Cuts have hit the region’s town halls nine times harder than wealthy parts of the South, a new analysis shows – despite the North facing much higher care bills.
The study highlights the areas where people suffer most from poor physical and mental health, disability and early death, imposing huge extra costs on local councils.
The worst-hit fifth of 325 authorities includes no fewer than ten North-East areas, a list headed by Middlesbrough which is ranked fourth for “health deprivation and disability”.
Not far behind are Newcastle (13th), Hartlepool (14th), Gateshead (17th), Darlington (20th), Redcar and Cleveland (21st), Sunderland (25th) and County Durham (28th), followed by Stockton-on-Tees (51st) and South Tyneside (65th).
On average, those ten councils have lost £213.04 of their overall ‘spending power’ for every resident since 2010, according to finance chiefs at Newcastle City Council.
Yet, the average loss in the ten areas with the fewest sick and disabled people, and much lower care costs, is calculated at just £23.19 per head – more than nine times less.
Incredibly, spending power has actually risen at one authority, Elmbridge, in Surrey (up £8.14 per head) – while it has plummeted in Middlesbrough (down £289.02).
The gulf is seen as crucial because social care is the biggest financial burden for cash-strapped councils, which are now also responsible for public health.
Recently, the charity Age UK warned that older people have been left “high and dry” by council cutbacks to help with washing and dressing, to day care places and meals on wheels services.
Hilary Benn, Labour’s local government spokesman, condemned the much-bigger cuts in areas with the biggest ill-health and disability burdens as “deeply irresponsible and unfair”.
Councils hit by the biggest cuts are already known to have slashed spending on adult social care by 12.7 per cent on average – against just 1.2 per cent in more protected authorities.
Labour has promised a new “fairer formula” for distributing local authority grants, but has yet to give details, or say when this would be introduced.
The ‘spending power’ measure bundles together grants, council tax, business rates and the New Homes Bonus, but is widely criticised for disguising the true scale of the pain.
Newcastle’s finance department calculated the changes since the 2010 general election, after the Government refused to produce official figures.
Source – Northern Echo, 14 Feb 2015
Welfare reforms such as the bedroom tax, sanctions and housing benefit cuts are fuelling England’s rapidly worsening homelessness crisis, according to an independent study.
The government’s welfare policies have emerged as the biggest single trigger for homelessness now the economy has recovered, the study says, and they look likely to increase pressure on vulnerable households for at least the next two years.
London has become the centre of homelessness, the study says, as high rents, housing shortages and welfare cuts force poorer people out of the inner city to cheaper neighbourhoods. Those who lose their homes are increasingly rehoused outside the capital.
Jon Sparkes, chief executive of the homelessness charity Crisis, said the report revealed the true scale of homelessness in England. “Rising numbers [are] facing the loss of their home at a time when councils are being forced to cut services. This is a desperate state of affairs.”
Official figures show that homelessness is rising – up by 12,000 in 2013-14 continuing an upward trend since 2009-10 – with rough sleeping also on the increase, and soaring numbers of homeless families in temporary accommodation.
But the study argues that these official figures underplay the scale and complexity of homelessness in England because they do not capture the hundreds of thousands of people in housing crisis who are given informal help by authorities.
Although latest government statistics show 52,000 households were formally recorded as homeless in 2013-14, a total of 280,000 families were given some sort of assistance by authorities because they were at risk of losing their home.
Local authorities are increasingly using informal homelessness relief to keep at-risk families off the streets by providing financial support and debt advice or by mediating with landlords, none of which appears in the headline statistics.
“Taking these actions into account, we see that the number of cases of people facing or at serious risk of homelessness rose sharply last year. Yet this alarming trend has gone largely unnoticed by politicians or the media,” said the study’s lead author, Prof Suzanne Fitzpatrick of Heriot-Watt University.
The Homelessness Monitor 2015, an annual independent audit, is published by Crisis and the Joseph Rowntree Foundation.
The housing minister, Kris Hopkins, said the study’s claims were misleading. Local authorities had a wide range of government-backed options available to help prevent homelessness and keep people off the streets, he said.
“This government has increased spending to prevent homelessness and rough sleeping, making over £500m available to local authorities and the voluntary sector,” he said.
