MPs say housing cost reform hurts disabled people

Tue,1 April 2014
News

House of Commons Work and Pensions Committee: Support for housing costs in the reformed welfare system - Fourth Report of Session 2013–14

Reforms to the support provided for housing costs – including the Social Sector Size Criteria (SSSC) (also known as the “Bedroom Tax” and the “Spare Room Subsidy”) and the household Benefit Cap – are causing financial hardship to vulnerable people who were not the intended targets of the reforms and are unlikely to be able to change their circumstances in response, say the Work and Pensions Committee in a report published today.

You can view the report at http://www.parliament.uk/business/committees/committees-a-z/commons-select/work-and-pensions-committee/news/support-for-housing-costs/

Key findings and recommendations:

Local Housing Allowance (LHA), paid to Housing Benefit claimants in the private rented sector

  • Reforms to LHA have led to a growing discrepancy between the average area rents and the amount of LHA that households can claim. As a result, there is evidence that private sector landlords are becoming increasingly reluctant to rent to LHA recipients and evictions and non-renewal of tenancies are increasing, leading to an increased risk of homelessness among Housing Benefit recipients. Private sector properties which remain affordable to LHA recipients are increasingly of poor quality. The Government should monitor the impact of reforms to support for housing costs on homelessness, and look at further ways of supporting claimants and local authorities if the reforms are found to be exacerbating it.

Social Sector Size Criteria (bedroom tax or spare room subsidy

  • This is having a particular impact on people with disabilities, especially those living in adapted accommodation, or who need an extra room as a result of their disability, and who are unlikely to be able to move house or enter work. There is evidence that many of these people are suffering financial hardship. The Government should take steps to mitigate the impact of the SSSC on disabled people. Disabled people living in homes which have been significantly adapted for them should be exempt from the SSSC. The Government should also exempt from the SSSC all adults on the higher rate mobility or care component of Disability Living Allowance, or equivalent in Personal Independence Payment.

Benefit Cap

  • This is affecting full-time carers receiving Carers Allowance who, although living in the same house as the person to whom they provide care, are not part of the same household benefit unit; and homeless households in temporary accommodation. The Government should take steps to exempt all those on Carers Allowance resident in the same house as the person cared for, and all households in temporary accommodation, from the Cap.

Discretionary Housing Payments (DHPs)  

  • DHPs are subject to a postcode lottery as to the help you receive. Some local authorities are taking income from disability benefits into account in the means tests they apply for determining eligibility for DHP awards. The temporary nature of DHPs may also mean that they do not provide sufficient safeguards for those who need longer-term support. The Government needs to give local authorities more specific guidance on allocating DHPs, including on granting long-term DHP awards for specified categories of claimants. The Government should also review DHP provision to ensure that those who cannot adjust to the reforms are provided with sufficient long-term support which is structured in a way that ensures they do not suffer hardship. If DHPs are found not to be providing sufficient protection from hardship, the Government must look at alternative means of protecting people who are unable to adjust to the reforms.

Council Tax Reduction

  • This is leading to financial hardship for some affected claimants and incurring extra expense to local authorities through loss of revenue, and costs relating to arrears collection, court action and providing support to affected claimants. The move to localise Council Tax support has also created a post-code lottery whereby in some areas residents qualify for 100% support while in other areas someone in the same circumstances has to pay as much as 20% of their Council Tax. The Government should commission research into the impact that this variation in Council Tax reduction schemes across the country is having on levels of poverty in different areas.

Universal Credit

  • Both private and social sector landlords are concerned about how tenants will manage direct payments of housing costs under Universal Credit. There was particular concern that vulnerable tenants may not receive help until they have accrued unmanageable levels of rent arrears. The Government should give vulnerable claimants the option of having their housing costs support paid direct to their landlords if this is their preference, at least for the first few years of a Universal Credit claim, as a transitional measure.