Benefits cap roll out begins

A cap on the total amount of benefits that people of working age can receive has begun rolling out across the country. Couples and lone parents will now not receive more than £500 a week, while a maximum £350 will be the limit applied to single people.

The benefits cap is not due to be rolled out in Edinburgh until 15 August, but claimants should really be making preparations for the introduction NOW.

The cap is an element of the government’s radical overhaul of the benefits system, which Work and Pensions secretary Iain Duncan Smith argues is necessary as the present system is ‘unfair’. The government has set the cap at a level they say reflects the current weekly household income.

Most benefits – Jobseeker’s allowance (JSA), housing benefit and child tax credits all count towards the cap, but there is no cap for people who receive Disability Living Allowance or its successor, the Personal Independence Payment. Those eligible for Working Tax Credit are also exempt.

“The benefit cap returns fairness to the benefits systems,” Mr Duncan Smith said. “It ensures the taxpayer can have trust in the welfare system and it stops sky-high claims that make it impossible for people to move into work.

“The limit of £500 a week ensures no-one claims more in benefits than the average household and there is a clear reason for people to get a job – as those eligible for Working Tax Credit are exempt.”

The DWP says about £90bn was paid out in benefit payments to people of working age and their families in 2009-10, and it expects the cap to save about £110m a year.

Shelter Scotland has issued the following advice:

‘If the benefit cap will affect you it’s a good idea to:

reduce your spending and focus on rent payments
make up any shortfall between your housing benefit and your rent by using other income.

If you still can’t afford your current home then you may have to consider moving somewhere cheaper. If you’ve received a letter from the DWP warning you that your benefits may be reduced, or you’re worried that you’ll be affected by the cap, talk to a money adviser who’ll be able to help draw up a budget.

It’s important to prepare for this as early as possible to avoid falling behind with your rent and being evicted. If you’re worried that you’ll be threatened with homelessness because of the benefit cap speak to an adviser in your area.’

The benefit cap will be implemented across the country by 30 September.

Letter: Warning – pensions under attack

Dear Editor

Pensioners of today and tomorrow, be aware: the government is laying the ground for further attacks on pensions and pensioners benefits.

First, they have to divide opposition, for example by saying they wish to be fair by stopping the wealthy getting the winter heating allowance. It sounds fine, but does that mean the introduction of a means test for everyone to qualify? And who sets the level?

Other benefits, such as travel passes, television licence and free medicine prescriptions – things to help pensioners maintain some quality of life – are threatened: the government is looking to see if the nation can ‘afford’ them.

The campaign of setting one section of people against another is well-prepared, with millions of words and pictures; every person working or retired is the target. Just a few figures:

31% of the population are of retiring age; not all get a full pension as many qualifying conditions apply
The government is raising the age of retirement for women from 60 to 65 by 2018 and for both men ad women to 66 by 2020, with increases to 67 and 68 later on
The ‘full’ state pension is only approximately one sixth of the average age
The amount paid out in pensions from the total wealth produced in one year is approximately 5%, yet the percentage of the population’s pensioners is 31% (and most have contributed to a pension scheme throughout their working lives).

Just two further points: today’s working population, who now produce all the nation’s wealth, were raised, loved and cared for by our pensioners. Today’s working population and pensioners combined have massive voting power: use it!

Tony Delahoy

Silverknowes Gardens

‘Bedroom Tax’ – minister demands fair deal for Scotland

Today (1 April) is day one of the Westminster government’s controversial welfare reforms. The Scottish government pre-empted the changes with two statements on the eve of the changes:

If the UK Government proceed to impose their plans for the bedroom tax on Scotland then Scotland must get its fair share of funds to deal with both the human and financial impact, Welfare Minister Margaret Burgess said yesterday.

In a letter to the UK Welfare Reform Minister Lord Freud, Mrs Burgess (picured below) demanded a fair deal for Scotland to address the potentially devastating impact of the bedroom tax, which is set to impoverish families and individuals.

The Scottish Government is completely opposed to the bedroom tax, which will affect 16,000 families with children in Scotland, but if UK Ministers proceed with cuts then Scotland must get its fair share of Discretionary Housing Payment (DHP) funding, says Mrs Burgess.

