Tag Archives: Housing Benefit

David Cameron Plots The Social Cleansing Of The South


A further cut in the Benefit Cap, as pledged by David Cameron yesterday, could lead to the social cleansing of the entire south of England as families on benefits are pushed ever further north by soaring housing costs.

Although touted by the right wing press as an attack on the workshy, this move is aimed squarely at struggling low income families, and almost all them are single mothers.  If these women were looking after one of Iain Duncan Smith’s four children they would be hard working people, toiling for the wealthy on poverty pay and doing the right thing.  But looking after your own kids is no longer considered work and so they are scroungers who should have kept their legs shut as some of the nastiest and most virulent voices now claim.

Perhaps one of the greatest achievements of the social security system was that the days when a working class woman was slut-shamed and stigmatised for having children on her own looked to be a distant memory. Benefits meant that single people of either sex could look after their children with some degree of independence and dignity if they found themselves without a wage coming in.  They would be poor as fuck, but they would be housed at least.  This applied whether they were single parents due to choice, relationship break up, bereavement or simply making a youthful mistake – and most people have had an unprotected shag at least once in their lives which is all it takes after all.

The introduction of the Benefit Cap, alongside workfare and sanctions for lone parents, has meant that single mothers are back in the firing line like never before.   Lone parents now face being driven from the very cities they have lived and grown up in due to a succession of brutal housing benefit cuts that will punish their children most acutely of all.  These are not people living in Chelsea mansions as this government pretend, but people living in the last remaining private rented slums that will still accept benefit claimants in places like Croydon, Tottenham or Catford.

The reduction of the benefit cap to £23,000 will mean cities such as Bristol, Bath and Cambridge will also become unaffordable to out of work parents with as few as two children.  For the small number who need a property with more than three bedrooms, then barely anywhere south of Birmingham will be cheap enough.  Councils in the midlands are already warning of pressures to housing and services in the region due to families being relocated from London and the economic cleansing from the first benefit cap has barely even begun.   Should the cap be lowered even further then the trickle of families in poverty arriving in northern towns from the south could becom an avalanche, re-entrenching the North-South divide like never before.

The truth is that benefits have always been capped, but previously this took place at a local level. Benefits for an adult on unemployment benefits are capped at just £72.40 a week plus an additional amount towards housing costs. How much this is depends on where you live. In Islington, where the average rent for a one bedroom flat is estimated to be £415 a week by estate agents Foxtons, Housing Benefit is capped at £255.50 a week for a single adult without kids. That’s why, apart from those in social housing, not many poor people live in Islington anymore. In Barnsley the average weekly rent for a one bedroom flat is £89.30 according to this property website, whilst the Housing Benefit cap for a single adult is £69.23 a week. Lots of poor people live in Barnsley.

It is not the fault of claimants that rents have spiralled out of control.  It is the failure of free market policies that have led to shrinking wages and soaring housing costs.  Greedy landlords and exploitative employers who don’t pay proper wages are behind the growing benefit bill.  And it is in their interests alone to blame struggling single mums and use nasty policies based on nasty prejudices to bully families out of their homes and communities.

Above pic from Haringey Solidarity Campaign.

A march for homes will be taking place in London this Saturday 31st January with meeting points in both East and South London.  Please help spread the word: South London facebook page
East London facebook page

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Boom Time For Landlords, The UK’s Soaring Housing Benefit Bill

landlord-772876Whilst the Tory Party pat themselves on the back at conference for the misery their welfare reforms have caused, recently updated benefit expenditure figures  make a mockery of any claims that these vicious cuts were carried out to save money.

Housing Benefit (or Local Housing Allowance) makes up one of the largest parts of social security spending and every last penny of it goes to landlords.  Ever since this government weren’t elected they have made brutal cuts to this vital benefit which pays for the UK’s poorest people to have a roof over theirs heads.  Despite this the Housing Benefit bill is soaring and expcted to rise even further.

£24.8 billion was handed out to landlords in the form of Housing Benefit cheques in 2012/13 – the latest year for which exact figures are available.  This is a rise of £2.7 billion, in real terms annual spending on Housing Benefit since the Tories came to power.

