Third Of Tenants Face Underoccupancy Cut

Cutting housing benefit for working-age tenants who underoccupy their homes will affect around a third of those living in social housing, the government has revealed.

An impact assessment from the Department for Work and Pensions estimates that limiting housing benefit payments to the number of bedrooms that a social tenant actually needs will affect 670,000 people living in social housing.


















The report, released yesterday as part of the government’s Welfare Reform Bill, says most tenants only underoccupy by one bedroom, and will lose around £11 a week in 2013/14, when the change comes into play.

Those with two or more bedrooms that they do not use will lose an average of £20 per week, the assessment says. It also found that tenants in the north, east midlands and Wales were more likely to be affected than those living in London and the south east.

Around 46 per cent of social tenants in the north east will see their housing benefit cut by around £12 a week, while only 19 per cent of London tenants will be affected.

The National Housing Federation condemned the plans. David Orr, chief executive, said: ‘Ministers have long promised to protect the vulnerable and yet these plans could force thousands of people to move out of homes they have lived in for many years.

‘As a result of these changes, thousands of couples are no longer able to offer their grown-up children a room to stay in should their circumstances change, and many single parents will be pushed away from friends, relatives and support networks.’

Under occupancy penalty could force struggling families into hands of loan shark.

Plans to slash housing benefit for hundreds of thousands of low income families could lead to a huge surge in the number of people turning to loan sharks and doorstep lenders as they struggle to pay their bills, campaigners warned today.

The Department of Work and Pensions (DWP) intends to use the Welfare Reform Bill to slash housing benefit for tenants living in homes deemed too large for their needs - even if they have lived there for decades.

The measure will hit 670,000 council and housing association tenants - a third of all working-age housing benefit claimants in the social rented sector across Great Britain.

The DWP has suggested that households seeing their benefit reduced - by 13% for those with one 'spare' room and 23% for two or more 'spare' rooms - should 'move to accommodation which better reflects the size and composition of their household' - or make up the shortfall from other income sources.

Each claimant is expected to lose an average of £676 a year if the Government succeeds in introducing the measure in 2013. Tenants will face a tough choice of either downsizing to a smaller home to avoid the penalty or staying put and paying a much higher level of rent from their own resources.

But even for those who do look to downsize there is by no means any guarantee they will find a smaller social home to move into. Around 180,000 social tenants in England are 'under-occupying' two-bedroom homes, but just 68,000 one bedroom social homes became available for letting in a single year (2009/10).

The average social housing household in receipt of housing benefit has an annual income of just £8,320 a year. The proposed 'under occupation' penalty will leave vulnerable families with a shortfall of £676 to make up from their savings or other allowances. Many are at risk of falling into debt because they simply would not have the money to pay all their bills.

Currently, around 2.5m people borrow from doorstep lenders at rates often in the region of 272% APR for new customers. A further 200,000 are estimated to borrow from loan sharks, who can charge anything up to 2,000% APR. A majority of those financially excluded are social housing tenants.

If a tenant took out a £700 loan to cover the under occupation penalty with the doorstep lender Provident, they would pay an APR of 272.2% on the loan, according to a typical example given on their website. That would mean repaying £1,274 back over the course of a year. For people going to illegal loan sharks the rate could be ten times as much.

Federation chief executive David Orr said: "The Government's plans to penalise hundreds of thousands of low income families who are adjudged to be 'under occupying' their property is harsh and regressive.

"In the vast majority of cases, people will simply not be able to make up the shortfall themselves and could end up being sucked into poverty and spiralling levels of debt.

"The Government has repeatedly said that it will look after the most vulnerable, but pushing thousands of people into the arms of doorstep lenders and illegal loan sharks is wrong and will lead to a huge degree anxiety for many of the poorest in our society."

Niall Cooper, National Coordinator of Church Action on Poverty said: "There is a real danger that people will be pushed into the hands of loan sharks by the housing benefit cuts.

"Many tenants are already struggling to make ends meet, and can ill afford the cost of borrowing from high cost lenders who routinely charge anywhere between 200%-2,000% APR for loans.

"For some, this will push them over the edge - into a spiral of debt, or even homelessness."

Homelessness Up As Cuts Take Effect

Homelessness is on the rise in the wake of the recession and government cuts to housing benefit, official figures show.












In the three months to June there was a 17 per cent rise to 11,820 in the number of households accepted by local authorities as in priority need of rehousing, compared to the same quarter last year.

The figures show that on almost all measures homelessness is now rising, reversing a trend that has seen more or less continuous declines since 2003, according to Crisis, the homelessness charity.

A report commissioned by Crisis and carried out by academics at York and Heriot-Watt universities to coincide with the figures warned the “worst is yet to come” after the combined effect of the economic downturn and significant cuts to housing benefit takes hold.

“Government reforms, in combination with the pressures of the economic downturn seem certain to increase all forms of homelessness, from rough sleepers on our streets to homeless people hidden out of sight,” said Professor Suzanne Fitzpatrick of Heriot-Watt’s institute for housing.