Despite both Scotland and London having the same number of households hit by the bedroom tax, Lord Freud is set to award London with £56.5 million of DHP compared to only £10 million in Scotland.

Welfare Minister Burgess said: “The bedroom tax is a socially divisive measure that will increase social inequalities across Scotland. It’s a policy that the Scottish Government is totally against as it hits our most vulnerable citizens in these already challenging economic conditions.

“This is a policy devised in London on the basis of housing benefit increases and overcrowding. However, in inflation-adjusted terms, 93 per cent of the housing benefit increase is attributable to the situation in England whilst London has almost two and a half times the level of overcrowded households compared to Scotland.

“We have consistently made that case to UK Government Ministers that we are opposed to these cuts – if they proceed to impose their plans then Scotland must get its fair share of funds to deal with both the human and financial impact.

“The small levels of DHP in Scotland is woefully inadequate and unfair to deal with the impact and scale of this policy.

“Civic Scotland is united in opposition to the bedroom tax and this Government has already taken action to strengthen the protection against eviction for rent arrears in advance of the introduction of the tax. From 1 August 2012 we brought pre-action requirements for rent arrears into force to ensure that proceedings for eviction is always the last resort.

“We are also providing an extra £2.5 million to social landlords for advice services to ensure there is support on hand for people who will lose housing benefit due to the under occupancy measures and other housing benefit cuts being introduced by Westminster from April.

“The UK Government’s agenda is completely at odds with the values of the people of Scotland and the aspirations that this Government has for our nation. Only through independence can Scotland have the levers required to create a welfare system that is aligned to Scottish needs and values.”

Thousands of vulnerable people in Scotland will be protected from increased Council Tax bills following the UK Government’s abolition of council tax benefit this week, Cabinet Secretary for Finance, Employment and Sustainable Growth John Swinney announced yesterday.

Around 560,000 people will receive support to ensure they are not affected by the UK Government’s 10 per cent cut in funding for Council Tax Benefit successor arrangements.

The Scottish Government and local authorities in Scotland are working in partnership to invest £40 million in 2013/14 to bridge the funding gap and mitigate the impact of the UK Government’s benefit cuts.

Mr Swinney (pictured below) said: “Hard working and vulnerable people are having to bear the brunt of these Westminster benefit cuts. Instead of protecting our poorest households, Westminster has responded to this recession by imposing deeply damaging welfare cuts which will make it far harder for people to meet the rising cost of living.

“To ensure households across Scotland do not face additional burdens the Scottish Government and Scotland’s councils are providing £40 million in 2013/14 to ensure that around 560,000 people in Scotland are protected from this reduction.

“Whilst Council tax bills will be increasing in many areas of England as a result of benefit cuts we are using the limited resources we have to ensure vulnerable people do not have to face increasing bills.

“We are determined to do everything that we reasonably can to help those who need it most, however we cannot meet every Westminster cut. We are making available an extra £2.5 million to social landlords to help them ensure that people affected by housing benefit changes have the advice and support they need.

“And we are providing £5.4 to organisations such as Citizens Advice to help those affected by benefit reforms. This extra support will assist social landlords in their efforts to engage directly with affected tenants and seek to identify ways in which they can deal with the impact of the changes.

“These unjust policies show why we need the powers of independence to protect vulnerable people rather than simply trying to cushion the blows in Scotland. It would be far better to control benefits and welfare so unfair policies like abolishing Council Tax benefit are not even considered, let alone implemented. “

Growing concerns over welfare reforms

The Church, charities and political opponents have spoken out over the imminent introduction the latest round of welfare reforms. With the controversial new ‘bedroom tax’ due to be introduced by the Westminster government in just over a fortnight, critics have united to ask the Tory/Lib Dem coalition to think again.

In an open letter to Work and Pensions Minister Iain Duncan Smith, Archbishop of Canterbury Justin Welby (pictured above) and 43 Church of England bishops wrote on open letter to Work and Pensions Minister Iain Duncan Smith last week, expressing concern that welfare reforms could push as many as 200,000 children into poverty. The churchmen said that benefits caps will hit the most vulnerable people in society and ‘a civilised society has a duty to support the most vulnerable’.

