14
October
2014
|
00:00
Europe/London

Cuts to housing support condemned


Government cuts to financial support for people living in rented accommodation have been heavily criticised by council leaders at the second largest local authority in the country, as they plan to make up the shortfall by using money from the city’s housing revenue.



Following the introduction of what is commonly known as the ‘bedroom tax’ a system of ‘Discretionary Housing Payments’ are an increasingly important aspect of the welfare system, helping vulnerable tenants meet the costs of their rent.



With Government changes to Housing Benefit since 2010 meaning many tenants get less Housing Benefit and face extra rent short term measures of support are being withdrawn, leaving the most vulnerable tenants at risk. Leeds City Council are also preparing for proposals to end local welfare support funding for local authorities.



Councillor Keith Wakefield, Leader of Leeds City Council, said:



“Local government in Leeds and throughout the country are increasingly stuck between a rock and a hard place. The help we had previously from Government recognised more tenants need extra support to deal with the changes they have made to support for tenants. But we are now hitting a crunch as these measures are withdrawn and tenants face impossible choices. Looking solely at cases where families were subject to the bedroom tax, in the last financial year we used Discretionary Housing Payments to help 456 families with severely disabled people in adapted properties and 35 households with foster carers.



“Leeds is facing having to spend hundreds of thousands of pounds in coming years to help out tenants who have lost financial support through no fault of their own. As a council we are committed to doing our best to help as many as possible, but we have to fund that help from money we would want to spend providing more houses for those who need them, and other services for people in the city. This is more money in effect going from local people in Leeds to shore up the central government coffers.”



Councillor Peter Gruen, Executive Member for Neighbourhoods, Planning and Personnel, said:



“The Government’s assumptions are based on an expectation that tenants will often be able to move to smaller accommodation. This is not the case on Leeds, or many other cities. There simply aren’t the smaller properties to move into. As a city we are trying to improve the situation with housing, but this is a long term plan and in the short term we must support those who need our help to keep a roof over their head.”



“The way we have used Discretionary Housing Payments so far is helping many tenants but is also causing financial pressures on the council that could make the scheme unaffordable. We’ve already been reviewing the scheme and made changes to provide a degree of protection while tenants consider and take steps to make up the shortfall in their rent or find alternative solutions. Our current plans will mean us using funds from our Housing Revenue Account to give particular support for disabled people who face losing out most from the government changes.”



Notes for editors:



Changes in support for tenants implemented by the Government since 2010 include:



• Local Housing Allowances in the private rented sector being reduced (now set at 30% of the market instead of 50% of the market)

• Social sector size criteria rules which reduce Housing Benefit by 14% where tenants are deemed to have 1-bedroom too many and by 25% where its 2-bedrooms too many or more

• A benefit cap which reduces the amount of Housing Benefit paid where overall benefit entitlement is greater than £500 for a couple (or £350 for a single person) the under-occupancy changes came into effect, the council spent £2.27m on Discretionary Housing Payments. This exceeded the Government’s initial contribution of £1.9m but the excess was met by a successful bid for additional funding from Department for Work and Pensions.



The table below shows how the money was spent and shows that the majority of the funding was spent on supporting tenants affected by the under-occupancy changes.

In 2013/14, when the under-occupancy changes came into effect, the council spent £2.27m on Discretionary Housing Payments. This exceeded the Government’s initial contribution of £1.9m but the excess was met by a successful bid for additional funding from Department for Work and Pensions. The table below shows how the money was spent and shows that the majority of the funding was spent on supporting tenants affected by the under-occupancy changes.



• Severely disabled in significantly adapted property: 456: £269,952

• Extra room for child access arrangements: 548: £268,211

• Approaching Pension Credit Age: 69: £34,202

• Extra room for pregnant women: 54: £8,134

• Exceptional Circumstances: 1442: £672,106

• Foster carers: 35: £22,890

• Other: 41: £20,182

• Number of Under-occupancy cases: 2645: £1,295,680

• LHA - welfare reform: 620: £383,427

• Benefit cap: 180: £289,690

• Other: 560: £305,337

• Total: 4005: £2,274,131



The Government’s funding for Leeds in 14/15 is £2.05m. While this represents a small increase against the basic funding for 13/14, it is, in fact, a reduction in funding as DWP is not providing any additional funds against which councils can bid. Additional funding has been provided by the council from the Local Welfare Support scheme and this gives a budget of £2.4m for the year. However, spend to date is showing a considerable increase compared to last year and action has had to be taken to reduce forecast spend down from £2.8m to around £2.4m.



The executive board report can be found at:



http://democracy.leeds.gov.uk/documents/s122253/Discretionary%20Housing%20Payments%20Report%20061014.pdf



Media contact:



Phil Morcom


Communications and Marketing team

Leeds City Council



Tel: 0113 224 3602

Fax: 0113 247 4736

www.leeds.gov.uk