Much of this increase is in payments to private sector landlords rather than towards  housing association or council rents.  But it is not soaring private rents that have caused the increase in spending, Housing Benefit rises are now capped at 1% annually whilst total caps on the amount landlords can receive are in place in high rent areas such as the South East of England.  It is claimants who have had to absorb the cost of rent rises, out of already meagre benefits.

Nor is the rise due to people who are unemployed.  Less than £4 bilion of the £24.8 bilion total Housing Benefit spend pays for accommodation for people on unemployment benefits.  Much of the rise is due to new claimants who are in work, which shows the true picture of the UK’s labour market.

Housing Benefit provides a good indicator of how many people in the UK are poor.  It is available to those in or out of work, as well as pensioners.  The only criteria for help with rent payments is an income low enough to qualify and less than £16,000 in assets.  The Tories may claim that the recovery is in full swing, and thousands of pretend jobs have been created, but that doesn’t change the harsh fact that there are now more people poor than at any point since the Housing Benefit system began.

This is reflected in the number of people actually claiming the benefit, which hit a record 5.05 million in 2012/13.  This figure has fallen slightly since last year – by around 25 thousand – but is forecast to rise again and is still almost half a million people higher than in 2009/10.

Surprisingly, another factor that may be driving up the Housing Benefit bill could well be the bungled attempts at cost-cutting reforms – the most notorious being the Bedroom Tax.  There has been no better gift to the landlord class than this nasty policy which is driving people out of secure homes at low, social rents and into the out of control and hugely expensive private sector.  Even the Benefit Cap might be increasing spending on Housing Benefits as families evicted due to no longer being able to afford the rent are rehoused by local authorities in emergency temorary accommodation which can be eye-wateringly expenisve.  Last year the BBC reported on families being placed in £3000 a week hotels after being made homeless due to caps on housing benefits.  The most recent homelessness figures showed the number of families living in B&Bs is at a five year high.

Many tenants are struggling with desperate poverty after cuts to Housing Benefits.  Some Bedroom Tax victims are now paying up to a third of their meagre benefit payments towards the rent.  Yet the cost of Housing Benefit is soaring.  All Iain Duncan Smith has created is more poverty at more cost to the tax payer.  Whatever your political persuasion that is nothing to be fucking cheering about.

You can download the most recent Benefit Expenditure tables at: https://www.gov.uk/government/statistics/benefit-expenditure-and-caseload-tables-2014

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One Million Housing Benefit Claimants Who Are Officially ‘Employed’ Makes A Mockery Of The Fall In Unemployment

housing-benefit-graphThe number of people with jobs forced to claim Housing Benefit hit record levels according to the latest figures making a mockery of the so-called fall in unemployment.

The number of in-work Housing Benefit claimants now stands at over 1.049 million, the highest figure on record.  In May 2010, when this Government weren’t elected, the number claiming this benefit was just over 650,000.

Housing Benefit is probably the best indicator of how many people in the UK are poor.  Available to those in or out of work, as well as pensioners, the only criteria are being a tenant on a low income and having low, or no, assets or savings.  Even those with jobs on Housing Benefit will have a disposable income little higher than someone on out of work benefits, as the benefit is reduced as earnings rise.  All of the Housing Benefit bill goes to landlords, and the rates are capped at the bottom 30% of properties in the local rental market.

Both the press and politicians are finally questioning whether the fall in unemployment is masked by a huge increase in the number of self-employed people who are barely scraping an income.  People are known to have been encouraged to come off unemployment benefits and claim the lower rate of  Working Tax Credits by companies running Iain Duncan Smith’s welfare-to-work schemes.  These firms receive huge pay outs if they can persuade a claimant to take this risky move, which involves declaring themselves as working at least 30 hours a week towards self-employment.

If this was happening on a large scale then you would expect the number of in-work Housing Benefit claimants to soar.  The same would happen if many of the people now officially ’employed’ are actually on workfare, or zero hours contracts with sporadic and precarious incomes.  That is exactly what’s happening.  The number of people overall claiming housing benefits hit 5 million households last February and has more or less stayed there ever since.   This is a quarter of a million more than in May 2010 and the figures were at record highs then.  The rise is almost entirely down to claimants who the Government say are working.

