House of Commons - Work and Pensions

Select Committee on Work and Pensions Written Evidence

Memorandum submitted by Shelter (CP 21)

Shelter is a national campaigning charity that works with over 100,000 homeless or badly housed people every year. We offer practical support and innovative services to people in housing need and use the evidence gathered from this work to campaign for long-term changes to legislation, policy and practice to reduce and prevent homelessness.

Last year, our housing services helped over 20,000 families with children. Through these services, we work with some of the poorest and most excluded children in our society. We have also been working closely with End Child Poverty and, in December 2002, we jointly published Child poverty, housing and homelessness to highlight the links between poor housing and child poverty.

Shelter welcomes the opportunity to submit evidence to this inquiry. We fully support the Government's commitment to end child poverty. However, we do not believe it can be met until the housing needs of families with children are tackled. Our evidence therefore focuses on the links between poor housing and poverty and the policies needed to ensure that tackling homelessness and bad housing is central to the drive to end child poverty.

Measuring child poverty

Shelter agrees that income should underpin the measurement of child poverty. However, as the Government has recognised, poverty is multi-faceted. As one of the key underlying components of poverty, a housing indicator should therefore be included within the overall measure of child poverty.

Shelter believes that the current housing indicator used in the Opportunity for all report does not accurately measure the housing dimension of child poverty. The indicator is based on the Government's PSA target to ensure that all social housing is brought up to a decent standard by 2010.[237] However, it omits large numbers of children living in some of the worst housing conditions—it does not include homeless children, children living in overcrowded accommodation or children living in poor conditions in private sector housing (57% of households below 60% of median income[238] are living in the private sector).[239]

Shelter therefore believes that the Government should introduce a new "housing poverty index" that more accurately reflects the nature and extent of housing poverty. This should include:

— Homeless households with children living in temporary accommodation.

— Households with children who are overcrowded.

— Households with children living in poor housing.

Such an index would be consistent with the criteria set out in the Government's consultation paper Measuring child poverty.[240] It would be unambiguous, outcome-focused and, we believe, well understood and accepted by the public. As set out below, it would also be relatively simple to develop.

Homelessness

The number of homeless households living in temporary accommodation is considered to be a robust and credible indicator of housing need and is currently part of the Housing Needs Indices and General Needs Indices used to allocate housing resources. Statistics are collected by the ODPM on a quarterly basis and have, since April 2002, identified the numbers of families with children. The ODPM are currently consulting on proposals to record the actual numbers of children in those households.[241]

Overcrowding

The English House Conditions Survey, which is now conducted on an annual basis, already includes a measure of overcrowding (in both the social and private sectors) based on the "bedroom standard" a far more realistic and modern indicator of overcrowding than the current statutory definition which dates back to 1935.

Conditions

The English House Conditions Survey also records the number of households with children living in poor housing (again this covers both the social and private sector). However, the definition currently used is very broad—it will not be the case that all the households identified will be suffering as a result. Further work should therefore be done to define where conditions are impacting adversely on children and to link this with the current target of bringing social housing up to standard.

The index should be one of the additional indicators used alongside the main income measure to track child poverty. By combining poor conditions with overcrowding and homelessness, the index would capture the different aspects of housing poverty in areas of high and low demand for housing.

More broadly, we agree with End Child Poverty that progress in tackling child poverty should be independently monitored.

The extent of child poverty

It has long been understood that poor housing and poverty are closely linked. A family's housing circumstances often provide the most immediate indication of their poverty and there can be few clearer and more shocking manifestations of poverty than homelessness. Government figures show that:

These statistics highlight the pressing need to bring housing into the heart of the child poverty agenda.

The impact of child poverty

Poor housing is not just a manifestation and indicator of poverty in itself. It also impacts on other aspects of children's lives and is closely linked to other key indicators of poverty. The effects of homelessness and bad housing on the health and well being of children are well documented, with infectious respiratory and gastrointestinal diseases common.[246] People in poor housing are more susceptable to tubercolosis.[247] Homelessness increases the risk of low birth weight[248] and homeless children are twice as likely to be admitted to hospital.[249] Mood swings, bed wetting and disturbed sleep are also common.[250]

Education can also suffer. Overcrowded conditions make homework and reading more difficult.[251] Impaired language and speech skills[252] and lower attainment are common.[253] One study in Birmingham found that only 29% of homeless children were attending mainstream school whereas 73% had been attending prior to becoming homeless.[254]A Shelter study in Bristol found that, of those families forced to change their children's schooling after they became homeless, more than half said that at least one of their children had been bullied.[255]

Poverty impacts disproportionately on people from black and minority ethnic (BME) groups. The Social Exclusion Unit found that people from minority ethnic communities are more likely to be poor, unemployed and suffering from ill health.[256] They are also four times more likely to live in one of the 44 most deprived areas of the country.

People from BME communities are also much more likely to live in poor housing. They are nearly three times more likely to be homeless—where nationally, they make up approximately 8% of the population, they account for more than 20% of homeless acceptances. They are also four times more likely to live in poor housing conditions—12% live in overcrowded accommodation compared to 2% of white households[257] (30% of Bangladeshi and 22% of Pakistani households live in overcrowded conditions).[258]

The Government's strategy

Shelter supports the Government's commitment to tackling child poverty and welcomes the progress made so far. However, we share End Child Poverty's view that a strategy should be published to map out how the Government intends to meet its child poverty pledge. We also believe that more sensitive policies are needed to target those in the most severe poverty, an issue highlighted in a recent report published by Save the Children.[259] Many of those living in the severest poverty are also likely to be living in the worst housing conditions and we are concerned that housing policies and resources are not currently being targeted at tackling the most acute need.

