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"PM faces benefit plan rebellion " - Housing Benefit

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Fri, 28/08/2009 - 10:41am
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PM faces benefit plan rebellion

The government faces a backbench rebellion over plans that could reduce housing benefit by up to £15 a week.

Ministers are considering ending a policy which allows people who rent homes for less than their maximum benefit to keep the difference.

About 300,000 people gained from the measure introduced last year. Ministers say scrapping it will save £150m.

Labour MP Frank Field said it was "crazy" and said he would table a Commons motion to block it.

He said there would be "grave disquiet" amongst Labour MPs about the proposal.

Another Labour MP, Karen Buck, told the Times Labour should not "under any circumstances" be forcing the poorest to choose between affordable housing bills and other day-to-day living costs.

Key reform

Since last year, tenants who shop around for accommodation have been able to keep the difference between their rent and the maximum benefit entitlement.

The change, one of the government's major reforms to housing benefit, was designed to give people on low incomes more control over their housing arrangements and budgets.

Of the 600,000 people who claim the housing allowance, about half are thought to have retained the surplus money - amounting to up to £780 a year in come cases.

A proposal to end the measure was in this year's Budget and is now being consulted upon. If approved it would come into force next April, just ahead of an expected general election.


“ This small change will not affect our customers' ability to pay their rent and further support is available ” 

Department for Work and Pensions spokesman

Mr Field, who led the Labour rebellion against the abolition of the 10p tax rate, said the timing "could have been decided in Conservative headquarters".

The measure was both "unfair" and "short-sighted", he told the BBC.

While punishing people who were acting as "good citizens" by trying to save money on their rent, the savings achieved would be "miniscule" in terms of what the government needed to get the grips with its budget deficit.

The former welfare minister said he would put down a motion when Parliament returns in October opposing the measure and expected to get support from other Labour MPs and opposition parties.

"I think there will be a natural revolt on Labour benches if the government tries to push this reform through," he told the BBC.

"We are not going to get through this mega-debt crisis which has engulfed the country by these sort of very small cuts in public expenditure which are clearly immensely important for people at the bottom who have least.

"We need to keep our eye on the big game. I don't think any Labour backbenchers are going to be in the mood to allow the first of these cuts to fall on people who are at the bottom of the pile."

'Ill considered'

Mr Field said he planned to stop the proposal in its tracks once MPs returned to Westminster: "We don't want to be presented as we were with the 10p [tax rate abolition] with the government actually announcing the changes."

Critics say the change would reduce incentives for people to find cheaper accommodation and mean landlords will raise rent levels to the maximum benefit levels, reducing choice for people.

The Liberal Democrats, who first drew attention to the proposal, said it showed the government was "abandoning" people most in need.

"This is a scheme that probably won't save any money, but will make an enormous difference to the families suddenly losing 20% of their income," said housing spokesman Sarah Teather.

Housing charity Crisis also said the proposal was "ill-considered and potentially counterproductive".

The government said the proposed change would not prevent people most in need from being able to find decent accommodation.

"This small change will not affect our customers' ability to pay their rent and further support is available to those on a low income to help with other expenses," a spokesman for the Department of Work and Pensions said.

Story from BBC NEWS:

http://news.bbc.co.uk/go/pr/fr/-/1/hi/uk_politics/8226032.stm


Published: 2009/08/28 10:22:48 GMT


© BBC MMIX

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