In Scotland, Deputy First Minister Nicola Sturgeon called for the bedroom tax to be scrapped earlier this week, when announcing that extra advice and support will help those who will lose out under UK Government housing benefit cuts like the bedroom tax.

The Scottish Government is providing an extra £2.5 million to social landlords to ensure there is advice on hand for people who will lose housing benefit due to the under occupancy measures and other housing benefit changes being introduced by Westminster.

Ms Sturgeon said: “I have made the Scottish Government’s firm opposition to the bedroom tax absolutely clear. It is a policy that will penalise some of the most vulnerable people in our society and I put the case for it to be scrapped in the strongest terms to the Deputy Prime Minister when we met in London this week – sadly there appears to be indifference to this argument at Westminster, despite strong opposition from across Scotland.

“We are determined to do everything that we reasonably can to help and as part of these efforts we are making available an extra £2.5 million to social landlords to help them ensure that people affected by housing benefit changes have the advice and support they need. This is on top of the £5.4 million we have already allocated to help those affected by benefit reforms, which will go to organisations such as Citizens Advice.

“This extra support will assist social landlords in their efforts to engage directly with affected tenants and seek to identify ways in which they can deal with the impact of the changes. We are continuing to consider all reasonable steps that we can take to mitigate welfare cuts, including the bedroom tax. However, these unjust policies show why we need the powers of independence to protect vulnerable people rather than simply trying to cushion the blows in Scotland. It would be far better to control benefits and welfare so unfair policies like the bedroom tax are not even considered, let alone implemented.”

Meanwhile North and Leith MP Mark Lazarowicz has produced figures showing that over 5200 people living in Edinburgh’s social rented sector – including nearly 20% of council tenants – will be hit by the ‘bedroom tax’, as they are considered by the government to be living in a home larger than they need or ’under-occupying’, so their housing benefit will be cut to reflect that.

According to the latest figures from Edinburgh City Council, 5,263 Council or social landlord tenants are currently live in a bigger home than the government says they need.

4,529 live in a home with one bedroom more than they are said to need and another 734 tenants live in a home with 2 or more bedrooms more than the government says they should have.

Nearly one-fifth or 3,851 of the 20,331 Council tenants in the City are likely to be affected – but there are only 27 one-bedroom flats available to rent, either in Council-or housing association property.

In a statement earlier this week, Mr Lazarowicz said: “These figures show just how severe the impact is likely to be in Edinburgh. There is a real danger that people who see their housing benefit cut will fall into either arrears or debt, and in extreme cases may even become homeless. The result of the ‘bedroom tax’ may be that people go from ‘under-occupancy’ to overcrowding, especially if they have to be rehoused in bed and breakfast accommodation.

“It will cause tremendous problems for local councils who will struggle to provide alternative accommodation and to cope with the effect on their finances if tenants fall into arrears or have to be rehoused in more expensive short term accommodation.
“It highlights the desperate shortage of affordable housing both here in Edinburgh and across the rest of the UK but the Government seems to have turned its back on the problem and the people who will be affected by this.”

The Department for Work and Pensions estimates that it will affect 80,000 social housing tenants in Scotland overall or 33% of the total number of housing benefit claimants in the social rented sector in Scotland who will lose on average £12 a week.

There aren’t enough smaller properties available to meet the demand if people have to move and so Citizens Advice Scotland and Shelter Scotland have both highlighted the danger that some people could end up homeless.

The Government has made some late concessions – armed forces personnel and foster carers have now been exempted – but other than that it’s full steam ahead.

Responding to concerns over the welfare changes this week Mr Duncan Smith told MPs the benefits system was “out of control” and simply “giving more and more money” would not help.

Speaking during Work and Pensions Questions in the House of Commons, Mr Duncan Smith said: “”I always listen to everybody who gives me advice. I don’t necessarily follow it. I have no issue with the Church of England, with the bishops, for them to say whatever they believe. It’s quite right and proper. They should try and argue with us and put pressure on us over a number of issues. I simply say that I don’t agree that the way to get children out of poverty is to simply keep transferring more and more money to keep them out of work”.

