Housing Benefit: Pensioners – Parliamentary Written Answer

Luciana Berger: To ask the Secretary of State for Work and Pensions, what assessment his Department has made of the potential merits of extending the local housing allowance from pensioners in the private rented sector to those in the social rented sector.

Caroline Nokes: Local housing allowance rates will not be introduced in the social rented sector for general needs housing until April 2019, and only then where tenancies have been taken out or renewed on or after 1 April 2016; and the tenant’s rent is higher than the Local Housing Allowance rates set for private sector tenants. Pensioners in the private rented sector have been subject to Local Housing Allowance rates since 2008. It is therefore only right that we bring about parity of treatment across both sectors, but pensioners in the social rented sector are unlikely to be affected unless they are substantially under-occupying their properties or they have high service charges. Discretionary Housing Payments remain available for those who need help transitioning to the change.

Care Home Rooms Now Cost More Than £30,000 A Year

The financial pressure on older people and their families when trying to pay for social care is growing, with the average cost of a room in a care home now more than £30,000 a year. The cost of a care home room has risen by 5.2% in the last year, more than 10 times the average increase in pensioners income, according to a report by Prestige Nursing and Care. The figures highlight the financial crisis in the care home industry and the impact this is having on older people and their families. Four Seasons Health Care, Britain’s biggest care home group, reported a pre-tax loss of £264m last year and that it was struggling under the weight of more than £500m of debt. Read more on the Prestige website.

Granny Flats To Be Exempt From Stamp Duty

Granny flats will be exempt from stamp duty after a Government U-turn in a major victory for pensioner groups and elderly campaigners. New plans to tax granny flats were dubbed as “morally wrong and economically illiterate” and will force grandparents to move away from their families and into care homes. Homeowners with self-contained accommodation designed to house elderly relations face being classed as having a "second property" under changes to stamp duty rules. The increase in stamp duty was intended to hit buy-to-let investors and second home owners, but accountants and estate agents say the small print will also embroil tens of thousands of families looking after elderly relations. Read more on the Daily Telegraph website.

Housing At Risk For More Than 400,000 Vulnerable People

Ninety-five percent of supported housing providers would be forced to close housing schemes for vulnerable and older people if a planned housing benefit cap goes ahead. The capping of housing benefit at local housing allowance levels for social housing tenants, announced in the chancellor’s spending review, represents a major threat to the financial viability of such schemes because the intensive housing management required is paid for by charging higher rents. These rents are covered by housing benefit for those residents unable to work. More than 440,000 vulnerable people, many of them pensioners, live in housing association homes that are now at risk across England. These include sheltered housing and extra care for frail elderly people, and supported housing schemes for people recovering from alcohol and substance misuse, young people leaving care and women fleeing domestic violence. Read more on the Guardian website.

Pensioners To Pay MORE To Stay In Social Housing!?

The Conservative’s Housing & Planning Bill includes the policy of pay (MORE) to stay which sees social tenants with a “household income” – a term as yet undefined – of more than £30,000 per year in the regions and £40,000 or more in London to pay market rents or near market rents to stay in social housing. Nowhere in this policy or in the Bill’s drafting does it say the pensioner household is exempt.  In Ealing and using the housing regulators own official figures the pensioner in a 3 bed social rented property will see the rent increase from £136 per week to around £480 per week as a result of this policy. Read more on the Speye blog.

One in Three to Face Renting In Retirement By 2040

Millions of future pensioners are destined to spend their retirement in rental accommodation as home ownership plummets, estimates show. Up to a third of 60-year-olds will be renting by 2040, with many never having been able to own their own home, it is claimed. Academics describe renting in retirement as a ‘time bomb’ which will stretch the finances of the elderly while costing taxpayers billions in housing benefit and social care. Professor Steve Wilcox, of the University of York’s centre for housing policy, estimated that only two-thirds of 60 year olds will own their own home within 35 years. Charities warned this could leave them vulnerable to poverty, poor living conditions and eviction. Read more on the Daily Mail website.

Housing Crisis Creating 'Pensioner Pockets' Across Rural England

A dire lack of affordable homes in England’s rural areas is pricing out young people and families and could lead to countryside ‘pensioner pockets’. A new analysis of population trends reveals the number of pensioners is set to soar across England’s rural communities by 2021, as younger generations who aspire to ‘grow up and grow old’ in rural villages and towns can’t get a foot on the local property ladder. The National Housing Federation has released a list of the country’s top ‘pensioner pockets’ where more than 40%, or four in every 10 households, will be over 65 in just six years’ time, considerably higher than the predicated national average of 29%. Read more on the NHF website.