If these claimants were actually earning any money, then this would be seen in the average weekly Housing Benefit claim for those in work.  As previously mentioned, the benefit is cut as incomes rise, so it could be that people are only claiming a few pounds a week to top up meagre incomes and pay soaring rents.  The figures show however that this is far from the case.  The average weekly Housing Benefit claim for those in work also hit a record high in the latest period and now stands at £90.44 a week.  This is only just under £3 less than the average claim for those out of work.  What this suggests is that most of these working Housing Benefit claimants have full awards, meaning they are only earning a few pounds at most above current unemployment benefit rates.

No matter how much the Government  try to claim that official unemployment has fallen, the number of people who have incomes around the current level of out of work benefits is higher than ever. This is the reality of the recovery for those not enjoying George Osborne’s house price bubble.  And with both in and out of work benefits being haphazardly slashed, not only are more people poor than ever before, but they are getting poorer.

Above graph from the latest DWP Quarterly Statistical Summary (PDF).

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Record Numbers On Workfare and In-Work Housing Benefit Claims Top One Million – They Call This Recovery

workfare-isnt-workingThe number of unpaid workers rose by over 10,000 people in the three months to September yesterday’s Labour Market Statistics revealed.

The number of people in “government supported training and employment programmes” – climbed by 11,000 to reach 175,000 – the highest figure since workfare began.

This could be due to an increase in unpaid work for young people with the launch of Traineeships in August.  These schemes involve a period of up to five months working without a wage and are designed to ‘prepare’ people for taking up Apprenticeships, often at below the minimum wage.  Predictably several major companies, including Boots and Kwik-fit, have been only to happy to take up this tax payer funded offer of free workers.

Young people cannot currently be forced to start on a Traineeships which are officially voluntary (UPDATE: at least the work experience element is).  Such is the toxic regime at Jobcentres however, where claims can be sanctioned for ever more ludicrous reasons, it is likely many young unemployed people feel they have no choice but to work unpaid.

And even if this were not the case, Traineeships still represent a wealth grab by grasping employers.  Some of the UK’s richest companies are exploiting young people’s very real fear of unemployment to convince them that they should work for nothing in jobs which would once have come with a wage.

Unpaid workers on these schemes are counted as employed, a handy distortion of the figures for a Government that claims they are bringing down unemployment.  With the numbers in part-time work, precarious self-employment or workfare all at record levels, and wages falling far behind inflation, the true picture of the labour market is far from good news. Recent Housing Benefit statistics* show that the number claiming help with housing costs remains at record levels.  Over 5 million people are on this benefit and for the first time, in July 2013, the number of working Housing Benefit claimants topped one million.

Other statistics published this week show that 522,000 people so far face the threat of homelessness due to the Bedroom Tax.  Every measure of homelessness is already rising.  The number of people dependent on foodbanks is soaring.  If this is a recovery then what the fuck does a recession look like?

*The Housing Benefits statistics are now being released via the near incomprehensible DWP Stat-Xplore website.

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More People Poor Than Ever Before As Numbers Claiming Housing Benefit Hit Record Levels

housing-benefit-recipientsThe number of people claiming some form of Housing Benefit has hit record levels giving a true indicator of plummeting living standards and high unemployment.

Housing Benefit (now called Local Housing Allowance) is paid to those in and out of work alike, as well as low income pensioners, those on sickness or disability benefits and lone parents.  In London it has recently been estimated that 44% of housing benefit claimants are in work but on wages which leave them unable to afford to pay the rent .  The only factor taken into account when assessing claims are income and savings, meaning that the number of people on housing benefit gives a good indication of how many people are poor in the UK.

And despite Tory lies about a million new jobs being created, the sad truth is that more people are poor than ever before.  Recently released statistics (PDF)  show that in February 2013 there were 5.08 million recipients of Housing Benefit, up from 4.74 million in May 2010 when this Government weren’t elected.  This is the highest figure since Housing Benefit was introduced in 1983.

The truth is that any job creation which might have taken place has been workfare, low income self-employment, zero hours contracts or part time work, leaving unprecedented numbers of people dependent on some benefits to survive.

The figures also reveal that despite endless propaganda about benefit claimants living in tax payer funded mansions, the average housing benefit entitlement is just £89.30 a week.

Around a quarter of housing benefit recipients are pensioners, a figure which has stayed fairly stable over recent years.  Pensioners are exempt from the recent vicious cuts to housing benefit, however 4 million claimants under pensionable age now face this vital benefit being cut due to the bedroom tax, benefit tax, benefit uprating bill and other measures.

