Bedroom Tax – Is there 160,000 more affected?

The Bedroom Tax – The numbers just don’t add up.

If you have ever read any of my posts you will know I like numbers.  2 and 2 always equals 4 unless you are a typical politician when it equals 5 or if you name is Iain Duncan Smith and it equals minus 387,223 or plus 928,761.

So how many are affected by the bedroom tax and the benefit cap then?  That should be easy but it is not.  Worryingly it is a distinct cause for concern as I now explain.

Two days ago I put out a post about Coventry City Council saying the tenant could not appeal the bedroom tax decision.  What many will have missed in that post is the numbers.  A councillor there who is the chair of the welfare reform scrutiny board said in official minutes that 2552 in Coventry are affected by the bedroom tax.  The NHF breakdown by constituency says it is 2945.  The head of the Council’s HB team in a presentation on Coventry’s website says it is 3,200.  The local newspaper reporting on the Council apology say it is 3,000. So which figure is right? The difference between the Council’s official figure and the HB managers figure is a whopping 25% and 648 households in number.

Liverpool is another example and even worse and very worrying as the table below shows with the Council apparently underestimating the numbers by 1315 households or over 3,000 men women and children using 2.4 per household!

Constituency

CLB No:

NHF No:

Variance

Garston *

1484

1616*

132

Riverside

2637

2920

283

Walton

2399

2473

74

Wavertree

1262

2352

1090

West Derby

2583

2319

-264

TOTALS

10,365

11,680

1,315

Liverpool has 5 parliamentary constituencies as above and the National Housing Federation released figures of the numbers affected by constituency.  These are the ‘NHF No’ column above and they appear very reliable figures on a national scale as they total 659,987 and the DWP figure is 660,000 – a variance of 0.002%.  The preceding “CLB No” figures were released from Councillor Louise Baldock in Liverpool and are internal Council figures.  The difference is very significant with the NHF figures having 1,315 more households affected.  So the internal Council figures cannot be reliable.

Only the Liverpool Walton figure with a variance of 74 families comes within a 3% variance which even then is not really acceptable and Luciana Berger the MP for Liverpool Wavertree will be very concerned at the 46% variance between these two figures.  Is Liverpool City Council working on the basis there are 1090 fewer households affected by the bedroom tax in her Wavertree constituency than the actual number?

Liverpool City councillors have often used a figure of ‘about 11,000’ affected at public speeches and I accept that exact figures are difficult as the original government figure of 660,000 was from June 2012 almost a year ago and also because the Garston & Halewood constituency has 8 wards of which only 5 are in Liverpool and the other 3 being in neighbouring Knowsley Council.  Yet a difference of 1090 in one inner city constituency is patently not acceptable.

The council has to plan and react to the chaos the bedroom tax will cause and not least immediately in its discretionary housing payment (DHP) budget.  It was given £1.6m for all DHPs and expected by central government (rather disingenuously after it cut the overall budgets by 10%) to top this up with £2.4m of its own money.  Liverpool has not done this, along with many councils, and in a news release last week stated it has spent out over £400,000. More than 25% of its annual budget has already been spent meaning the DHP budget will run out in late July or early August.  Add to this the 1315 additional bedroom tax cases it never knew about from the NHF figures and it will have much more impact on tenants, landlord and council homeless budgets than first feared.

Also in conversation with Deputy Mayor Councillor Paul Brant on Wednesday this week I mentioned that the benefit cap is likely to have greater impact on council homelessness services than the bedroom tax.  The benefit cap has an average £93 per week cut in benefit compared with the £14 bedroom tax average.  He mentioned there are only about 200 or so cases in Liverpool yet the DWP has sent out letters to 490 households in Liverpool to tell them they will be affected.  So, again, what is the true reliable number?

More practically and worryingly as the benefit cap comes into effect from July 15th this year the council DHP pot will be empty by that time and a £93 per week cut in benefit guarantees eviction for arrears.  The Council will be facing huge additional costs and these are public purse costs which central government fails to acknowledge and so the bedroom tax and benefit cap are a transfer of financial cost and risk to local government as well as tenant and landlord.

Note that despite my earlier posts accusing Liverpool City Council of a dirty tricks campaign in the bedroom tax the Council has corrected this and has extended the appeal deadline and so I am not taking issue with Cllrs Baldock and Brant over the figures above as the Council has nothing to gain and much to lose in underestimating the bedroom tax and benefit cap figures.  It’s more a case of cock-up theory than conspiracy theory.

Yet when it comes to evictions the Council will have full homelessness duties due to welfare reform arrears and tenants will not be deemed as intentionally homeless by the Council.  If the Council (and any other Council) try this ‘intentionality’ strategy then all manner of protest and challenge will rain down on them.  Many Councils I have spoken with believe such tenants will be deemed intentionally homeless yet how many of them have read what Steve Webb said in the last bedroom tax debate on 27th February?  Hansard records:

Steve Webb: If I may, I shall respond to the Chairman of the Select Committee, who made an important point about those who are “intentionally homeless”. Although it is for local authorities to make decisions on homelessness applications as they do now, under current statutory homelessness legislation, if the only reason for the person’s homelessness is a reduction in benefit that is outside their control they should not be considered intentionally homeless by the local authority. I can put that on the record and hope it is helpful.

