It’s Landlords Not Tenants Getting Rich on Benefit Payments

As a somewhat naive, northern teenager I found myself in London with no money and nowhere to sleep. After some days and nights wandering I ended up in a night-shelter. It wasn’t very nice.

Sharing a room with four others, we were booted out at 10am and not allowed back on the premises until 6pm when we were fed a meal of out of date frozen pizza and oven chips donated by the local supermarket. For this we paid £10 a week, whilst Housing Benefit covered the considerable rent of around £150 a week.

After a few weeks of this I opted to move into the salubrious surroundings of a DSS B&B in Paddington. This time I shared a small twin room with just one other person, an ever so slightly psychotic heroin addict. The room was barely large enough for two single beds, with a small shower unit in the corner that didn’t work properly.

The nearest toilet was down two flights of stairs and was shared with around 15 other residents. It was rarely, if ever cleaned and the task of scrubbing away the dried shit and blood did not appeal. There was no kitchen. The manager was an amiable enough geezer with a hint of menace about him. He claimed dealing with dead bodies was a regular part of his job. Before even being handed the keys I was required to fill out a Housing Benefit form. Aside from a letter informing me I had been awarded Housing Benefit of £148 a week that was the last I heard of it. The cheques went straight to the owner of the B&B, whoever that might have been.

This was in the early 90’s under the last Tory administration and long before Paddington began to move upmarket. Housing Benefit rates were somewhat random back then. It seemed the trick the B&B owners employed was to apply for £250 for everyone and then take whatever came back. My room mate was receiving about £180 a week for the exact same room, although his bed was nearer the window I suppose.

All the residents agreed it was a fucking rip off.  Dodgy bastards providing sub-standard hovels at huge cost to the tax payer. It was impossible to secure employment, which was forbidden under the terms of the B&B’s licence agreement, in case it affected our Housing Benefit.  What I didn’t realise until this government was that this was all my fault.

These are the circumstances some of the families affected by the new benefit caps will be enduring. Despite repeated claims made by the Government of luxury houses many are in grotty temporary housing which will cost the state a fortune, of which they themselves will never see a penny. Unable to move because they can’t afford the huge deposits demanded by landlords these days, they will also be unable to stay because they can’t afford the rent. Huge swathes of the South East will now be out of reach for large families.

Some of these families may be unemployed, some may be to ill to work, it matters not to Iain Duncan Smith. As many as 100,000 people, children, parents and pensioners could find themselves in an impossible position. Local councils are also now placed in a paradoxical situation. The Housing Act attempts to ensure that no child is ever forced to sleep rough. Many Tories, including Eric Pickles and Westminster Council are desperate to change this.

At present however they are legally bound to place homeless people with children in emergency accommodation. The problem is the temporary accommodation they have used traditionally will charge rents which places them out of reach due to the Housing Benefit cap. If IDS noticed this gaping hole in the legislation, which may cause some councils to either break the law or fund huge rents via Council Tax revenues, he didn’t care.

The DSS B&Bs have long gone from most parts of London. Where I stayed in Paddington caters to tourists now. Much temporary accommodation is now privately rented flats and houses or hostels. Hostels, many run by charities, say they need high rents to pay staff. It is quite possible these cuts will force their closure. Private landlords will no doubt give their properties a lick of paint and rent them on the open market, one of the few sectors that appears to be booming. There is no evidence to suggest that landlords will cut rents to accommodate the changes to Housing Benefit. The opposite seems to be happening.

Councils will very likely claim that families facing eviction are ‘intentionally homeless’, a sinister phrase that means you and your family are stripped of all rights to support. Eviction for rent arrears has long been a way for council’s to avoid responsibility for homeless families. Whether that will still apply if the arrears were due to benefit cuts will no doubt form the basis of a court case at some point. In the meantime Local Authorities will try it on as much as they can.

