Social housing providers are warning that up to 440,000 homes are potentially at risk due to George Osborne’s plans to slash benefits intended to pay the rent of those living in supported housing.
In the Autumn Statement the Chancellor announced that Housing Benefit for tenants living in socially managed housing would be capped at the same level as payments for those renting privately. This cap is to include those living in some form of supported accommodation where high rents are charged to cover the additional costs of providing care or supervision. With weekly Housing Benefit awards capped at less then £50 a week for single people under 35 in some parts of the UK, this will mean the potential closure of every women’s refuge and homelessness hostel along with supported housing schemes for pensioners and those with acute physical or mental health conditions. The combined financial loss to social housing providers could be as high as £400 million according to housing industry spokespeople quoted in trade magazine Inside Housing recently – and this is assuming that those over pensionable age are excluded from the cap. To date no-one from the Treasury, DWP or Department for Communities and Local Government (DCLG) appears to have said they will be.
The DWP have said that any shortfall in payments to cover rents will be made up by Discretionary Housing Payments. This is money given to local councils which can be used to top up housing benefits of those affected by cuts already introduced such as the Bedroom Tax and Benefit Cap. Osborne himself has claimed there will be an additional money for these payments, believed to be around £70 million a year, but this will not come close to meeting the funding gap. Just as importantly these payments are not ring-fenced and are discretionary – there will be no requirement by law for local authorities to meet people’s rents. The implications are chilling Without central control then any old swivel-eyed Tory Council could close a homelessness hostel or drug rehab project in their constituency simply by cutting off their income stream.
Perhaps most astonishingly – given that it is only now that the social housing sector has taken notice – is that this is a problem which is four years old. Way back in 2012 the charity for domestic abuse survivors Women’s Aid warned that a combination of benefit caps and the reforms being introduced under Universal Credit would ‘decimate’ the women’s refuge system. This led to Lord Fraud, the comedy toff brought in on the cheap to oversee welfare reforms, quickly pledging that payments for supported housing would continue under the current system. Then followed a bitter row about what exactly the government means by supported housing, as well as concerns raised over funding for emergency temporary accommodation such as B&Bs. Neither of these matters were ever fully resolved as DWP ministers dithered and dodged questions whilst homelessness charities and housing associations were too busy looking to profit from lucrative government contracts to pay attention to their impending destruction.
And so here we are again, except now homelessness has soared and over 100,000 children are living in expensive and insecure temporary accommodation. These bed spaces are also under threat with DWP documents suggesting that housing benefit payments for temporary accommodation will now also be capped. Previously the solution to temporary housing – which doesn’t have the same costs as supported housing but is more expensive than mainstream accommodation – was to allow an additional weekly payment of £40 to be added to housing benefit. In the latest guidance aimed at social landlords explaining benefit changes however it states that homeless Universal Credit claimants in temporary housing will have their rents capped at the same level as those in the mainstream private sector. There is no mention of additional funding. So it is not just homelessness hostels, refuge’s and other supported housing that is under threat, but possibly B&Bs and private sector emergency accommodation.
Whilst these changes are terrifying and if implemented could lead to a street homelessness crisis that has not been seen before in a so-called developed economy, the DWP has a long way to go if this is truly what they want. The cuts to housing benefits will not be implemented until 2018 and will only apply to tenancies signed after April this year. This will prevent, at least for a couple of years, mass evictions. But the biggest problem is that almost all of the people eligible for both supported and temporary accommodation would be classed as ‘statutory homeless’ if they were unable to find a roof over their heads. This means that local authorities are bound, by law, to house them – there and then if they have nowhere to go that night. There just won’t be any money to pay their rent.
In short, it’s a giant fucking mess and one the DWP have been trying to sweep under the carpet ever since Iain Duncan Smith’s half-baked reforms to the benefits system were first announced. Expect another bodge as the realities of a modern social security system clash once again with the delusions of a Secretary of State who thought he could fix poverty by making people poorer. The truth is this has probably only dragged on so long because no-one really believes that Universal Credit will ever be fully implemented anyway. It sill might not be. The tragedy, as Inside Housing reveals, is that this shambles is already having very real consequnces. Social housing providers say that schemes to provide desperately needed new supported housing are currently on hold until the government makes it’s mind up about whether they should condemn everybody officially classed as ‘vulnerable’ to street homelessness or not. Decisions, decisions. What a bunch of cunts.
A march against the housing bill, which will decimate social housing, is taking place in London on Saturday January 30th. More details on facebook, please spread the word.
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