The welfare reform benefit reductions, that is the bedroom tax and the benefit cap ARE outside of the control of the tenant and so central government despite the caveat this is a local government decision expect such tenants caught to be deemed unintentionally homeless and the local council to have a full duty…of course to a huge cost to local government.

If Liverpool City Council’s DHP budget is drained by the time the benefit cap comes into force in 7 weeks time then the additional cost of the inevitable homelessness will be very significant.

This is why the numbers are important and need to be accurate.  How can any council and councillors serve their communities if they don’t know the numbers affected?  How can any council plan any training for their homeless department staff on the intentionality issue with welfare reform deductions?  How can any council plan DHP budgets and whether or not to allocate additional monies to the pittance that central government has given them which amounts to just 6% of the anticipated need?  Will Council’s homeless prevention teams act in a stronger gatekeeping role than before and attempt to deny the full duties they will have to the poor tenant affected by the bedroom tax and benefit cap!?

Inevitably they will as there are huge cost pressures of homelessness which should have been anticipated but were not because they underestimated the figures!

The original DWP estimate of 660,000 affected released June 2012 and borne out by the NHF figures are based on the HB claimant count at April 2012 and now the latest figures we have for Feb 2013 show a national rise in this of 67,000 or so and in Liverpool’s case 937 additional claimants.  Extrapolating the typical social to private tenant ratio for Liverpool could see about 600 additional bedroom tax cases in Liverpool taking the figure to 12,280 and almost 2000 higher than the working figure of 10,365 the Council appears to be using.

Using the same 2.4 persons per household it could be that 160,000 or so more men women and children are affected by the bedroom tax and in Liverpool an additional 4600 men women and children!

The same will be happening across the country and the bedroom tax numbers are NOT reliable.

I have real concerns for a sharp rise in intentional homeless decisions nationally and decisions that will run contrary to the Steve Webb ‘reassurance’ as above.

This brings me onto a final and linked point and one I first raised a few months back in late March that really does need much further consideration.

In Norris Green which is part of the West Derby constituency of Stephen Twigg in Liverpool I was told that tenants were abandoning their properties ahead of the bedroom tax.  They were just packing up and doing a flit because they knew they couldn’t afford the bedroom tax deduction was the reason given for this.  I have had updates to that anecdotal evidence and even went around the estate last week to see.  The situation is so bad and so acute that the landlord cannot apparently afford to ‘tin’ the properties and is using Perspex instead!  I have been told by reliable sources that Cobalt Housing’s budget for tinning up properties has run out and hence the cheaper Perspex is being used.

It is self-evident that abandonment of property is rife in the area and this area is the worst affected of the 30 wards in Liverpool with 1007 affected by the bedroom tax according to the (underestimated) Council figures.  Almost 10% of the bedroom tax affected households across the 30 wards in the City are in Norris Green

Norris Green is an ex-Council estate now managed by Cobalt Housing and 80% of the properties are 3 bed properties.  Yet the City Council had a policy for years of putting those with a 2 bed or even 1 bed need there as few wanted to live there.  The same will have happened in other major cities too. I am not painting a sink estate picture as that is not true of Norris Green and many families have lived there for decades and quite happily and it has a very strong sense of community.  Yet these families are the typical ones affected by the bedroom tax – families who have raised their children there who have now flown the coop leaving mum and dad – who are now grandparents – alone in the 3 bed family home to which they return with grandchildren in tow of a Sunday.

That is what the bedroom tax does.  It destroys communities and none more so in Liverpool than in Norris Green.  Yet the large numbers of tenants who have abandoned are doing themselves no favours.  Even if they change their names or some other ruse they will be found eventually and their Housing Benefit will be reduced by the arrears they owe their landlord for the 4 weeks’ notice they should have given.  This will lead to them being evicted from their current properties, most likely private rented at the lower end of the market and being found intentionally homeless by the Council for abandoning the previous property in Norris Green and Liverpool City Council will not have a full duty to re-house them.  So where will they live?  How many will have nowhere to live?  How many children’s lives will be affected? I don’t know and don’t want to think about it to be honest as it is a horrific but likely scenario.

It is too easy and simplistic to say it is the tenants fault for abandoning.  Yes they are wrong to do so and it does not work in their own interests, yet these tenants are not thinking straight due directly to the bedroom tax and other welfare reforms. That is something that numbers can’t say and if one of the major unforeseen consequences of the welfare reforms which all attack the most vulnerable social tenants. Tenants are not thinking straight because they are so stressed over the bedroom tax and the context of it with below inflation welfare benefit rises, paying council tax for the first time and cost of living expenditure such as food and utilities rising far more than inflation.

The additional public purse and taxpayer cost this will bring to all local councils has not been factored into any financial projections the government has made and even if the numbers affected have not increased, which they clearly have, then the overall cost to the public purse and to the taxpayer will be higher than the disingenuous savings the coalition claim they will bring to it.