Councils will offer to take the children into care, the parents will be told to fend for themselves. This is not scare-mongering, it already happens to families deemed intentionally homeless. When these new reforms come into effect, if you become sick, disabled or unemployed you will face not just losing your salary, but possibly your home and even your children.

It’s true the Daily Mail has been able to find the less than a handful of families living in what appear to be nice properties at huge expense. All systems will create anomalies. However a cap that makes most of London out of reach to families on benefits is obviously not intended to address the 2 or 3 families who were living in 2 grand a week Kensington pads.

Most people are living in average accommodation, in average areas. Not just Kensington, but Hackney, Tower Hamlets, Newham, Southwark and in fact almost all London boroughs will now be out of reach to low income families. Housing Benefit will already now only pay for rents which are in the bottom 30% of the market up to the point of the caps, which are far below rent levels. Children are already expected to share rooms, up until the age of 11 if they are the opposite sex or 16 otherwise. Many families affected by the caps will have rented the property before the relentless onslaught of gentrification sent private rents soaring in London.

It is true that soaring rents and unaffordable housing is a fuck up on a national scale. Greedy buy to let landlords and a desperate shortage of Council Housing are largely to blame. This Government instead has chosen not just to blame the tenants, who never see a penny of the Housing Benefit payments, but to force them into homelessness. The costs of this, both financial and social, will be huge. It seems even in times of banker enforced austerity the purse is bottomless when it comes to dismantling the Welfare State.

Meanwhile IDS and his vile cronies continue lying that people living on a pittance, vulnerably housed in some of the shittiest properties London has to offer, are somehow living it up at the expense of the tax payer.

I was in the B&B for about four months and then managed to secure a place in a longer stay hostel. With a list of rules and regulations so long it was similar to an open prison, but at least I had my own (tiny) room. Housing Benefit were paying around £170 a week. I could be evicted with only 24 hours notice, and almost was more than once. Whilst not written into the licence agreement, working was discouraged, again because it would affect my benefit entitlement.

I managed to last a year in the hostel before we became decidedly intolerant of each other and I moved into a squat. And got a job.

The reason I had found myself in this position was my previously declared naivete. Up north back then few landlords charged deposits and for those that did you could apply for a Social Fund loan. I assumed the same applied in London. It didn’t. After a couple of days trawling LOOT for properties I thought were cheap enough to be covered by Housing Benefit and another couple of days sat in DSS offices finding out they wouldn’t lend me the deposit I realised I was in the shit. It didn’t help that the vast majority of landlords refused to rent to benefit claimants anyway, although I had no real scruples about lying to them about my circumstances. Eventually I threw myself on the mercy of a now closed advice centre for young homeless people who referred me to a night-shelter.

Had I been eligible for a Social Fund loan I would have easily been able to secure much lower cost accommodation all by myself, saving the state thousands. And I’d have had to pay the money back.

Tomorrow the Lords will be discussing an amendment in the Welfare Reform Act which will abolish the Social Fund completely. Yet another piece of car crash legislation that will cause social chaos. That the impact and cost of all these changes may well see the undoing of Iain Duncan Smith’s political career will be of little comfort to the children and families whose lives will be devastated by the upcoming carnage.

As unemployment sky rockets more and more people are going to be forced into poverty and desperation as the the state support they paid for is stolen to fund tax cuts for the rich and new nuclear bombs. It is difficult to predict what hundreds of thousands of people who can’t afford to feed their children will look like. Last Summer’s riots may well be seen as little more than youthful exuberance compared to what could be about to come.

This government should be careful what they ask for, because they might just end up getting it.

Take action against the Welfare Reform Bill this Saturday 28th January.

8 responses to “It’s Landlords Not Tenants Getting Rich on Benefit Payments

  1. Excellent article. Although there are still plenty of B&Bs providing temporary accommodation in London – two years ago when I worked in supported housing in Islington, most of our clients had come via these awful places, there was a whole string of them on Seven Sisters Road opposite the park. If someone is placed there by the local authority, HB are (or at least were 2 years ago) obliged to pay the rent, whatever it is. There’s no cap, so the landlords are raking it in and providing little to no service for their vulnerable tenants.

