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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:
Raum · 31/03/2013 12:44

Council housing stock is poorly utilised and I agree with taking steps to improve it but the current policy is poorly thought out. The problem is how do we get people living on their own in two or three bed houses to agree to move? The system is abused as it is.

If I want another bed room in a house I buy I need to pay for it, families on in council houses who don't need that bed room should have to move so someone who does can make use. A blanket defence of claiming the tories are just cunts and against the poor is rather feeble though.

rhondajean · 31/03/2013 12:45

They already have that less choice though hw. I can choose to sell up and buy wherever I want. (kinda but you get the point!)

So when given a home, should people be allowed to make it their home or should it just be a roof as long as they meet loads of requirements?

You already see the misery caused by being in private let's all over the boards. People on six month tenancies, given contracts etc.

Still when you are busily preoccupied with keeping a roof vet your head and feeding your kids you don't have time to look at the bigger picture eh! Call me a cynic.

I have first hand experience of the impacts in that I'm on the board of an ha an I know how much we are already spending trying to help tenants with this and our projected impacts financially over the next few years, which will impact the service we can provide ALL tenants including those in suitable accomodation or paying full rent.

Also economically, where people are having to pay more out of their very limits benefits for rent, there is less to spend locally on other things (food etc) and spending slows up, shops will close etc. I cannot see how that will have a positive impact on the overall economy. And no it won't shrink the deficit ffs! The savings are minimal and the implementation costs exceed them.

HoHoHoNoYouDont · 31/03/2013 12:46

I understand people are scared by the whole Universal credit and monthly payment aspect but as far as the gov are concerned this is your notice to prepare. I suspect they expect you to start putting a little bit of cash away each week so you will be able to cope with the initial change.

And before anyone asks, I don't have a clue either where people who are already strapped for cash will magic up the 'extra' to put away.

But, I do agree with monthly payments and that in the long term it will work out better for most (not all) to receive benefits that way.

Dawndonna · 31/03/2013 12:47

And now, if these changes actually work and bring down the countries debts and spending I can guarantee you Labour won't change a thing if they get in. Their new moto will be 'if it ain't broken don't try and fix it'.
But it's been proven time and again that it isn't saving any money, it's costing more.

As for milking the system Viv benefit fraud is actually very low.

Leith I don't believe in forcing people to buy when they can afford it. I guess that though, is a discussion for another time.

JaquelineHyde · 31/03/2013 12:48

Aaah yet again another thread turns into a benefit bashing free for all, it warms the heart.

So avoiding the poor sods on benefits what about those who work for the housing associations that are going to lose there jobs when the HAs suddenly see a massive reduction in income and have to start cutting jobs to cover the short fall? Around 70% of a HA's income is made up from the households that are being hit the hardest.

More people having to claim benefits possibly? Hmm Yes, yes this well thought out plan is really going to work isn't it.

Viviennemary · 31/03/2013 12:49

Nobody knows whether or not UC will be abandoned. Not even Gideon himself I wouldn't be surprised. I just wish Labour had a better person in charge than Milliband. They need another John Smith.

Birdsgottafly · 31/03/2013 12:49

There is a big campaign across Liverpool\Merseyside urging people not to pay. It is what we (in Liverpool) did with the Poll Tax and that was successful. The tax doesn't effect me, but I've joined in the various protests. The campaign needs to go National and we need this tax to be abolished, it can be done. This Tory government doesn't have the stronghold that Thatcher and her government did and they had to do a re-think because of the will of the people. Luckily this government has shown its true colours straight off, we need immediate action before the country and our people are thrown into poverty, as it was in the Thatcher years.

rhondajean · 31/03/2013 12:50

Benefit fraud is massive outsized by unclaimed benefit.

Dawndonna · 31/03/2013 12:51

it's the fault of the poor

Birdsgottafly · 31/03/2013 12:54

Tory policies never save the money country, that it is not opinion, that is fact, read social policy books, rather than listen to opinions. What they do, do is make the rich. Richer (especially their personal friends and family) and cut the living standards of those on the bottom rungs of society's ladder.