Some of those people will be left with just a few pounds a week after paying the rent, whilst others will be driven from their homes completely.  Almost every working age Housing Benefit claimant has been affected by the cuts.  This means that not only are there more poor people than ever before, but that 4 million of them are now at very real risk of homelessness as incomes shrink and rent rises.  A recent DWP report revealed how many landlords are in the process of evicting housing benefit claimants due to the cuts.

Iain Duncan Smith  boasted over the weekend that he is prepared to make even further cuts to housing benefits, once again raising the spectre of ending the benefit completely for those under 25.  Homelessness is already soaring and the Secretary of State is determined to make the problem even worse.  The UK could look like a very different place in just a few years time as vast numbers of people lose their homes.  The responsibility for that will not just lie with George Osborne and his fucked economy, but with Iain Duncan Smith’s reckless, bodged and brutal attempts at social security reform.

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DWP In the Dock Again, This Time Over Benefit Cap

civil-servant-in-the-dockAnother of Iain Duncan Smith’s flagship welfare reforms is to face a court challenge it has been reported this week.  Four families are to bring a judicial review against the cap on benefits at £500 a week which was recently brought into force in three London boroughs and is due to be extended throughout the UK from July.  The families will argue that the cap is ‘discriminatory and unreasonable’.

This latest legal challenge comes in the same week that the DWP faced a humiliating court defeat over the Atos assessments for sickness and disability benefits – which were ruled to discriminate against people with mental health conditions.  This followed last week’s news that the DWP had lost a tribunal hearing and was ordered to release the names of the companies and charities profiting from workfare schemes.

These are the very same workfare schemes which were ruled unlawful in the Appeal Court earlier in the year.  This judgement forced Iain Duncan Smith, with the shameful support of Labour, to introduce emergency legislation to steal compensation payments due to those who had benefits sanctioned under the illegal schemes.  Despite this, the DWP are clearly on a losing streak and long may it continue.

The department may hope to be on safer ground with the benefit cap, which the Tories believe has been one of their most popular reforms.  Yet along with the housing benefit caps, in many ways this policy has been one of the nastiest of all.

The benefit cap has been the one policy that has absolutely guaranteed that tens of thousands of claimants –  almost all with children – would lose their homes.  There is not even a remote possibility of families being able to scrimp and save to pay the rent if they live in the capital.  Across huge swathes of London grasping landlords charge far more in rent than even the maximum now allowed in benefits, leaving these families with no choice but to leave the city.  One of the richest cities in the world, is about to export it’s poorest residents to places like Bradford and Birmingham where unemployment is already soaring and public services are stretched to breaking point

It is not the fault of claimants that rents have sky-rocketed out of control in London and that no government has made any meaningful attempt to address the chronic lack of social housing.  The difficulties involved in finding a private sector flat, where many landlords demand ‘No DSS’, is already one of the main causes of homelessness in the city.  Often claimants have faced eye-watering rents simply because these were the only properties available.  Slum landlords have been all too happy to exploit the situation, with astronomical rent demands for shitty rooms in B&Bs or flats that they wouldn’t be able to let to someone who was working – and who had a choice about where they lived.

Yet the Government has chosen to punish claimants themselves for the greed of landlords by forcing them from their homes. Two of the families who have launched the legal challenge against the benefit cap have recently fled domestic violence.  Many claimants in high rent London properties have been those who have faced desperate circumstances and have done what any decent parent would – which is made sure their children have a roof over their heads by any means possible.  These children, who may already have faced significant trauma due to witnessing or experiencing abuse, homelessness and just simple poverty, will have settled in these new homes, gone to school and made friends.  Now they are to be uprooted again, possibly hundreds of miles away, whilst watching their parent(s) disintegrate under the pressures of forced relocation and a new threat of homelessness.

Rarely has a government policy been so precision targeted to attack the most marginalised in society.  People who may just have been starting to put the pieces of their lives back together in safe if shabby accommodation, only to have that security destroyed as they face being cast out onto the streets.

And like so many of Iain Duncan Smith’s welfare reforms, the policy was based on a lie – which is that there were claimants living in areas or properties that those in work could not afford.  Housing Benefit  is available to families in and out of work alike.  Working families in the capital living in high rent areas would be just as eligible for housing benefits as those out of work. Even families on salaries of £30k plus may have been eligible for some housing benefit in parts of the capital.

