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Housing benefit: the truth will out

<strong><span class="has-inline-color has-accent-color">Steve Hilditch</span></strong>
Steve Hilditch

Editor and Founder of Red Brick. Former Head of Policy for Shelter. Select Committee Advisor for Housing and Homelessness. Drafted the first London Mayor’s Housing Strategy under Ken Livingstone.

In a recent post I made the observation that government impact assessments, and especially equality impact assessments, tended to reveal more about a policy than all the other official documents put together, and that looking at any policy from the point of view of those most likely to be worst affected tends to expose the downside or weak links in the argument. 

The point is well supported by the DWP impact assessments on the housing benefit changes, or more correctly the Local Housing Allowance changes, published last week. 

At constant prices, and taking account of the recent minor concessions in the proposals, the LHA savings will start in 2012/13 and build up to £1040m in 2014/15, slightly offset by piddling amounts for increased discretionary payments and an (extremely welcome) allowance for an extra room for a carer.  In 2014/15:

– removing the £15 bonus for people achieving a rent below the LHA rate (the shopping around incentive) will save £550m

– setting Local Housing Allowance at the 30th percentile of local rents will save £425m, and

– capping LHA rates will save £65m.  

The first point to note is the relatively small saving from the ‘cap’, given that virtually all government comment on the LHA issue has focused on excessive benefit payments to people in high rent areas, especially in central London.   17,400 households are affected – often very severely – by the caps.   The much higher saving from the ‘30th percentile’ change will have far more impact.  It will affect more than three-quarters of a million households in all parts of the country.

Nearly everyone will lose: over 900,000 households, a stunning figure.  The national average loss is £12 per week, from an average benefit of £126, but the hardest-hit group, households needing a 5 bedroom property, will lose an average of £57 per week as the 5 bed rate is withdrawn entirely.  All the regions/nations are hit, with London top with an average loss of £22 per week.  The biggest groups numerically are those in the 1 and 2 bedroom categories, who will face average losses of £11 and £15 respectively.   The lack of grip on the reality of what it is like to live on a very low income is illustrated by the argument that “only four per cent of cases will have a shortfall of over £20 a week” – well, that’s all right then.

DWP refuse to make an assessment of the number of households that will have to move.  They say they can’t predict behaviour, and customers have options – for example, “some may start work or increase working hours”, others “may be able to renegotiate their rent with their landlord and others may have resources such as savings they can fall back on”.  To be fair, they do note that the Greater London Authority’s estimate that over 9,000 households may need to move in London as a consequence of the caps, and that 6,800 of those will be families; and Shelter’s estimate that between 68,000 and 134,000 households may have to move nationally.

“David Cameron insisted today

no one will be made homeless

by limiting ‘extravagant’ housing benefits”

Daily Mail

Contrary to the assertions of leading members of the coalition, including David Cameron, the impact assessment notes “a risk of households falling into rent arrears leading to eviction and an increase in the numbers of households that present themselves as homeless”…. and that “any resulting population movement could have wider impacts. People who move may need to rearrange their children’s schooling, healthcare arrangements or, where relevant, social services support; they may also need assistance with finding accommodation.”

Other specific groups affected by the changes include:

Disabled people, especially those who may have to move across a council boundary, because care and support packages do not move with the person and settled arrangements will be disrupted as the new authority carries out a new assessment. This “could lead to gaps and delays in new arrangements being put in place and consequential distress for the individual.”

Large families, who often have poor employment prospects and a much increased risk of poverty: for them, the “cap could affect their risk of overcrowding and the associated health and educational effects.”

Ethnic minority groups, who tend to have a higher proportion of large families, will be likely to be affected disproportionately.  Further research may be commissioned in this field as there are “limitations in current data.”

Quotable quote from the impact assessment

“the impact assessment recognises that there are a number or risks as follows:

– increases in the number of households with rent arrears, eviction and households presenting themselves as homeless;

– disruption to children’s education and reduced attainment;

– disruption to support services for people with disabilities and other households with care and support needs;

– increase in the number of households living in overcrowded conditions; and

– a decrease in the number of and quality of private rented sector properties available to Housing Benefit tenants.”

The truth will out.

Quotations from DWP impact assessment: http://www.dwp.gov.uk/docs/lha-impact-nov10.pdf

apart from *David Cameron http://www.dailymail.co.uk/news/article-1324941/David-Cameron-claims-homeless-cuts-social-housing-budget.html#ixzz17LsNDNnz

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Unequal impact

<strong><span class="has-inline-color has-accent-color">Steve Hilditch</span></strong>
Steve Hilditch

Editor and Founder of Red Brick. Former Head of Policy for Shelter. Select Committee Advisor for Housing and Homelessness. Drafted the first London Mayor’s Housing Strategy under Ken Livingstone.

Since the Election the Government has substantially reduced the information it provides in announcements, consultation papers and the like concerning the impacts the proposals will have in equalities terms. 

It was an important innovation by Labour to introduce a statutory requirement to publish impact assessments.  Policy documents improved: ‘straight line thinking’ was challenged by the discipline of having to look at issues from the different standpoints of women, ethnic minorities, disabled people, and others.  It didn’t solve the problem but equalities issues were much more likely to be properly considered as part of policy development, and policies were much more likely to be adapted to mitigate any adverse impacts identified.  Impact assessments were fascinating to read because they tended to reveal downsides or unintended consequences of a policy that did not appear to have been addressed.      

By any measure, this week’s consultation paper on social housing and homelessness is likely to have major implications for women, ethnic minorities and disabled people.  Yet there is no impact assessment or equalities assessment published with the consultation paper.  And none of the 30 consultation questions explicitly concerns equalities (although one asks if new tenants who are older people or have a long term illness or disability should be given ‘a social home for life’ – is there any answer other than ‘yes’?).  The only reference to the duty is a note saying that impact assessments of the legislative changes will be published with the Localism Bill – we will see how thorough these are when they emerge – but the consultation paper has much wider consequences for practice in the sector than the contents of the Bill. 

The Equality Commission is launching a formal inquiry as to whether the Treasury fulfilled its “legal duty to pay ‘due regard’ to equality and consider any disproportionate impact on protected groups when making decisions, including decisions about the budget”, pointing out that “Where decisions are found to have a disproportionate impact on a particular group protected by the legislation, public bodies must consider what actions can be taken to avoid, mitigate or justify that impact.” (see link below).  The charge was made at the time of the spending review, notably by Yvette Cooper, that it would hit women much harder than men.  Although officially denied, it emerged that Theresa May had written to George Osborne after the June budget to register concerns about non-compliance with the legislation.  

Although the Commission will not report until next summer, they could then serve a compliance notice and go to the Courts to force the Treasury to comply.  Their intervention is to be welcomed and should also serve as a warning to Communities and Local Government Ministers.

http://www.equalityhumanrights.com/news/2010/november/commission-to-assess-the-spending-reviews-compliance-with-equality-law/