He went on: “The reality is what we’re having to do is reform a system that became completely out of control under the last government, get people back in work, for being in work is how you get your children out of poverty. The reality is that we are doing the right thing in bringing in the benefit cap. For the first time ever, people on low and average earnings will realise at last that those on benefits will not be able to be paid more in taxes than they themselves earn.”

The city council’s North Neighbourhood Team is now offering a drop-in service on Wednesdays between 10am-1pm to provide advice and support on a range of services. Officers from the Rents, Choice, Revenue & Benefits Teams and Neighbourhood Support Service, along with Letfirst and Granton Information Centre staff, will be available.

NADI

The Bedroom Tax – a Poll Tax for the 21st century?

It could become the most hated piece of legislation to be inflicted on British people since the infamous Poll Tax. And it’s now only weeks away …

In April, a new measure is to be introduced that will apply to all tenants of working age – welfare reforms will cut the amount of benefit that people can get if they are deemed to have a spare bedroom in their council or housing association home.

Under the legislation, size criteria will restrict housing benefit to allow for one bedroom for each person or couple living as part of the household. Children under sixteen years old will be expected to share with others of the same gender, while children under ten will be expected to share regardless of gender.

Under the new legislation – labelled the bedroom tax – all claimants who are then deemed to have at least one spare bedroom will be affected and face an ‘under occupation’ penalty: a cut to their housing benefit.

The cut will be a fixed percentage of the Housing Benefit eligible rent, which the Westminster government has stated will be set at 14% for one extra bedroom and 25% for two or more extra bedrooms.

Those affected – around 660,000 working-age social housing tenants (over 30% of existing Housing Benefit claimants in the social sector) in the UK – will lose an average of £14 per week, with Housing Association tenants expected to lose around £16 per week.

The architect of the scheme is investment banker and Welfare Reform Minister Baron Freud of Eastry – who incidentally lives in an eight-bedroom Kent mansion when he is not staying in his four-bedroom townhouse in London’s Highgate. The noble Lord believes that ‘spare council house bedrooms are a luxury the country can no longer afford: “It’s not fair or affordable for people to continue to live in homes that are too large for their needs when, in England alone, there are around five million people on the social housing waiting list and over a quarter of a million tenants are living in overcrowded conditions. It’s only right that we bring fairness back to the system and make better use of the social housing stock.”

He went on: “Nearly a third of working-age social housing tenants on housing benefit are living in accommodation which is too big for their needs, in spite of the fact of severe overcrowding. We are stopping the practice of the state paying for rooms beyond claimant needs, and that should go in some way to help tackle the social housing shortage that has been blighting too many lives.”

Lord Freud and his ministerial chums hope that more households will chose to ‘downsize’ to smaller, more affordable properties – and in the process slash £500 million from the Housing Benefit bill. So the government reduces the national debt and tenants get suitably-sized homes: a win, win situation, then – everybody’s happy?

Sadly not. There’s a desperate shortage of suitable, smaller accommodation, as Shelter Scotland Director Graeme Brown explained: “The UK Government is simply failing to listen to the voice of reason being put forward by housing professionals, social landlords, MSPs and individuals. Penalizing low-income people for having an extra room assumes that there is a ready supply of smaller properties for them to move to. This is simply not the case. So the only consequence will be people stuck in homes with mounting rent arrears and a further descent into debt. Even at this late stage, we urge the UK Government to modify its proposals.”

According to the latest Scottish government figures, there are 586,000 households in the social rented sector in Scotland, and 105,000 of these – roughly one in five – will be affected by the Bedroom Tax, each losing an average of around £50 per month.

Advice organisations have already seen a significant increase in demand for their services, and the imminent welfare reforms will inevitably lead to even more desperate cries for help.

Citizens Advice Scotland (CAS) Chief Executive Margaret Lynch gave evidence about the impact of welfare changes on advice services at the Scottish Parliament earlier this month.

She said: “We expect demand for benefit advice, to increase even further along with an increased need for other areas of advice such as debt, housing, and budgeting due to changes in benefits. This increase in casework, as well as the increasing complexity and time-consuming nature or many issues, is of course having a knock-on effect on the ability of our service to help our clients.

