HOUSING benefit cuts being debated in parliament today and set to come into force next April will see local authorities ‘decanting’ poor families out of London, the Child Poverty Action Group (CPAG) warned yesterday.
A CPAG report, ‘Between a rock and a hard place: the early impacts of welfare reform on London’ examines the effects on London residents and local authorities of cuts to Local Housing Allowance, the introduction of the benefit cap and under occupation penalties.
The report is based on interviews with local authority officers, advice agencies and partnerships.
The research found that:
• Government impact assessments predict that 124,480 households in London will be affected by these changes.
• The changes are intended to reduce expenditure on housing benefit, in part by driving down rent levels.
But there is no sign that rent levels in London are falling, and local authorities predict that as housing benefit expenditure falls, their costs will rise, as they struggle to prevent or deal with increased levels of homelessness.
• Many local authorities are actively considering procuring accommodation outside London.
However, they fear that placing families outside of London will leave them subject to legal challenge.
Alison Garnham, CPAG CEO, said: ‘Families are facing the impossible situation of being told to move to cheaper accommodation that just doesn’t exist with London’s rising rents.
‘London Boroughs are staring at a black hole in their budgets as a result, with costs transferred from central to local government.
‘It’s not right that children are left paying the price for London’s housing crisis, which they did nothing to create.
‘There’s still time for Government to do the sensible thing and think again when these reforms are debated in Parliament on Tuesday before thousands of London’s families find themselves uprooted, overcrowded and thrown into turmoil.’
• Caps to local housing allowance (LHA) restrict the level of support that families can receive with their rents to the ‘30th percentile’ of rents within a local area.
These began to take effect in April 2011, although many families will not see their level of support reduced until later this year.
17,400 households in London will be affected by this change.
• The benefit cap will restrict the total amount of support received by a household to £500 a week for families with children and £350 for single people.
27,440 households in London are expected to be affected by the cap.
• ‘Under-occupation penalties’ will reduce the level of support for families in social rented housing if they are deemed to have an extra bedroom.
This will affect 80,000 households in London.
