Wednesday, 04 March 2015

Legal threat over surprise plan for four councils to pilot £26k benefit cap

Councils protest at benefit cap switch

Councils being hit first by the benefits cap plan to lobby the government over fears they will be disadvantaged by the surprise move.

The government announced on 20 December that the £26,000 total household benefits cap will only apply to four councils, Haringey, Croydon, Enfield and Bromley, from 1 April and not to everywhere at the same time as widely expected. At least one, Croydon, is considering legal action to prevent the move.

Instead, the Department for Work and Pensions will phase in the transition over six months.

The four London councils - two Labour-led and two Conservative-led - are considering coming together to warn the government the move will make it more difficult and costly for them to house homeless families in temporary accommodation.

This is because other surrounding boroughs unaffected by the cap will be able to afford to place people in accommodation in the ‘capped’ boroughs, potentially leading to a shortage of suitable homes in the affected boroughs.

Ahmet Oykener, cabinet member for housing at Enfield Council, said: ‘Our homeless families will be competing in a highly competitive private rental market with residents from other London boroughs and elsewhere who will be able to pay higher rents.’ 

Mr Oykener warned addressing this could cost ‘millions of pounds’ and said the borough will lobby the government to ask the DWP for extra funding.

Croydon Council is also concerned and is considering taking legal advice about whether the decision can be challenged. Jon Rouse, chief executive of Croydon Council, this week confirmed the four boroughs are talking about how to ‘relay our concerns back to the government’.

Bromley and Haringey councils confirmed they are looking at the impact of implementing the cap.

Steve Bullock, executive member for housing at umbrella group London Councils, said: ‘There are considerable risks attached to neighbouring boroughs proceeding on different timetables and as yet this has not been taken into account.’

The four boroughs were chosen partly for administrative reasons as their benefits are all administered from a central office in Stratford.

A spokesperson for the DWP said the department is working closely with the boroughs ‘to look at the additional costs’ they may incur.

Readers' comments (12)

  • You couldn't make it up !!

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  • Chris

    You could if you were Mr Pickles and had the notion that localism meant Councils had to do as they were told.

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  • oilyboots

    Omni-shambles again anyone - seriously the Welfare Reform Act implementation will be the 'perfect storm' starting April 2013 for some but spread over the whole year and beyond.

    The politician and departmental mendacity is worse than usual yet where is the media challenge? Problem is I reckon the politician and departmental demonisation of anyone evely remotely claiming tax credits / benefits has 'turned' many people into believing all the hype!

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  • Joe Halewood

    I posted a blog late yesterday which details that the overall benefit cap will see the Tories create more £100k per year HB families as a direct result of the OBC

    Demonisation as Tory strategy? - Yes Cameron at PMQs wednesday again raised the (at most) 5 families it inherited that were paid £100k per year in HB costs. That figure will rise into the hundreds if not thousands who th public purse will need to pay £2k+ per week in HB.

    And you thought a cap meant that the welfare bill would decrease? The exact opposite and scratch beneath the surface of the rhetoric and political grandstanding of this government and you see their policies are making the situation much much worse for every taxpayer.

    Incompetence writ large

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  • Peter Fish

    The Welfare Reform will prove so inefficient, cost far more than it saves, and will increase rather than prevent poverty - clearly then it will be adopted as policy by the Labour Party before the next election, if only to justify their lack lustre opposition to its principles and implementation.

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  • This article focuses on the headaches and costs for the Councils. What about the unfairness of families in neighbouring boroughs being treated differently under what is supposed to be a national benefits system?

    I am a bit mystified as to why the government have got off so lightly on this last minute announcement. Those against the cap should be complaining of the unfairness of implementing in a select few places first. Those in favour should be complaining that the government has badly slipped on the timetable for one of its headline policies.

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  • Ian, the way it was "announced" by was as though it was always planned this way. No apology, no acknowledgement of a change at all. As one Orwell fan put it, it was a case of "we're at war with Eastasia...we've always been at war with Eastasia"

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  • Does anyone actually know how much a single adult on job seekers for example will check per month to keep themself and pay rent and council tax?

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  • It's called victorian values, well er dickensian, back to the era of deprivation!

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  • The position is, that there have been so many cuts, freezes and negative changes to so many different types of benefits, in such a short time. The government has been very clever in introducing them a drip at a time and cushioning the blow with transitional protection. By April this year there will have been at least 12 changes to various benefits in various areas since 2011. Add to this mix the moving of sick people from one sickness benefit to another with a more stringent criteria, which incidentally, has already cost an extra £26m due to the high numbers of appeals, as people contest the results of their medical assessment.
    Then come the two biggies. In June Disability Living Allowance (DLA)is to change to Personal Independent Payment at a 20% reduction of the DLA budget, (more work for the Appeals Service) and in October comes the beginning of Universal Credit with all its quirks
    So the result is a game of Divide and Conquer on different levels, Firstly, every single agency that is out there for different groups, the elderly, the carers, the children's group etc. have focused on helping their own client group, especially campaigning against the impact of the introduction of Universal Credit later this year. So while these groups were busy, the Government then turned the low paid worker against the unemployed, and launched a very successful media campaign to do this, thus diverting the media's attention, who jumped on the Government's propaganda bandwagon, instead of looking at the cumulative affect of these cuts, freezes and negative regulation changes.
    Making people homeless when the local councils have a legal duty of care towards them is incredibly expensive and destructive. The Government have evidence that shows this, impact assessments and letters that warn that there could be costs rather than savings, especially with the benefit cap. The Government knows how many children will be affected. It did an impact assessment.
    Finally cut the route for help and assistance to the groups who are affected, by abolishing almost all of Legal Aid which finances many voluntary sector organisations
    So while all this was going on the government introduced other measures inot law. On 9th November 2011 the British Public lost the right to put their names on the councils Housing Waiting List and The Government cut the budget for Council Tax by at least 10% the coming year
    At the same time this government voted through a 1% increase to Benefits. Their own impact assessment shows that the families who earn the least will lose £3-£4 per week
    So now everyone, Councils, Housing Associations and the voluntary sector organisations are taking a huge intake of air and holding their breath for April, when the perfect storm arrives.

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