Wednesday, 04 March 2015

Cameron rent claim attacked by sector

The prime minister’s claim that rents have been reduced as a result of his government’s welfare reforms has been disputed by sector figures.

David Cameron was asked a question by Labour MP Joan Ruddock at prime minister’s questions today about plans to increase the age limit for the shared accommodation rate, which is based on the amount of rent for single room in a shared house, from 25 to 35 years.  

Mr Cameron said: ‘What we have seen so far, as housing benefit has been reformed and reduced, is that rent levels have come down, so we have stopped ripping off the taxpayer.’

The claim that rents have fallen was immediately questioned by figures in the social housing sector. Abigail Davies, assistant director of policy and practice at the Chartered Institute of Housing, tweeted: ‘I’m wondering what data David Cameron is using to support his claim that rents have fallen due to housing benefit reform.’

The CIH has used National Valuation Office Agency data to calculate that local housing allowance rates have increased or stayed the same since March 2011 in 853 out of 960 local authority areas in the UK.  LHA rates are based on market rents.

Department for Work and Pensions data does show a fall in average local housing allowance awards, from £114.07 last March to £112.01, but Ms Davies said this is not the same as rent, it merely means less is being claimed.

Mr Cameron’s claim that housing benefit has been reduced has also been disputed.

Joe Halewood, housing consultant, said: ‘The facts prove Cameron has misled parliament with this statement.’

Mr Halewood pointed to DWP statistics showing that housing benefit claims have increased by 182,580 since May 2010, adding £1.5 billion to the benefit bill.

Readers' comments (17)

  • Rick Campbell

    Nice namecheck for Joe.

    Jack Dromney has called upon the PM to correct the statement ( ... "...what we've seen so far, as housing benefit has been reformed and reduced, is that actually we have seen rent levels come down. So we've stopped ripping off the taxpayer.").

    Potential headline pointing out that Cameron was wrong?

    So, IDS and wrong figures about cost of bedroom tax, Shapps and his figures, the PM and his lies.....

    ---- and the self-serving dumbnuts DumDems are propping up this shower of liars

    --- will the acolytes and apologists be out in force soon defending this shower along with the snakespeak of Central Office?

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  • Joe Halewood

    I blogged earlier today the following:

    Cameron about Housing Benefit at PMQs today. He said:
    "All parties are committed, as I understand it, to reform housing benefit. That was Labour's commitment before the last election. The housing benefit bill is completely out of control. Labour's own welfare spokesman said last week that at £20 billion, it was unacceptable and it had to change and what we've seen so far, as housing benefit has been reformed and reduced, is that actually we have seen rent levels come down. So we've stopped ripping off the taxpayer."

    Cameron said “ housing benefit has been reformed and reduced”
    Housing Benefit has indeed undergone reform and as some of the HB changes have become operational it is correct to say that HB has been reformed. Yet;

    Has Housing Benefit has been reduced? No it hasn’t and that must be a knowing youknowwhat by Cameron.

    The official HB figures produced by DWP reveal that this is not the case. They reveal at May 2010 that there were 4.751,530 HB claims in-payment (see tab 4) each receiving £84.20 (see tab 5). This makes an ‘inherited’ overall HB bill of £20,875,541,599 or £20.88 billion

    Whereas the latest official figures for the position at September 2100 reveal that 4,934,110 HB claims are in-payment (tab 4) each receiving £87.01 (tab 5) making an overall HB bill of £22,401,143,111 or £22.4 billion.

    This is an increase of £1,525,601,512 or £1.53billion since the coalition took office 610 days ago and means the HB bill has been rising by £2,500,986, or £2.5million pounds per day.

    In summary the facts prove Cameron has misled Parliament with this statement. The fact that the HB question was first raised was a patsy question by a Conservative MP (Nick Boles) and Cameron must have known what the question was in advance, and hence could have this researched, proves to me that it must not be a simple mistake by Cameron.

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  • Rents have not gone down. What world does Cammers live in??? Let's see what happens next with Crisis Loans etc when they're handed to local councils to operate. Will they go down to too? Yes, because they'll be no mechanism to operate them. Where are we going to hide the new homeless in time for the Olympics? Oh sorry, they're not 'homeless' they'll become: 'folk that like fresh air'.

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  • BlokeWithAConscience

    Where I live the LA has increased council rents in excess of inflation for many years now to try to catch up with Housing Association levels.

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  • It will be interesting to know exactly what Mr Cameron is basing his information on. In November I posted about the potential rent increase for social rents of over 7% on the back of information that private rents had gone up by 4.3%.

    With regards to HB, the number of new claims has gone up, and councils up and down the country have shown a reverse in trend of recent years for the number of HB claimants in council housing (as a subset of social housing), and an increase in the use of B&B and emergency temporary housing which are more expensive and are far more reliant on HB than long term council housing.

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  • Eric Blair

    No doubt Mr Cameron's statement comes from his vast experience of living in the PRS! The poor woe-begone little mite...

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  • Gavin Rider

    Derren - I have asked for the figures from the DCLG - let's see what they have to say about it.

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  • Joe Halewood

    Grant Shapps announced two months ago at the time of the Housing Strategy release in November that the rent levels set in his affordable homes programme was 65% of the gross market rent (and not 80%)

    As such Shapps MUST have the gross market rent figure to be able to make this definitive statement. Yet despite calls at the time he refused to release the figures. Why not Minister?

    This week RICS produced more guidance for landlords looking at AR 'products' (and a RICS approved method must be used according to the Affordable Homes programme framework document) yet this still was ambiguus with much subjectivity still left for landlords to decide.

    But Shapps has the figures for gross market rents else he couldnt say AR to date was 65% of gross market rent. Publish Mr Shapps.

    I am surprised that IH or other housing body has not asked Shapps (FOI request?) to publish the gross market rent figures he claims to know.

    Gavin - I blogged in October that at 70% of GMR that affordable rent would still cost at least £423m more per year in HB and the erstwhile Mr Shapps tweeted that he would get back to me and asked Jake Berry to do just that. He still hasnt by the way so you may be waiting some time.

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  • Jon Southall

    Does anyone have figures showing what the change in UK private rents are *in real terms* relative to changes in UK incomes *in real terms*, and also the change in average claims *in real terms*?

    That would make an interesting read.

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  • Gavin Rider

    Joe - I avoided the possibility of having the request ignored by adding that it was an enquiry under the Freedom of Information Act, which requires an answer within 20 working days.

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