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Bedroom tax will be costly disaster, says housing chief

999 replies

vivizone · 31/03/2013 06:51

I don't understand how they can implement it. When a council tenant signs the tenancy agreement, if bedroom tax is not mentioned, is it not illegal to implement it at a later date?

I don't see how it is enforceable. Let's say a tenant refuses to pay/can't pay. They then get evicted - wouldn't the council still be obliged to house them after eviction, especially if they have children?

The whole thing is a mess. Why so many changes all at the same time?!

www.guardian.co.uk/society/2013/mar/30/bedroom-tax-disaster-housing-chief

Cost-cutting policy will push up benefit bill, cause social disruption and create widespread misery, say critics

Ministers came under new fire over benefit cuts last night as the independent body representing 1,200 English housing associations described the controversial bedroom tax as bad policy and bad economics that risks pushing up the £23bn annual housing benefit bill.

David Orr, chief executive of the National Housing Federation, said the tax would harm the lives of hundreds of thousands of people. It comes into force this week alongside a range of other tax and benefit changes.

"The bedroom tax is one of these once-in-a-generation decisions that is wrong in every respect," he said. "It's bad policy, it's bad economics, it's bad for hundreds of thousands of ordinary people whose lives will be made difficult for no benefit ? and I think it's about to become profoundly bad politics."

His intervention came as opponents launched nationwide protests against the tax, which will hit 660,000 households with each losing an estimated average of £14 a week.

Crowds gathered in London's Trafalgar Square yesterday to protest against the measure, and simultaneous protests were being held in towns and cities across the UK. One protester, Sue Carter, 58, from Waltham Forest, told the Observer: "I'm a working single parent with a tiny boxroom and now I'm faced with the choice between food, heat or paying the bedroom tax. People have looked after their homes, improved them ? why should they be turfed out?"

Under the scheme, which is introduced tomorrow, people in social housing with one spare bedroom will have their housing benefit cut by 14%, while those with two or more unoccupied rooms will see it slashed by 25%.

Ministers say the tax, which David Cameron calls the "spare room subsidy", will encourage people to move to smaller properties and save around £480m a year from the spiralling housing benefit bill. But critics such as the National Housing Federation (NHF) argue that as well as causing social disruption, the move risks increasing costs to taxpayers because a shortage of smaller social housing properties may force many people to downsize into the more expensive private rented sector.

The federation's warnings came as charities said the combination of benefit cuts and tax rises coming in from this week will amount to a £2.3bn hit on family finances.

Labour said analysis of official figures showed average families would be £891 worse off in the new tax year as the changes ? including those to tax credits and housing benefits ? begin to bite.

Research by the NHF says that while there are currently 180,000 households that are "underoccupying two-bedroom homes", there are far fewer smaller properties in the social housing sector available to move into. Last year only 85,000 one-bedroom homes became available. The federation has calculated that if all those available places were taken up by people moving as a result of the "bedroom tax", the remaining 95,000 households would be faced with the choice of staying put and taking a cut in income, or renting a home in the private sector.

If all 95,000 moved into the private sector, it says the cost of housing benefit would increase by £143m, and by millions more if others among the remaining 480,000 affected chose to rent privately.

As well as the move on spare bedrooms, council tax benefit will be replaced from this week by a new system that will be run by English local authorities but on 10% less funding. Pensioners will be protected under the changes but, as a result, it is feared there will be a bigger burden on poor working-age adults. Restrictions on the uprating of a number of welfare payments will also hit millions of households, homelessness charity Crisis has warned.

Chief executive Leslie Morphy said: "Our poorest households face a bleak April as they struggle to budget for all these cuts coming at once. People are already cutting back on the essentials of food and heating but there is only so much they can do.

"The result will be misery ? cold rooms, longer queues at food banks, broken families, missed rent payments and yet more people facing homelessness ? devastating for those directly affected, but bad for us all."

A Department for Work and Pensions spokesman said: "Our welfare reforms will improve the lives of some of the poorest families in our communities, with universal credit simplifying the complex myriad of benefits and making three million people better off. And by next year, we will have taken two million of the lowest earners out of paying tax altogether."

