Housing, THINK TANK - The Ideas Zone....!!!, Welfare to Work

– Housing Benefit: Families receive equivalent income of £156,000

A couple with one child spending a third of their gross income on accommodation would need a household income of over £45,000 a year to afford a rent of £290 a week, and would be in the top third of the household income distribution.

A similar family would need an income of over £156,000 to afford a rent of £1,000 a week and they would be in the top two per cent of UK earners.

What these reforms mean is that people receiving Housing Benefit may not be able to live in expensive city centres, but the same applies to most working families who do not receive benefit.

The Coalition Government has also announced that it will triple its contribution to local authorities’ funding for Discretionary Housing Payments. This is currently £20 million a year, and will increase to £30 million in 2011/12 and then to £60 million a year from 2012/13.

Read DWP’s outline summary  ‘Impact of changes to Local Housing Allowance from 2011′

See full report


A note of caution;

Whilst we need to remove barriers to employment. We must not blame the recipients of Benefits for a poorly planned and administered benefit system. Similarly, it is irrational to blame the unemployed for high unemployment.

The implication of some of these reforms for some of our major cities will be significant. For example, in London, the Evening Standard reported that 9 out of 10 rental homes would be out of reach for people on housing benefit.

Across the capital approximately 70% of private rented homes would be deemed ineligible. As we reported last week there is a much welcomed inquiry taking place into the impact of these changes. Also please see our piece on the response from Simon Hughes and Karen Buck.

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