A brief summary of some of the policies that should be included within the overall strategy in order to tackle the housing aspects of child poverty as set out below.

Housing and poor housing

The Government has taken a number of very welcome steps to tackle homelessness. This has included setting a target to end the use of bed and breakfast for families with children by March 2004. A recent consultation paper proposed outlawing its use altogether for families with children.[260] These are very positive developments. However, the number of homeless households in other forms of temporary accommodation—largely a result of the severe shortage of affordable housing across much of southern England—continues to increase and has now reached record levels.

In July 2001, the then junior Housing Minister announced a review of the overcrowding standards. More than two years later, that commitment remains outstanding. The Government should implement the ODPM Select Committee's recommendation that the current standards should be updated in the forthcoming Housing Bill.[261] More broadly, particularly given its disproportionate impact on BME communities, overcrowding should be given more priority within housing policy and the allocation of resources.

Shelter welcomes the continuing progress being made against the target to bring social Housing up to standard. We also welcome the measures included in the draft housing Bill to improve standards in the worst properties in the private rented sector. However, as the report of a commission established by Shelter and the Joseph Rowntree Foundation identified,[262] more needs to be done to raise standards across the sector as a whole.

More generally, there remains a chronic shortfall in the supply of affordable housing. Although the new resources identified in the Communities Plan are very welcome, they are unlikely to deliver more than half to two-thirds of the 90,000 new affordable homes we estimate are needed every year. We are also concerned at the extent to which the new resources are being targeted on "key" workers—this should not be at the expense of those most in need.

Housing costs

The Government has introduced a number of very welcome reforms to the welfare system to boost the income of families in poverty. For many families on low incomes, housing costs are the largest part of their expenditure. Housing Benefit therefore has a key role to play in supporting the Government's objectives in this area. However, the interaction of the housing benefit system with other benefits and tax credits currently undermines efforts to tackle child poverty. Recent research commissioned by the DWP on child benefit packages in 22 countries found that the relative merit of the UK package was eroded once housing costs were taken into account.[263]

There are four main aspects of the Housing Benefit system that undermine the effectiveness of other benefits and tax credits in reducing child poverty:

264

— The steepness of the Housing Benefit taper also creates a poverty trap—every pound a person on a low income earns over and above the "applicable amount" results in a 65p decrease in their Housing Benefit (and a further 20p decrease in their council tax benefit);

265

266

— Although performance has improved, the complexity and poor administration of Housing Benefit continues to penalise many claimants.

In addition, although they comprise just under half of those in the bottom two-fifths of income distribution,[267] low income owner occupiers receive very little support with their housing costs (around a quarter of owner-occupiers are couples with children and 3% are lone parents with children.[268] Income Support for Mortgage Interest (ISMI) is not payable until nine months after employment is lost (for those who took out their mortgage after 1995) and there is evidence that the poorest owners are the least likely to take up private insurance. We hope the Government's Home Ownership Task Force will make positive recommendations in this area.

Many of these issues were taken up in the Social Security Select Committee's report into Housing Benefit in 2000 and have not been acted on by the Government. Further reforms that we believe should be prioritised with the Government's child poverty objectives in mind include:

— Ensuring that arrangements to increase the number of private tenants being paid Housing Benefit directly do not lead to increased rent arrears, poverty and homelessness;

— Disregarding part or all of Child Benefit and the Child Tax Credit in assessing income for the purposes of Housing Benefit;

— Improving the relationship between the Housing Benefit and Working Families Tax Credit tapers;

— Amending the Housing Benefit regulations to enable households to claim Housing Benefit on two properties for four weeks where they temporarily have two rental liabilities (a problem that can particularly affect households moving from temporary to permanent accommodation );

— Strengthening the mortgage safety net by ending the nine month delay in the payment of ISMI and revising the "standardised" rate at which interest is calculated;

— Considering the option of a housing tax credit for both tenants and owners to provide a more integrated and transparent system on in-work benefits.

Broader issues

The commitment to tackle child poverty is and should be a major strategic priority for the Government. Delivering on it should underpin the work of departments across Whitehall—policies should be "proofed" against child poverty objectives and should not be implemented if they undermine efforts to tackle it.

There is evidence that some departments have placed child poverty objectives at the heart of their agendas. However, departments too often pursue their own policy objectives in ways that undermine the collective priority of tackling child poverty. Policies on anti-social behaviour, for example, risk significantly increasing poverty. The Anti-Social Behaviour Bill includes measures to "demote" the tenancies of people in social housing who commit anti-social behaviour. This is likely to lead to an increase in evictions, driving people further into poverty. If implemented, the proposals recently consulted on to withhold Housing Benefit from anti-social tenants will have a similar effect.

More broadly, government structures and processes tend to encourage departments to pursue their own objectives rather than promoting a strategic focus on major cross-cutting priorities. The experience of the Social Exclusion Unit shows how cross-cutting issues can fall down the political and departmental agendas. A new and more imaginative approach to policy-making is needed to overcome these problems if the commitment to tackling child proverty is to be met in the long term.

Mr Patrick South

Public Affairs Manager

12 September 2003

237 The PSA was updated following the 2002 Spending Review to include (an increase in the proportion of) conditions in private housing occupied by vulnerable groups. Back

238 Households Below Average Income 1994-95-2001-02, DWP, 2003. Back

239 English House Conditions Survey 2001. Back

240 Measuring child poverty: A consultation document, DWP, April 2002. Back

241 Possible future homelessness data collection (P1E)-consultation, ODPM, July 2003. Back

242 ODPM Statutory Homelessness Bulletin, September 2003. Back

243 Official Report, 9 November 2001, column 460W. Back

244 English House Conditions Survey 1996. Back

245 English House Conditions Survey 2001. Back