Housing Benefit has  functioned as a crude sticking plaster for a dysfunctional housing market, and now that sticking plaster is being ripped away.  The consequences of this, for some of the UK’s poorest and most vulnerable children, will be terrifying.  All those who have cheered this reform from the sidelines should think of those children whose lives are about to be destroyed as a result of this bodged experiment in social cleansing.

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‘We won’t reduce the rent … We’ll kick them out’: Research Reveals Landlord’s Response to Housing Benefit Reform

HomelessA report published by the DWP gives a glimpse of the horrific future hundreds of thousands of people are set to face due to housing benefit reforms.

The report is part of an ongoing piece of ‘independent’ research commissioned by the DWP to look at the impact of the first raft of welfare reforms – the vicious cuts to housing benefits.  These included the caps on the amount of benefit available to pay for housing and a reduction in local housing allowance rates from the bottom 50% to 30% of the local rental market.  Another change meant that those aged under 35 are no longer entitled to a self-contained property, but can only claim the Shared Accommodation Rate (SAR).

The research features wide ranging interviews with claimants, landlords and housing advisors discussing the changes.  As is repeatedly pointed out, as these interviews were carried out throughout 2012, then many, if not most claimants will not have yet been affected by the reforms.  This research is therefore an indicator of how people are intending to  respond to the changes.   The report is also quite long so I won’t try cover it all in one post.

Predictably the most telling comments come from landlords.  According to the report, 16% of landlords who currently let to claimants plan to stop doing so due to the cuts.  Most landlords seem well aware of what is to come and are already making plans:

“I’m giving notice on [20 tenants affected by the change to the Shared Accommodation Rate], it’s not fair, I don’t like doing it. And we’re not taking any [more] on. We have to protect ourselves and we have to protect our landlords.”

This was the response of one letting agent to the vicious slashing of housing benefits for those under 35 and is an attitude which seems to dominate the private rental sector.  Despite initial claims by the Government that landlords would lower rents in response to the changes it seems that barely any of them have been prepared to do so.  Only those renting in areas with high numbers of claimants have seriously considered this as an option – but crucially even this in many cases appears to be just a temporary measure.  Landlords may be willing to accept a temporary small reduction in rent to avoid the expense of eviction, but will turf tenants out when tenancies are due for renewal.

Local Housing Allowance (LHA) is a localised benefit, which is paid according to the local cost of rents.  This decision to peg the maximum available at the bottom 30%, rather than 50% of the market, will mean hundreds of thousands of private sector tenants forced to pay some of their rent out of meagre benefits intended to pay for other living expenses.

The average loss to claimants according to the report is £7.76 a week – although due to the caps in some areas this will be far higher.  Landlords appear to be sceptical that those on benefits will be able to afford this, with one warning: “Some of them are making it up but a lot of them are struggling because it’s not just [LHA] that’s been cut, they’re getting other money cut as well, so it’s making it harder and harder.”

Many landlords report having already reduced the number of claimants they rent to on Local Housing Allowance due to the introduction of Direct Payments by the Labour Government in 2008.  This meant that generally rent payments were sent direct  to tenants not landlords, a move which was hugely unpopular amongst those renting out property.  When Universal Credit is finally launched, the Direct Payments regime will be strengthened and also applied to the social housing sector.  The  very thing that most landlords say puts them off renting to claimants is about to be hugely extended.

As would be expected, one of the biggest impacts of the reforms has been in London where in some boroughs almost no properties are now affordable to those on benefits due to the caps.  This will not just affect those out of work – 44% of housing benefit claimants in London are working.  It will also not just impact on central London boroughs such as Westminster where rents are astronomical.  A letting agent in Barking and Dagenham reports their current strategy on renting to tenants on benefits: “We have slowly, slowly been booting them out, average between 150 and 200 properties.”

The research also reveals that a less well known, but sweeping reform to housing benefits, the introduction of the Shared Accommodation Rate for those under 35, could bring some of the most devastating consequences.   This change, which means anyone under 35 will have to find a room in a shared house to be eligible for LHA, was carried out without any assessment of whether enough properties exist to house all those who need them.