Crisis argues that homelessness is set to rise dramatically. This winter has already seen a rise of 31% in the numbers of rough sleepers across the country and a 20% rise in people seeking help with homelessness from their local authority in the past two years, according to Crisis.

ChartiesCharities are also concerned that the government-funded network of homelessness advisers in England is to be scrapped. The team of regional advisers and rough sleeper and youth specialists which have provided councils with expert guidance on meeting statutory homelessness duties since 2007 will be disbanded just as the bedroom tax comes in. Also being scrapped are the crisis loans and community care grants which provided a lifeline for people in financial crisis who needed essentials when moving to a new home.

Shadow chancellor Ed Balls said: "This is the week when the whole country will see whose side David Cameron and George Osborne are really on and who is paying the price for their economic failure."

OP posts:
FasterStronger · 01/04/2013 11:12

retro Making long term private renting more secure and affordable would mean less need for social housing.

how do you make LL want long term lets for less money?

Raise the NMW so people can afford to live without claiming.

which will lead to inflation and/or higher unemployment.

there are not simple solutions.

FasterStronger · 01/04/2013 11:14

actually politicians never say 'we don't have much control over what happens in the UK' which is probably closer to the truth than most things they say.

retrorita · 01/04/2013 11:18

'how do you make LL want long term lets for less money?'

The landlords in Europe seem to cope OK. Long term lets are standard there.

As far as the NMW wages goes, you are either going to have to top wages up through the benefit system (CTC, WTC) or you are going to tell business to pay a fair wage.

expatinscotland · 01/04/2013 11:18

Sex offenders are exempt (and, again, this government is so clueless they think everyone can take in a lodger when many councils and HA forbid this practice of their tenants).

here

retrorita · 01/04/2013 11:22

At the moment the benefit system is propping up an economy where LL's get rich from over priced rents and a NMW which people cannot live off.

This is what isn't sustainable.

Most people want to go work and pay their rent without claiming penny. There is something very wrong with the economy when this isn't possible.

lottieandmia · 01/04/2013 11:32

'Who ever said this was a bedroom "tax". Despite a lot of things being called "tax" these days, you can only really be taxed if you have some sort of income you earned for yourself.'

Rubbish - everyone pays 20% VAT, everyone has to pay road tax.

momma39 · 01/04/2013 11:35

if you HAVE to move will the council help with moving costs I dont think so.
Moving house is one of the most stressful things you can do why should this be inflicted on people who are most likely settled near family and friends, schools etc.
my heart goes out to everyone who is forced to move, I for one think this tax is bloody stupid, remember the people tax when each adult living in the house had to pay the local council tax ha ha that didnt last long.

lottieandmia · 01/04/2013 11:41

I am sick of hearing Tory MPs on the radio saying this bedroom tax is in the interest of fairness so that people can have houses suited to their means when they are doing nothing to help people move into a smaller house or swap with someone who needs a bigger house. The reality is that if you live in social housing with more rooms than you need you can't just move to protect yourself because there isn't anywhere to move to.

So all that is happening is that these people suddenly don't have enough money to eat or heat their homes because their HB has been cut.

retrorita · 01/04/2013 11:43

There will be a lot of homes up for exchange in the near future I should imagine.

IneedAsockamnesty · 01/04/2013 11:45

Lottie.

It gets me as well. Because they can only define need by sex and amount of people as well as age and that's it.

lottieandmia · 01/04/2013 11:46

'Why, why prey tell has the expenses system also purchased homes for MPs, and still does, at the expense of the taxpayer?'

Exactly, oh it's fine for MPs to cream off thousands for things they don't actually need but for not for poor people to expect help in what is supposed to be a civilised society? I really do not understand the way some people think. Or why they are so sure that they themselves are immune to needing state support.

IneedAsockamnesty · 01/04/2013 11:47

There are already thousands up for exchange but its rare to find one that you can downsize to.

That's been the case for years.

retrorita · 01/04/2013 11:49

That's true Sock. And even less people will be looking for swap their smaller homes for bigger ones now.

infamouspoo · 01/04/2013 12:00

'Is that what a government is really supposed to do?'