Leithlurker · 31/03/2013 12:55

Could not agree more Dawn, but it was already brought up by someone else so I was answering it. No surprise that I also completely agree with your point re benefit fraud.

Jaqu: I again wholeheartedly agree with you, the laws of unintended consequences are indeed at play, but then since what the con dems want is another housing bubble to prop up the banks and to keep house prices artificially high I am not certain that it is an unintended consequence.

The one thing I would say about HA's though and I am not saying this is you or your employer, but from my experience HA's are doing a good job of sitting in the middle and doing lots of pathetic handwringing, bleating on about "How it's not fair", where as to my mind this is the time that they should be putting the good of their tenants first and saying that the changes will hurt people and also hurt the HA's

rhondajean · 31/03/2013 12:57

Another point.

The majority of HB goes to people in work.

If you are under occupied by the new rules, you don't lose 17% plus of your HB. You lose that from the total cost of rent.

Let me explain.

Rent is £100 a week. You get £15 HB and have one extra room.

You would lose £17 a week so the whole £15 is wiped out.

So it won't just hit the "benefit sroungers", it will hit those working in low paid jobs as well.

HoHoHoNoYouDont · 31/03/2013 12:57

I quite like the last para in that article re the bankers Smile.

moondog · 31/03/2013 12:57

Is it Rhonda?
Do you have some stats?

rhondajean · 31/03/2013 12:58

Leith, the sfha are doing a lot of research and campaigning around welfare reform.

Like I said, not too clued up on the English system though sorry.

rhondajean · 31/03/2013 13:01

Yes moondog.

Unclaimed benefits are 12-16 billion per year.

Top estimates for benefit fraud are 5.5 billion per year.

moondog · 31/03/2013 13:02

Have you got a reference for that Rhonda?

Leithlurker · 31/03/2013 13:02

Good point well made Rhonda, let me add to it by saying that a fair number of those low waged will be self employed people. Nail technicians, had dressers, plumbers, child minders, nannies, ebay sellers. In fact loads of people who will positively baulk at the idea that they are benefit scroungers. But since that is all we hear about that is what they will be forced to conclude they are. That will almost certainly stick in their minds the next time they are in the polling station.

itsallyourownfault · 31/03/2013 13:03

You moaners make me feel sick. You never want to pay for anything, contribute to your own living costs, be responsible for your own lives. Get off your backsides, fill one of the many thousands of vacant posts advertised today and pay for yourselves (and the hoards of kids you can't afford to support either). Why should you get to live in a house bigger than you need for free? This country is full of such entitled, lazy beggars.

Dawndonna · 31/03/2013 13:04

itsallyourownfault
April fools day is tomorrow, dear.

Leithlurker · 31/03/2013 13:05

Rhonda funnily enough it is Scotland I was thinking about, I am a tenant of one HA I have friends who are tenants of others. We have all got the same view that whilst campaigners are on the ground some, I grant you I cannot say all. HA's are sitting back and looking out for themselves.

rhondajean · 31/03/2013 13:05

All from bbc moondog. All on public record.

The governments actual estimate on benefit fraud is 1.2 billion so I gave the figures the benefit bashing campaigns use, that's the very top number I've ever seen for it.

HoHoHoNoYouDont · 31/03/2013 13:05

Has a bridge dweller just entered the room?

AThingInYourLife · 31/03/2013 13:07

Ha ha!

Good one, itsall.

You capture the idiotic cuntiness really well there. Nice touch with the misuse of "hoard" - it's a common mistake amongst the badly educated, spiteful morons who support this kind of policy.

Nice work :o

Leithlurker · 31/03/2013 13:07

Ah the careing face of conservatism, or is it the true face of ukip, do tell us all your, who it is that you wish was imposing workhouses on us poor feckless people.