What is it about housing benefit that produces so much misery and so many well-intentioned plans that go wrong? Yesterday a report by Shelter has found that a quarter of private tenants are falling behind with their rent as a result of direct payment of the local housing allowance and Grant Shapps pledged to let tenants choose to get it paid direct to their landlord.
Today Inside Housing has revealed the plight of vulnerable housing association tenants left facing rent shortfalls of £10,000 a year. This time last year the furore was all about tenants getting paid too much - the government was forced to announce caps on the allowance after media reports of a family that received payments of nearly £3,000 a week to rent a seven-bedroom home in Ealing, west London. Over the last few years take your pick from the problems caused by the single room rent, broad rental market areas, the verification framework, benefit administration chaos, the housing association rent formula…the list goes on.
This time next year there will probably be a Conservative government with Iain Duncan Smith in charge of mending ‘broken Britain’ and drawing on radical plans by his Centre for Social Justice think tank for a universal life credit combining housing benefit, council tax benefit and working family and child tax credits for all low earners. How long before that too falls victim to the problems that seem to dog any reform plan? And will people out of work be ‘supported’ back into it by cutting their benefit and undermining their security of tenure?
The problems facing housing benefit/local housing allowance are bad in the social sector, worse in supported housing and even worse in the private sector. The root cause is that housing costs linked to market rates inevitably rise faster than politicians and taxpayers are prepared to pay for them. The problems will get even worse at a time of rising unemployment and shrinking public spending.
Add to the equation the steady shift from bricks and mortar to personal subsidies and the accompanying slowdown in social sector development and widespread use of the private rented sector to house homeless families and problems like the ones revealed this week are more or less inevitable. Somehow, somewhere there must be a system that allows landlords a reasonable return without letting them charge what they like, that pays reasonable rents for tenants without trapping them on benefit and that controls costs for the taxpayer without creating misery for claimants. But that’s what the architects of the local housing allowance thought they had designed and probably what the social security commissioners involved in the latest debacle thought they were doing.
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