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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 · 02/04/2013 11:48

so social housing is built too large for what people need.

this is why govt should stay well away from building houses.

private ll have small properties. because they know private renters can only afford small.

pollypandemonium · 02/04/2013 11:49

Bollocks! Compensated for being allocated a roof over them!? Get REAL!

They are allocated a roof over them that they have to pay for. If the government thinks that if a property is too large they should pay more, it is logical therefore that if a property is too small they should pay less.

As I have said endless time before, council housing should be means tested.

They should also never be sold off.

Then there would be plenty of money and housing stock.

PeneloPeePitstop · 02/04/2013 11:49

I work damn hard for the money I get. 24/7 no holidays or breaks, and yet if the local authority was to do my job for me it would cost them twelve times as much as all the benefits I receive (including the kids' DLA).

I am a cost effective option. Therefore I won't be treated like scum. I've sacrificed mental and physical health to save taxpayers' money.

Yet you won't engage with that debate, I notice.

As I said before shows just how weak your argument is.

CouthySaysEatChoccyEggs · 02/04/2013 11:51

Faster - just to point out, insomnia combined with a child with ADHD means that that child has little awareness of risk, and will often climb up a bookshelf and jump off, this waking the other child. Or a child with Autism that also has insomnia - these children aren't quiet while they are awake in the night.

Which disturbs the OTHER child's sleep.

Some of these children with 'insomnia' might actually hurt their sibling if they were left unsupervised overnight in the same room.

The person caring for that child needs to sleep too - therefore they need a SAFE environment for both the child with 'insomnia' and for their other child.

But don't let facts get in the way of punishing people...

expatinscotland · 02/04/2013 11:53

That is true, Cecily, and something government ministers did not consider because of course, why would they bother to examine what stock is truly out there? We are not affected by the reduction, because we do not claim HB, but we are a family of 4 in a 4-bed, 1st floor maisonette (it was allocated when we had 2 daughters and 1 son, but 1 of our daughters died a couple of years later). In this area, two of them were empty because people wanted houses with gardens and there were two homeless families with 2-3 children each in the homeless flats in this building who are holding out for houses or ground floor flats with outdoor space. They don't want the stock that is on offer.

expatinscotland · 02/04/2013 11:54

'so social housing is built too large for what people need.'

Um, no, it is that people want a house rather than a flat. There was a post on here last week from someone with 4 DCs in a 3bed flat who complained they were 'forced' to take the flat after 2 years in homeless accommodation and wanted a house.

FasterStronger · 02/04/2013 11:56

couthy - I haven't mentioned insomnia, but thanks for the info Grin

CecilyP · 02/04/2013 12:04

^so social housing is built too large for what people need.

this is why govt should stay well away from building houses.^

If that is in reply to my post, that is not actually true. The estate that I lived on was started in the late 60s and originally rehoused families displaced from an estate of prefabs. The sizes of families who needed them then would have been taken in to account. The first tenants in my flat had 6 children!

When they were built, the flats would have seemed desirable, and even slightly luxurious compared to the prefabs and older council houses. Families would have wanted to move into them and stay in them. As new houses were built and older houses refurbished, the flats became less popular and would be allocated to first time tenants - typically couples with one child who may or may not go on to have more. If they were good tenants, they could go on the transfer list for a house, leaving their flat/maisonette for another small family.

FasterStronger · 02/04/2013 12:04

expat - on this thread, posters have mentioned various people who wanted smaller property having to take a larger one as that was all that was available.

this only happens with social housing.

VictorTango · 02/04/2013 12:05

Does anyone know what happens to children aged 18 living in a council house with their parents?

Are they allocated a room each?

undercoverSAHM · 02/04/2013 12:06
  1. When a council lets a home for less than the market rent, this is a subsidy. Perhaps that would be clearer if the councils charged a market rent and then paid free money to the tenant equal to the current subsidy. That is economically identical to what is happening. The government is simply reducing the amount of free money for claimants in houses that are too big for their basic needs. It is right that taxpayers money is spent carefully. There is no social contract that makes it fair for taxpayers to subsidise people's spare bedrooms when they don't necessarily even have one of their own.
  1. When the 85,000 one bedroomed homes (or however many there are) are all gone, THEN people can justifiably complain about being asked to downsize to places that are not available.
  1. It's harsh to take a cut in a subsidy you have become used to but the alternative is worse. The alternative is for the country to gradually bankrupt itself to the point where we cannot pay any benefits or pensions at all (or buy drugs, or pay public sector workers, or import food etc).
  1. Nonetheless the vulnerable should be protected and it seems like that is to happen for those needing extra rooms for disability related reasons and those too old to work ie pensioners ( although personally I am not sure why they have a right to stay in a too big house at my expense just because they have always lived there whilst at the same time there are young families living in very cramped housing).
FasterStronger · 02/04/2013 12:07

Cecily - have you ever heard anyone not in receipt of social housing say they had to get a larger property than needed as it was all that was available?

Dawndonna · 02/04/2013 12:10

undercover the whole point is, it isn't happening. There are disabled people being targetted for having too many bedrooms. Hmm

IneedAsockamnesty · 02/04/2013 12:10

Flatbread.

