Welfare Reform Bill - You Can Act!

Tomorrow the Welfare Reform Bill will be debated and voted on in the House of Commons. The Government are seeking to overturn the amendments passed in the Lords. As I write another amendment protecting disabled children has just been passed in the Lords against the Government's will.

The principle that all who play by the rules should receive enough to meet their basic needs has been at the heart of the welfare system for 65 years; if the benefit cap becomes law that principle will be destroyed. Only families whose basic needs are less than £26,000 will be safe. The rare and extremely vulnerable families who have greater needs will be left behind

The principle is wrong and the best predictions are that the effects will be equally wrong.The government’s proposed benefit cap will hit many of the most vulnerable people in society. It will affect 220,000 children (75% of those affected) and 14,740 families where Employment and Support Allowance (a disability benefit) is the main household income. It threatens to make over 80,000 children homeless and will push 133,000 children into poverty or further into poverty.

 

The Bishops amendment, carried in the House of Lords removes Child Benefit from the calculation. The effect would be to remove most of the families with children from the cap. The amendment was supported by children's charities, churches, faith groups , no-faith groups and many others because injustice of impoverishing children because of an arbitrary limit is obvious and painful.

The Methodist, Baptist, Quaker, and United Reformed Churches jointly wrote to every MP, explaining their objection to the principle of the Benefit Cap and urging them not to overturn the Bishop's amendment in tomorrows debate.

If you wish to contact your MP to express your concerns about the Welfare Reform Bill press the Church Action on Poverty button below. The emailer link will ask for your email address (for replies) and  your street address (to find your MP). It will then offer you a draft email which you can edit or accept as is before sending it to your MP with one more click.

Click to Email Your MP

Useful Links:

• The idea of a benefit cap is initially appealing to some. Many within churches - even former Archbishops - have supported it. 
• Go here for a simple explanation of why the Churches have said that the principle of a Cap is flawed:
• Today's Press statement of the Baptist, Methodist, Quaker and United Reformed Churches is here:
• You can read the letter that was sent to MPs here.

The Housing Crisis

The word 'crisis' is overused, but the National Housing Federation's warning of a coming housing crisis is not so much alarmist, as inevitable unless a fundamental change of policy takes place. Beyond the lesser crisis for party politics and middle-class aspiration, there is a growing threat of increased poverty and homelessness due to the shortage of affordable housing.

There are nearly 5 million people on social housing waiting lists in the UK, homelessness is rising and cuts to housing benefit are tightening the screws on those on low incomes. On 2010 Government figures, 48% of Local Housing Allowance claimants, i.e. private sector tenants in receipt of housing benefit, experienced an average shortfall of £23 per week between their rent and the benefit they received. £23 is a serious sum to have to meet from a low wage or unemployment benefit. And these figures were before the cuts announced in the Comprehensive Spending Review of October 2010, which have begun to come into effect from April this year: preliminary studies suggest things are going to get much worse.

The single main cause of the pending crisis is the ongoing failure of successive governments to build sufficient social housing in combination with the 'right to buy' scheme introduced by Thatcher in the 1980s. This led to a chronic and unsustainable loss of social housing stock especially following the previous Labour Government's wasted opportunity to invest in social housing during the boom.

During an economic downturn, with home ownership set to fall to 1980s levels, the increased difficulties in getting mortgages, along with benefit cuts, make the need for social housing acute. Yet Government has announced an approximately 50% cut in its social housing budget from £8.4bn to £4.4bn from 2011-2014.

Whilst the Keynsian attitude that a country must spend its way out of an economic crisis is not universally valid, it arguably applies to housing, which is on a par with national infrastructure. History shows that the cost of investment in good social housing is soon recouped. Increased investment in social housing would also create jobs and incentivise the housing and related sectors.

It would also offset the net result of this and the last Government's housing policy which is an ever-increasing transfer of taxpayers' money to private landlords. According to the (aptly-named) housing charity, Crisis, the average private sector rent rose from £79 per week in 1997/8 to £129 in 2007/8, while the average housing benefit award in 2007/8 was £109.25

The current housing benefit bill is estimated at £21bn - this is a massive sum. But the most significant cause of the last decade's increased bill is the steep rise in private rental prices. One of the many damaging effects of the way housing became bound up with global financial speculation and irresponsible borrowing and lending was that house prices in the UK appoximately trebled in the last decade. The persistent high value of property not only prices many out of home ownership, but contributes to landlords charging higher rents. Contrary to popular opinion, this is not merely an issue for the unemployed: 2010 figures showed that more housing benefit claimants were in work (26%) than out of work (22%). The net result is that private tenants struggle to pay the rent while their money drains away instead of serving to support social housing stock.

It is fundamentally scandalous that average wages (and benefits) are so low that people need the current high levels of housing benefit. But the Government's housing benefit cuts look set to increase pain for the growing proportion of the less well off in the UK without resolving the problem. It has justified setting the Local Housing Allowance at the 30th percentile instead of the median, and an 'affordable rent scheme' allowing housing associations to charge tenants up to 80% of local market rates, by claiming that landlords will reduce rents to accomodate falls in benefits. In view of the high demand for accomodation and ongoing property values, this remains an unlikely scenario.

The other solution would be for Government to cap rents. That this policy is politically unpopular is a sad reflection on how property and the land it occupies have been equated, mistakenly, with the market. This leads to property speculation and high housing costs and works agaist communities. From a Biblical point of view, it ignores the theological view of the earth as God's creation and a field not just of opportunity but stewardship and moral action. Housing is not a lifestyle choice and land not a 'possession' in the way a car is; they are more fundamental should be guarded against being made subject to concepts of profit and 'value added'. Until our society revisions the concept of land value and the malpractice of exploiting people's basic need for shelter and a context in which to thrive, property will continue to enshrine a feudal attitude of enclosure and landlordism.