‘The government won’t give a damn about us'

‘Last winter, it got so cold but I couldn’t afford to heat the house. I don’t want to go back to sitting on that sofa wrapped in a blanket. And I’ve got so poor I’ve had to scrape mould off my bread before making a sandwich because I can’t afford another loaf.’

These are the words of Patricia Wright, a 61-year-old pensioner living in Grimsby. Health problems have prevented Ms Wright from working since 2006 and following a spine operation in February, she has retired into poverty.

Each month, she scrapes together what she can from her pension to afford the monthly £120 gap between what the state pays her in local housing allowance and her rent. This is a lot for someone whose state pension of £132 a week has to cover her utility bills, her food and her clothing. She says that after rent she is left with £27 a week - and surviving on this is taking its toll on her health.

Her case is a far cry from the popular image of large families living in luxury at the expense of the taxpayer, but it is the reality for thousands of older people.

Pensioners make up around a third of all housing benefit claimants. And this vulnerable social group is yet to feel the bite of the government’s cuts to housing benefit announced in the emergency Budget last month. These reforms could leave thousands of them facing further hardship and even the prospect of homelessness.

From October 2011, local housing allowance will be calculated using the bottom 30 per cent of rents rather than the median currently used. It will also be linked to the consumer price index, rather than the higher retail price index which includes housing costs. The changes mean rents are likely to increase faster than benefits so that eventually it will be impossible to pay rent with local housing allowance alone, according to research by the Chartered Institute of Housing. There are also concerns that a failure to exempt pensioners from the 2.5 per cent VAT increase set for January 2011 will hit pensioners with an £8 billion bill over the next five years through every day spend.

A changing world

MPs and charities have identified several groups at risk from these cuts, including pensioners, those with disabilities and low-paid working families. Many pensioners in particular have seen areas where they have lived all their lives change, with rents in some places rising dramatically. They may have worked all their lives and paid their taxes for years, but on retiring, many have found themselves dependent on housing benefit to remain in the homes they have rented for decades.

‘Many [elderly] tenants will not have moved around for many years and the areas that might have been undesirable a long time ago may now be desirable and expensive,’ says Neil Duncan-Jordan, national officer for the National Pensioners Convention. ‘It may be a case of those people not changing, but that everything around them has changed.’

However, some pensioners on housing benefit may be safe from the effects of the cuts if they have regulated tenancies - agreements signed before 15 January 1989 which offer protection against increases in rent. This means those tenants, many of whom are elderly, will not feel the sting of a cap on housing benefit.

At a recent debate, pensions minister Steve Webb rejected MPs’ concerns about the impact the reforms would have on elderly tenants based on the assumption that many pensioners would be on regulated tenancies. Housing charity Shelter argues this is not the case. It says there are many pensioners who have signed agreements since 1989, are not on regulated tenancies and are vulnerable to the cuts.

Waiting and wondering

In reality, many pensioners don’t know how housing benefit reform will affect them. Ms Wright is one of them. She is still waiting to learn how much her LHA payments might be cut by, and is wondering whether she will be able to meet the rent in her current house. Already she can barely afford to live there. Renting her three-bedroom home costs her £105 a week, and she is adamant that she would struggle to find a cheaper deal on any one-bed flats. But her housing benefit is only £75 a week. Sometimes she has to borrow money from friends to get by. Furthermore, she has already racked up £360 of debts to her gas supplier.

Ms Wright’s financial situation is such that even a small drop in her LHA could tip her over the edge. She has tried to gain a little extra income by looking after her grandson, who had been living in care. But the state support for this was poor recompense for coping with his severe behavioural problems, and she has decided that she can no longer manage. Plus the carers’ allowance that she receives means her pension has been cut.

‘I don’t really know what I’ll do if the benefit goes down,’ she says. ‘I can’t afford to pay any more on my rent, and I’ve got a good deal on my house.

‘My landlord is one in a million, and I’m dreading what might happen if I can’t stay here. I might see if I can rent just the bedroom and the kitchen. Otherwise, what can I do? Maybe I’ll end up homeless.

‘The government won’t give a damn about us [older people], even though they can take much more than we would ever receive in their own expenses.’

Austin Mitchell, MP in Ms Wright’s local constituency of Great Grimsby, says he expects to see local councils dealing with a sharp rise in homelessness when they discover they can no longer make up the gap between their rent. He expects pensioners to be among those arriving at council homelessness offices to look for accommodation.

‘People are struggling financially and are going to be hit hard by these cuts and will no longer be able to afford their accommodation charges,’ he says. ‘The government claims that reform will cause the benefit bill to fall. It is certain to cause pain quickly when the cuts take place.’

Ministers have designed the housing benefit reforms to cut the rising bill and encourage as many claimants as possible to return to work, but these cuts leave pensioners at the sharp end, says Mr Duncan-Jordan.

‘The problem is that they are on a very low income,’ he says. ‘The basic state pension in this country is £96.67 a week, so housing benefit is there to recognise that the state pension is pathetically inadequate. The examples used by the government of people getting hundreds of thousands of pounds in benefit might match a handful of cases, but it just does not match the experience of older people.’

It appears pensioners are the forgotten face of housing benefit reform. While there is much talk of the need to ease people of working age off benefit dependency and into paid employment, there is little mention of those who have retired, who cannot fill the sudden gap in income with a job.

‘Thousands of pensioners will be affected by these changes,’ says Shelter chief executive Campbell Robb. ‘Their housing benefit and pension is all they have, so they won’t have the option of increasing their income to pay any shortfalls.’

Forced out

Shelter is also concerned that the drop in LHA rates paid to private tenants will mean elderly people have to move away from the support networks they rely on. ‘This will impact on many aspects of their lives and make something as fundamental as food shopping a real difficulty,’ says Mr Robb.

Labour MP Glenda Jackson agrees: ‘These plans could tear families apart. Pensioners are going to lose their homes.’ At the adjournment debate on housing benefit a few weeks ago, the MP for Hampstead and Kilburn also claimed the reforms could take society back to the days of the 19th century Poor Law - the pre-welfare state poverty relief legislation.

‘If [pensioners’] homes are taken away, where will they live?’ she asked. ‘Many of them do not have families who can house them. Are we going to put them in a residential home? Are we going back to the good old days of the Poor Law, where a husband and wife could be separated and put in separate buildings?’

For Ms Wright, the options if she does have to move are limited. The situation in her extended family is extremely difficult, and she is fiercely protective of her independence. ‘Why should they make me move in with someone or go into a home when I can look after myself?’ she asks.

‘It’s not fair that David Cameron is picking on the poor and not helping people like myself that really need support.’

Cases like Ms Wright’s are what austerity will really look like when the benefit cuts start to hit home. This is why Inside Housing’s What’s the Benefit? campaign needs your support. We are calling for fairer reforms to the housing benefit bill which we can present to the government so that Ms Wright and other pensioners can at least have a chance to live above the breadline. Without having to remove the mould first, that is.

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