Friday 12 April 2013

Tories debunk one of their own myths...

The Tories came up with the fundamentally good idea of capping Housing Benefit payments to "private" landlords, both

a) directly via the £400 weekly upper limit, which still seems far too generous to me and

b) indirectly by capping the total welfare payments which any household can receive at £500 a week. Except in the most unusual cases/outright fraud, no workless household gets anywhere near £500 a week in income support, Child Tax Credits etc, so effectively this means that Housing Benefit (which rather bizarrely is considered to be a welfare payment to the household, not the landlord) will be capped at £200 a week or so (which seems "about right" to me).

Now, somehow unable to sell this simple but fair proposition (perhaps IDS realised he wouldn't be able to smuggle it past the Home-Owner-Ists?), they came up with the myth that millions of workless households were getting £500 a week in benefits as part of their divide-and-conquer approach to government, cue dozens of outraged readers' letters and angry pub conversations etc.

IDS now finds himself under attack for the apparent harshness of this measure (having oversold it) and is backtracking wildly. From the BBC - click and highlight to see how many such households there really are:

The number of households that will be affected by a new £500 a week benefit cap has fallen by over a quarter, the Department for Work and Pensions says.

The government initially estimated that 56,000 households would see their benefits reduced by the policy, losing on average around £93 per week. It now expects 40,000 households to be affected.

10 comments:

Bob E said...

I see the Beeb also quote a "DWP source" [so we have strictly not official and deniable information] as saying "some councils may face the prospect of re-housing residents in other boroughs not yet covered by the cap" in respect of the 4 London Boroughs first in to introduce the cap. One wonders if their willingness to be at the forefront, other than being able to grab some extra central government provided dosh to help with the extra admin costs of applying the cap, is that it dawned on them that the chances of being able to offload some of their social housing tenants falling foul of the cap onto other boroughs that weren't yet applying it would be a strictly time limited opportunity.

Bob E said...

MW - "IDS now finds himself under attack for the apparent harshness of this measure (having oversold it) and is backtracking wildly".

Well, during the course of the afternoon the DM unveiled an article which suggests that far from backtracking, IDS is now claiming the "revised" figure simply reflects how brilliantly the scheme was working even before it came into effect, because the 16,000 "anticipated it" ...

"Victory: Iain Duncan Smith's Department for Work and Pensions today announced 8,000 people had found work thanks to the benefit cap.

In addition, another 8,000 people have moved into cheaper homes in an attempt to cut their own housing benefit bills before they are capped by the Coalition plan.

Figures from the Department for Work and Pensions suggest that a total of 40,000 households are likely to be affected by the cap when it rolls out over the summer, losing £90 a week on average.

This is down from a forecast of 56,000 last year, as 16,000 families moved out of the criteria.

After today's data were released, Work and Pensions Secretary Iain Duncan Smith said: 'The Benefit Cap sets a clear limit for how much support the welfare state will provide - the average wage for working households.

'But it's also a strong incentive for people to move into work and even before the cap comes in we are seeing thousands of people seeking help and moving off benefits.

'We have a very clear message: we will provide support to those who need it, but the days of outrageous claims giving people incomes far above those of working families are over.'"

http://www.dailymail.co.uk/news/article-2308159/16-000-fewer-households-affected-benefits-cap-500-half-jobs-rest-moved-cheaper-houses.html

Mark Wadsworth said...

BobE, first comment, agreed.

Second comment, the notion that because of the cap loads of people have suddenly found themselves a job is absolutely fanciful.

Out of 5,000,000 welfare claimants, if 8,000 find a job over a period of a few months, that proves f- all.

OTOH - the notion that people will look for cheaper housing if there is a housing benefit cap is perfectly realistic and exactly what we would expect to happen. And it will happen, rents will come down, people who are seriously looking to move home to find a job will do so, hooray, everybody wins.

Bayard said...

I wonder how much expensive-but-surprisingly-grotty accommodation is now standing empty in central London, while landlords adjust to reality.

Mark Wadsworth said...

B, loads apparently. It's called "most of Kensington".

Bob E said...

"that people will look for cheaper housing if there is a housing benefit cap is perfectly realistic and exactly what we would expect to happen".

And some people are very fearful of this being the case .. reports Jill Sherman Whitehall Editor of the (paywalled) Times,

Tory council chiefs hit out at benefit cap 'ghettos'

The new £500 weekly benefit cap is a “recipe for disaster” and could create “ghettos” of benefit communities in coastal resorts, Tory council chiefs have warned.
Paul Carter, the Conservative leader of Kent County Council, is urging the Government to introduce new laws to try to stop London councils moving benefit claimants into deprived areas of coastal towns with lower rents than the capital.

Mark Wadsworth said...

BobE, what are they whining about? This is the inevitable result of a sensible policy.

Apparently, a lot of them are going Down to Margate.

Bob E said...

MW - "what are they whining about?"

I fear that compiling a list of the things that KCC whine about would take some time ... they certainly don't seem to be sure whether to be happy about or totally dismayed about being a county with border that consists of (a)coastline and (b) puts them next door to that there London for one. They do seem to like and encourage "some" visitors and expend a lot of effort trying to get the numbers of the ones they do like "up" whilst expending perhaps even more in trying to get the numbers of those they don't like "down" assuming they can't stop them entirely.

Mark Wadsworth said...

BobE, so apart from being the geographically best located county in the UK, what else is making them unhappy?

Bob E said...

MW Well the Men of Kent/Kentish Men issue remains live ... that is supposed to have been kicked off by "visitors who outstayed their welcome" ....