Don't Believe the Benefits Hype Part One - Housing Benefit

The scene of the fallen tree that killed a homeless woman

Last Saturday night, during some of the worst storms and flooding seen in the westcountry in years, Michelle Conroy - a 21 year-old homeless woman - died when a tree came down on the tent in which she and two men were sheltering in Exeter. 

Early reports from the BBC simply stated that "a woman had died" when a tree fell on her, then as details emerged that she had been in a tent, BBC changed their reports to say that she was "camping." She was not camping. She was homeless, and she had died seeking shelter where she could.

In recent weeks Exeter Council has had several discussions and presentations about the changes and cuts this government is making to the welfare system. With a now tragic irony, many in Labour's ranks, and local voluntary agencies, have described these changes as an approaching "perfect storm". The stormy events of last Saturday night now create a desperate metaphor of the impact the seismic changes in the benefits system can have on the most vulnerable members of our community.

Shelter cannot guarantee service delivery
in Exeter beyond next March

Government cuts implemented by Tory-led Devon County Council has seen Exeter lose over 200 emergency and supported beds, while cuts are also seeing advice agencies that can help to prevent people losing their homes - the Citizens Advice Bureau and Shelter - losing staff at a time that demands on their services are soaring. 

One of the frustrations for me has been that public antipathy to the benefits system (and by extension to the recipients of those benefits) has been at a record high. An autumn poll for the Telegraph of over 3000 people showed 62% saying that they felt unemployment benefits are "too high", and a YouGov poll showed 36% being in favour of benefits being capped at under £20k a year. (The current cap will be set at £26k) In short, the idea of the "undeserving poor" - feckless, irresponsible, work-shy - has taken a hold. The rhetoric of the Tories has set working poor against workless poor, as was illustrated by the speeches George Osborne and David Cameron made to their Party's autumn conference. 

George Osborne at Conference 2012

"Where is the fairness, we ask, for the shift-worker, leaving home in the dark hours of the early morning, who looks up at the closed blinds of their next door neighbour sleeping off a life on benefits?" - George Osborne

"What are hard-working people who travel long distances to get into work and pay their taxes meant to think when they see families - individual families - getting 40, 50, 60 thousand pounds of housing benefit to live in homes that these hard working people could never afford themselves? It is an outrage. And we are ending it by capping housing benefit." - David Cameron

When the Left points out that this year the pay of top executives rose by an average of 27% when most workers' pay is not even keeping pace with rising food and energy costs, it is accused by the Tories of engaging in "the politics of envy". Yet when it comes to the poor, their strategy appears to be precisely to "divide and rule" - to persuade those that are working that those on benefits are somehow taking "their" money, getting "something for nothing", living an idle life on soaring benefit payments while those working are the "strivers." It's a sadly popular image.

Local Tory leader Yolonda Henson:
"They don't want to work!"

Even locally, the Tories peddle this view. At a recent meeting of Exeter Council's Executive Committee, as Labour Councillor Rosie Denham was stressing her concern about the growing number of local long-term unemployed, the Exeter Conservative leader was heard to say, "But they don't want to work!"

Here's a conundrum. In October, the government told us that employment  - those in work - rose to a record level. In the same month, local housing allowance (housing benefit) also rose to a record high. How can that be? If the Tories' economic strategy has somehow moved the "feckless and work-shy" reluctantly into employment, then surely our benefit payments should be falling, not rising? It is by answering these questions that we start uncovering the truth. 

The reason housing benefits are often so high is that private rents are high. The lack of affordable homes and social housing is pushing growing numbers of people into the private rental sector, which in turn is pushing rents up. The average rent of a 3 bedroom family home in Exeter is over £900 per month. The benefits paid to cover some of that (capped incidentally at just £700) is not money going to the claimants - it goes straight into the pockets of the landlord - and with the family concerned needing to find the additional £200.

93% of new housing benefits claims last year were from
households in work

According to the DWP, the government's own definition of "affordable" housing is rents costing no more than 25% of a household's gross (pre-tax) income. So, in order to afford, say, a modest £800 a month rented family home in Exeter, a household would need an income of £3200 per month, or £38,400 per year. The mean average household income is £31,500; but it is estimated that 21% have an income of less than £15,000 and 10% have an income of less than £10,000. Housing benefit costs are rising not because there are growing numbers of unemployed, but because rents are rising, and people who are actually in work simply do not earn enough. Last year, a staggering 93% of all new housing benefit claims were made by households that had at least one working adult. Yet the government has persisted with its caps and cuts, painting pictures of large, idle, workless families enjoying palatial homes at tax-payers expense. It is a myth. (Incidentally, 93% of benefit-claiming families have 3 children or fewer, and less than 1% have 5 or more children to support.)

From 2014, it is mooted, housing benefit will be removed altogether for those under 25. Even if young people of Michelle Conroy's age approach services for help, they will not be entitled to housing benefit. What other impact can such measures possibly have than to increase the number of young, vulnerable people on our streets?

What is to be done?

• Labour voted against a welfare cap, recognising that what is needed is greater regulation of private landlords, reducing rents, not capping housing benefits.
• Labour is calling for a huge building programme to provide more homes, more jobs and to boost a flagging economy. 
• In Exeter, over the next 5 years our Labour-led Council is on target to deliver more affordable homes (including housing cooperatives) than any other area in the southwest
• "Making work pay" and ensuring people are not "better off on benefits" is not about cutting benefits to poverty levels, but about ensuring that employers pay a living wage. Exeter Labour councillors and Ben Bradshaw MP have all voted against regional pay in the southwest, and are working on plans to make Exeter a living wage city.



Michelle Conroy, who died homeless
in Exeter this week.

• Exeter Labour is introducing a more strategic response to delivering benefits payments, by a complete business transformation review of the Council's Customer Service Centre, to ensure it functions as a "one-stop shop" for advice, and is directly linked with Citizens Advice Bureau, Shelter and other community sector services.

While this government remains in power, I am not at all confident that tragedies such as the death of Michelle Conroy will not happen again on Exeter's streets. However, Exeter Labour will be doing all it can to coordinate its reduced resources and pressured but excellent frontline services to minimise the impact of government cuts on the most vulnerable in our city.