Imagine you own a three bed property that you rent out for £126 per week and you are looking for a new tenant. A prospective tenant comes along and says I’d like to rent but I can only afford to pay you £50 per week.
You naturally refuse for obvious reasons.
So why do the Tories expect a council or housing association landlord to say YES to the above deal?
That is the Tories overall benefit cap in a nutshell and the £76 per week shortfall used in the example above [£126 minus £50] is also accurate.
On average, and just in England alone, council and housing association landlords issue 385,000 new tenancies each year and directly because of the 23% cut to the overall benefit cap that at least 150,000 of these 385,000 new tenancies each year will NOT be allocated to the benefit household.
150,000 families that will statistically contain 197,000 adults and 501,000 children will be refused SOCIAL housing because of the Tories overall benefit cap each and every year.
Where will they go?
They will go directly onto the homeless figures and their local councils homeless department is the only place or agency that will provide these 150,000 families per year with a roof over the heads of their 501,000 children.
Hence the Tory overall benefit cap policy and its swingeing cut that is being rolled out will add half a million homeless children to the already outrageous and unacceptable 124,000 children who are in temporary homeless accommodation this Christmas.
Homeless children will thus quadruple and directly due to the Tories overall benefit cap policy.
Do you have a right to be housed?
Many wrongly believe that the law entitles you to housing. It doesn’t and even a council housing landlord is able to refuse to allocate a property to you if you cannot afford it.
Only when you become legally homeless do councils have a corporate duty to put a roof over your head and of your children’s. It may seem bizarre that a council landlord says no allocation and you then go to the same council’s separate homeless department who then ask the same housing department to house you and they can still say no, yet that is the reality.
Housing Associations have no legal duties to house at all as they are not public authorities.
How can this not have been foreseen by the Tories?
The Tories produced a claimed impact assessment on the swingeing cuts to the overall benefit cap policy as they are obligated to do. YET nowhere in that document did it consider the 385,000 or so prospective new tenants that social landlords allocate to each year. It focused only on existing tenants.
It was an impact assessment that failed to look at the inevitable direct impacts of the policy.
The 150,000 household number?
Social landlord stock of housing sees 36% of it being the 3 bed or larger property and this, in England alone, means that 139,000 of the new tenancies each year will be at least a 3 bed in size and the overall benefit cap makes the 3 bed+ property unaffordable for a landlord to rent to a fully occupying household.
The households types who fully occupy a 3 bed are the lone parent with 2, 3 or 4 children and the couple with 2, 3 or 4 children. Most of these household type will get a cut to their Housing Benefit and some will only receive 50 pence per week in HB. They will then need to pay their full rent out of their other benefit which is already set at a subsistence level an each benefit award has the phrase “This is the minimum amount the law says you need to live on” on the benefit award letters.
In short they are all too financially risky to accommodate for a social landlord and note well I am not criticising any social landlord at all for refusing to allocate on the grounds of affordability. They have no choice. I could and have criticised them and their professional lobbies for their abject failure in challenging this policy and rightly so.
Any smaller sized household would under occupy a 3 bed and thus be at risk of the bedroom tax and since 2013 all social landlords have introduced affordability tests to their allocation policies and refused to accommodate those under occupying.
What this also means is that social landlords have deemed the average £15.21 per week bedroom tax HB cut to be a financial risk too far. As the average overall benefit cap HB cut will be £76 per week or 5 times the bedroom tax HB cut then social landlords will refuse to accommodate. Even if the average HB weekly cut is £44 as the DWP perversely and wrongly claim it to be, this is still 3 times the average bedroom tax cut and so refusal to accommodate is inevitable.
A more detailed explanation of the numbers is here and the 150,000 is a cautious figure.
Isn’t social housing a Welfare State safety net?
Not any longer due to the Tories overall benefit cap! Council and HA landlords have always accommodated those that the private landlords have refused to house with their NO DSS policy and signs.
Yet now the Tories overall benefit cap policy means council and HA landlords will themselves be having the same NO DSS signs in their windows and as their policy!
What are the cost implications?
The costs of temporary homeless accommodation is borne by local government and the policy is a massive transfer of cost from central to local government. For example I discussed how Liverpool City Council could be facing an ADDITIONAL £30 million per year cost, that could easily be over £40 million, here and also how the private landlords who own B&Bs, hotels and HMO’s have every local council over a financial barrel as councils MUST provider this accommodation.
