level rents, the difference between them and council rents being profit for the landlord or previous owners or those lending money for buy-to-let purchase.

  • Some of the people writing about this issue should get out on the doorsteps more often and listen to what people have to say about benefits. During the 2010 election in Leeds Central (a working class seat if ever there was one) the number one complaint was about benefits and having to support people who don’t work.

    Also people should remember that this terrible policy was introduced for private sector tenants BY THE LABOUR PARTY and no-one said a word. There’s the real hypocrisy for you.

  • Dominic Curran 2nd Apr '13 - 4:03pm

    Danny’s article is exactly the sort of reason i left the LibDems in 2011 after 18 years membership of the party. He really should do the decent thing and join the Tories, as he runs the risk of being prosecuted by Trading Standards officers for calling himself a Liberal Democrat.

    His article genuinely makes me ashamed to have been a LibDem.

  • @Mickft – Also people should remember that this terrible policy was introduced for private sector tenants BY THE LABOUR PARTY and no-one said a word. There’s the real hypocrisy for you.

    No it wasn’t – Housing Benefit in the private sector has always had a size restriction – before LHA this was and still is evaluated in pre LHA claims by the Rent Officer Service who will make a Size Related Rent/Local Reference Rent Determinations when households are over accomodated.

  • Matthew Huntbach 4th Apr '13 - 1:28am

    Mickft

    Some of the people writing about this issue should get out on the doorsteps more often and listen to what people have to say about benefits. During the 2010 election in Leeds Central (a working class seat if ever there was one) the number one complaint was about benefits and having to support people who don’t work.

    Yes, but when newspapers like THE Sun go on about this, they quote amounts of money going to people on benefits, but they don’t mention that the high sums that are now paid in some cases come about because they are going in housing benefit to people living in private rented accommodation. The amounts would be much lower if their recipients were living in council housing, but the money the recipients would have to spend on themselves would be EXACTLY THE SAME. That is, the bulk of money your complainants are complaining about actually goes to private landlords, but your Sun and your Mail and your Express and your Telegraph whipping up hatred of people on benefits never mention that. They also give the impression that this benefit goes only to people who do not work, which is untrue. Housing benefit also goes to people who work, therefore it is highly misleading to quote, as one Tory did just recently, an amount which a recipient of Housing Benefit could receive and the average wage, because doing that hides the fact that the person on the average wage would receive housing benefit to top it up if they lived in high cost private rented accommodation.

    It is the Tory policy of right-to-buy which has caused the supply of council houses becoming available to relet to dwindle, and so for people to be forced to seek private rented accommodation where the rents are much higher, and so therefore to be given more in benefit to hand over to their landlord in rent. It benefits the recipients of those payments nothing at all. Yet your Sun and your Mail and your Express and your Telegraph continue to push the right-to-buy as a hugely successful Tory policy, they don’t mention how it led to this thing they complain so much about.

  • Peter Chivall 5th Apr '13 - 4:07pm

    As a Liberal Democrat who believes in freedom and justice and genuine fairness I belong to the same Party as Sarah Teather. Given his recent support for the more wild-eyed pronouncements of that misanthrope Osborn, Danny Alexander has proved that he does not.

    In the Referendum on Scottish Independence next year, I shall encourage my son and his partner to vote for independence. Alexander will be one less proto-Tory for what is left of our Party to deal with after 2015.

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