The Housing Benefit bill is set to spiral out of control due to low wages and rising rents, official figures suggest.
Between 2010/11 to 2018/19 the amount spent on helping struggling households to keep roofs over their heads is set to rocket to a staggering £12.9 billion, or £488 for every household in the UK.
The figures obtained from the Commons Library also show that Housing Benefit paid to people in work is set to more than double, from £2.4 billion in 2010/11 to £5.5 billion in 2018/19.
Stagnating wages will also have a knock on effect on how much is spent supporting low-income households with tax credits. Currently the UK spends £21.2 billion on tax credits, but this is forecast to rise to £23.7 billion by 2018/19.
Speaking in Pudsey, West Yorkshire, Rachel Reeves is expected to say:
“The number of working people claiming housing benefit is set to double because the Tory Government has failed to tackle low pay, insecure work and the cost-of-living crisis.
“Labour will raise the minimum wage, introduce living wage contracts and get 200,000 homes built a year by 2020 to tackle the bill and ensure working people can make ends meet.”
She will also say that Labour may withdraw its support for Iain Duncan Smith’s flagship Universal Credit scheme, unless “urgent action” is immediately taken to prevent “more money being wasted” on the crisis hit programme.
Ms Reeves will say: “Today I want to make a direct appeal to David Cameron and Iain Duncan Smith.
“Labour wants Universal Credit to work. But we won’t accept more taxpayers’ money being wasted. It is in crisis and needs urgent action.”
> Yes, Rachel, but what you need to understand is that the problem with Universal Credit is not just that it’s a money pit. Its also the way in which it makes life so much more difficult for people who already have more than enough problems to be going on with.
Are Labour going to deal with those aspects ? Nothing seen so far suggests that they would anything except continue with more of the same.
Earlier this year, Welfare Reform Minister Lord Freud described the write-off of a failed £40 million IT system for Universal Credit as “deeply regrettable”.
He insisted that the programme would be delivered on time and within its £2.5 billion budget and that the scheme would benefit taxpayers to the tune of £35 billion.
Minister for Disabled People, Mark Harper MP, told the Daily Mirror that the government had “inherited an out-of-control housing benefit system from Labour”.
He added that the government were working to “build a welfare system that provides a safety net for those in need, while rewarding the willingness to work”.
Source – Welfare News Service, 05 Aug 2014