What IS a Govt meant to do? I always thought we voted in representatives for ourselves so all 50 million of us didnt have to have a big debate. They debated for us on how we'd like the country run so we had a civillised functioning society, as opposed to, say, a dictatorship or medieval serf system. So technically the Govt is US.
So we all pay into a pot, via taxation, to make this society run smoothly, via roads, education, healthcare etc. Our representatives debate ourwishes and off it goes.
What we seem to have though, is a bunch of self interested knob ends bribed by corporations and banks, ignoring people. People hating on people and not wanting to pay tax for safety nets and a civilised society and claiming it isnt the Govt's job to help. Yes it is. Thats why we voted 650 people to represent the 50 million in the 'tribe' because we can no longer sit down on a tribal level and work out whats best for the tribe. When you forget about people you end up with poverty, more crime, lawlessness and back to the Lords in the manor and the serfs. We didnt like that the first time.

lottieandmia · 01/04/2013 12:13

'Fewer people will be looking to swap their smaller homes for bigger one'? Yes I am sure there are just loads of people trying to get into a house with rooms they don't need that they can't afford to heat(!)

retroria, what exactly is your point? The people this cut will affect are those whose children have moved out leaving them with rooms they don't need. Or people who do need an extra bedroom but suddenly that's ignored - like a man talking about his experience in my local news. He has shared residency of his dd and she lives with him 14 days a month, but now he apparently isn't entitled to a 2 bedroom flat.

retrorita · 01/04/2013 12:18

I was following on from Socks point that its rare you can find a home to downsize to.

My point was that now it will be even harder as less people will want to exchange their 2 bed for a 3 bed.

My point is, where are all these smaller homes going to come from?

Read the thread. Try to understand the posts before jumping down peoples throat eh lottie?

expatinscotland · 01/04/2013 12:19

'The people this cut will affect are those whose children have moved out leaving them with rooms they don't need.'

No, those people are more than likely not affected because anyone age 61 or over is exempt from this policy. And yet, they are the greatest proportion of under-occupiers. So there will be no glut of houses up for exchange, because a) the most significant group of under-occupiers are exempt b) there is nowhere to downsize to.

Newcastle has thousands affected by this policy and only 50 1-bed homes available.

lottieandmia · 01/04/2013 12:24

I'm not jumping down anyone's throat. I feel it's most unlikely that someone struggling to make ends meet would want a house with more rooms than they need because this affects the costs of running that home.

FasterStronger · 01/04/2013 12:24

surely more people wanted to swap up than down?

because before the bedroom tax there was no incentive to downsize?

lottieandmia · 01/04/2013 12:25

expat - I agree but there are still people in their 40s and 50s whose children will have grown up and moved out.

retrorita · 01/04/2013 12:29

I don't understand your post Faster?

In the past, a family with two children under ten may have to looked to exchange a two bed for a three bed so the dc could have a room of their own. Now they won't do this as they will have to pay for the extra room.

In my area you have always been paid for downsizing. My MIL received money from the council for exchanging her 3 bed for a 2 bed.

So the situation is worse now. Those with two beds will sit tight and where do the people with 3 beds that now need 2 beds go?

expatinscotland · 01/04/2013 12:30

'surely more people wanted to swap up than down?'

Um, no, because many in those 1 and 2 bed homes are disabled and have had the property modified, or they are older or single.

FasterStronger · 01/04/2013 12:31

expat - but in Newcastle there are lots of private 1 bed properties to rent. I just checked on Rightmove

expatinscotland · 01/04/2013 12:31

'In the past, a family with two children under ten may have to looked to exchange a two bed for a three bed so the dc could have a room of their own. Now they won't do this as they will have to pay for the extra room.'

And now, too, the HA and council will not approve such exchanges.

expatinscotland · 01/04/2013 12:32

'expat - but in Newcastle there are lots of private 1 bed properties to rent. I just checked on Rightmove'

And they are all willing to take DSS tenants, Faster, surely.

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