04 May 2001
The massive savings are largely the result of a 30% drop in the number of private sector tenants claiming benefit. This, in turn, is attributed to the restrictions introduced by the former Conservative social security secretary Peter Lilley, which limited young people to renting bedsits and linked maximum benefit levels to average rents within each local authority. Housing benefit was also paid in arrears for the first time.
The report's author, Steve Wilcox, a housing specialist at York University, said the 10% fall in public sector tenants on benefit since 1996, compared with 30% in the private sector, illustrated the main reason for the savings. 'This reinforces the suggestion that the 1996 restrictions affecting the private rented sector are the main reason that the number of claimants has dropped,' he said.
The savings were calculated by comparing actual expenditure over the past four years with government spending plans over the same period. Other factors contributing to the Treasury bonus include a steady fall in unemployment, increased anti-fraud campaigns and the introduction of the Working Families Tax Credit, which has boosted some people's income above the levels qualifying for benefit.
Wilcox called on the government to seize the chance presented by these savings to improve the housing benefit system, making it fairer and simpler to administer. The savings 'provide the government with the opportunity to introduce radical reforms to simplify and improve the scheme', he said.
A spokesman for homelessness charity Shelter agreed that the current benefits system caused problems for many people and said the money saved should be used to finance its reform.
'The rent limits are so tight that people often can't afford rents or have to move into very low-quality accommodation. The current system causes severe hardships and the government should take this opportunity to enable people to get housing that is affordable.'
PFmay2001