Hopkins added that the government had provided Crisis with nearly £14m in funding to help about 10,000 single homeless people find and sustain a home in the private rented sector.
Julia Unwin, chief executive of the Joseph Rowntree Foundation, said:
“Homelessness can be catastrophic for those of us who experience it. If we are to prevent a deepening crisis, we must look to secure alternatives to home ownership for those who cannot afford to buy: longer-term, secure accommodation at prices that those on the lowest incomes can afford.”
The study finds:
- Housing benefit caps and shortages of social housing has led to homeless families increasingly being placed in accommodation outside their local area, particularly in London. Out-of-area placements rose by 26% in 2013-14, and account for one in five of all placements.
- Welfare reforms such as the bedroom tax contributed to an 18% rise in repossession actions by social landlords in 2013-14, a trend expected to rise as arrears increase and temporary financial support shrinks.
- Housing benefit cuts played a large part in the third of all cases of homelessness last year caused by landlords ending a private rental tenancy, and made it harder for those who lost their home to be rehoused.
The study says millions of people are “hidden homeless”, including families forced by financial circumstances to live with other families in the same house, and “sofa surfers” who sleep on friends’ floors or sofas because they have nowhere to live.
Official estimates of rough sleeper numbers in England in 2013 were 2,414 – up 37% since 2010. But the study’s estimates based on local data suggest that the true figure could be at least four times that.
Source – The Guardian, 04 Feb 2015
The North-East’s biggest council expects to have to cut its spending by more than quarter of a billion pounds by 2019, it announced today (Tuesday, January 6).
Financial experts at Durham County Council have been frantically crunching the numbers since Chancellor George Osborne delivered his Autumn Statement and the Government announced its local government funding settlement for 2015-16 in December.
While the budget reductions announced by the Chancellor were widely predicted, the extension of austerity means by 2019 central government grants to Durham will have fallen by 60 per cent since 2011 and the cuts total will have topped £250m.
The Labour-led council also had to cut £18m following the Coalition’s emergency budget in late 2010.
Previously, council leader Simon Henig claimed another Tory-led government would mean “the end of local council services as we recognise them”.
Today (Tuesday, January 6), he said the authority was “largely on track” to deliver the required savings, but added: “There is no doubt that facing these continued cuts we will no longer be able to protect frontline services.”
The council is expected to cut £16.2m and spend £10m of its reserves in the year from April and the budget will be top of the agenda when the cabinet meets in Durham Town Hall next Wednesday (January 11).
A council tax hike of two per cent, the biggest allowed without a local referendum, is expected in the 2015-16 budget, which will be finally agreed in February.
The council’s opposition groups are expected to announce alternative proposals shortly.
Northern town halls are furious that poorer areas are being hit hardest by austerity.
While December’s funding settlement saw councils lose an average 1.8 per cent of their spending power across the country, Durham was down 2.7 per cent, Newcastle by 4.9 per cent and Middlesbrough by 5.6 per cent.
In contrast, Surrey’s spending power grew by 3.1 per cent. North Yorkshire will gain 1.1 per cent.
Durham expects to have cut £136.9m from its spending by April, leaving £88.5m-worth of savings still to find by 2018.
Local government minister Kris Hopkins said the Coalition had been vindicated, because councils were still delivering good quality services with a reduced amount of money.
> There’s Tory thinking for you… and if you continue to cope, they’ll cut funding further because obviously you don’t need it.
If you don’t cope, they’ll cut funding anyway, because you’re in the North and don’t vote Tory, unlike Surrey and North Yorkshire.
Source – Durham Times, 06 Jan 2015
The pain is set to continue for South Tyneside Council and the people it serves as a near £7m cut in government funding was announced.
It means the authority will need to find yet more savings from services.
The settlement for 2015/16 – the amount the council can expect from the Government – announced by Local Government and Communities Minister Kris Hopkins yesterday, is £161,662m – compared to £168,482m – in the current financial year.
That is a reduction of four per cent and means the local authority has £6.821m less to spend on everything from waste collection to road maintenance.
That is significantly higher than the national average grant allocation cut of just 1.8 per cent.
Coun Ed Malcolm, the council’s lead member for resources and innovation, said:
“The Government has published its provisional grant figures for local authorities.
“We are currently analysing the proposed settlement for South Tyneside in detail to look at how it impacts on the local authority’s finances.
