Posted by: Jules Birch04/07/2011
The leaked letter from Eric Pickles is shocking on so many levels that it’s hard to know where to begin.
Ironically, the least shocking level is the warning that 40,000 families will be made homeless as a result of benefit cuts. It’s exactly what housing organisations have been arguing for months after all.
More shocking is the fact that the government has accused them of scaremongering or claimed the effects cannot be quantified.
Yet here is a letter from the Pickles’s private secretary warning Cameron’s office that DCLG modelling suggests that the £26,000 household benefit cap will make 20,000 families homeless and will cost more than it saves.
Another 20,000 will be made homeless as a result of the housing benefit cuts, according to the letter.
And the affordable rent programme will be fatally undermined: ‘initial analysis’ suggests 23,000 of the 56,000 homes will not be built and that it will be ‘extremely difficult to fund any four-bed properties….anywhere in the country’.
The minor change suggested by Pickles, removing child benefit from the cap, was not adopted. But even if had been the whole of London and the South East would still have been unaffordable for families with four children.
The DCLG is arguing that because the letter is six months old it is old news and therefore irrelevant.
However, to my mind, that makes it even more relevant and even more shocking. It means the government knew full well what the effect of the household benefit cap would be – and then went ahead and introduced it anyway.
Shadow work and pensions secretary Liam Byrne is expected to argue in the Commons later today that ministers repeatedly misled parliament about the evidence that was available.
So what are we to make of a policy that increases homelessness and costs more money? It seems complete nonsense in terms of housing policy and deficit reduction.
We know that Eric Pickles was calling for changes but apparently did not even raise the small matter of spending more money to make 20,000 homeless in Cabinet . We strongly suspect that even Iain Duncan Smith himself is opposed to the cap and the Centre for Social Justice, the think-tank he founded and which dreamt up most of his welfare reform agenda, has called it ‘devastating’ and ‘highly damaging’.
But we also know that the cap was first proposed at the Conservative Party conference by the chancellor George Osborne.
The truth is that this is a political and ideological decision, one based on spurious ‘fairness’ to ‘hard-working families’, and the (probably correct) calculation that it will play well with the voters, never mind the blatant lack of evidence and misuse of statistics.
So maybe, at the most basic level, the leaked letter and the (lack of) government response to it, are not so shocking at all and simply confirm all our most cynical prejudices about politics?
That would be true were it not for the fact that a bad policy that increases homelessness and costs more money has already completed all of its stages in the House of Commons.
In the face of well-argued criticism from Labour and some Liberal Democrat MPs, ministers have simply been able to steamroller that bad policy through.
Despite arguing against it, even the official opposition tacitly acquiesced at Third Reading when the Labour frontbench failed to move any amendments to the cap so that it could concentrate on arguments that were more winnable. Backbencher John McDonnell tried but tweeted yesterday: ‘Two weeks ago I tried to amend Bill to scrap cap but Labour frontbench refused to support. Now?
The affair raises all sorts of questions about what’s going on in Whitehall too.
The supposedly neutral impact assessment of the benefit cap published by the DWP in February said: ‘Some households are likely to present as homeless, and may as a result need to move into more expensive temporary accommodation, at a cost to the local authority. It is not possible to quantify these costs because they are based on behavioural changes which are difficult to assess robustly.’
But we now know that the costs had been modeled and quantified by the DCLG and conveniently not mentioned by the DWP.
That in turn undermines the neutrality and the findings of all the other impact assessments published by the government.
What, for example, are we to make of the fact that the DCLG assessment of affordable rent claimed to have taken account of the cap yet conveniently neglected to mention that its own modeling suggests it will stymie almost half of the programme and all of the larger family homes?
So the most shocking thing about the Pickles letter is not the increase in homelessness, not the increase in costs, not the revelation that one government policy completely undermines another, not even the fact that ideology and political calculation trumps the human and financial consequences of a policy. It is the collective failure of the political and policy-making process.
There is still a chance of extra concessions in the secondary legislation to follow the Bill, However, three weeks ago the welfare reform minister Lord Freud was slapped down by Downing Street for a mild suggestion of that and Iain Duncan Smith told MPs: ‘The reality is that this policy is not changing because it is a good policy.’
And so, following one of the most remarkable leaks of recent times, only the House of Lords can now change one of the worst policies of recent times before it reaches the statute book.
From Inside edge
Housing commentator Jules Birch puts the latest news in context