Impact of the changes to Housing Benefit announced in the June 2010 Budget
Written evidence submitted by National Association of Welfare Rights
The Work and Pensions Committee has requested written evidence for its enquiry from interested organisations to focus on how the announced changes will impact on:
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Incentives to work and access to low paid work
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Levels of rent, including regional variations
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Shortfalls in rent
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Levels of evictions and the impact on homelessness services
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Landlord confidence
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Community cohesion
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Disabled people, carers and specialist housing
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Older people; large families and overcrowding
It is extremely difficult to reply to this in isolation of the other changes to benefits proposed in the budget as they are likely to be seen as a direct attack on benefit claimants as a whole. This is not likely to be conducive to lowering child poverty as Housing Benefit is one of the few benefits claimants may access in work.
This evidence was started by inserting the title of this paper into Google search engine; one of the foremost entries was for a landlord’s website
www.landlord-forum.co.uk
and one of the posts simply states ‘yet another reason not to let to benefit tenants’. This bald statement indicates existing hostility towards tenants, when the levels of LHA are capped at current levels. Clearly reducing the levels at which people will be able to claim Housing Benefit is only going to increase this. Another comment from the same forum mentioned dissatisfaction with the way that LHA is paid 4-weekly in arrears, rather than in advance as is the norm for most assured shorthold tenancy agreements.
It is recognised that this cap will have a disproportionate effect on claimants in London and the South East of England, where rents are on average much higher than in the rest of the country. One postcode in the London Borough of Barnet shows the lower quartile for the postcode NW7 as £402 per week for a property of 4 or more bedrooms
www.london.gov.uk/rebntsmap
. Barnet as a borough has extremely limited social housing, so privately rented accommodation is at a premium. The borough has 3 Broad Market Rental Areas. Much of the housing in this area is let to communities of Jewish or Islamic extraction. We are not aware of any Equalities Impact Assessment on this issue, and the proposal may be said to directly or indirectly discriminate against the relevant races as the families are typically larger and so need larger than standard properties. It is difficult to envisage how social cohesion can be fostered by alienating or vilifying these claimants. It cannot be reasonable to insist that whilst landlords may charge a market rent, people who are already by definition living in poverty, are penalised by not being able to rent property without having to make good a shortfall from an already low income. History documents well what happens to people who are victimised and deemed less than worthy of public support.
Families in general are going through very hard times financially, and there must be concern that the increased financial pressures of trying to make young adults within them contribute as non-dependents will fracture them. Mention is made of uprating the non-dependent deduction in line with the Consumer Price Index, but there have been various statements indicating that benefit rates could be increased at a lower rate. Does that mean that the young adults who may have learning difficulties or other problems should be told that if they cannot make the contribution, that they should leave the family home and present as homeless so that they can try to find accommodation themselves and claim Housing Benefit in their own right? Social housing is scarce and if they have to try to rent in the private sector, what course of action should they take when faced with shortfalls in their rent from the 30th percentile of local rents from October 2011? Remembering that people under 25 are entitled to Job Seekers Allowance at a reduced rate, the ability to cover a shortfall in rent is reduced commensurately. This situation can only worsen if we penalise Jobseekers who have not been able to find employment within 1 year by reducing their entitlement to LHA by 10%. We are concerned that this may be an additional sanction to unsuccessful jobseekers. If the Jobseeker has not been able to find work within 2 years, is the government’s intention to reduce entitlement by a further 10%? We already have examples of older parents who are afraid of violence, often through drugs or alcohol misuse, to ask their adult children who still live at home for a contribution at all towards the rent. It is not clear whether the parent should be punished for the "sins" of the child.
Housing Benefit is a lifeline to people who are fortunate to have a job, albeit that when someone works they have to contribute 65% of the income they earn above means tested benefit rates towards their rent and a further 20% towards Council Tax. This could be seen as a deterrent to work, particularly in lower paid jobs.
Many clients have built up a way of life in an area and they need to continue to live there, perhaps they work, have family or have developed a support network. I know of a client who has to live in NW11, which is another high rental area, because his autism means that he would be confused and unable to deal with unfamiliar places. He needs continuity and reducing his entitlement would not enable he or his mother to stay in that area.
We would welcome the increased contribution by government towards the fund for Discretionary Housing Payments; however this payment is not a right but may be awarded at the discretion of a housing benefits officer. These payments have traditionally been for short periods of time and there is no guarantee of award either at first application or on renewal. It should not be seen as a replacement for entitlement. Historically, some of the barriers to people claiming benefits are that they are vilified and that they do not have a right to claim. It cannot be right to ask clients to take on tenancies with the commitment to pay rent when they do not know how much they will be able to pay or whether they will be able to meet the payment if the DHP is not awarded or renewed. Not only does this make it extremely difficult for people on fixed income to budget, but with possible changes to the amount of LHA payable on renewal claims it must make it difficult to achieve stability. This can only lead to a less favourable climate between landlords and tenants.
Another encouraging element is the proposal to include a room for a non-resident carer in the calculation to award LHA, but we would suggest that in situations where a couple need to sleep in separate rooms due to disability, those cases should be included. A colleague interviewed a client who was doubly incontinent and so she and her husband need to have separate sleeping arrangements. Currently they are only entitled to the LHA rate for a one bedroomed property as there are no other family members in the home.
A related matter of great concern involves security of tenure for people of working age. The proposal to restrict housing entitlement to the size of their family has been mooted. The thinking is to reduce under-occupancy of social housing. This appears to penalise people who rent a property, turn it into their home and decorate it investing time and money on the home and whereas they may currently enjoy a secure tenancy, this proposal could mean that that in future they could lose this. Should the state effectively be telling people who may have lived in a property for many years that they have to move because their family composition has changed, perhaps because of bereavement? We refer the committee to the examples given in this paper and ask that the future of people like the young man with autism and the couple who need separate sleeping arrangements are not penalised because their rent is too high for Housing Benefit/LHA to cover or because the couple are deemed only to need a one bedroomed property is not compromised due to a fallacious argument for economy.
If the proposals really are intended to safeguard the public purse, surely registering rents would be a more equitable means of doing so? It is difficult to imagine that landlords will reduce the rent on their property to let to benefit claimants and if rents are so high, many more people are going to have to claim Housing Benefit. As can be seen from the comments from the landlord-forum website, no distinction is made as to whether a tenant is working, merely whether s/he claims Housing Benefit and this feeds into the public criticism of benefit claimants.
Many colleagues have reported advising clients who have taken their own lives due to benefit being stopped, and Housing Benefit has been one of the benefits which has been a trigger for this. To people who are already marginalised, stopping their benefit does not encourage them to look for work, particularly in the current economic climate where jobs are scarce even for the best motivated. It merely increases the gap between the ‘haves’ and ‘have nots’ who are least able to help themselves. It must be clear then that in such times as these, funding high quality independent advice is more important than ever if we do indeed believe that we are all in this together and people who need to depend on benefits for however short a period are not made to feel like workless scroungers.
If we consider that clients have a right to family life, can these proposals comply with the Human Rights Act?
Maureen Arthur on behalf of NAWRA
6 September 2010
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