“We have already had to deal with an unprecedented series of budget cuts and have made savings of more than £100m so far. Over recent years, we have redesigned our services for maximum efficiency, improved quality through new models of service delivery and strategically planned ahead for further funding reductions.”
Borough council leaders do at least have an incentive to freeze council tax – for the fifth consecutive year.
Since 2011, the local authority has not increased the levy to its taxpayers by utilising a financial incentive from central government.
The Government has confirmed that incentive will remain in place in 2015/16 – making another freeze more likely.
Merv Butler, branch secretary of the borough’s Unison trade union, who has seen hundreds of his members lose their council jobs over the last four years, accused the Government of targeting areas in the most need.
He said: “This announcement is desperately difficult news for council staff and services.”
The local authority has already made an estimated £90m of efficiency savings since 2010, shedding 1,200 jobs in the process and the latest settlement will have an impact on every home in the borough.
There are 70,329 households in South Tyneside and average council spending on each amounts to £2,395.63p in the current financial year.
Next year that will drop to £2,298.65p – a four per cent reduction of £96,98p per household.
Mr Butler added:
“I expected a difficult settlement and that’s what we got. The fact that the council’s spending power has been reduced compared to the English average shows again that the Government is not giving sufficient grants to areas of need such as South Tyneside.”
Mr Hopkins has insisted the funding grants settlement for 2015-16 was “fair for all parts of the country”.
“Councils facing the highest demand for services continue to substantially receive more funding and we continue to ensure that no council will face a loss of more than 6.4 per cent in spending power in 2015-16, the lowest level in this Parliament.”
Source – Shields Gazette, 19 Dec 2014
This articlewas written by Patrick Butler, social policy editor, for The Guardian on Thursday 18th December 2014
Poverty charities and councils have warned that the government’s refusal to guarantee funding for local welfare schemes will force low income families in crisis to turn to food banks and loan sharks.
The government announced in January that it would no longer provide £180m central funding for local welfare assistance schemes operated by English local authorities after April 2015, triggering a cross-party revolt by Conservative MPs and council leaders, Labour councils and charities.
It is believed that the communities secretary, Eric Pickles, attempted to secure £70m for local welfare to announce in Thursday’s local government finance settlement, but was blocked by the chancellor, George Osborne.
The local government minister Kris Hopkins told the Commons on Thursday that there would be no additional funding for local welfare, although he encouraged councils to make further formal representations, raising faint hopes that the government may revisit the decision in February.
Local welfare provision offers emergency help for a range of vulnerable people who fall into unexpected crisis, including women fleeing domestic violence, homeless people, pregnant mothers, care leavers, pensioners and people suffering from chronic physical and mental health problems.
Some in Whitehall are understood to be concerned that cutting local welfare will provide additional fuel to critics who argue the government does not care about poverty. A cross-party report on food banks this month urged the government to protect local welfare assistance, saying food bank referrals would increase if it was not reinstated.
Hopkins said that although there would be no new funds for local welfare, ministers would outline a notional figure of £130m in the overall grant allocations to councils – a cut of £50m – although this would not be ring-fenced, meaning councils can spend it on other services.
Cllr Andy Hull, Labour-run Islington council’s executive member for finance, called the decision not to provide local welfare funding “an early Christmas present from the government for loan sharks and payday lenders.”
He added: “This safety net supports families to stay together, helps people sustain their tenancies and keeps kids out of care. It is a lifeline, not a luxury. Now, thanks to the government, it lies in shreds.”
The Local Government Association said almost three-quarters of local authorities will abandon or scale back local welfare schemes unless they receive government funding. Two county councils, Nottinghamshire and Oxfordshire, have already closed their schemes.
Alison Garnham, chief executive of Child Poverty Action Group, said:
“In the long-run tax payers will foot a higher bill if low-income families can’t stop a one-off, unforeseen expense from becoming a full-blown crisis – and the human cost will be high. For mothers leaving violent partners or youngsters moving on from homelessness or care, the schemes can make the difference between managing or not.”
Helen Middleton of the Furniture Reuse Network, whose member charities work closely with councils on helping low-income families, said the decision showed the government had “no real understanding of the levels of poverty in this country”.
