Construction sector has shrunk by 10 per cent since coalition took office, says TUC

Press release from TUC

Commenting on figures released on 25th April by the Office for National Statistics (ONS), which show that the UK economy grew by 0.3 per cent in the first quarter of 2013, TUC General Secretary Frances O’Grady said:

“The Chancellor has set the economic bar so low that avoiding the UK’s first ever triple dip recession is considered good news.
”Today’s figures have taken us back to where we were six months ago, and not much further on from when the Chancellor started his austerity experiment.

“The economy is flat-lining, unemployment is growing and the much-needed rebalancing of the economy, away from financial services and the South East, has failed to materialise. It’s no surprise we face a housing shortage when the construction sector is now nearly 10 per cent smaller than when the Chancellor took office.
“The government’s economic policies are still failing on every measure that matters to people.”

TUC

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The battle of the bedroom tax: A summary for beginners

Reblogged from CMS Home – Social Housing and Policy

The bedroom tax is big news – you can’t have missed it. You’ve probably already chosen sides. But it’s complicated too. When Cameron muddled the details in Parliament, even Miliband didn’t notice. Read on, if you want to find out what’s really going on.

A massive cut in housing benefit – thinly disguised as an attempt to rationalise the use of scarce resources – is about to have a huge impact on 660,000 of the poorest households in the country.[1] It will also have a lasting effect on their social landlords.

From 1 April 2013, social housing tenants of working age who are ‘under-occupying’ their homes will see their housing benefit cut by:

  • 14% of their full rent for one bedroom ‘too many’, or
  • 25% of their full rent for two or more bedrooms ‘too many’.

For some people this means they will no longer receive housing benefit at all.

Answering the myths

Myth 1:
It’s only fair to cut subsidies for rooms that aren’t being used

The largest group of genuine under-occupiers – especially in the South – are elderly people, who are not affected by this change.[2] In the North, where social housing landlords tend to provide larger properties than in the South, many households are allocated social rented homes with more bedrooms than they need – because it’s all that’s available.

The Government accepts that most people will not be able to move, because there aren’t enough smaller homes to move to. And that’s not just in the social housing sector. Private landlords have always been reluctant to rent their properties to people on benefits, but an increasing number of mortgage lenders are actually prohibiting their buy-to-let landlords from doing so.

So, most people will be forced to stay put and pay more. Social landlords know this is a ticking time bomb. An Ipsos Mori survey for the National Housing Federation reported in January that around 84% of housing associations expect their rent arrears to increase – by an average of 51%. Shockingly, more than half reported that their tenants knew little or nothing about what to expect.

Spokespeople from the Department of Work and Pensions have suggested that people will just need to work an hour or two more to pay the extra – but this is not true, as means testing would claw back most of any extra earned.[3]

Myth 2:
Similar rules already apply to local housing allowance (The name for rent benefits paid to people renting privately)
People renting privately have a cap on how much they can claim, depending on the size of their household and the area they live in. They aren’t specifically penalised because of the number of bedrooms they have. However, since tighter rules were introduced, many privately renting tenants have had to move to smaller homes in cheaper areas. Some have had to uproot their families, leaving behind schools, family support and local connections.

But the bedroom tax targets the number of bedrooms a tenant has, regardless of the actual cost, and it ‘fines’ people who are deemed to have too many. It is up to landlords to define how many bedrooms there are in each property. In practice, social landlords are more likely than a private landlord to call a box room or small second living room a bedroom. One reason is that housing associations have to satisfy their lenders by keeping the value of their assets high and getting the most rent possible.

And there are other, more important, differences. Social housing, by definition, tends to house a high proportion of vulnerable people. Households with disabled members, who make up at least two-thirds of the people affected by the bedroom tax (see below) are twice as likely to be social housing tenants as non-disabled people.

Myth 3:
A bedroom is a bedroom is a bedroom

There are several statutory definitions for the minimum size for a bedroom – and they differ. For the purposes of the bedroom tax, if your social housing tenancy agreement says you have three bedrooms, you pay a three-bedroom rent, whatever the size of the smallest room. The National Housing Federation has explained this more fully here.