The report suggests that this is not the case, with many landlords pulling out of the multiple occupancy market due to recently introduced regulations.  Planning permission is now needed if a property is to be used for multiple tenants in a move which many landlords claim has made the sector unprofitable.  Quite simply, most landlords say the Shared Accommodation rate is too low, summed up by this quote from a landlord in Perth:  “‘Where’s the difference going to come from £52 [LHA] up to £85 a week [rent]?  There’s no way somebody on £120 a fortnight can afford to pay the difference and I can’t rent them out at £53 a week. I think they’ll possibly be moving, I can’t see any alternative.”

Almost all landlords quoted say they are planning to evict claimants under 35, with some going even further and suggesting they will now not rent to anyone from this age group: “We’re not housing under 35s now, so long term it will resolve itself because we’re not putting anyone in under 35. But we’ve got this 15, 20 people who are going to be on the street.”

This comment is backed up by a housing advice worker later in the report who says: “a lot of existing agents and landlords have told me they’ve now served notice on every tenant they have under 35. Even those tenants who might be in work at the moment, a lot of landlords have thought if they lose their job they won’t be able to pay the rent.”

Many landlords fear that tenants under 35 will face homelessness as a result of the drastic cuts: “[They’ll end up] on the streets, they’ve got nowhere to go. These people haven’t got no funds.”

Others have concerns that separated parents will no longer be able to have their children stay with one Hackney landlord saying: “There are going to be certain tenants who it’s going to have a massive impact on.  My heart bleeds for them, because the majority of them are divorced fathers who see their kids. I’ve got one lovely guy, he’s got three kids, wife lives in Hillingdon, kids come and spend the weekend with him, where’s he going to put them? Does he lose his visitation rights to his children because he hasn’t got a job or hasn’t got the home to be able to offer the children somewhere to sleep [because] there isn’t any room?”

Like many of the bodged welfare reforms, it will be the most marginalised who are worst affected by the slashing of LHA rates for under 35s.  Those likely to end up homeless will be the people who cannot go back to live with their parents, or who face other difficulties such as a mental or physical health condition which makes sharing difficult or even impossible.

Whilst claimants in some form of supported accommodation, such as homeless nightshelters or women’s refuges have been exempt from the reforms (so far), many Local Authorities used informal relationships with landlords to provide housing for those they deem ‘vulnerable’.  The report suggests this is all likely to come to an end, with one landlord reporting: “‘I’m kicking them all out … I’m serving them notices because I want, on the day the rent will have to be changed, they’ll already be out … It’s a complete change to the portfolio.  I’ve always been the person they phone up and say they’ve got somebody who’s not well or who’s just come out of drug rehabilitation, that kind. I’ve always taken them in and never had a problem but I’m not going to do it any more.”

To read the DWP’s gushing press release which accompanied this report you would never guess the bleak future it describes for low income tenants.  This is far from surprising.  Minister for Welfare Reform, Lord Fraud claimed the first piece of research in this series proved tenants were not facing excessive financial difficulties due to housing benefit reforms.  In fact the research had revealed that many tenants were having serious money problem before the cuts were even introduced.

This time the DWP is attempting to use the research to claim that there has been no Kosovo style social cleansing due to LHA reforms and people are not being exported from London in huge numbers.  But that’s because the report was carried before most claimants had been affected by the changes.  The views of claimants themselves, along with housing advice workers, (both of which I’ll cover later this week) reveals that this mass forced expulsion is simply yet to come.

It’s also important to note this research does not include the impact of the Bedroom Tax, the overall benefit cap or Council Tax benefit reform.  Nor does it consider the changes to DLA, Employment Support Allowance, the upcoming nightmare that is Universal Credit or the huge rise in the numbers of claimants having benefit’s sanctioned.  It also does not examine the consequences of the Benefit Uprating Bill which will see Local Housing Allowance rises capped at 1% annually despite rents soaring by over ten times that figure in some parts of the UK.

If this report makes grim reading (and it does) for all those concerned about the future of housing for people on low incomes, then it is only a small taste of what is to come.

The report can be read at: http://research.dwp.gov.uk/asd/asd5/report_abstracts/rr_abstracts/rra_838.asp

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Benefit Cap For Single People Is Just A Claimant Bashing Propaganda Stunt

Iain_Duncan_Smith_pissedThe benefit cap for single people, which comes into force this week, appears to be little more than an attempt to use the law to tell lies about benefits.  The cap for those without children will not save the government a penny, and apart from gradually eating away at the income of a handful of sick or disabled claimants* – who may not even exist – it will barely affect anyone at all.

