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Living with the 'bedroom tax'

Hugh Owen

Hugh Owen
Director of Policy and Communications

So the Government got its way, and the Welfare Reform Bill will shortly become law, meaning that many tenants will face the under-occupation penalty, aka ‘the bedroom tax’. Lord Best led stout opposition to this unfair penalty in the House of Lords - he deserves a huge ‘thank you’ on behalf of landlords and tenants across the UK.

So what do we know?

– from April 2013 working age social housing tenants will have their housing benefit cut by an average of £14 per week if they are deemed to be under-occupying their home in accordance with a very ‘tight’ set of rules called the bedroom standard. There are few exceptions.

Two – this will have a major impact on tenants with disabilities, those on low incomes, and the over 40s. Many of those affected will be longstanding, loyal tenants, whose children have ‘flown the nest’.

Three – surveys tell us that around one third of tenants will try and move, mainly to one bedroom properties: far more than the Government is banking on. However there is a national shortage of one bedroom council and housing association homes and many tenants will have no choice but to move into the more expensive private sector or stay put.

Four – the majority will stay put. Surveys show that of those, nearly eight in ten are worried about going into debt, and 40% fear they will soon accumulate rent arrears. This will lead to loss of income for landlords – less to spend on new homes and services - and increasing evictions and homelessness.

Sadly all of these arguments have been put to the Government, but have fallen on deaf ears. In the end it all came down to money, and surely that is that!  Well not quite. Shortly the Government will spell out the details through laying regulations before Parliament – if you like the small print. Needless to say we will look at these very carefully, and ensure they do not go beyond what Parliament has agreed, unfairly penalising the type of tenants who need protection. The Government has also promised a review of the under-occupation penalty once it kicks in, and we need to make sure this is done quickly, thoroughly and independently.

The bedroom tax has been a massive campaigning issue for Riverside, especially the 6,700 tenants who stand to lose benefit. We have campaigned hard together, but now is the time to move on, and turn our attention to supporting those who are at risk because of the penalty. We are doing this in three ways:

·         Improving our data. We have spent the last year doing this and now have a pretty clear idea which households are most at risk.

·         Providing clear information to tenants: existing and prospective. Whilst we don’t want to alarm people, it is essential that those affected understand the implications of the changes and what choices they have.

·         Providing support and advice, focusing on: opportunities for downsizing, where they exist; ways of boosting income through our employment and money advice services; and other alternatives such as taking in lodgers.

None of this is easy, and tenants and staff will need to steel themselves for difficult conversations over the coming 12 months. The impact on communities could be profound, but we will do all that we can to make sure that tenants have information and sound guidance to help them make informed choices.