Some tenants may find they are expected to put two children into a tiny box room, or even an adult child and their partner. Housing lawyers are expecting some challenges on this point as arrears cases start to come to court.

Myth 4:
Every under-occupier actually has empty rooms

Not true. Under the rules, you are only allowed a bedroom for:

  • a couple
  • a single person aged 16+
  • two same-sex children under 16
  • any two children under 10
  • another child
  • a carer for a disabled person who sometimes stays over.

For the time being, you can keep a room for a student studying away from home – providing they spend at least a week at home each year. (The rule is set to change to six months in the future.)

However, it took until 12 March 2013 for the Government to agree that foster children could be counted (providing the tenant has fostered, or started fostering, within the past year). They conceded this after lots of adverse publicity and a letter from 11 charities, who warned that this could stop some people from fostering. Unfortunately, within 24 hours, it emerged that only one bedroom would be allowed – regardless of the number of children being fostered. This will hit people wanting to foster siblings.

Also on 12 March, the Government finally conceded that someone on a tour of duty with the armed forces could have a room to come back to. Almost immediately, military charities were expressing doubts as to whether this would include someone away on training exercises.

You are still not allowed extra bedrooms because you share childcare with your ex-partner or are a disabled person living in an adapted property – even if it was adapted especially for you. You are not automatically allowed a room for a child who needs to sleep away from siblings, even if that child is disabled (more on this below).

A phone survey carried out for three housing associations found that 72% of ‘under-occupying’ households included a disabled member, with 20% of under-occupiers living in specially adapted homes. Some 9% reported storing essential medical equipment in a spare room. Many had disabled children who needed a room of their own. Speaking in the ‘under-occupation’ parliamentary debate on 27 February 2013, SNP MP Stewart Hosie reported that 80% of those affected in Scotland are disabled.

The housing association phone survey also identified that 15% of couples did not share a bedroom, 13% regularly shared parenting and 4% slept separately as they worked shifts. Half of the families used their ‘spare room’ to give a child their own bedroom.

Myth 5:
Well the rules are fair enough, people will just have to live with them

The Government has been facing a series of human rights challenges on its rules about who should be allowed to have a bedroom and who should be forced to share.

In 2012, the Government lost three relevant cases on appeal, involving the Article 14 human rights of private sector disabled tenants. [4] The Government gave way on the first two cases (which established the need for a bedroom for overnight carers), but it intended to take a third case (around the need for a separate bedroom for some disabled children) all the way to the Supreme Court. The Government finally backed down on 12 March, adding this to the day’s list of concessions. However, in this case, they made the concession discretionary. In future, tenants in this situation – whether renting privately or from a social sector landlord – will be able to apply to their local authority for a discretionary exemption from the bedroom tax. [* Thank you to Sue for clarification on this point – see comments.]

In early March 2013, new legal challenges were launched against the bedroom tax on behalf of a disabled couple and five families with disabled children. The challenges were due to argue that the under-occupation rules break Article 14 of the Human Rights Act and Article 28 of the UN Convention, by ignoring their needs as disabled people. Despite the u-turn on the earlier case (which makes some of the new cases relating to children academic), the adults and some of the children are likely to go ahead with their challenges. The first judicial review case is to be heard in May 2013.

On 21 March, Liberty, the civil rights charity, announced that it was launching a judicial review on the issue of parents sharing custody of children. It will argue that the rights of three parents, who will lose benefit because they are not their children’s primary carers (defined for the bedroom tax as being the person who claims child benefit) are being denied. The appeal will use Article 8 of the European Convention on Human Rights (the right to a private and family life) and Article 14 (which outlaws discrimination) to challenge the legality of these rules.

Myth 6:
Discretionary Housing Payments will sort out the worst anomalies

Local authorities have been given additional funding to help out families caught in the worst circumstances. Adverse press and lobbying led the Government to concede another £25m to this pot for disabled wheelchair users in significantly adapted properties. But this cannot help every disabled person affected, because fewer than one in 10 disabled people uses a wheelchair. [5] Since the u-turn on 12 March, the funding will also have to cover disabled children who cannot share a bedroom.

