Iain Duncan Smith’s new report may come as a shock to some of his Tory colleagues
Iain Duncan Smith’s Centre for Social Justice (CSJ) report on shaking up the benefits system, released today, proposes the coalescing of the current 51 benefits available for working age people into just two – one encompassing the likes of Jobseeker’s Allowance and Income Support, the other including Housing Benefit and Tax Credits.
The plans, which the CSJ hope will move 600,000 households off welfare and into work – and raise the incomes of the lowest paid by “an average of £1,000 per year” – have been broadly welcomed by Guardian and Spectator alike. Housing benefit reform, however, represents one area where the centre-right think tank’s aims would run against their own policies and those of some Conservative-run councils.
The report (p.70) details the deterrent to work posed by housing benefit being withdrawn when the unemployed find work:
“Housing Benefit, the main means-tested programme though which the government helps people on relatively low incomes with their housing costs, has an extremely high withdrawal rate. This exacerbates the problem of undesirably high marginal rates.”
But the CSJ’s own “Housing Poverty” report (p. 21) last December said:
“Local authorities and housing associations must be encouraged to produce asset management strategies that would ensure that they maximise the value that they secure from those assets, and dispose of homes which were not economic to repair, in the wrong areas or the wrong unit types.”
On a similar note, a Localis report (p. 33) published in April on the “Principles for Social Housing Reform,” written by Tory leader of Hammersmith and Fulham council Stephen Greenhalgh, said:
“To continue building and publicly investing in the ‘social rent’ template which provides tenancies for life with no incentive or requirement to seek work or move on and which locks investment and people into properties, makes no sense.”
In July, Left Foot Forward reported on Mr Greenhalgh’s secret proposals to demolish 3,500 homes on estates deemed “not decent”.
In other words while Iain Duncan Smith himself promotes a policy of raising housing benefits to encourage a return to work, his colleagues are looking to restrict supply and set market rates for rents, which would squeeze the purchasing power of the benefits.
It is also worth noting that the report does not include any explanation on how 600,000 new jobs would be created in a weak labour market. The Child Poverty Action Group note that it, “underplays other barriers to work, such as lack of jobs, low pay, lack of childcare, inflexible employment practices and ongoing discrimination.”
Other responses to the report include Don Paskini who links to a Joseph Rowntree Foundation report and notes that:
“The total cost is £3.6 billion, and it would reduce child poverty by 210,000. In contrast, increasing benefits and tax credits by roughly this amount would reduce child poverty by around 1 million.”
National charity Gingerbread welcomed the report. CEO Fiona Weir said,
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“We’re delighted that the report recognises that the route to help more parents into work isn’t to impose tighter benefit conditions, but to do more to make work pay.
“Benefit simplification is never easy because people’s lives are complex; we need to make sure that there is support for those who can’t work as well as those who can. But we welcome the ambition of this report to do more to help the lowest paid single parents.”