New Benefit Cap Means Workless Private Renters Now Banned From 92% of UK

A reduction in the benefit cap was a centre piece of the Tory manifesto in the run-up to May's election. Even as some other 'commitments' were downgraded the reduction in the cap from £26,000 per year to £23,000 is to be pushed through in the first year of parliament. For most claimants only housing benefit - the one part that varies according to cost - will be affected. Working people, most pensioners and many disabled people are exempt, regardless of the level of benefits they receive and ignoring the idea of affordability. This measure is targeted directly at unemployed people, the lepers of the welfare world.  This targeting of housing benefit means the cap is likely to affect claimants' homes and choice of accommodation more than any other aspect of their lives.

Read more on the Huffington Post website.

What If Pensioners Paid The Bedroom Tax?

Retired people are living in multiple-bedroom council houses in central London, according to research that shows how hundreds of millions of pounds would be cut from the welfare budget if the so-called bedroom tax were ever applied to pensioners.  Local authorities could save £400million a year if pensioners' housing benefits were cut to reflect the fact they have spare bedrooms, under a controversial reform applied to working-age families. Councils would save an average of £1.2million each if the DWP extended the "spare room subsidy" removal policy to pensioners, a survey using the Freedom of Information Act suggests. Read more on the Daily Telegraph website.

Over-55s Forced to Use House Equity to Pay off Debts

An increasing number of pensioners are having to cash out on the value of their homes so they can top up their income or pay off debts, figures suggest. Equity release lending, which lets over-55s access some of the value of their house, rose 32pc year-on-year to its highest point since 2004 at £326m, according to the Equity Release Council. The proportion loaned out in lump sums during the first half of the year rose to 41pc to 37pc, suggesting a rising number of borrowers who need funds immediately. But soaring house prices also played a part, because the average value of each loan had gone up more sharply than the number of new borrowers. Read more on the Daily Telegraph website.

Benefit Cheats Face Higher Fines and Losing Their Homes

Welfare cheats will be forced to sell their homes and pay higher fines to reimburse taxpayers for the money they have wrongly claimed, under plans to tackle benefit fraud. Hundreds of thousands of pensioners who fail to declare their full earnings from private pension schemes will also be targeted as fraud investigators trawl through HM Revenue & Customs records. The plans form part of a major campaign from ministers this week to publicise reforms to the welfare system, which the Conservatives regard as among their most popular, vote-winning policies. Ministers will highlight the scale of savings to taxpayers, announce a tougher stance on fraud and detail further action to limit welfare for migrants. Polls suggest that even Labour supporters now regard state benefits as too generous. Read more on the Daily Telegraph website.

Tory MP Attacks OAP Exemption from Bedroom Tax

Pensioners should be made to pay the Bedroom Tax too, says a Conservative MP. Julian Brazier has said he is “not happy” OAPs are exempt. In a letter to a constituent, he claimed many pensioners could move and downsize “in order to free up accommodation for young families”. The letter emerged in the same week David Cameron refused to guarantee pensioner “perks” such as winter fuel allowances and bus passes. Around 1.3 million pensioners would be hit by the charge on “spare” rooms if the Government’s exemption was withdrawn. Read more on the Daily Mirror website.

Pensioners Want To 'End Their Days' In Bungalows, Says Minister

The majority of pensioners want to “end their days” in a bungalow, Nick Boles has said, as he called for single-storey homes to be built across the country. The planning minister wants more bungalows in order to encourage older people to move out of bigger homes to make way for younger families.

Mr Boles admitted that a programme of bungalow development would require councils to open up more land for development. However, he suggested that locals are less likely to oppose the development of bungalows because of their popularity. Mr Boles also said he would like to see greater numbers of elderly people being housed in town centres. Read more on the Daily Telegraph website.

Government Should Raise Bedroom Tax Threshold

The government should concentrate its efforts to tackle under-occupation on households with two spare bedrooms and remove the exemption for pensioners, a housing association chief executive has argued. David Bogle, chief executive of Hightown Praetorian & Churches Housing Association, argues under-occupation is a problem in social housing, but the government is taking the wrong approach to addressing the issue. He suggests the government should look at households that are under-occupying by two or more bedrooms and have been doing so for ‘significant periods of time’. He also says the policy should be applied to young and old equally. Read more on Inside Housing.

Social Rented Housing – Parliamentary Written Answer

Mark Hendrick: To ask the Secretary of State for Communities and Local Government what consideration his Department has given to allowing councils and other bodies housing pensioners being given incentives to downsize to smaller social housing properties, with particular reference to (a) financial incentives and (b) priority in bidding for smaller properties; and whether such incentives have also be considered for people below pensionable age.

