Bullock on the impact of benefit reform on Lewisham housing

Mayor Bullock was interviewed this morning on the Today programme about how changes to housing benefits could effect London boroughs. Speaking to Evan Davies in his capacity as both the Mayor of Lewisham and the spokesperson for London Councils on housing, he said:

"We are not block booking bed and breakfast but we are looking at what is available. We are looking at the private rented sector in our area because we know it’s under pressure. What we’re doing is sensible preparation because if the problems happen on the scale that’s possible over the next year, we need to be prepared."

When asked whether it was an urban myth that Councils are spending money to relocate people, Bullock responded:

"What we’re doing is beginning the procurement. We need to know what is available, what costs are at the moment. I don’t think anyone is spending money today to reserve accommodation for the future."

He was then asked whether he was worried that Lewisham could received a “huge outflow” of people who are priced out of central London?

"For us, that is the major concern. There would be some effect on some of our current residents as well but our main worry is that we would see a significant population flow across the city, which would put our current private rented sector, which is already under pressure, under greater pressure. But also, if we get hundreds of families moving in to our borough, there will be issues around education, social care and so on.

"We all take the view that we want our boroughs to have a mix of housing tenures. It’s good for the nature of our communities and we’ve tried to get away from those enormous estates and so on. We do need to be careful not to stigamatise those on housing benefits. There are people who are working hard and receiving housing benefits and I am not saying we don’t want these people in our borough."

Here, we asked what changes the policy could have on Lewisham. Now, it seems we have the answer.

Thanks to 'Name' for the tip off.


Name said...

Thanks for creating this thread. This is a subject that will affect almost all of us one way or another.

I have given my view, proud of Lewisham facing up to it's social responsibilities and I trust that the government will ensure that this borough is fully renumerated and vice versa for boroughs that aren't shouldering the load.

Anonymous said...

Is it just me or does the statement

"if we get hundreds of families moving in to our borough, there will be issues around education, social care and so on"

seem a little odd from a Mayor who has presided over a borough with a desperate shortage of school places for years?

Anonymous said...

He's such a patronising *person* - he's uses the word 'procurement' and then says 'sorry for being technical', good grief, he must either be surrounded by idiots or thinks he's speaking to idiots (maybe that the same thing . . .)

Lou Baker said...

To hear some people talk you'd think millions of people are being turfed out on the street.

Put this in perspective: housing benefit's being limited to £400 per week. £20k per year.

That is still a considerable sum.

On Rightmove about 6 of the 130 or so properties available to rent in SE14 and SE4 are above the level. Most only just above it. And this is private rental.

It is absolutely right to help people who need help while they need it. It is wrong to fund unnecessarily expensive accommodation for those who aren't doing their bit.

If 20k of someone else's money is not
enough to fund what you want, get a better paid job or move somewhere cheaper. Simples.

Mazehiller said...

Well said Lou! I understand the disagreements over the cuts, but I find it surprising that this is such a contentious issue. It seems so obviously wrong for scarce state resources to be used to fund expensive housing in pricey areas, or young people to be entitled to benefits to allow them to live alone in a flat, while we compromise on location and have to share housing. Should have been actioned a long time ago, based on economic necessity as well as moral grounds.

Tim said...

Completely agree. Not having a cap on housing benefit means that rent rises become a self fulfilling prophecy. Why should I pay taxes so that people can live in a nicer house than me?

Name said...

We all pay taxes for all sorts of things.
I don't think public subsidy for a decent home for a large family is the worse thing we do. For me it's better than allowing that family to be live in poverty and the resultant social problems that poverty causes.

Anonymous said...

@name The new £20000 cap is still a HUGE amount of public money for rent. Some people have been claiming double that under this system. All workers pay tax, not just well-off ones- I find it absurd that a hard-working nurse living on under £20000 a year, is paying tax which subsidises non-workers to live in a FAR nicer area than she can dream of. I'd be happier if my tax went on improving the nurse's salary to allow her to get out of poverty.

Anonymous said...

The nurse can claim housing benefit so she can live near the hospital in Chelsea where she works. Most claimants work hard, they just cannot afford the market rent. The problem is lack of affordable housing. Demonising the victim is easy.

Tamsin said...

Any system that gives a carte blanche to the profit-takers at the supply end of a supply-demand relationship should be addressed. Where there is no realistic limit on what can be paid for a rare commodity of service things get distorted.

It seems that in some cases it is happening in the rented sector with the state picking up the housing benefit tab and the money going (as has been pointed out) to private landlords, and it certainly happened in the house selling market when, with "self-certification", mortgage lending was no longer linked to actual income.