Homelessness charity Centrepoint said young homeless people used local welfare schemes as a vital safety net:
“It’s completely unacceptable that young people who have fought to turn their lives around after facing homelessness are once again left to sleep on floors for lack of something as basic as a bed.
“Ministers must look carefully at responses from councils to this announcement and consider whether their proposal really reflects the level of poverty in many of our communities.”
Matthew Reed, chief executive of the Children’s Society, said:
“The government’s decision to reduce annual funding from £172m to £130m will make it harder for councils to support vulnerable families facing a crisis. The requirement that town halls fund their schemes from within existing budgets may create a postcode lottery for many families in poverty.”
Source – Welfare Weekly, 18 Dec 2014
Universal Credit claimants who fall behind on rent payments could see up to 20% of their monthly allowance redirected to landlords, the DWP has announced.
The move comes after housing organisations raised concerns that the previous amount of just 5% could result in increased arrears and possible evictions.
Universal Credit brings together six different benefits into one monthly payment and the housing element will, in most cases, be paid directly to the claimant – rather than their landlord.
The new system is designed to “encourage financial responsibility”, says the Department for Work and Pensions. However, some housing organisations and charities are concerned that vulnerable claimants – which may include people with learning difficulties or debt problems – may struggle to manage their finances and fall into rent arrears.
The DWP say “work coaches are being trained to assess a claimant’s financial capability and will refer to personal budgeting support where appropriate”.
Where Universal Credit claimants need additional support to help keep up with their rent payments, the DWP may make rent payments directly to landlords, and deduct additional amounts from a claimant’s monthly Universal Credit payments if requested by landlords.
Communities Minister Kris Hopkins said:
“Universal Credit helps claimants and their families to become more independent through simplifying the welfare system. I welcome this initiative to help social landlords and tenants prepare for Universal Credit.
“I’ve been impressed by the work I’ve seen that social landlords do in supporting their tenants and it’s clear to me they have a vital role to play in helping them to make this change. A large number of social housing tenants will over time move onto Universal Credit so I would encourage landlords to get involved.”
In a ‘support pack‘ published for housing organisations, the DWP said:
“The amount that can be deducted from a claimant’s universal credit if they fail to pay their rent, has been increased from 5% to an amount of up to 20% of the universal credit standard allowance, which will ensure claimants are back on track with payments quicker. The minimum amount that will be deducted is 10%.”
If a claimant accumulates a months worth of rent arrears it will trigger “early intervention” by the DWP, who will review a tenants financial status and may consider making rent payments directly to landlords where appropriate.
Should a tenant accrue two months of rent arrears, the DWP will step in immediately and divert the housing element of Universal Credit to a claimants landlord.
20% of a claimants ‘standard allowance’ could be deducted and diverted to landlords to clear rent arrears as quickly as possible. The DWP had consulted with charities and experts on deducting as much as 40% from a claimants standard allowance.
However, like many others, The Money Advice Charity described this amount as “excessive”, which “could ultimately compound the financial difficulties that led to the arrears building up.”
Responding to the consultation (pdf) the charity said:
“A maximum deduction rate of 20% for housing-related arrears would strike a more appropriate balance between increasing repayments and ensuring that these repayments do not have unintended negative consequences.”
Social landlords are being encouraged to identify tenants who may be struggling to keep up with their rent payments under Universal Credit.
Lord Freud, Minister for Welfare Reform said:
“Social landlords have been playing a vital role in welfare reform and supporting tenants who are already receiving Universal Credit. There is great work happening in the sector.
“Universal Credit is now available in 1 in 10 Jobcentres and will be in almost 100 by Christmas, with national roll-out beginning early next year – so now is the ideal time to boost preparation activity.
> Didn’t they say that last year ?
“For the first time many tenants will be paid their Housing Benefit directly and I would encourage landlords to think about identifying tenants who need support to prepare for this, and put those who are ready onto a direct payment early.”
Universal Credit has been beset with delays and costly IT problems. The DWP has already written-off £40 million failed IT system with a further £90 million predicted to be thrown away over a five-year period.
Work and Pensions Secretary Iain Duncan Smith originally promised that 1,000,000 households would be on Universal Credit by the end of 2014. However, DWP figures show that less than 18,000 households were claiming Universal Credit by 9 October.
The national roll-out of Universal Credit is expected to be fully completed by 2018.