The latest figures are the first since cuts to the local housing allowance for new claimants – an allowance that determines housing benefit levels – were introduced in April. There has been a big percentage rise, although small numerical increase, from 1,460 to 2,130 in the number of households accepted as homeless because a private rented tenancy has come to an end.

The report for Crisis notes that during the last big housing recession in the early 1990s, homelessness fell as lower house prices eased access for first time buyers, releasing homes for rent.

That is unlikely to happen this time, the report says, as available lettings in the social rented sector are down and first time buyers still face difficulty in getting mortgages.

On top of big housing benefit cuts, the government is moving towards more “flexible” tenancies in social housing while pushing up rents for new homes to 80 per cent of market levels. Both moves will weaken the safety net function of the social rented sector, the report says.

Leslie Morphy, chief executive of Crisis, called on the government to reverse the housing benefit cuts and withdraw its plans to no longer pay benefit on actual housing costs, instead providing an allowance. “We need the government to change course now or risk returning us to the days of countless lives facing the debilitating effect of homelessness,” she said.

Grant Shapps, housing minister, urged those threatened with homelessness to seek help as early as possible, arguing that a wide range of support remained available to people struggling to stay in their homes.

London Council Ordered To Disclose Details Of Empty Properties

A judge has ordered a council to make public a list of empty homes after a squatting campaigner challenged its refusal to reveal the list under the Freedom of Information (FOI) Act.









Camden Council argued that disclosing the list could lead to organised crime in and around the properties.

However, the judge said any concerns were outweighed by the public interest in returning empty properties to use.

Camden has 28 days to comply with the FOI request.

The ruling was a victory for Yiannis Voyias of the Advisory Service for Squatters.

Mr Voyias argued that making the list public would "rejuvenate the empty homes debate" and put pressure on the government to tackle empty property.

He said academic researchers, homelessness charities - and even English Heritage - would benefit from disclosure of the number and location of unoccupied homes.

Camden's lawyers argued the disclosure of the list would compromise "the prevention or detection of crime".
'Not illegal'

Local police, who are backing the council's stance, said there was a link between squatting and crimes, including vandalism, running crack houses and threatening behaviour.

Camden also pointed out that, after a list of long-term empty homes in Lambeth was made public, the number of squatted properties in that borough almost doubled.

Under the ruling Camden will have to release information on all empty council owned properties and on private properties owned by a non-individuals that it knows to be unoccupied.

Judge Fiona Henderson accepted that disclosure of the list was likely to have "a negative impact on the prevention of crime".

But she said there was a lack of evidence that squatters were the source of more anti-social behaviour than rent-paying tenants.

She also emphasised the fact that squatting "is not illegal".

In a statement, Camden said it was considering its legal options.

Leaked Letter Reveals Tory Welfare Reform Madness: 40,000 More Homeless Families, And An Increase In Cost

Britain’s incompetent coalition government has just hit a new low. In a leaked letter to David Cameron from the office of Eric Pickles, the Secretary of State for Communities and Local Government, the ruinous impact of the government’s decision to cap benefits at £500 a week per family (essentially capping housing benefit at £400 a week) is exposed.














Pickles, via his private secretary Nico Heslop, told the Prime Minister in no uncertain terms that 40,000 families will be made homeless by the government’s savage welfare reforms, and that the estimated £270m saving from the benefits cap “will be wiped out by the need to divert resources to help the newly homeless and is likely to ‘generate a net cost,’” as the Guardian explained.

The limit on housing benefit was a key plank of Cameron’s manipulation of the electorate last year, with the unemployed portrayed as workshy scroungers, and housing benefit portrayed as something that is a result of their greed, rather than of landlords setting rents that are either unnecessarily high or an unfortunate response to an overheated property market.

The proposals alarmed those involved in housing and welfare, although in polls the public decided to support Cameron and his vile politics of envy, in which he pushed the notion that it was unacceptable for the unemployed to live in houses that those in work were unable to afford.

I lamented all of these developments in my articles last year, Critics Attack UK Government’s Cruel and Ill-Conceived Assault on Welfare and On Housing Benefit Cuts, British Public Reveals Shocking Lack of Empathy and Compassion, in which I also noted that, according to independent research commissioned by Shelter from the Cambridge Centre for Housing & Planning Research at the University of Cambridge, an estimated 134,000 households “will either be evicted or forced to move when the cuts come in next year as they will be unable to negotiate cheaper rents.”

Shelter also noted, “Of these, an estimated 35,000 households will approach their local authorities for housing assistance, and where councils have a legal duty to help they will face costs of up to £120 million a year providing temporary accommodation such as hostels or bed and breakfasts,” adding that these costs “would cancel out a fifth of the £600 million the Treasury has said it will save from the cuts in 2012, the first full year they are in force.”

