Rent arrears ‘result of bedroom tax in Scotland’

8 Jul 13
A majority of local authorities in Scotland say that an increase in rent arrears in council housing is a result of the government’s changes to the welfare system, including the so-called bedroom tax.

By Richard Johnstone | 8 July 2013

A majority of local authorities in Scotland say that an increase in rent arrears in council housing is a result of the government’s changes to the welfare system, including the so-called bedroom tax.

A survey of town halls by the Convention of Scottish Local Authorities said there had been an increase in the number of people struggling to pay their rent at 20 of the 26 authorities who own council homes. Of the rent due to be collected since the change in April, 80% of councils reported receiving half or less, while 60% said they had got less than 40%.

The poll, which comes 100 days after the benefit reforms were introduced, found that an estimated 82,500 households are affected by reductions in Housing Benefit for rooms that are deemed ‘spare’.

The changes have led to an increase in requests from the Discretionary Housing Payments funds run by councils, which supports people who are struggling to pay their rent, the report added.

In total, more than 22,000 requests were made for help to the end of May, with most councils reporting a four-fold increase in claims. Funds were being awarded to 44% of applicants, and one-fifth of the £10m of transition funds made available to councils by the Department for Work & Pensions has already been spent.

Nearly half – 14 of the 32 councils in Scotland – have already had to top up the funding from the DWP, with an extra £2.9m already earmarked. Ten authorities have topped up their funds by more than half their original allocation.

Cosla president David O’Neill said it was clear that predictions about ‘the dire consequences of this ill-conceived policy’ were being borne out.

‘We always said that any saving to the UK Treasury would be reflected in additional costs and financial pressures for tenants and councils. 

Unfortunately that is exactly what is now happening,’ he said.

‘Councils are being required to reduce Housing Benefit payments only to see rent arrears rise sharply and tenants experiencing distress. At the same time, housing services are being undermined by a threat to our income streams.

‘The UK government need to urgently reconsider this horrendous policy and I shall be re-emphasising this yet again when I meet [welfare reform minister] Lord Freud at the end of this month.’

Responding to the report, a DWP spokeswoman said there was ‘no conclusive evidence that people affected by our Housing Benefit reforms are not getting the help they need’.

She added: ‘This reform will help restore fairness to our Housing Benefit system and we’ve given Scotland £10m so vulnerable claimants get the help they need.

‘It is simply not affordable to pay Housing Benefit for people to have spare rooms in social housing. In Scotland there are many thousands on housing waiting lists or living in overcrowded homes. This reform will save hard-working taxpayers almost £1bn over the next two years.’

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