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End of spare room subsidy 'puts thousands in arrears' One in three 'behind on rent' since housing benefit changes
(35 minutes later)
Tens of thousands of people affected by the removal of the spare room subsidy have fallen behind with their rent, according to the National Housing Federation (NHF). One in three council tenants affected by a recent cut to housing benefit has fallen behind on rent since the policy took effect, figures suggest.
The NHF said half of those affected by the so-called bedroom tax went into arrears between April and June. The TUC's False Economy campaign made Freedom of Information requests to all of Britain's councils; 114 responded.
It said 32,000 tenants had gone into arrears, or further into arrears, just after the policy started. Data revealed 50,000 tenants had fallen into arrears since 1 April 2013 when the spare room subsidy, dubbed the bedroom tax by critics, was scrapped.
But the government said the removal of the subsidy was a necessary reform. The government said the figures did not represent "long-term" changes.
For its survey, the NHF surveyed 51 housing associations across the country. The policy was introduced to reduce the housing benefit bill and free up homes for families living in overcrowded conditions.
In a separate sample, it also found that 25% of tenants affected by the spare room subsidy had gone into arrears for the first time. It means that housing benefit was cut to tenants in a council or housing association property who are deemed to have bedrooms they do not need.
"This is the most damning evidence yet to show that the bedroom tax is pushing thousands of families into a spiralling cycle of debt," said David Orr, the NHF's chief executive. The Department of Work and Pensions said the policy is in its early stages and it was "carefully monitoring the policy nationally, ensuring the extra funds to support vulnerable tenants are used well as these changes are introduced".
"If these figures are replicated nationwide, over 330,000 households could already be struggling to pay their rent and facing a frightening and uncertain future," he said. False Economy's report is the biggest study of the effects of the benefit change carried out so far.
The changes, introduced in April, mean that tenants with one spare bedroom have lost 14% of their housing benefit, or £14 a week on average for someone in a council house. Those in housing association accommodation have lost an average of £16 a week. None of the 50,000 tenants were in arrears prior to the benefit changes.
Anyone with two or more spare bedrooms will have lost 25% of their housing benefit. 'Only get worse'
Hardship The council with the greatest percentage of tenants who had fallen behind was Barrow in north-west England. Of the 289 tenants there affected by the cut, 219 have not been able to pay rent since the policy came into effect.
But the government took issue with the survey, saying it was based on a narrow sample, and only covered the first three months of the policy. False Economy campaign manager Clifford Singer said the figures show that, along with other benefit cuts, the benefit change is "driving tenants and families who were just making ends meet into arrears".
"It is just wrong to suggest the early stages of the policy - as people start to adjust to the changes - represent long-term trends in any way whatsoever," said a spokesman for the Department for Work and Pensions (DWP). He predicted that tenants could struggle even more if council payments designed to help the most in need stop.
He added that the removal of the spare room subsidy was "a necessary reform to return fairness to housing benefit". ''The worst part is that these figures have been collated while councils' emergency Discretionary Housing Payments are still available; they are being used up at record speed and when they run out, these figures will only get worse," Mr Singer said.
The government has said the change will save the taxpayer £500m this year, and a similar amount next year. The National Housing Federation has also carried out a survey looking at the numbers of tenants in arrears.
However, it said it will monitor what happens, to make sure the change is applied fairly. It found that a quarter of households affected by the cut have fallen behind in their rent for the first time ever - 11,000 out of 44,000 households were in arrears according to data given by 38 of England's housing associations.
It has already provided £190m as a transitional subsidy, to ease cases of hardship. The National Housing Federation's Chief Executive David Orr, called the figures "damning".
"What more evidence do politicians need that the bedroom tax is an unfair, ill-planned disaster that is hurting our poorest families? There is no other option but to repeal," he said.
'Have to lump it'
One of the central criticisms of the policy is that there are not enough one or two bedroom homes for people to move into.
The National Housing Federation estimated in March that although 180,000 households were under-occupying two bedroom social homes, only 85,000 one-bed social homes became available in 2011-2012.
It is one of the reasons why Tony Wilson, a former civil servant who worked on housing policy, thinks that rent arrears could become the new normal in social housing.
Now head of policy at Centre for Economic and Social Inclusion, he said that research shows most tenants are unlikely to move out of their homes - instead they will deal with the cuts.
"Essentially people either reduce what they spend, or they find work. The problem is that even where people are looking for work, they're not finding it.
"I think, going forward, this is going to be a permanent problem for social landlords and for Local Authorities, of increasing rent arrears. To some extent, they're going to have to put up with that, they're going to have to lump it.''