Wednesday, 10 October 2012

Letter to Boris Johnson on Conservative London welfare cuts


Here's a letter I sent to Boris Johnson following the announcement of further welfare cuts in London (see previous posts).

9th October 2012

Dear Mr. Mayor,

Impact of reduced welfare support for Camden and inner London residents
Further to your Conservative Party conference speech today, I am writing to you with new evidence we have gathered regarding the impacts of Government’s welfare changes on Camden residents.

I am concerned that these reforms will make it increasingly difficult for low income households to live in our borough, and raises real questions about inner London’s social mix over the next decade.  As Mayor of London you have spoken before against the ‘social cleansing’ of London.  Our analysis shows that the hardest hit will be families with young children – raising the likelihood that your legacy as Mayor will be remembered for the migration of low income families to the outskirts of London and rising child poverty for families just about able to remain.

I would like to ask you to join us in trying to tackle the issue of high rents in inner London.  Contrary to what the Prime Minister says in the Daily Mail when referring to high levels of benefit payments in London, these payments support individuals who are in properties with high rents - the fault of the ‘landlord benefit’ system not the individuals themselves.  The simple remedy repeated by CLG and DWP Ministers to ‘get a job’ to pay for rent does not stack up when there remains a 4:1 ratio of claimants-to-job-vacancies in Camden.  It is also unlikely that the figures cited by you on increasing housing supply – even for intermediate housing - are at all adequate.  London – particularly inner London - needs a distinct approach to private sector rents and housing benefit, something which can come from active lobbying of central government and legislative change.    

Impacts of LHA caps on households
Of the 3,384 households which were claiming Local Housing Allowance in Camden in April 2011, one year on 1,104 households are no longer on our rolls.  Of these 49% were already workless; 36% are under-35 (see below) and 19% have children.  It is likely with these cohorts that, barring a swift change in fortune in an area with the 4th highest rents in the country and few jobs on offer that they are being priced out of the borough.   We have also noticed a churn inside of Camden for those continuing to claim LHA in the borough, with areas in the south of the borough, notably Somers Town, becoming more unaffordable for low income households.  Camden is also managing increasing pressure on homelessness applications and placements.

Camden cannot track housing benefit claimants moving from the borough, and we would urge the Mayor and GLA to do this on behalf of Londoners so an adequate evidence-base can be gathered for further representations to the Prime Minister.

LHA impacts on schools and pupil places
In Camden we estimate that 493 children come from households impacted by the LHA changes, with some households losing up to £90 a week. The number will be higher for all Camden residents, as some send their children out-of-borough.  Primary schools will very much be at the front-line coping with change, and already some are instituting breakfast clubs for low income households seeking, on reduced weekly incomes, to stay in their local area.  Again, we urge the Mayor and GLA to properly monitor the impact on schools and school place planning in order to assist further lobbying of Central Government.

Council Tax Benefit
The changes and cuts in Council Tax Benefit undermine the fundamental principle of ‘no minimum contribution’ which distinguished Council Tax from the previous Community Charge.   They also provide support for low income households at a time when inner London cost of living pressures are rising.  The impact of this will be widespread on  already hard-pressed families.

Our analysis shows that areas of high deprivation will be impacted most by these changes, with households in Somers Town, Kilburn and Gospel Oak most impacted.  We also remain concerned that the Government will cut the Council Tax grant in the future, forcing further pressure on low income households.

Our analysis shows that over 16,000 Camden residents, previously considered too poor to pay council tax, will see their exemptions wiped out amid government cuts. If boroughs are forced to ask people to pay more Council Tax, authorities will find it difficult to collect from households who are not used to paying and may be struggling financially at a time of huge churn in the welfare system, when other benefits are being cut. As I am sure you are aware, there is also a knock-on effect on the GLA’s revenue base.

Removal of housing benefit for under-25s
David Cameron’s plan to cut housing support for under-25s in Camden would see over 940 young people forced to move from the borough.  The largest group are young people in council housing, many of whom are vulnerable or were previously in care, or have succeeded tenancies from their parents after caring for them.  320 of Camden under-25s supported in this way are single parents with young dependents.

Shelter argues that the group most affected by the government's proposals would be young adults who do not have a family home to move back to, including care leavers and orphans - but also young people with:

• Abusive parents/step parents/partners
• Severely overcrowded parental homes – likely to be exacerbated by under-occupation housing benefit cut
• Parents who have downsized
• Parents who have moved abroad
• Parents who have divorced – children reaching maturity is the 'peak' point for divorcing parents
• Parents in prison
• Family breakdown – parents who refuse to accommodate children
• Parents on low incomes who will be hit by non-dependant deduction should their child move back home when universal credit comes in.

We know that changes of this kind will have an impact, as our LHA statistic cited above shows that changes to housing benefit for under-35s have seen over 380 leave Camden, over a third of the total impact this year.  For young people who have lost parents, but remain in the area, these new changes may well uproot them from their neighbourhood, and for vulnerable people getting settled after trauma this is another unwelcome change.

If these plans go ahead, London should prepare for a rise in the kind youth street homeless which was commonplace in the 1980s.

I would be grateful for a strong reassurance from you that you will support Camden in opposing the impacts of the Welfare Reform Act and associated changes and help stop the movement of low and modest income households and families from our borough.

Yours sincerely,

Cllr Theo Blackwell
Cabinet Member Finance

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