It is time local councils started to lobby central government over these additional financial costs to them of welfare reforms.  Central government is shafting local councils regardless of their political hue by transferring huge direct and indirect costs of the welfare reforms which are financially unsustainable for the country.  Instead of the general public believing in their naivety that the coalition is reducing the welfare spend it is time local councils exposed just how much more the welfare reform policy is costing and is going to cost the public purse and the taxpayer.

Getting the bedroom tax numbers right is only a start, but a very necessary one.

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11 thoughts on “Bedroom Tax – Is there 160,000 more affected?

  1. The figures are a mystery down here in (un) sunny brighton too. An FOI request of the council revealed nearly 1600 affected, but the council and press always report 1400, and now as Joe points out there’s been a rise since last year of 67,000 nationally..
    What’s the cause of the 67,000 rise? More welfare claims? Dodgy earlier figures? It seems an awful lot for such a short time span.

    1. The 67,000 rise is not in a short space of time. The original 660,000 figure appeared in June 2012 DWP paper and this would be based on April 2012 HB claimant count. The latest HB claimant count figures released last week detail the position as at February 2013 and 10 months after original figure.

      NHF and DWP figures show 1413 (483 Pav; 439 Kemp and 491 Hove) and the official HB claimant count down 118 there from April 12 to Feb 13 and this suggests using Brighton rations of social to private tenants and % affected in South east suggests a fall of 11 in that number. So this is complicated either way with the only certainty being the figures are not accurate

  2. The problem I can foresee with the “if the only reason for the person’s homelessness is a reduction in benefit that is outside their control they should not be considered intentionally homeless by the local authority. ” test is that councils will try their damnedest to find a single penny that is not due to the BT/OBC so they can weasel out of their statutory duty.

    If a household has any arrears, that as yet have not triggered a possession order or has triggered one that is currently held from execution, and subsequently are kicked into that case because of the bedroom tax/OBC then people will be deemed intentional homeless… if not the councils could see staggering levels of cash needed for temp, non rental, accommodation as already they are issuing notices for short term emergency rental accommodation that they know will be triggered by the OBC,

    And as you rightly state, this will all be placed at the feet of the local council while central gov will whistle innocently and say “its not our fault, nothing to do with us, we’re just cutting central gov’s spending, can’t help it if councils have to spend thousands they had long enough to come up with ideas”

  3. My MP has obtained figures showing “there is a total of 487 households affected in West Dorset. By comparison, there are 2147 households waiting on the list for social rented accommodation, of whom 140 are currently overcrowded, and are on the list because they are seeking larger accommodation. There are also 48 households on the list seeking a transfer through swapping to larger accommodation.”
    No surprise in the amount wanting to get into Social Housing, as our private rents are extortionate in this part of the country.
    On a separate note, I tried to email you for some advice regarding the letter I received back from my Council after I sent in a letter asking for more information, before possibly appealing. Not sure if you received it, or that maybe you do not wish to look at individual cases. x

    1. I dont recall seeing an email and I cant get involved in most cases as I get over 200 emails a day but pleas send again and I will pass back any comments. West Dorset has 557 according to DWP and NHF figures not 487 so over 14% more than the figure your MP gave you and the HB claimant count has risen by 235 in that time which statistically would mean another 32 on that figure making 589 households and over 100 more than the figure given to you

  4. Agree wholeheartedly with that very last highlighted sentence of your blog.

    The only thing that will make the general public give a toss about these issues is the realisation that they personally will end up paying more in taxes as a result.

    So why have the media gone so quiet? Have we no proper journalists out there, with the nouse or the balls to get their teeth into this and reveal how joe public is being taken for a ride? I guess not – if it doesn’t involve celebrities or cuddly animals, they’re not interested!

    But keep up the good work, Joe.

  5. Hi Joe, the figures I shared in January were those known at the time. If I recall correctly, the Head of Service did say that they had not had the figures in at that point from some of the smaller independents and expected them to rise by up to 1000. I think you can find the relevant paper online on the council website for the appropriate Finance and Resources Select Committee where it does say that. There was certainly no intention to downplay the figures – far from it!!

    1. As I say in the piece I didn’t infer there was anything untoward in them which I hoped I made clear. The issue is the general veracity of the ‘official’ figures and the consequences these will have and I will gladly correct if up to date ward figures are available

  6. The figures can only capture a snapshot of the circumstances at that time. In benefits there is a large ‘churn’ of claimants and claimants circumstances. People move, people have children or become pensioners, increase wages and drop out of the bedroom tax altogether. Cutting peoples benefit by 14% or 25% may have taken a substantial number out of benefit altogether. The changes regarding overnight carers, foster parents, people with non deps who are on active service, severally disabled children requiring their own bedroom may have taken many more people out of Bedroom Tax altogether.

    One thing is never believe any figure given by the Government.

    The DWP estimate in June 2012 was a joke as no Local Authority had even started to compile lists of who would be impacted because under Housing Benefit rules the bedroom numbers for social tenants wasn’t needed for Housing Benefit purposes.

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