“We are already at breaking point so desperately need to be adequately resourced to enable us to help those who need it most as we aim to mitigate the impact of welfare reform as much as possible. The recent benefits uprating bill debate highlighted the statistics showing how the poorest are paying the price for cuts. The evidence we are publishing today is not just statistics but is based on the real lives of real people. It is not just about the numbers of people affected, but the severity of the individual cases. We have seen a big rise in the number of people in crisis situations, either because of the direct impact of a benefit cut or because they have fallen through the gaps in the safety net that is meant to protect them.

“The evidence we are publishing shows who is really being hit hardest by current policies and it includes thousands of people who are genuinely sick, disabled, and vulnerable and deserve support. The impact of current policies don’t just hit the individual claimant but can also have a huge effect on children and others being cared for. Pushing people further into poverty and financial difficulties will lead to an increase in other problems such as homelessness, health inequalities, and family breakdown, as well as lead to rising debt and an increase for food hand-outs. Tackling these issues in future years will only add to the overall public spending bill, not reduce it. The UK government must heed this evidence and question whether they really want to continue on a track of devastating reforms which can only damage more lives.”

Shelter Scotland has issued advice to tenants likely to be hit by the imminent benefit cuts, and urge them to ACT NOW:

If you’re going to be affected by a deduction to your housing benefit then it’s very important that you prepare for the change before April 2013.

There are several things you can do:

take in a lodger – renting out a spare room would bring in extra income, but make sure you get the agreement of your landlord first and check whether this will affect any other benefits that you’re currently receiving
ask for a contribution to your rent – your family members may be able to pay more towards your rent
move to a smaller property – you may be able to transfer to a smaller property, speak to your council or the housing association you’re renting from to see if you can apply to do this
apply for a discretionary housing payment – your local council may be able to give you temporary support to help you stay in your home through a discretionary housing payment.

If you can’t pay all your rent after the reduction you may have to think about finding somewhere else to live or you will risk falling behind with your rent and possibly being evicted. Speak to an adviser in your area as soon as possible if you’re worried that this may happen to you.

For Local advice:

Granton Information Centre 134-138 West Granton Road. Telephone 552 0458 Email info@gic.org.uk

Pilton CAB, Drylaw Shopping Centre: Telephone 202 1153 Email pilton@caed.org.uk

A Happy New Year?

A Happy New Year? Not for people on benefits. The introduction of the controversial Universal Credit is sure to be one of the biggest stories of 2013. It’s the most radical shake-up to the welfare system in seventy years, but what does it mean for you? Granton Information Centre’s Roddy Samson (pictured below) has been giving presentations on changes to the benefits system, and the impact these changes will have on the lives of millions of people. Below, he guides us through the benefits maze:

‘The rationale for changing the welfare system is a generally accepted belief that the current system is far too complex, with too many different types of benefit and allowances. So the Westminster government is seeking to simplify the system and make it easier to understand – and will also make savings of around £8 – 10 billion as it does so!

The idea behind the reforms is to get people back to work, and to try to make pay. Between 2010 and 2013 there will be 39 changes to the benefits system, some are already in place and more will come in next year.

The main points to consider are Income Support, Rent Capping, Disability Living Allowance (DLA) the introduction of the Universal Credit, benefits caps, Housing Benefit and the scrapping of Incapacity Benefit.

Income Support is now generally paid to lone parents – is used to be the case that lone parents could claim income support up until their child was 16 years of age. That dropped to twelve, then seven and now, when the child reaches five years of age, the parent is expected to register to be available for work. That’s a major change.

Disability Living Allowance (DLA) is currently paid to people who have a disability or a long-term condition, and it’s paid both to people in work and out of work. There are two sections to it – mobility and care – but DLA will be scrapped altogether next year and replaced by Personal Independence Payment.

There will be a new, tougher medical test for people on DLA; new claimants will be tested and existing claimants will be re-assessed by an organisation called ATOS who were contracted by the Department of Work and Pensions to carry out the medical assessments. The retesting will mean a lot of people will lose their entitlement to this benefit, there will be substantial loss of income and the impact will be that people with disabilities – many of whom require a significant level of care – will find that they have far less money coming into their household. Universal Credit is the flagship of the government’s welfare reform agenda, a single ‘super-benefit’ that will replace a number of existing benefits – including Income Support, Job Seekers Allowance, Employment Support Allowance, Housing Benefit and Tax Credits – and replace this with one single benefit payment.

