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Posted on 7 July 2010 at 2:18 GMT

Housing benefit cuts - increasing homelessness

The budget changes to housing benefit will make the mass of working and middle class people far more insecure in their homes.

The idea that 'an Englishman's home is his castle' clearly doesn't impress George Osborne!

Paul Kershaw

Housing benefit will now be capped at a maximum payment of 340 a week for a three-bed house and 400 a week for a four-bed house.

Changes in the calculation of Local Housing Allowances (LHA) will add a further squeeze. Much publicity has been given to certain cases where high levels of payments have been made under the current system.

Grant Shapps, the housing minister, has been forced to admit that these cases are rare.

Of course high rents mean that it's the landlords who benefit massively. The housing charity, Shelter, shows the real picture, pointing out that "nearly half of LHA claimants are already making up a shortfall of almost 100 a month to make up their rent.

If this support is ripped out suddenly from under their feet it will push many households over the edge, triggering a spiral of debt, eviction and homelessness".

Shelter also explains that, as a result of Osborne's budget, some people will lose as much as 40% of their total rent.

The reality of the budget proposals is an intensification of 'social cleansing' in which the poor are pushed out of 'desirable' or expensive areas like central London.

Sue Witherspoon, head of housing at Havering council, points out that several London authorities have no private rents below the cap.

As she says: "the implication for a [cheaper outer London] borough like Havering is that we will have a flood of people moving in because of the lower costs.

It will lead to a ghettoisation of benefit claimants" (Inside Housing). For all the misery they will cause, the caps will only 'save' 70 million. The biggest saving (490 million according to the 2010 Budget Red Book Policy Costings p41) will come from restricting working age entitlements in the 'social sector' (council housing and housing associations).

People occupying a property the government thinks is too big will have to make up the difference or move.

During the election campaign the Tories denied that they would attack security of tenure in social housing, knowing that this would provoke a furious response, but this change threatens to turf many long-term tenants out of their homes.

From April 2013 people on Jobseeker's Allowance (JSA) for over 12 months will get a 10% reduction in their housing benefit payments.

This will hit the 200,000 single, childless claimants hardest. Presumably they will have to find the difference out of their weekly JSA payments of 65.45 for over 22-year olds, which are also being squeezed!

Shapps has told the BBC that the changes target people "choosing not to work as a lifestyle choice".

But unemployment isn't going up as a new 'lifestyle choice'. Nationally there are five JSA claimants for every one job available. Shapps and his government's cuts will make this worse, if they get away with it.

Unemployed homeowners will be hit too. The rate at which support for mortgage interest is paid will fall from the current level of 6.08% to the Bank of England's measure of an average mortgage rate from October this year.

It is true that interest levels are currently low but the people most likely to be experiencing difficulty, people with subprime mortgages, tend to be paying well over the average rate.

House building

A record 4.5 million people are on housing waiting lists, according to the National Housing Federation (NHF), and 2.6 million are living in overcrowded homes including a million children.

The NHF estimates that if, as the Institute of Fiscal Studies suggest, the housing budget is cut by a third, 142,000 planned affordable homes will not be built in the period leading up to 2020.

That would add 354,000 people to housing waiting lists. It would also result in 212,000 jobs going in construction and related fields.

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Related links:

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triangleSurrey firefighters to ballot on Christmas industrial action

triangleUnite against terrorism, racism, war and austerity

triangleTata announces 1,000 job cuts - Steel unions must fight for every job!

triangleEnd council cuts now, to end Tory austerity!

triangleCarmarthenshire union demands no-cuts budget

Housing:

triangleBirmingham South East Socialist Party: Socialist answers to the housing crisis

triangleClimate change election debate - Corbyn offers best green solutions but needs to go further

triangleUnite housing branch supports stand of Enfield councillor

triangleEast London Socialist Party: Election 2019 - fighting for housing for all

Homelessness:

triangleUnsafe, unaffordable housing scandal

triangleLabour launches homelessness campaign

triangleThem & Us

Budget:

triangleCouncil seeks to take budget deficit out on school staff and pupils

triangleLeicester: No-cuts budget only way forward

Claimants:

triangleFraudsters thrive and claimants suffer in despicable Universal Credit scam

JSA:

triangleDWP to outsource more work to Capita

Housing benefit:

triangleHousing arrears double, suicide risk soars - scrap Universal Credit!

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