With a further £12bn in welfare cuts in the pipeline, what evidence is there to show that reforms to the welfare system are helping people into work and cutting costs?
The head of Housing and Communities at the London School of Economics (LSE) believes that savings are lower and costs are higher than planned.
Anne Power says:
“In 2013 and 2014, LSE Housing and Communities carried out a survey of 200 social housing tenants across the South West of England to find out whether welfare reform, introduced by the coalition government, was in practice helping tenants into jobs and making them better off.
“We found that the impact was direct, harsh and in most cases not leading directly to work. We have also talked to 150 social landlords and their tenants all over the country to understand the impact of cuts in benefits on the way landlords and tenants are managing.
“Our findings are striking. Welfare reform isn’t working as planned. Government savings are lower and costs are higher, particularly disability payments due to mismanagement.
“The ‘Bedroom Tax’, was introduced to make social housing tenants with one spare bedroom move home or pay more rent. This has led to empty homes in some parts of the country as many social landlords in the North and the Midlands have surplus larger properties which they have under-let to small households. Tenants now compete to downsize, leaving a costly supply of empty, larger units. Often tenants simply can’t find a smaller unit to move too.
“Sanctions, government-imposed penalties on job seekers who fail to meet Job Centre requirements, suspend all benefits with no notice. Many appeals have over-turned the job centre sanctions but often too late to prevent deep and sometimes tragic hardship. Housing benefit payments are also rising because evictions have forced tenants to pay higher rents in the private rented sector.
“Welfare reform is directed at getting a job. But older working age bands struggle because, after a long gap, skills may no longer be usable and jobs requiring IT require considerable retraining. Former manual workers often suffer serious injuries at work and can no longer do hard labour.
“Benefit cuts create longer term social costs too. For example, carers and their dependents may need a spare bedroom for a foster child or sick relative or night-time carer.
“The government is playing to popular attitudes. Spending on welfare, when austerity hits everyone, is not popular. There is a common belief that far more people cheat than actually do, whereas bureaucratic errors are far more common and cost more.
“There is general belief that people should work, whatever the job and certainly tenants we spoke to want to work. Tenants like working. But “booting” people into standing on their own feet can cut vital support lines without jolting them into a job. It can incapacitate them.
“Welfare reform is underpinned by a strong belief in the value of the market; if things don’t pay, they will stop happening, so if benefits don’t pay, people will stop depending on them. This over-simplified view has led to unintended and unnecessarily harsh consequences. As tenants feel less certain that they can rely on benefits, they find job centre interviews and the threat of sanctions too painful and too humiliating, so some just disappear off the unemployment register.
“The number of people actually finding work through job centre action is far smaller than claimed.
“On the other hand, tenants want to work whenever possible, even when pay is poor, so in that sense the strong work focus of welfare reform is positive. Tenants also like training and learning – and job centres send claimants on courses.
“Tenants are adjusting to lower incomes, although paying bills is a constant juggling act and it is no longer possible to take basic support for granted. The adjustment tenants are making would be far more painful if it wasn’t for advice organisations like CAB, churches and charities that offer emergency support. Food banks help in extreme circumstances.
“Social landlords are responding to welfare reform and the wider cuts they face with considerable anxiety. They know the vast majority of their 4 million tenant households are hard hit.
“Collecting rents becomes even more important, but far more challenging. Welfare reform has forced social landlords to recognise the need for more direct, face-to-face, front-line contact with tenants to ensure payments and help resolve problems. They develop opportunities for training and accessing jobs to help welfare reform work.”
Source – Welfare Weekly, 26 May 2015
David Cameron’s plans to target benefit cuts at the young and vulnerable have come under fire from within his own party.
Sarah Wollaston, the Conservative chair of the health committee, said she did not support scrapping housing benefit for 18-to-21-year-olds, after the prime minister toured the television studios detailing some of the Tories’ proposals to cut another £12bn from the welfare budget.
In a series of interviews, Cameron repeated his pledge to lower the welfare cap from £26,000 to £23,000 per family alongside proposals to stop housing benefit for school-leavers. The cap was about a “basic issue of fairness”, he said.
“I don’t think a family should be able to get more in benefits than someone going out to work, working every day, and trying to do the right thing for them and their family,” he said.
> If anyone ever does get more in benefits than someone working (which I doubt) , perhaps it’d be because the wages they are earning are so poor, or they’re only working 16 hours a week.
But in any case, you can only play the hand you’ve got, so if it did happen that you’d get more on benefits than by working…why not ? Cameron & Co probably dodge paying more tax in a year than you’d claim.
“One of the criticisms of the cap set at £26,000, which I have heard all over the country, is that the cap was set too high. We’re responding to that.
“We’re generating these jobs. People listening to this programme don’t pay their taxes to sustain people on welfare who could work.”
> Well actually, yes they do – National Insurance, at least. When working I’ve never grudged paying NI (much) because I paid it in the belief that I could claim some of it back should I become unemployed, and also – and this is an important point – that it should go towards helping others unemployed even if I wasn’t.
He said the country was no longer willing to tolerate people living on welfare as “a lifestyle choice” and claimed Conservative plans would help “young people move into work more quickly”.
> A lifestyle choice ? And I thought it was a survival choice….the choice being survive or die.
However, his proposals on scrapping housing benefit for young people came under fire from Wollaston and a number of charities.
Wollaston, the Conservative MP for Totnes, told the BBC’s Daily Politics:
“That is a policy that I don’t actually support. The point is that there is a debate going forward, I would not support personally taking housing benefit from the most vulnerable. I would not personally support taking away housing benefit from the very young. I think because there is an issue here we need to discuss about intergenerational fairness … There are many policies within parties that we have a debate about.”
Tory peer Baroness Wheatcroft later added that the Conservatives need to “get the tone right” to make sure they sound sympathetic towards those who cannot work.
“I firmly believe there is only one nasty party and it’s a very nasty party called Ukip. What the Conservative party needs to do is to be careful that it does not appear to be in the least nasty, but kind and caring and wants people to work because it is the best possible solution to them as well as the country,” she told the World at One.
> HA HA HA HA HA ! Maybe you’d appear kind and caring if you were kind and caring. No-one who has been fucked over by the Tories is going to forget it.
The warnings came the day after academics from the LSE, Manchester and York published a new study showing the coalition’s cuts are disproportionately hitting families with young children.
Among the charities to issue warnings about the proposed benefit cap were the Child Poverty Action Group. Its chief executive, Alison Garnham, said:
“Let’s be absolutely clear – the benefit cap is at least nine times more likely to affect children than adults, and the majority of adults it hits are lone parents, many of whom have children so young even the government recognises they should not be required to work.
> The parent or the children ? I only ask because the government making small children work just seems so likely…
“On the day that a major programme of research by academics from leading universities shows families with young children have been more impoverished than anyone else in recent years, we have another policy-push that would undercut the most vulnerable.”
Paul Noblet, head of public affairs at youth homelessness charity Centrepoint, weighed in on the issue of housing benefit, saying it would cause further misery for vulnerable young people.
“The 80,000 young people who find themselves homeless will think David Cameron is more focused on May’s elections than the reality that, for the most vulnerable young people in our society, housing benefit is a lifeline, not a lifestyle choice,” he said.
Source – The Guardian, 27 Jan 2015