Category Archives: Housing

MP Criticises Lack of Action Over Child Poverty in Aberdeen

Dame Anne criticises lack of action over child poverty in Aberdeen as recent figures show 18% of children in Aberdeen grow up in poverty.

Aberdeen South MP, Dame Anne Begg, says that only Labour’s plans to tackle the cost of living will help reduce child poverty in Aberdeen.

The release of the child poverty map by the Campaign to End Child Poverty showed that 18 per cent of children in Aberdeen are living in poverty after meeting housing costs. This is on the back of recent news that unemployment in Aberdeen South is 1 per cent.

Commenting on the report Dame Anne said: “Despite unemployment in Aberdeen South sitting at one percent, children are still living in poverty. We have an acute housing shortage, energy bills soaring, and jobs aren’t paying enough.

“We face the biggest housing crisis in a generation and both Tories in Westminster and Nationalists in Holyrood are letting children down.

“The Tories always say work is the best route out of poverty, but we can see in Aberdeen that simply isn’t the case.”

Dame Anne went onto criticise the Scottish Government: “The SNP have failed to use the measures open to them to mitigate the impact of Tory policies like the bedroom tax.  The SNP have refused to use all the Scottish Welfare fund and the fuel poverty budget, at a time when 900,000 households are in fuel poverty.

“Labour has endorsed the comprehensive plan set out by Sir Michael Lyons Housing Review, the first of its kind in a generation, which shows how Labour will meet their commitment of building 200,000 homes a year by 2020 and sets a course for doubling the number of first-time buyers by 2025. Labour will also increase the minimum wage, and freeze energy bills.

“Only Labour has a plan to tackle the cost of living crisis and help lift children out of poverty in Aberdeen.”

Increasing Number of Working People in Aberdeen Claiming Housing Benefit to Pay Soaring Rent

Today, Dame Anne Begg MP criticised the Scottish and UK Governments for failing to tackle the huge increase in working people claiming Housing Benefit in Aberdeen.

Since 2010, the number of working people claiming housing benefit has increased by 53 per cent across Scotland, costing Scottish taxpayers an extra £256 million. In Aberdeen alone, the number of working people now claiming housing benefit has increased by a staggering 64 per cent.

Dame Anne said “Working people are now on average £1600 a year worse off as wages have fallen while prices have soared. Many people in work can’t get the hours they need, while soaring rent is pushing the cost of housing ever higher.

“The Scottish Government say nothing can be done unless we get a Yes vote, but we know they have the power to build housing now. Instead they put Scotland on hold as they push for separation and it is hard working families who are paying the price.

“The UK Government is equally to blame, saying that ‘work is the best way out of poverty’ yet we know that 52% of families living in poverty have at least one adult in work.

“More must be done to build more houses, and that’s why I’m proud that Labour has committed to building 200,000 houses a year by 2020. Helping to tackle the cost of living crisis and in the process, reduce the benefit bill.”

Vulnerable people suffering as result of housing welfare reforms

Reforms to the support provided for housing costs – including the Bedroom Tax and the household Benefit Cap – are causing financial hardship to vulnerable people who were not the intended targets of the reforms and are unlikely to be able to change their circumstances in response, say the Work and Pensions Committee in a report published today.

The Bedroom Tax is having a particular impact on people with disabilities who have adapted homes or need a room to hold medical equipment or to accommodate a carer. The Committee recommends that anybody living in a home that has been significantly adapted for them should be exempt from the Bedroom Tax.  The Report further urges the Government to exempt all households that contain a person in receipt of higher level disability benefits (DLA or PIP) from the Bedroom Tax.

Commenting Committee Chair, Dame Anne Begg MP, said:

“The Government has reformed the housing cost support system with the aim of reducing benefit expenditure and incentivising people to enter work.  But vulnerable groups, who were not the intended targets of the reforms and are not able to respond by moving house or finding a job, are suffering as a result.

“The Government’s reforms are causing severe financial hardship and distress to vulnerable groups, including disabled people. Discretionary Housing Payments (DHPs), which local authorities can award to people facing hardship in paying their rent, are not a solution for many claimants. They are temporary, not permanent, and whether or not a claimant is awarded DHP is heavily dependent on where they live because different local authorities apply different eligibility rules.