The practical impacts of this mean Liverpool City Council need to make a further £30 million per year of cuts in order to balance the books and proportionately the same goes for every local council.
I can say with absolute certainty that LCC has not factored in the huge added costs of homelessness for the prospective / new social tenant households who will be refused social housing that I say will likely be £30 million per year. LCC is already seeking to make £30 million of yearly cuts and so the Tories overall benefit cap policy alone will DOUBLE the amount of cuts it needs to make.
That goes for every local council across the UK not just Liverpool.
I’m work and I’m not a ‘scrounger’ on benefit so why should I care?
If you are working and if you are a home owner your council’s services will have to be massively reduced and directly due to the Tories overall benefit cap policy.
Your libraries will probably close and it is also highly probable that every council will now collect the bins every fortnight rather than every week (or from fortnightly to monthly) and so any other drastic cuts that hit every local citizen working or not, home owner or renter … and all because of the Tories ideological driven nonsense called the overall benefit cap policy.
Some wrongly believe I am being dystopian or scaremongering over the Tories overall benefit cap policy. I can assure you I am not and I have also criticised Labour over this as it was also in their 2015 manifesto. No political party has criticised this policy publicly. No lobby group such as Shelter or Gingerbread or Save the Children for the impacts the policy has on homelessness, lone parents and children has publicly challenged this policy.
Neither has the uber right-wing Tax Payers Alliance given that ALL local councils will increase council tax and provide far less in return. The LGA (Local Government Association) who claim to represent local government issues have also been noticeable by their silence on this policy to.
Meanwhile private owners of dingy B&Bs, large houses in multiple occupation (HMO) and dingy hotels must be rubbing their hands with glee at how much they can charge every local council for ‘temporary’ homeless accommodation that is highly likely to be anything but temporary!
If only we could magic up 500,000 new child care places out of the ether for the children of those caught by the overall benefit cap so that their parents could work and receive even more in welfare from central government by way of tax credits (with no HMT tax take) and the costs of child care.
Yet of course that cannot happen and so the 60% of those who will be capped that have children of preschool age will just have to be evicted and made homeless and thus adding to the local councils cost.
What a pity the 15% of current capped households and likely future ones who are in receipt on what we used to call Incapacity Benefit are unable to work. They too will be evicted and made homeless and perhaps even create some disability friendly dinghy B&B hovels as a new form of necessary homeless provision!
Just 13% of benefit capped households are on the dole – and that is from the DWP’s own figures. More than 6 out of every 7 capped households are not able to work immediately yet will still face an average £76 per week cut to their housing benefit. £76 per week is £330 per calendar month.
Here is Tab 6 from the DWP official figures on currently capped households which records that less than 1 in 7 capped families are on the dole …
…the other 86.37% are not able to start work which is the only practical way to escape the overall benefit cap (and would increase the ‘welfare’ bill by at least £0.8 billion per year if they could all work as the Tories say they should!)
Reader, have you ever stayed with the kids in a ‘family room’ at a hotel? It can be a bit ‘fractious’ can’t it! Now imagine that IS your home as it will be to many of the half a million or more children in the benefit capped families all year!
No privacy. Nowhere to cook a meal. Nowhere to wash your clothes and nowhere to iron them too. Nowhere for the kids to do their homework, that is homework set by their new school as your council will and can only place these families where they can find this unsuitable and temporary (sic) homeless provision and so it is extremely likely that children will have to move schools and lose old friends and make new ones – friends they can only meet and play with outside as there is no room inside and the kids will likely feel as embarrassed as hell over where they live. Imagine when it is raining or cold or dark outside and the children can’t play … and I have barely touched on the issues that will affect 500,000 homeless children and directly created due to the Tory overall benefit cap policy.
To finish I started this with an obvious question so I will end it with one …
Put your hand up if you could afford an extra £330 per month to your housing cost whether you are renting or paying a mortgage?
If the answer is no you have a flavour of what the overall benefit cap means.
Oh Happy Christmas by the way and especially to the additional minimum 377,000 children for whom this will be the last Christmas they spend in their homes.