Eric Pickles’ intervention provides different figures, but the impact is, if anything, even more damaging, as his letter suggests that these changes, impacting on 40,000 families and creating, in London, what Boris Johnson appropriately criticised as “Kosovo-style social cleansing, ” will not save any money at all, and will actually end up costing more that leaving all these people where they are.

There is more in Eric Pickles’ thoroughly alarming letter — an acknowledgment that “We are already seeing increased pressures on homelessness services,” that local authorities “will have to calculate and administer reduced Housing Benefit to keep within the cap,” and that plans to build 56,000 new, “affordable” homes will, as a result, be savaged. Involving a distressing proposal to oblige or allow social housing landlords to charge rents at 80 percent of market rents, the success of this venture depends, in Pickles’ view, on the availability of housing benefit, whereas the cap will, he estimates, lead to 40 percent of the new homes not being built at all.

Pickles’ letter also highlights a particularly cruel benefit-cutting proposal, warning of a PR disaster were it to be implemented. “I understand that there may be a suggestion around requiring families to divert a percentage of their non-housing (benefit) income to cover housing costs,” he writes, adding, “It is important not to underestimate the level of controversy that this would generate (likely to dwarf anything already seen on the HB only caps) and the difficulty of justifying this in policy terms as well as implementation.”

That really ought to tell you all you need to know — that the Prime Minister and his advisers, as well as happily making at least 40,000 people homeless, and striving to eradicate social housing as a valid form of not-for-profit housing, also propose forcing poor families to use the money provided for their living costs (and, for example, child benefit) to be taken away from them to subsidise their rents.

This, of course, is a sign of the essential meanness of spirit of this particular pair of privileged Etonians and their colleagues (including their Lib Dem stooges), as they work out how to kick the poor as savagely as possible, but it is not the only problem, of course. As with almost every aspect of the government’s proposed cuts — and as Eric Pickles pointed out so significantly — the sums don’t even add up. As a result, the welfare reforms join a list of costing disasters that show up the PM and his Chancellor George Osborne as the most incompetent political double-act in living memory, so driven by an ideological desire to destroy the British state that they can’t even make a valid economic case for their reforms.

Think of the savage “reform” of university funding, in which, having eradicated state support for arts, humanities and social science degrees, and having scrapped the fee limit of £3290 a year, the government had the nerve to complain when universities largely decided to charge fees of £9000 a year. Most universities need to do this simply to survive, as it costs more than £9000 a year to teach a student, but the government never thought about this, and is now whingeing about how much it will all cost.

Think of the brutal cuts to legal aid, which are supposed to save £350 million, but will leave ordinary people with almost no ability to seek legal assistance in cases involving debt, employment, housing, family law and criminal negligence. This appears to be a huge financial saving, but as legal experts have warned, and as Zoe Wiliiams explained in a Guardian article on June 22, “This might be a cut, but it isn’t a saving. It will cost us a fortune.” Back in February, judges warned that “a massive increase in ‘litigants in person’ — ordinary people appearing in court without a lawyer — will slow down the court system and may cost more money down the line,” as the Guardian explained. The judges’ council, chaired by head of the judiciary, Lord Igor Judge, stated, “The proposals would lead to a huge increase in the incidence of unrepresented litigants, with serious implications for the quality of justice … at a time when courts are having to cope in any event with closures, budgetary cut-backs and reductions in staff numbers. There is a real question whether the cost savings arising from the proposed cutbacks in the scope of civil and family legal aid would be offset by the additional costs imposed on the system by dealing with the increase in litigants in person.”

The Law Society has launched a campaign against the proposed cuts, establishing a website, Sound Off for Justice, describing its own proposals for saving £384 million “while still protecting access to justice.” The Law Society explains, “Our savings protect the continued provision of legal aid for the neediest in society, while the MoJ proposals would remove the right to legal aid that supported the families affected by the Hillsborough disaster, the Thalidomide scandal, and the Clapham rail crash.”

Think also of the planned privatization by stealth of the NHS. Resistance to the reality of the plans, revealed through the legally enforceable obligation for competition in every aspect of the NHS, has been rigorous, and critics have pointed out how throughly disastrous the government’s plans would be for huge swathes of the NHS in which enforced competition is entirely inappropriate. The government now claims to be revising its plans, but ministers cannot be trusted until the entire bill has been scrapped, because the main reason for the reforms is the ongoing privatisation of the NHS. This can only cost more and result in worse healthcare, because corporate interests don’t have a social conscience, and are designed solely to maximise profits at all costs.
32 years after Margaret Thatcher began the destruction of British society, we need a new way of thinking, which no one in the mainstream appears able to provide. Cameron and Osborne may be spectacular examples of arrogance, stupidity and callousness, but they’re also, essentially, just tinkering with the broken template provided by Margaret Thatcher, John Major, Tony Blair and Gordon Brown, which failed so abysmally with the financial crash of 2008, but whose true impact remains unacknowledged.