An additional £5m set aside for foster carers has been taken back since the decision to allow them to have one extra bedroom.

These discretionary payments are designed to avoid the Government having to change the bedroom rules. They offer a concession as a nod to the legal challenges. The Government is hoping that most disabled people and foster carers will simply come up with the extra money.

Myth 7:<
The bedroom tax will save money

Many in the housing sector doubt this. See also the National Housing Federation Report of 28 March 2013 (p3). Tenants who manage to move to privately rented homes will actually cost more in benefits, because rents are higher in the private sector. Also, tenants with children who are evicted for rent arrears by their social housing landlord may end up registered with their council as homeless – with all the associated costs of providing them with temporary housing.

Social landlords are preparing to spend large sums on extra rent collection staff and welfare and debt advice – very probably at the expense of their community work. Housing lawyers are expecting a stream of possession cases against people who have, up until the bedroom tax, been good payers. Unlike poor payers in the past, who could offer to pay their arrears off gradually, these will be people who really cannot pay their rent, let alone a bit extra. This is a new twist and likely to lead to more defences that challenge the application of the rules.

One housing association has decided to reclassify the size of 500 of its homes, which will let some of their tenants off the bedroom tax hook, but at a cost to the organisation of £250k in lower rents. A housing consultancy recently blogged advising landlords to reconsider collecting the bedroom tax – they say landlords should do the maths, because they might even lose less this way. To take this step, housing associations would first have to check whether their lenders or covenants allow them this flexibility.

However, as the article points out, there are wider economic implications. Durham County Council has estimated the impact of welfare reform as a whole on its local economy in 2013 as £150m. Lowering rents, especially in the North, could put more money in tenants’ pockets – with a knock-on effect for the whole area.

Of course, the bottom line is that, if the housing benefit bill drops because landlords are charging lower rents, the Government will, in effect, have achieved a saving by passing on the cost of housing support to social housing landlords.

Myth 8:
The bedroom tax will help solve overcrowding

In its report issued on 28 March (see p2), the National Housing Federation points out that in the North under-occupiers in the social and private rented sectors outnumber overcrowded households by 3:1. It arrives at this figure using the Government’s own data.

By contrast, in the South, there are many families living in overcrowded conditions. In theory, the bedroom tax is supposed to encourage under-occupying tenants to move elsewhere, freeing up larger homes. However, in practice, the shortage of smaller homes means this cannot happen on any real scale – unless literally thousands of people are moved between the North and South. The massively reduced amount of state funding for building social housing (it dropped by 63% in 2010) and the harsh climate for social housing landlords seeking loans – makes building out of the crisis a non-starter.

Affinity Sutton has pointed to an unintended possible consequence of the bedroom tax. Older people who really need to move somewhere smaller, and who may genuinely have a larger home to free up, are going to find it harder, because they will have to compete with demand from people needing to downsize because of the bedroom tax.

And in case you assumed all claimants are unemployed…

In fact, 28% of housing benefit claimants are over pension age. Amongst those of working age, 24% are actually in work (a figure that has grown by 10% since the start of the crisis in 2008). [6] The size of the housing benefit bill is not just about unemployment. It is also about low wages and pensions, and the high cost of housing – especially now that as much as a third of former council housing may be owned by private landlords.

[1] See page 10 of the Government’s own Impact Assessment.

[2] However, blogger Joe Halewood points out that the new rules may hit many couples where only one is a pensioner.

[3] Affinity Sutton have calculated that someone working 16 hours at the minimum wage will need to work 32 more hours to pay a £14 a week increase. See here.

[4] Burnip v Birmingham CC, Trengove v Walsall MBC, and Gorry v Wiltshire C [2012] See analysis.

[5] The National Housing Federation has calculated a shortfall of £100m for disabled people. See here.

[6] See the TUC blog.

