By Vivienne Russell | 17 July 2014
The Liberal Democrats have pledged to reform the controversial bedroom tax so that claimants are only penalised if they turn down suitable alternative accommodation.
Disabled adults would also be permanently exempted under the party’s plans.
LibDem Chief Secretary to the Treasury Danny Alexander said a government report had shown that the bedroom tax, officially known as the Removal of the Spare Room Subsidy, was not working as intended.
It cuts the Housing Benefit paid to social housing tenants living in properties with bedrooms that are deemed to be surplus, although there are exemptions for pensioners and some other groups. Local authorities have can use Discretionary Housing Payments to top up benefits paid to people deemed to be in special circumstances.
But an analysis of the policy commissioned by the Department for Work and Pensions and published this week found that just 4.5% of affected claimants had downsized and highlighted concern that many affected people were cutting essential expenditure elsewhere or borrowing money to pay their rent. And social landlords’ arrears increased by 16% in the six months following the introduction of the bedroom tax.
‘We brought in changes to how Housing Benefit is calculated in the social housing sector with the best of intentions,’ Alexander said.
‘However, a recent report shows people are having to cut back on household essentials despite the help offered through Discretionary Housing Payments.
‘Therefore, we have reviewed our position so only those already in the social rented sector who turn down suitable smaller homes will see a reduction in their benefit.’
The commitment is to be included in the next LibDem manifesto and the party would push for it to be government policy ‘right away’, he added.
The LibDems’ proposal gained support from the Chartered Institute of Housing, which has called for the bedroom tax to be repealed.
‘It’s been clear for some time that the bedroom tax is causing hardship and suffering for thousands of people across Great Britain,’ said director of policy Gavin Smart.
‘The government’s own report on the policy this week has provided more evidence, so any recognition from the Liberal Democrats that the bedroom tax is not working is welcome – although long overdue.’
But the party’s stance was criticised by their coalition partners. A Conservative source told the BBC that the LibDems ‘have never demanded the abolition of the spare room subsidy in private and have campaigned for it in public’.
Meanwhile, shadow work and pensions secretary Rachel Reeves called it ‘unbelievable hypocrisy’.
‘There wouldn't be a bedroom tax if it wasn't for the LibDems,’ she said.
