From the TUC

Housing Benefit debate: Ministers may be mistaken with facts

09 Nov 2010, by in Society & Welfare

Today’s Housing Benefit debate has allowed both Steve Webb and Ian Duncan Smith to make use of the DWP’s secret briefing that was published yesterday by Left Foot Forward.

During this afternoon’s debate Steve Webb has informed the House that “private rents have fallen by 5 per cent since 2008, LHA rents have risen by 3 per cent”. And the Secretary of State for Work and Pensions has also told MPs that ‘nine tenths of growth in Housing Benefit is down to increased rents’. Both Left Foot Forward‘s analysis and comprehensive work undertaken by the Chartered Institute of Housing shows that these statements are wrong.

In their analysis of changes, CIH found that:

Around 70% of the recent rise in the housing benefit bill is due to an increase in the caseload arising from the economic down turn.

And in his post yesterday, Declan Gaffney showed that when you compare private sector rents and HB over the same time periods (which the DWP analysis failed to do) the disparity in rents falls significantly. His analysis also demonstrates that:

Average payments in the private rented sector account for only 10 per cent of all HB growth – and even this is not a sign of landlords pushing up prices, because there have been enormous flows of tenants on to LHA since 2008, and it would hardly be surprising if those impacted by the downturn in employment had, on average, higher rents than the existing caseload. Within the private rented sector, 86 per cent of growth came from increased numbers of recipient households. When it comes to accounting for recent growth in housing benefit, rent inflation is a red herring.

And as the DWP’s own research showed earlier this year, despite the Government policy line the facts on the ground show that low income workers in the private sector can afford better accommodation than those who are out of work and claiming HB.

The Government may get away with statistical mistakes when attempting to make the case for these reforms. But the crunch will come when the impacts of their policies start to be revealed – all of the evidence suggests that these will be far worse than the Govenment are currently choosing to believe.

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