Source – Welfare Weekly, 13 Nov 2014
This article was written by Randeep Ramesh, social affairs editor, for The Guardian on Wednesday 27th August 2014
Local authorities were unable to collect up to 40% of council tax due from low-income households that had the charge imposed on them for the first time last year.
The result has been widespread non-payment. Nationally, more than a fifth of council tax charged to working-age claimants was unpaid at the end of 2013-14.
The figures, obtained from responses from 140 councils to Freedom of Information requests by the anti-cuts group False Economy, reveal that some of the biggest towns and cities were left chasing millions of pounds from the poor.
Liverpool collected 61% of council tax due from the poor, leaving the city short by £3.5m.
In Birmingham, the non-payment rate among the vulnerable was 30%, leaving the council seeking to recover £3m in lost revenue.
Leeds, Nottingham and Sheffield were all chasing more than £2m each in tax from those on the lowest incomes.
A report published last month by Child Poverty Action Group and the Zacchaeus 2000 Trust said almost 40% of Londoners affected by the cuts had been sent a court summons for council tax debts in 2013-14, with more than 15,000 claimants’ debts referred to bailiffs.
In Haringey, north London, which collected 80% of the council tax due from benefit claimants, hundreds of households have been taken to court to recover unpaid tax – with non-payers threatened with bankruptcy, repossession and ultimately prison.
Last week, sitting in the magistrates court in Tottenham, Dick, 49, said there was “no way” he could afford the £7-a-week council tax his housing association two-bedroom flat was being charged. He has walked with a stick since his Achilles tendon snapped in 2012.
“I don’t work. I get employment support allowance which is £70 a week and my son lives with me and he gets a few hours on a market stall. After rent and everything else we have about £140 a month to live on. Food, clothes, the lot. I go down the food bank to eat. Can’t afford to heat up food because we cannot put money into the gas meter. How can I afford the council tax too? We never paid this before. It’s just getting the poor to pay up. That’s all it is.”
Dick said he had offered to pay £3 a week towards council tax after working out his finances with the local Citizens Advice bureau, but the local authority did not respond to his offer. Instead the council has asked for the full year’s council tax to be paid immediately – £350 – plus the cost of recovering his unpaid tax through a liability order of £125. “It’s ridiculous. I worked all my life. Never needed anything. Now I got nothing they want to get that.”
A spokesperson for False Economy called for the cuts to be reversed. “These figures show that people on low incomes are struggling to cope with council tax benefit cuts, just as the government was warned they would. Households are left either falling into debt and at risk of legal action, or taking money for food and essentials to plug the shortfall, in what is a government-created personal debt crisis.”
Councils said they were caught in an “impossible situation” as ministers had forced local authorities to pass on £500m in cuts when the scheme was introduced – and there would be further reductions in the discounts the poor received as town hall budgets were squeezed in the coming years.
Sharon Taylor, chair of the Local Government Association’s finance panel, said: “Councils would need to find £1bn by 2016 to protect discounts for those on low incomes.
“At a time when local government is already tackling £20bn worth of cuts, this is a stretch too far. Many councils have been put in an impossible position. No one wants to ask those on the lowest incomes to pay more. But pressure on funding for local services means many councils have had little choice but to reduce the discount.”
Hilary Benn, the shadow cabinet member responsible for local government, said two million of the poorest people were affected by the council tax hikes.
“These figures show that many of the people affected, including single parents and disabled people, are finding it very difficult to pay the Tories’ tax increase. The government was warned that this was going to be Poll Tax mark two, and so it is proving.”
The government defended its changes, saying it had “worked with councils to freeze council tax for the last four years” for most residents.
Kris Hopkins, the local government minister, said: “Our reforms to localise council tax support now give councils stronger incentives to support local firms, cut fraud, promote local enterprise and get people into work. We are ending Labour’s something-for-nothing culture and making work pay.”
Source – Welfare News Service, 29 Aug 2014
Housebuilding has collapsed in most of the region – despite Government claims of a “success story”.
The number of ‘affordable homes’ being built has fallen in 13 of 17 areas since the Coalition came to power, after housing programmes were axed.
And it has plunged sharply in many areas, including in Hartlepool (down 62.5 per cent), Middlesbrough (down 59.1 per cent) and Stockton-on-Tees (down 54.5 per cent).