The cap overall will have a devastating impact on London poorest families with up to 40,000 people now staring homelessness in the face.  For those who are single and without children however the cap is set at £350 a week.  This is higher than anyone unemployed is currently receiving on benefits, and just 15p less than the maximum currently available for those on sickness or disability benefits.

Disabled people, which in this case means those on DLA, its replacement PIP, or those in the Support Group part of Employment Support Allowance (ESA) are exempt from the cap.  Not disabled enough people, in the Work Related Activity Group (WRAG) part of ESA, are affected, but only those living in properties which are priced at the maximum possible level which can be paid by housing benefits – £250 a week for a single person.  This handful of people in high rent central London boroughs, will lose 15p a week, although that will become worse over time as rents and prices rise and benefit levels stays the same.

Most single claimants in London are not eligible for anything like £250 a week in Housing Benefits, which are also capped at the bottom 30% of rents in the local housing market.  Even if 500 people in the high rent London boroughs are currently claiming the full rate of Housing Benefit – and are in the ESA WRAG group –  then the single person’s benefit cap will save less than £100 a week in total.  This is considerably less than it will cost to administer and inform everybody about the cap.

Claimants on Job Seeker’s Allowance can currently also claim a maximum of £250 in Housing Benefit, but again this is restricted to those living in the central London boroughs.  Job Seeker’s Allowance is currently £71.70, meaning nobody on the dole will be affected by the benefit cap for single people of £350 a week.

Iain Duncan Smith’s seemed to love his benefit cap so much that he did it twice.  The first time, when he capped Housing Benefits, it genuinely hurt, with every measure of homelessness –  including the number of people sleeping on the streets – rising as vast swathes of London became unaffordable overnight to the poorest.

The second time it also hurt, but only for those with children who are now being socially cleansed from most of London.  For single people however it seems to have been little more than a crass PR exercise designed to give the impression that many claimants were receiving far higher benefits than is legally possible.  The only reason for this can be an attempt at entrenching Tory benefit bullshitting in legislation.  Not content with the endless abuse aimed at claimants from the right wing press, the DWP have introduced a pointless law simply to mislead people into believing that everyone on benefits was receiving a small fortune.

*It is technically possible that should there exist a non-resident carer, who happens to be paying the full rent of £250 a week and is on income based Employment Support Allowance in the WRAG group, then they may see their income affected by the cap.  If such a person exists they must feel very special that Iain Duncan Smith has invented a whole new law just for them.

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Nationwide Bans The Poor From Private Renting

no-dssUPDATE: Nationwide have backed down releasing the following statement on their facebook page: 

“The Mortgage Works, a subsidiary of Nationwide Building Society, has removed the exclusion of tenants on benefits and Local Authority tenants from its Buy-to-Let terms and conditions. This follows concerns raised by its customers.

“The clarification of the terms and conditions, which took place last December, brought The Mortgage Works into line with several other Buy-to-Let lenders. This will now be removed.”

In a shocking, and possibly illegal decision, one of Britain’s biggest buy-to-let mortgage lenders is to ban landlords from accepting tenants on Local Housing Allowance.

This nasty little move will mean unemployed, disabled people, many pensioners and people on low wages will be locked out of a large sector of the private rental market.  This comes at a time when homelessness is soaring and the bedroom tax is set to force hundreds of thousands of people out of local authority housing and into the private sector.

Nationwide’s subsidiary, The Mortgage Works, are one of the largest mortgages providers for the buy-to-let vermin who have caused soaring rents and house prices.  The company say:  “Previously, lending to landlords with local authority tenants was not explicitly referenced in TMW’s lending criteria. Our re-issued terms and conditions make it explicit that local authority tenants are not acceptable.”

By local authority tenants they actually mean Housing Benefit tenants.  Many tenants on Housing Benefits are working, however should they lose their job, become disabled or fall ill, then they may now face homelessness as their landlords will have no choice but to evict.

In truth it is none of a landlord’s fucking business, or his banks, whether tenants are on benefits or not and there is no requirement to tell them.  This will sadly be of cold comfort to many tenants however, who all too often live in fear of eviction on the whims of the landlord.  Most tenants can be thrown out of their home for any reason or none with just two months notice.