  2. I have also come through the supported housing and HB route.

    I first lived in a YMCA who charged nearly £200 a week for a single room, share bathroom and toilet and one meal a day – it was clean tidy and generally nice to live in – I gave up this happiness to live with a friend it diddn’t work out in my favour and I ended up on the streets again via my parents.

    The second hostel was a lot better I was there for two years again at near £200 a week for the room which was actually a self contained bedsit – they offered classes on how to budget, cook, they help me with confidence training to make me the more rounded person I am today.

    After two years they helped me secure a council flat – could you imagine my surprise when I found out the rent was only £70 per week at the time (2001).

    This training, this help, this lifeline that was afforded to me to help me leave an abusive family and become a safe, secure, sensible member of society.

    I am by no means saying this saved my live alone but I can hand on heart say that I would be dead if not for it – I fear that those in my shoes will no longer be as lucky as I was.

  3. Reblogged this on Daily News Items and commented:
    Our Teenagers will be thrown more and more into this persons world with this welfare reform bill. Please read

  4. I’ve met lots of these landlords on my daily travels. A retired Neighbourhood Office Manager outlined to me how I could take in homeless people, make them share a room and fill in the application forms for Housing Benefit. When the money came in the homeless person is likely to have moved on cos that’s what they do. Meanwhile the money would have been paid into my bank account and it wouldn’t have veen fraud because I didn’t apply for it. Wilst this was happening I could have got new tenants who’d go through the same process and I could still collect the Housing Benefit for them. I declined his ‘help’ in getting this. I had a 6 bedroomed house at the time so I would have been a millionaire in no time. Other scammers I’ve encountered: the guy who had a very smart way of counting ‘flats’. Each house have a number and name, each room have a number and letter. 19 flats, 96 claims. Add to this the benefits from people who’d long moved on and he was a millionaire. He also had a few people in his pockets: the postman who delivered all the letters to the landlords home, the guys in social security, post office, housing department, neighbourhood office who knew of his scams and got a backhander.
    Then there was the one who had a house full of rats and mould who charged each resident £40 per week whilst claiming Housing Benefit. ANd of course because it’s cash-in-hand and no receipts they also fiddle the taxman. These guys don’t work on their own. Somebody knows and is getting paid to keep quiet.

  5. Reform is needed – reform that stops the landlords from raking in benefits while creating hazardous living situations for the most vulnerable citizens.

  6. Pingback: January 2012 News round-up | House Bites Man

  7. I never understood why housing benefits never covered deposits, is it deliberate or just them been stuck in the stone ages out of touch. The real solution which needs time is to build enough social housing to house all claimants, and then of course dont sell it off. Before that housing benefit really should have stayed how it was prior to LHA. I am currently living on a shortfall of £120 a month after my HB has been cut since oct on the new shared room under 35 rule (I am 34 next week). My family have decided to buy my food for a year until my help is brought back so effectively I am no longer buying food, since all of my family are scared of the thought of taking me in, this is the lesser evil for them. Since I have no kids I assume also the council have no duty to house me. For me to move factoring in deposits, first months rent to be paid before benefit approval possibly also 2nd month, moving costs of belongings, breach of my tenancy agreement (moving mid tenancy agreement) I estimated at around 1 and half grand. I would be moving to a grotty bedsit for a year to get my £120 back when it would cost me 1.5k to move, this is why me and my family are doing it this way. Also to mention I am off ill health and moving it to a cramped space probably not on ground floor isnt viable anyway.

  8. Pingback: Is the Tide Turning Against the Tories, as Labour Pledges to Scrap the Bedroom Tax and Sack Atos? | Andy Worthington

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