Pete said...

Do people realise that the majority of people on housing benefit are actually in work?

The benefit may be capped at £400 a week but not everyone will be entitled to that much. Single people will be getting far, far less so there will definitely be quite a bit of movement going on.

Headhunter said...

I completely agree. No limit on housing benefit is simply inviting private landlords to push up rent. The benefit receiver won't care as long as the state picks up the bill and the private landlord is happy.

It's unfortunate that this may drive people on benefits to specific areas of London rather than serving to maintain the happy mix of people across the city but with this new limit in place not only will we see movement but we may also see rental prices drop in more expensive areas as homes rented to those on benefit fall empty.

Monkeyboy said...

Pete, I agree. People do like the comforting feeling that they are being ripped off, it takes away the guilt.

HH, I don't actually disagree with you entierly but do you think its appropriate to penalise the majority of claimants because there is a lack of affordable housing for the low paid? How many of your friends have flats that they rent out? I know several. You rarely see headline screaming about the middle class accountant renting his second flat, he's the one profiting. The tennant just wants somewhere to live.

Headhunter said...

Yes but how much influence does access to limitless housing benefit push up rental prices in the 1st place? Who knows, perhaps we'll see rental prices in "nice" areas fall once those on benefit move out.

Yes, I have friends who rent out flats and houses and although they're my friends, I'd prefer that my tax didn't flow directly into their wallets without limit. Having said that, as far as I'm aware, none of them rent to anyone on benefit...

max said...

I read an estimate that one third of London's rented accomodations are in receipt of benefits, I suspect that a large part of this are just a help towards meeting the cost of the rent rather than the full expense but it says a lot about the diverging directions of the market and society.

It's the result of the policy of encouraging buy to let and wide spread housing benefits and an almost total embargo on building socially rented accomodations has landed us in this awful market situation.

Notice how Bullock in his interview says that "we’ve tried to get away from those enormous estates and so on", can it be that he's trying to justify that the provision of new social housing was stopped under Thatcher and Labour didn't restarted it?

Housing benefits should not be thought as a full subsitute for social housing, ideally they should only be a temporary measure for those that rent in the market but happen to be in a temporary situation of financial distress.

Mb said...

"as far as I'm aware, none of them rent to anyone on benefit..." how would the landlord know?

Tamsin said...

The landlord would know because isn't housing benefit (which is what is being talked about) paid direct to the landlord?

Mb said...

I didn't think so but you may be right. Doesn't really alter the fact that people who struggle to pay the rent are not to blame for high rents.

Tamsin said...

I thought it was paid direct to the landlords because, understandably if you are on your uppers and trying to make ends meet, if you get the money there is the tempation to spend it on food or the children's shoes. (Or, if you want to conform to the stereotype created by the media, cigarettes and booze.)

Lou Baker said...

I'm not to blame for high rents either.

But, according to an earlier comment, it's okay for me to part fund a nurse to live in Chelsea.

My mum was a nurse in central London for years. And, you know what, she never once thought about claiming housing benefit so she could walk to work.

She found somewhere she could afford and she commuted. Like millions - including me - do everyday.

And that's the difference here. Some people believe the state is there just as a safety net when you absolutely need it. Others feel you should exploit it for every penny you can get.

Anonymous said...

Housing benefit is now paid to the tenant - apparently the result of a (crazy) initiative to empower people.

Now I wonder what the unintended consequences of that initiative might be!

Anonymous said...

It makes me wonder how many people in poorly paid jobs will be able to afford the time and expense of a daily commute from some suitably modestly priced zone where the accommodation is within the housing benefit limits?

Give that we have just about the most expensive urban transport system in the world, I think we will find out pretty soon that exoensive areas will become devoid of people to do the low paid work.

Seems a triple blow: removal of a housing subsidy and the imposition of travel expenses and a bunch of extra hours to be given over to playing sardines on the tube.

Maybe all the low paid work can be taken up by the army of underpaid foreign workers living in overcrowded accommodation and being ripped off for a large porportion of their earnings by gangmasters.

While the ring of hideous towns around London will become worse with an influx of poor families to add to the social malaise.

Housing Benefit certainly needed reform, but this simplistic approach....is that the best they can do in formulating a joined up policy? I would rather have preferred someone to have spent some time thinking this through.

Unknown said...

In Argentina, everybody pay taxes that then are very bad spent.
I heard that from the owner of an apartment for rent Buenos Aires

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