Housing Benefit to Be Targeted In Osborne's Welfare Cuts

Housing benefit could be cut by over 10% in George Osborne's July Budget as the government attempts to deliver its commitment to reduce welfare spending by £12 billion in two years. The Institute for Fiscal Studies said that the pledge to protect child benefit from the social security cuts means HB, along with tax credits and disability/incapacity benefits, would "most likely" take the biggest hit.  Carl Emmerson, IFS deputy director, explained: "Cuts of this scale amount to almost 10% of unprotected benefits. Finding such a reduction without cutting child benefit would mean that even more significant cuts would likely be required to spending on one or more of tax credits, housing benefit and disability & incapacity benefits." Read more on 24dash.

Hitlist of Welfare Cuts Facing Next Chancellor

A list of “very, highly or extremely controversial” potential cuts to benefits have been drawn up by civil servants in response to warnings that the next government would struggle to keep welfare spending below a legal cap of about £120bn a year. Options laid out include:

• employers to contribute more to the cost of statutory maternity pay – or abolish it entirely.

• Freezing benefit payments at current levels across the board.

• Limiting welfare payments by family size.

• Forcing single parents on income support to seek work when their youngest child reaches the age of three (currently five).

• Making it harder for sick people to claim state aid when they are out of work by introducing “stricter” fit-for-work tests and/or tighter limits on eligibility.

• Increasing the bedroom tax on certain categories of renters.

• Barring under-25s from claiming incapacity benefit or housing benefit.

Read more on the Guardian website.

Should Social Landlords Pass On The Bedroom Tax To Tenants?

The idea of social landlords reducing rents by universally reclassifying their properties against those hit by the bedroom tax may seem absurd, but let's do the maths.  We already know there aren't enough alternative one-bedroom properties for the 400,000 who qualify for them; there are only 60,000 relets of existing one bedroom properties each year.  Even if all one bedroom homes we have were only allocated to underoccupiers from now on, some would wait for seven years while being charged as much as £25 extra a week from an income of as little as £75. Add on council tax, utilities and existing debts, and it becomes an impossible, unaffordable situation for many.  The impact will be worst in the north of England, hit by higher levels of underoccupation and by other benefit cuts such as changes to employment and support allowance, tax credits, incapacity benefit and council tax. Recent estimates suggest that working age households will face an additional £4.50 a week in council tax, while across the north east of England 50,000 underoccupiers will need to pay an additional £30m a year in rent. The government's discretionary housing payment (DHP) fund stands at £1.25m, leaving a shortfall of at least £28m in help available for underoccupiers.  This won't improve much even when a promised DHP increase kicks in next year. Durham county council has estimated the impact of welfare reform as a whole on the local economy in 2013 at £150m, worse in following years. That's £150m less going into local pockets, businesses and services when it already has the highest worklessness and the lowest job creation rates in the country.  Read more of this opinion piece on the Guardian website.

Incapacity Claimants Set To Be Slashed By One Million

A report reveals for the first time the likely impact of the reforms to incapacity benefits that are currently underway. Researchers from the Centre for Regional Economic and Social Research Centre at Sheffield Hallam University calculate the headline total of 2.6m men and women on incapacity benefits is set to be cut by nearly 1m by 2014. Most of these will be existing claimants who will lose their entitlement. The report shows that, because of the reforms, 600,000 are set to be pushed out of the benefits system altogether, forcing a big increase in reliance on other household members for financial support. The research also shows that by far the largest impact will fall on the older industrial areas of the North, Scotland and Wales, where local economies have been struggling for years to cope with job loss and where the prospects of former claimants finding work are weakest. The report provides estimates of the impact of the reforms for every district in the country. Download a copy from the Sheffield Hallam website.