Nationwide’s decision comes on the back of savage cuts to Housing Benefits which have already made much of the South East of England unaffordable for people on low incomes.  The growing homelessness epidemic in the South is soon to be matched by mass homelessness in Northern England, Scotland and Wales as the bedroom tax begins to bite.

On top of this will come the drip drip effect of George Osborne’s decision to cap annual Housing Benefit rises at 1%, despite a soaring rental market.  And in April this year the benefit cap begin to kick in which will force thousands of people out of London or onto the streets.

Already the cuts have led to local councils placing homeless families in hotels which can cost almost £3000 a week.  People’s lives are being torn apart and the Housing Benefit bill is still rising.

No DSS has long been a common sign on the windows of letting agents.  Some landlords say they will not even take working tenants on DLA, effectively banning disabled people from their housing.  This, along with punitive deposits, credit and reference checks, mean accessing private sector housing is more difficult than ever before for those on low incomes.

At present people with resident children, or those disabled or unwell enough to convince their council they are officially ‘vulnerable’, are legally able to gain some help should they become homeless.  Increasingly that means B&Bs as the number of people presenting as homeless rockets.

Yet landlords, mortgage lenders and property speculators are making millions as they exploit the soaring demand for housing.  In many parts of the UK, even a so called ‘living wage’ is not enough to pay the rent.  If Nationwide’s greedy demand is repeated by other lenders and landlords then it will mean disabled, sick, unemployed or low waged workers are effectively barred from housing in the UK.  You can tell the recession profiteers what you think of that on twitter @AskNationwide or at: http://www.facebook.com/NationwideBuildingSociety

Follow me on twitter @johnnyvoid

Homeless Families Living in £3000 Per Week Hotels Due to Housing Benefit Reforms

homeless-familyNothing sums up the toxic mix of brutality and blundering at the DWP than the news that homeless families are being housed in hotels at a cost of almost £3000 a week.

BBC London last night reported on the families kicked out of their homes due to the Housing Benefit cap who are now being put up in hotels at huge cost to the tax payer – an entirely predictable scenario for anyone who has a basic understanding of the housing and benefits system.

The Housing Benefit cap was introduced after lurid stories appeared in the tabloids about families living in £2000 a week Kensington mansions.   David Cameron himself denounced the housing benefit system that led to people claiming £100,000 a year.  The truth was not so dramatic and it turned out that less than five families were actually receiving that much in benefits – which it should be repeatedly pointed out went into to the pockets of landlords, not claimants.  The average Housing Benefit award was just £85 a week.

This didn’t stop Iain Duncan Smith steaming ahead with the Housing Benefit cap which has seen most of London become unaffordable for private tenants on a low wage or who are out of work due to sickness, disability or sky high unemployment.

At the time IDS claimed: “‘We have got to bring an end to the hysteria and scaremongering around housing benefit we have seen this week.  Our reforms are not about making people homeless.”

Since he made those remarks every measure of homelessness has risen sharply,  from the number of people living on the streets to the number of children living in B&Bs and hotels.

London Councils have been overwhelmed with homelessness applications, leading to some, like Westminster Council – a flagship Tory borough – housing families in hotels at astronomical cost.  Less than five families who were living in what was very likely temporary housing at a cost of £2000 a week have been replaced by possibly scores of homeless families living in hotels which cost £3000 a week.

These are families who have already faced the trauma of eviction due to the benefit caps.  Whilst the BBC points out that the shortage of accommodation is so acute that Westminster are sometimes using 4 star hotels, a posh carpet and and a concierge are unlikely to make up for large families forced to share a room without cooking facilities or any long term security.

When the overall benefit cap is introduced in Croydon, Haringey and Enfield in April, this is a problem that is only going to get far worse as even more families will find themselves unable to pay the rent and forced from their homes.

Iain Duncan Smith whinged in the Spectator yesterday that criticism of the upcoming bedroom tax is ‘pathetic’ and ‘scaremongering’.  Which sounds a lot like his tantrum when people warned the Housing Benefit cap would lead to a huge rise in homelessness in London.

IDS was wrong then, and he’s wrong now.  There will be no comfort in saying we told you so however when hundreds of thousands of children’s lives are shattered by the inevitable poverty and homelessness that is to come.

Follow me on twitter @johnnyvoid