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The Ticking Time Bomb of Child Poverty and Austerity

The UK is the sixth richest country in the world and yet more than one in four children is growing up in poverty today.

  • Child poverty damages childhoods. Growing up in poverty means being cold, going hungry, not owning belongings that others consider essential and not being able to join in activities with friends. It also impacts on health, educational outcomes and the overall experience of childhood.
  • Child poverty destroys life chances. Leaving school with few qualifications translates into lower earnings over the course of a working life. Poorer childhood health results in more complicated health histories over the course of a lifetime, again influencing earnings as well as overall life quality.
  • Child poverty imposes costs on broader society. Governments forgo prospective revenues and commit themselves to providing services in the future if they fail to address child poverty now.

Cross-national studies and evidence gathered over time show us that child poverty is not a natural phenomenon. Instead it is a political phenomenon – the product of choices and actions made by government and society.

Child Poverty damages children’s experiences of childhood and harms their future life chances. Research by Save the Children earlier this year highlights:

  • well over half of parents in poverty (61%) say they have cut back on food and over a quarter (26%) say they have skipped meals in the past year.
  • around 1 in 5 parents in poverty (19%) say their children have to go without new shoes when they need them.
  • a large number of children in poverty say they are missing out on things that many other children take for granted, such as going on school trips (19%) and having a warm coat in winter (14%).
  • only 1 in 5 parents in poverty (20%) say they have not had to borrow money to pay for essentials, such as food and clothes, in the past year.

A recent study by the Institute of Fiscal Studies (IFS) estimates that 800,000 more children will fall into poverty by 2020. That would be a rise in the child poverty rate from 19.9% to 24.4%. This will be the biggest increase in child poverty since the 1980’s, and would completely reverse the improvements made by during the last decade when 900,000 children were removed from poverty. The IFS figures are for children living in absolute poverty. Millions more children live in relative poverty.

As the govt’s spending cuts continue, so more and more families are at real risk of slipping into poverty, either from a reduction in tax credits, child benefit, the decision to uprate benefits in line with the consumer prices index rather than the retail prices index (which tends to show a higher annual inflation rate), the time limiting of employment and support allowance or from the loss of their jobs or stagnating wages. Poverty affects every aspect of a child’s life. 47% of children with asthma are from the poorest 10% of families, poor children are 5 times less likely to have access to a safe outdoor play area, 85% of children living in damp flats have breathing problems.

Austerity measures may also affect children in more subtle ways. There is another type of poverty, one that is more difficult to define and quantify, that of emotional poverty. As the unemployment rate soars, many households are experiencing joblessness for the first time. Children are far from immune from the negative effects of austerity. The additional stress levels, lack of funds and general loss of confidence experienced by parents and family members must impact upon children also. It has been proven that unemployment can become cyclical for generations of families. These children are feeling both the direct and indirect outcomes of unemployment and austerity measures likely affecting their own participation in the workplace in future years.

Children’s charity Unicef has published a report highlighting that child poverty rates within the UK are set to increase significantly, due to government spending cuts. There is recognition that child poverty is one of the most crucial indicators for measuring successful social cohesion, a marker of wellbeing and future prosperity of any given nation. Long-term effects of child poverty include: issues in education, employment, mental and physical health problems and difficulties with social interaction. The standard of living encountered during a person’s childhood is recognized as being instrumental in shaping their future.

Unicef warns that during times of economic recession, children can “drop off the policy agenda” in the scramble to effect immediate change, all planning for future generations is perceived as of secondary importance. This is highly problematic, not only because future planning is negated in favour of a short term outlook, but because a child’s current living situation is under escalated risk during times of financial crisis. Children, as one of the most vulnerable groups of people, cannot be left out of the equation especially in times of financial recession.

This government has proposed changes to child benefit; however, major inconsistencies regarding financial eligibility led to strong opposition and initial proposals were re-drafted highlighting the governments’ incompetence in making basic calculations. The Child Poverty Action Group has already warned that the proposed cuts to child benefit will have an adverse effect on children’s wellbeing. They questioned the moral issue of using children as a battlefield for austerity.