Providing support throughout the night is fuck all to do with the state. Why on earth would you think it is.

Do you think parents don't have to risk asses and safeguard.

The reason I would ask that question would be because the answer would give you a very easy way of working out that if the parents have needed to provide additional support to that child at night time then the needs are higher than a child who can get sent to bed and stay there all night.

I think your the one who assumes over reliance on the state given that I didnt even imply any thing to do with it.

Dawndonna · 02/04/2013 12:10

Oh, and there are not enough properties for downsizing.

CouthySaysEatChoccyEggs · 02/04/2013 12:11

Hahahahaha Skinny.

£2 a week bedroom tax?! You really ARE blinkered, aren't you?!

An average HOUSING ASSOCIATION (I.e. not full market value, roughly 80% here) 3-bed rent is £160 a week.

The 'Bedroom Tax' is a reduction of 14%, or £22.40 of that if you are classed as having one 'spare' bedroom - which may not, as evidenced above, actually BE 'spare', if it is for someone with a disability, their equipment, a lift, or numerous other things.

If you are classed as having two 'spare' bedrooms, that rises to a 25% reduction, a massive £40 a week.

And remember, 2/3 of the people affected have a disabled family member, sometimes more than one with disabilities.

I am not going to be affected by this bedroom tax. But I know lots of people that will be.

One of them is my friend whose severely Autistic son attends residential school during term time. She either has the choice to pay the top up, or not have a bedroom for him when he is at home during the holidays, as he is not classed as 'ordinarily resident'.

How many people would not want their 11yo DS to come home during the holidays and at weekends?

This poor woman, unfortunately, also has a DD with quad CP. Who is using their dining room as a bedroom. Because this now classes as an extra bedroom (irrespective of the fact that she can't carry a 15yo upstairs), this woman will now be classed as having TWO 'spare' bedrooms.

She will have to pay £40 a week to keep the home that is already adapted for her DC's disabilities, and that she NEEDS the rooms.

THIS is the reality of the 'bedroom tax'.

Penalising those already pushed beyond limits of endurance.

Yet this is meant to be a 'civilised' society.

She might get help from the DHF here and there, but she has been told NOT to rely on that money, as they have far more people to help than funds to actually help, and they need to share it fairly...

PeneloPeePitstop · 02/04/2013 12:12

I disagree with the subsidy point. What is happening is that private rents are vastly over inflating 'market' rent.

Former social rents covered costs and were not for profit, making the rents more 'real' and not at all subsidised.

What has happened now is that the government is rocking housing associations to set their rents at 30% below market rents (remember these are vastly inflated) so they do make profit. The thinking being that those profits should go into building more social housing.

Only that doesn't appear to have happened. It has increased the housing benefit bill, though.

VictorTango · 02/04/2013 12:15

If 18 years old are entitled to a room each then a family with 3 adults teens (18+) all able to work and contribute, could live in a 4 bed house and they wouldn't be targeted under this rule.

That hardly seems fair given the people that will be hurt by this rule eg the disabled.

Am I correct in thinking this?

PeneloPeePitstop · 02/04/2013 12:15

Prior to receiving our reprieve from bedroom tax on severe disability grounds our 14% would have been £30.78 a week. Not a couple of quid, certainly not on £58 a week Carers allowance.

Once again this is due to the 'affordable' rents now being charged.

CouthySaysEatChoccyEggs · 02/04/2013 12:18

Because it's sooo easy for those on just £71 a week to cover that 14% rise in gas bills, or the 8% rise in electricity bills (which, incidentally became 11% if you are on a card meter).

Yes, they are getting a 1% rise. But 1% of £71 is 71p. You ACTUALLY begrudge someone on benefits getting a 71p rise?!

You can't argue with people who are begrudging a benefit rise of less than £1 a week. They have NO insight.

Anifrangapani · 02/04/2013 12:19

Undercover - it isnt a subsidy because the government takes first charge in disposal. Grant is treated as debt, just like a mortgage.

Housing needs surveys, waiting lists and demographic data are used to estimate what housing will be required in the future. The housing associations, local government and central government work very hard to match supply. If they data says that there is a surplus of a particular type of housing it is harder to get funding. Unfortunately the underlying affordable homes programme assumptions and current allocations pre date the benefit reform.

FasterStronger · 02/04/2013 12:19

so if private LLs are making large profits, what percentage does anyone think they are making?

how much should they make?

skinnywitch · 02/04/2013 12:22

But they are getting valuable work experience couthy which will be a benefit to them.

CecilyP · 02/04/2013 12:23

So sorry for your loss, expat. I never thought of that as a reason why people may live in larger accommodation than they need. I do agree that there seems to have been no consultation whatsoever with local authorities who will now be responsible for administering this mess.

PeneloPeePitstop · 02/04/2013 12:24

I'm not saying they're all creaming it in - there is a contingent that do - but rents are vastly inflated and some of that is due to obscene house prices. BTL landlords' lenders insisting that the rent is set at 130% of mortgage as a condition of loan, for example.

Once that set the level then yes the greedy arses piled in. Of course they would. Pigs with snouts firmly in the trough.

This is why housing - a basic need for all - should not be a commodity.