The lack of new homes is even more acute in North Yorkshire, in Hambleton (down 76.9 per cent), Ryedale (down 66.7 per cent) and York (down 85.2 per cent).
In Richmondshire, not a single affordable home – those available at lower rents, or for shared ownership – was completed in 2013-14.
Yet, in 2010-11, the year the Coalition came to power, 60 were built, the official figures show.
Only South Tyneside, where 1,050 affordable homes were completed last year, bucked the trend, cutting the decline across the region to 15.3 per cent.
Last week, the department for communities and local government (DCLG) claimed its record on affordable housing since 2010 was a “clear success story”.
But ministers totted up four years’ of figures to reach that tally – and the statistics for previous years reveal a different story.
Rachel Fisher, head of policy at the National Housing Federation, said: “It is nowhere near enough.
“Demand is still far exceeding supply. England needs around 240,000 new homes a year. We need to build more of the right homes, in the right place, at the right price.”
Emma Reynolds, for Labour, said: “We have repeatedly called for action on housing supply, particularly on the need for more affordable homes, but this government has failed to act.
“Under David Cameron, the number of homes built has fallen to the lowest level in peacetime since the 1920s.”
The chronic shortage of housing is an issue rising up the political agenda, with hundreds of thousands of families languishing on council waiting lists.
Meanwhile, town halls remain barred from borrowing money to build homes, as the Government relies on the private sector to step in.
But Kris Hopkins, the housing minister said: “Our affordable house-building efforts are a clear success story, with nearly 200,000 new affordable homes delivered since April 2010.
“It means families have new homes available to them, whether to rent at an affordable rate or to buy through our shared ownership schemes.”
Across England, 41,654 affordable homes were built last year – well down on the 53,172 in the year before the last general election.
Source – Northern Echo, 20 June 2014
Unemployment Minister Esther McVey claimed a whopping £17,227 last year to rent a swanky central London pad whilst invisible Housing Minster Kris Hopkins trousered £18,045.
The total bill for MPs languishing in luxury properties at our expense came to over £5 million says pressure group Generation Rent who compiled the figures.
The maximum Housing Benefit available in London is just over £250 a week for a single person, around £100 a week less than McVey scrounges. This benefit goes to people in and out of work alike and was capped shortly after the current government weren’t elected. Soaring rents in London have meant that many new housing benefit claimants are working full time but still cannot afford the eye-watering cost…
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A GOVERNMENT minister has been challenged to a face-to-face meeting with South Tyneside councillors concerned at the impact the ‘bedroom tax’ is having on borough citizens.
> Good luck with that. The Jarrow marchers in the 1930s walked the length of England to London, only to have government ministers refuse to meet them when they got there.
South Tyneside Council chief executive Martin Swales is to write to Tory MP Kris Hopkins, the current housing minister at the Department for Communities and Local Government, calling for the meeting.
> Make him come here.
It comes after a motion expressing concern over the scheme was carried unanimously at a full council meeting last week.
The motion – signed by ten South Tyneside councillors – stated that the tax ‘discriminates unfairly against the poorest in our society’ and welcomed a commitment by Labour Leader Ed Miliband to ‘repeal this draconian legislation’ if the party returns to power at next year’s General Election.
> Given Labour’s other plans for the poor, I should wait a while before we all start cheering (and voting).
A total of 2,770 council tenants in South Tyneside have been affected by the tax, which has seen a cut in housing benefit for households with one or more bedrooms deemed to be spare.
Nationally, one in three council tenants affected by cuts to housing benefit have fallen behind on rent since the policy took effect in April, according to figures from the Trades Union Congress.
Since March there has been an £81,000 rise in South Tyneside council rent arrears, with the total amount owed to the local authority now standing at £1.8m.
The motion stated: “South Tyneside Council notes with concern that 2,770 council tenants have been affected by the bedroom tax.
“The council believes that the bedroom tax discriminates unfairly against the poorest in our society, and that by forcing residents to leave their homes can lead to instability of close-knit local communities and neighbourhoods.”
> Suprisingly ( or perhaps not…) they don’t seem to have connected the above with the rise in begging on the streets in South Shields, reported yesterday.
Source – Shields Gazette, 21 Jan 2014