Mr Prisk (part answer): We have made it easier for all social tenants to downsize to more suitable accommodation by increasing mobility, through changes to the housing allocation rules in the Localism Act 2011 and the introduction of a national mutual exchange scheme, “HomeSwap” Direct.

For the rest of this answer go to Hansard by clicking on the logo below.

IDS's Think Tank Calls for Changes to Bedroom Tax

The boss of the think tank set up by work and pensions secretary Iain Duncan Smith has called for changes to the government’s controversial ‘bedroom tax’. In a move that is likely to cause embarrassment to Mr Duncan Smith, the managing director of the Centre for Social Justice, Christian Guy, has said that he would like to see the government’s under-occupation penalty altered so that it is fairer.  Speaking at the National Housing Federation’s leadership forum Mr Guy told delegates from the housing sector he thought people should only have to pay the penalty if they had turned down a suitable downsizing offer.  He added that he thought it was ‘odd’ that pensioners are exempt from the policy.  Read more on Inside Housing.

DWP Issues 'Bedroom Tax' Reassurance

The DWP has said pensioners claiming housing benefit now will not be affected by the Government's "bedroom tax".  A spokesman said: ‘We want to reassure pensioners claiming housing benefit that they will not be affected by this policy now, or when Universal Credit begins, even if one partner is below pension age.’  He confirmed however that this would not apply to new claimants after that time.  A poll for the Sunday People newspaper found that voters believed - by a majority of 46% to 35% - that the principle of the change was "only fair" at a time of economic austerity.  But clear overall majorities said that its implementation should be delayed for a rethink on how to implement it (52%), that it should only apply if people refused smaller homes (60) and that it should not apply at all to Army families with children away on active service (77%).  Read more on the ITV website.

Bedroom Tax – How Cameron Has Lied To Pensioners

Pensioners, more correctly the mixed-age couple, i.e. where one has reached state pension qualifying age and the other has not, will be hit by the bedroom tax. Last week I put out a blog stating that mixed-age pensioners will be hit by the bedroom tax, not initially in April but from October when Universal Credit kicks in. I was wrong.  They can be hit by the bedroom tax from April, yes in just 9 weeks time!  Cameron has said he has guaranteed pensioners will not lose ANY universal benefits during this parliament.  Yet this will happen as we can see below;

    *Pensioners can be hit by the bedroom tax in April

    *Pensioners can be hit with 65% tax rates or 100% tax rates if they work

    *Pensioners can and will be hit by the overall benefit cap

    *Pensioners that work will lose universal benefits such as cold weather payments

    *Mixed-age pensioner couples will receive less in benefits that a single pensioner £1714 per year less to be exact!

    *Mixed-age pensioners may well see a higher divorce rate

    *The coalition changes will see pensioners being poorer

    *Universal Credit says that a mixed-age pensioner couple have lower needs than a single pensioner!! (No you couldn’t make it up could you!)

    “All in-work help will disappear for them at a time when pension age is rising and more people have to continue working into old age”

Read more on the Speye blog.

Government Fails in Bid to Block Council Tax Benefit Review

The Government has failed to block a bid by peers ordering Eric Pickles to commission a formal independent review of council tax support three years after its implementation.  The amendment - tabled by Labour peer Baroness Hollis of Heigham - was successfully voted in favour by peers - despite attempts by the Government to block it. Critics of the reform point out that cuts will be pushed onto low-income working age claimants as pensioners will be protected.  Thus, those who have never paid council tax could find they’re liable for payments of up to £200 a year.  Read more on 24dash.

Labour Blocks Move to Limit Council Tax Benefit Cuts

Labour peers have come under fire for refusing to back an amendment which would have spared thousands of benefit claimants from welfare cuts. The Local Government Finance Bill, currently going through parliament, will see council tax benefit scrapped and replaced with grants which only cover 90 per cent of the cost.  Councils will be able to choose how to make up the 10 per cent cut but cannot reduce benefit for pensioners. This means in some areas councils will have to cut benefit for working age council tax claimants by as much as 20 per cent.  Crossbench peer Lord Richard Best has tabled an amendment to the bill which would allow councils to cut the single person’s discount, currently set at 25 per cent. This, argued Lord Best, would enable the Treasury to receive its £500 million savings without hitting the poorest people.  Lord Best said a cut in the discount from 25 to 20 per cent would equate to an 85 pence per week reduction in discount for single people living in the lowest council tax band and £2 per week in the highest band. Read more on Inside Housing.