“Using housing stock more efficiently and reducing overcrowding are understandable goals.  But 60-70% of households in England affected by the Bedroom Tax contain somebody with a disability and many of these people will not be able to move home easily due to their disability. So they have to remain in their homes with no option but to have their Housing Benefit reduced.”

The report can be read in full here: http://www.parliament.uk/business/committees/committees-a-z/commons-select/work-and-pensions-committee/news/support-for-housing-costs/ 

Housing Costs in a Reformed Welfare System

The below article written by Dame Anne Begg MP appeared in this month’s edition of  24 Housing.

Because housing costs form a large part of any household’s budget they also figure large in the benefits system.  It is not surprising, therefore, that a government who wishes to make huge cuts to the cost of welfare has turned its attention to Housing Benefit to realise some of these savings.  Over the past 4 years there have been many changes to the amount paid to tenants to help with their housing costs, in both the social and private rented sectors.  Which is also why the current inquiry of the Commons Work and Pensions Committee entitled “Housing Costs in a Reformed Welfare System” is important.

The UK social security system is often criticised for being overly complex and contains various disincentives to work.  That is why both the last government and this have attempted reforms of the system aiming to “always make work pay”. The last Labour government’s solution was the introduction of Tax Credits while the Coalition government is staking its reputation on a wholesale reform of working age benefits by consolidating most of them into the Universal Credit.

However, once you factor in housing costs the tapers which are meant to smooth the transition from benefit to work don’t always work effectively, especially in areas with high housing costs.  That’s because in this country we calculate the level of housing benefit based on the actual cost of housing in different parts of the country, not a flat rate depending on the size of your household.

What identical families living in different parts of the UK can receive towards their Housing costs can vary by as much as £1000 per month depending on whether they are in a private rent, receiving Local Housing Allowance in Central London or rent a Council house in deprived area in the north of England. Therefore the work incentives, or lack of them, can vary hugely.

The government’s reforms have been a rather blunt instrument and are only beginning to make themselves felt.  The changes to LHA introduced in 2011 only applied to new private sector tenants  or once existing tenants tenancy agreement came up for review, so the impact wasn’t immediate.  As more tenants face a shortfall between what they receive in benefit and their rent, the larger their arrears grow.  This means fewer private landlords are willing to take tenants who are benefit claimants which, in turn puts pressure on the social rented sector where there is already a shortage of properties.

The shortfall between HB received and level of rent is being replicated in the social sector with the introduction of what has become known as the “bedroom tax”.  If the policy had worked perfectly, the government’s own impact assessment shows that there would have been no savings.  Those in homes deemed too large would simply move to smaller properties freeing up the larger houses for those overcrowded, who would then qualify for more HB.  But we don’t live in a perfect world.  Councils and Housing Associations have not been building 1 bed properties for years so the smaller houses don’t exist in sufficient numbers. At the moment few are moving house, preferring to subsidise their housing from their other benefits.  However, the crunch can’t be far off as this is not sustainable for most households in the long term.

There has been an enormous outcry against the “bedroom tax”, even amongst those who believe that the government is right to be cutting the benefit bill.  I think this is because it is seen as being unfair.  It is not floor size, or bed spaces which are the determining factors, but bedrooms regardless of how small they might be.  Many of the government’s own backbenchers believe that disabled people living in houses specifically adapted for them are exempt.  They aren’t. They have to apply for the temporary Discretionary Housing Payment (DHP) to make up the shortfall. A married couple who can’t share a room because one or both of them has a disability are not exempt either.  Nor are households where it is a family member who is the full time carer.

For these households, moving is not an option, nor is increasing their income by working. So the government will have to keep paying out DHP so it makes sense that such households should be exempt.

There are a number of cases where it might even be costing the government more.  Apart from in London, many of the people who have been caught by the Benefits Cap are in temporary accommodation, which by its very nature is more expensive.  Of course some of them are in temporary accommodation because they have been evicted from their cheaper accommodation because of rent arrears caused by the government’s reforms!  A one bed private rent is likely to cost more than a 2 bed Council house but a tenant will qualify for full benefit for the more expensive tenancy, but not for the cheaper one.

All this, and I haven’t even mentioned how things might change with the introduction of Universal Credit.  Lots, then, for my committee to get their teeth into.

Dame Anne Begg MP

Chair of Work and Pensions Select Committee

16th January 2014