Universal Credit is supposed to be structured to make work a better choice than being on benefits, but there has already been a lot of criticism of the proposals. Universal Credit introduces conditionality and sanctions for the first time. Just now, you have Tax Credits to top-up the incomes of people on low pay, which are paid if you work 16 hours a week. – but the government proposes that you must now work for at least the equivalent of 35 hours a week at the national minimum wage to qualify – and if you don’t, they suggest you should ask your employer either for more hours or for a wage rise!

Job Seekers Allowance will also become part if the Universal Credit, but if you fail to meet the conditions of the benefit the sanctions will now go much higher – they are talking about sanctioning people for up to three years, which means that people could be left with no money for that period.

The other problem with Universal Credit is that it’s going to be paid monthly, with all benefits paid in one lump sum. There’s a real problem with this, in that – to take housing benefit, for example – rent is currently paid directly to landlords. If you give large sums of money to people with drug or alcohol issues, and other vulnerable people, what is likely to happen is that they will spend the money on other things and not on the essentials, leading to rent arrears and potential debt problems.

The other problem with this is that applications for Universal Credit must be made on-line, which poses huge problems for people who either do not have access to computers or others who have difficulty operating them – the on-line application can take one and a half to two hours to complete. The government also plans to introduce a Benefit Cap from next April. This is supposed to be about fairness – making sure that people on benefits are not better off than families in work – but this will impact on larger families and those whose housing costs are higher. The benefits cap has been set at £500 for couples with or without children living with them, and for single parents whose children with them. For single adults without children or with no children living with them the cap is set at £350.

The new rules on Housing Benefit is being called the Bedroom Tax, and it basically means that, if you are a single person who lives in a two bedroom house, you will not be paid additional housing costs – you will only get enough to cover the cost of a one-bedroom flat. The idea behind it is that there are lots of people living in homes with spare rooms, but the fact is that there are very few one-bedroom flats available, particularly in areas like North Edinburgh. The difference in cash terms is a cut of around £14 a week per unoccupied room.

People on Incapacity Benefit are also facing tougher tests as the government tries to get more people off benefits and into work, and the medical focuses on what people are able to do other than what they are unable to do, the thinking being that almost everybody could carry out some form of work. What we’re finding, though, is that as many as 34% of those on Incapacity Benefit don’t turn up for their medical and disappear off registers altogether. Of those who do turn up for the medical, 37% are passed fit for work – but 71% of those who challenge the decision are successful on appeal when they are represented by organisations like ourselves.

In summary, these are massive cuts. It’s clear that no-one will be better off as a result of the latest welfare reforms, whereas even more people will be worse off as the new arrangements are introduced. There are massive social implications, affecting huge swathes of society – but the poorest, in particular, will be hardest hit.’

So there you have it. As Neil Kinnock once said: ‘I warn you not be ordinary. I warn you not to be young. I warn you not to fall ill. I warn you not to get old.’ That day of reckoning is now fast approaching. For too many British citizens, rather than a new year of hope and opportunity 2013 promises to be a year of pain, misery and despair.

If you are confused about how the benefits system changes will affect you, make an appointment to see an adviser at Granton Information Centre or attend a drop-in session. Telephone 552 0458 for more information.

WIG to tackle housing issues at public meeting

Women’s International Group (WIG) is holding a public meeting to discuss housing issues next Thursday evening (17 May) at 6.15pm in Royston Wardieburn Community Centre. All welcome.

A spokesperson for WIG said: “A number of housing officials, local councillors and reps from the Tenants Federation will be in attendance to respond to questions/issues from the floor. One of the aims of the meeting is to raise awareness about some of the changes which are going to affect local people currently claiming benefits (e.g. the bedroom tax/under occupancy penalty which will result in any working household with an extra bedroom losing part of their housing benefit; and the benefit cap which will be deducted via people’s housing benefit and universal credit. These are important issues and we hope to see a lot of people attend the meeting”.

The Women’s International Group (WIG) was established at a succesful event organised to celebrate International Women’s Day in March (pictured below).