Austerity measures are proving a complete failure, exacerbating the problems of unemployment and thereby increasing levels of child poverty. State-direction job creation, along with relevant supporting policies, is the route to success in lowering the rate of child poverty in the UK. The ‘Lost Generation’ will not just be those currently leaving school to no jobs and no higher and further education places, but the generation before them who are too young to be aware of their disappearing future. To put the brakes on this depressing picture we need to end the madness of austerity Britain. The Children’s Society have said: “It would be a grave injustice if we allowed the burden of the current economic turmoil to fall on the shoulders of disadvantaged children.”

Child Poverty in Britain, £10 Billion To Be Cut From Welfare (RT news report Oct 2012)

End Child Poverty, a coalition of more than 150 charities, welfare organisations, social justice groups and unions has published a report and interactive map detailing the level of child poverty in each constituency, local authority and ward in the UK. The campaign predicts that, as benefits start to fall in real terms later this year, the proportion of children living in poverty will increase significantly.

Commenting on the figures, Enver Solomon, Chair of the End Child Poverty campaign said:

“The child poverty map reveals the depth and breadth of child poverty across the country showing the gross levels of inequality that children face in every region. Far too many children whose parents are struggling to make a living have to go hungry and miss out on the essentials of a decent childhood that all young people should be entitled to.

The huge disparities that exist across the country have become more entrenched and are now an enduring reality as many more children are set to become trapped in long term poverty and disadvantage.

Local authorities have to deal with reduced budgets but they have critical decisions to make. We’re calling on authorities to prioritise low income families in the decisions they make about local welfare spending, including spending on the new council tax benefit, and on protecting families hit by the bedroom tax. This week we have written to local authority leaders in the local authorities with the most child poverty, asking them what they will do to tackle child poverty in their local area.”

The government must also closely examine its current strategy for reducing poverty and consider what more it could do to ensure millions of children’s lives are not blighted by the corrosive impact that poverty has on their daily existence.’’

cpag dorset

Within the local Boroughs in our area, there is a very contrasting picture from ward to ward. In Bournemouth, 33% of children within Kinson South are living in poverty whilst in Littledown and Iford the figure is 8%. In the Poole Town ward, within Alderney it is 30% whilst in Broadstone it is below 5%. Click here for the full percentage breakdown for all wards within Bournemouth, Poole and Christchurch. Excel spreadsheets detailing percentage figures for all South West local authorities can be viewed and downloaded by clicking here.

From April 2013, local authorities will have significantly increased discretion over the allocation of financial support for families, although in circumstances in which this support has been dramatically reduced. Local Authorities will be responsible for:

  • Providing support with the cost of essential items such as replacing cookers or fridges for families on a low income, as the Social Fund is replaced by schemes run by local authorities.
  • Deciding who receives help with paying Council Tax, as Council Tax Benefit is replaced with local assistance schemes. The Resolution Foundation has found that low income families will see their council tax rise by up to £600 a year as a result of this change.
  • Deciding who should receive support with housing costs. April 2013 will see the introduction of the £500 a week benefit cap and the bedroom tax for families who live in social housing if the government believes they have a spare bedroom.
  • Local Authorities have been allocated control over Discretionary Housing Payments, which they can use to help make up rent shortfalls for a small proportion of families affected by these changes.

End Child Poverty believes that Local Authorities should take a strategic decision to protect the poorest families with children when allocating these resources. Local Authorities have not imposed these cuts but, with the removal of ringfencing, they will have a significant influence over how they affect local residents.

If you would like to become involved in BPACC campaigns about this issue or any other, please Contact Us by email to info@bpacc.co.uk

Sources:
End Child Poverty Report – Child Poverty Map of the UK
Child Poverty in the UK – CPAG
Child poverty: a generation sacrificed to austerity – Counterfire
Austerity increases child poverty, report confirms – ISG
UK’s Poorest Families hit Hardest by Recession and Austerity – The Real News
Poverty map shows how cuts in benefits will hurt children – Guardian