Housing Federation: 'Bedroom tax' will push up benefits bill

Monday, 01 April 2013 09:07

Protesters have gathered in various locations across the UK to register their disagreement to the ‘bedroom tax’ which is due to be introduced next month.

The new tax means that housing benefit claimants will lose part of their benefit if their home has a spare room. Pensioners, who tend to have the highest number of spare rooms, will be exempt from the tax.

People with one spare room will lose 14 per cent of their benefit and those with two spare rooms will see their benefit slashed by 25 per cent.

David Orr, the chief executive of the National Housing Federation says the policy is bad economics and risks pushing up the overall housing benefit bill by £23 billion.

Mr Orr says the policy will cause problems for hundreds of thousands of people and won't succeed in its main aim which is to cut the cost of the social housing bill. This is because it will force many people to have to downsize into the more expensive private sector because of the lack of smaller social housing properties.

The NHF says that there are currently 180.000 families living in two bedroom homes who could be rehoused into smaller properties, but last year only 85,000 new one-bedroom homes became available. This leaves 95,000 households who would either have to stay where they are or move into a smaller property in the private sector that would cost more.

Mr Orr said: "The bedroom tax is one of these once-in-a-generation decisions that is wrong in every respect.

"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."

Critics argue that the elderly and disabled people often need an extra room to help manage the care of residents in the home.

Protesters gathered in Trafalgar Square, London on Saturday to rally against the cuts that are being introduced from April and simultaneous protests took place in towns and cities across the UK. Around 3,000 people gathered in Glasgow Green, Glasgow.

The new tax will affect 660,000 households and the average benefit cut will be £14 a week, according to the charity Crisis who also predict that homelessness is expected to increase.

Crisis warns that queues at food banks are set to increase and that the unemployed and disabled people will be most affected by the cuts.

The charity also warned that low paid working families will also be hit by changes to Council Tax bills that will see a new system introduced that will receive 10 per cent less funding.

Crisis also said that it had “serious concerns” about replacing the disability living allowance (DLA) with a personal independence payment (PIP) as it believes the new criteria for claiming the new benefit will exclude many people who previously qualified.

Crisis 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.'

The ‘bedroom tax’ is aimed at people renting council property or homes from housing associations and is not aimed at people living in privately rented accommodation.

The ‘bedroom tax’ is an attempt by the government to encourage people to downsize and free up larger properties for families.

The protests have been organized by left-wing think tanks and trade unions and some protesters have taken to the streets wearing masks and waving placards calling Work and Pensions Secretary Iain Duncan Smith a ‘ratbag’.

Mr Duncan Smith was called this by a protester when he visited Edinburgh last week and the insult was used by many protesters during the demonstrations on Saturday March 30th.

Kelly Parry, representing the National Union of Students, said of Mr Duncan Smith: “He is a ratbag. The cuts that are going to come in are going to disproportionately affect women.
“We need to fight back so that never again will the people of this country be robbed by Westminster.”


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