Housing benefit cap

One of the items on the BBC Politics Show for London yesterday was the proposal to cap housing benefit at £2,000 a month. Apparently, this may force 82,000 families in London to move. An eye-opening story, that I must confess had previously passed me by.

There was a good interview of Grant Shapps MP (Con.), Minister for Housing and Local Government, by the presenter, Tim Donovan. Mr Shapps’ position was that with housing benefit costing £21bn annually, something has to be done. Transitional funding will be put in place to avoid real hardship but, yes, some families would probably have to move. However, that was not intrinsically objectionable. Such choices about where to live based upon one’s means were no more than the sorts of decisions that people whose housing is not paid for by the State have to make all the time.

Despite the efforts of Mr Donovan to equate being “forced to move” due to affordability of rent with the much more emotive idea of “being made homeless”, a rhetorical line of attack that Mr Shapps was right to reject, I find it hard to believe that many (apart, perhaps, from those currently in receipt of housing benefit in excess of £2,000 a month) would find Mr Schapps’ position unreasonable or oppose this cap. On the contrary, I suspect that many would regard £2,000 as still too much and would be shocked that it is currently possible to get more than that.

Mr Donovan asked slyly whether benefit claimants shouldn’t be allowed to live in Westminster? In theory, yes, but this does not mean they should be entitled to an open-ended State subsidy in order to do so.

This article by Jenny Jones about the effects of the cap demonstrated to me how mad all of this is:

“In central London, the Local Housing Allowance gives families in four bedroom homes up to £1,000 per week to pay their rent. So families in Westminster and parts of boroughs such as Camden could be worse off by up to £600 per week, or £31,200 per year”.

So if you are on benefits, you can get £52,000 a year to pay your central London rent. Around double the national average pre-tax salary. That is insane.  I have to say, when people talk about “regressive cuts that target the sick and the unemployed”, depriving London housing benefit claimants of their £31,200 is not the sort of thing that I had in mind. That appears to me to be simply correcting a manifestly crazy and out-of-control situation.

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