Welfare reforms are cementing social tenants at the bottom of the economic pile

The picture emerging is one where social tenants are bearing the brunt of welfare reform and worsening austerity. This doesn’t quite gel with the chancellor Osborne’s claim that ‘we’re all in it together’.

The Bank Holiday weekend saw the clocks go forward while everything else went backwards for social tenants and other vulnerable people across the country.

Research by the Human City Institute reveals that social tenants are PiPs – ‘Poor in Perpetuity’ – with squeezed incomes in recent times years from an already low baseline. The median income of all social tenants is just £9,000 per annum. That for working tenants is £14,000 – less than two thirds the national average.

Welfare reform and austerity are cementing the position of social tenants at the bottom of the economic pile.

The introduction of the Bedroom Tax and changes to Council Tax Benefit from 1st April, coupled to uprating of in-work benefits of just 1 per cent per year for the next three years, will result in £3.5bn lost in purchasing power in social housing communities by 2015.

This projected fall in real terms tenants’ incomes comes in the wake of at least a 10 per cent loss of purchasing power since the Credit Crunch hit, equating to a total drop in real terms income of £3bn between 2008 and 2012. This has resulted from above inflation increases in necessities – food, fuel and transport – which take up disproportionate amounts of tenants’ incomes.

Behind the figures lie tales of genuine distress. In 2012 HCI ran a series of focus groups with over ninety social tenants from across the country with concerned social landlords Aster, Trent & Dove and Trident.

Tenants’ recorded comments convey the depth of their daily struggle:

  • Having to cut back on fuel.
  • Not enough food for the week – three days OK and the rest make do.
  • Less social activities – go out once a week and don’t eat to be to afford it.
  • I am buying less food – living on toast for last few days of the week.
  • Do less shopping so that I can’t spend any money.
  • Choosy about what I buy.
  • Can’t afford to eat much meat.
  • Being careful and monitoring everything including water – don’t just let it go down the drain.
  • Never fill the kettle – only just enough for a cup of tea.
  • Get up later and go to bed earlier.
  • Wear extra woollens and drink hot soups.

As well as low and increasingly stretched incomes, tenants have few savings to fall back on in times of crisis; more than two thirds have no savings at all. Of those tenants with savings, almost half have less than £1,000 with a further quarter having no more than £3,000.

The localised Social Fund, following a 10 per cent cut across the board, will leave tenants with few options except recourse to legal and illegal loan sharks: already a growing problem in the sector.

The picture emerging is one where social tenants are bearing the brunt of welfare reform and worsening austerity. This doesn’t quite gel with the chancellor Osborne’s claim that ‘we’re all in it together’.

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