I recently published a post on the unintended consequences of welfare benefit sanctions. While away on annual leave I missed a report published by the Department of Work and Pensions (DWP) about the failure of the Spare Room Subsidy regulations to achieve stated objectives and the unintended consequences. It is not the principle, but the failure of the DWP to think things through that concerns me.
The Spare Room Subsidy, better known as the Bedroom Tax, cuts housing benefit for housing association and council tenants who are deemed to have a ‘spare room’. I have blogged on this subject many times, for example:
The report by the Cambridge Centre for Housing and Planning Research and Ipsos Mori, Evaluation and Removal of the Spare Room Subsidy: Interim Report, found that financial institutions (lenders and investors feel that the cumulative impacts of of welfare reform could lead to a “build-up of arrears, reduced liquidity, reduced profitability … and less development” by housing associations. The report said that these lenders and investors have seen little if any positive impact from improved work incentives from the bedroom tax because, as the research found, few tenants affected by the bedroom tax had found employment.
The report found that 17% of those affected by the bedroom tax have non-resident children regularly staying with them overnight, and that 34% of landlords, solely because of the bedroom tax, had initiated possession proceedings against tenants,
6% of tenants have reported that they have borrowed money on credit cards and/or payday lenders to bridge the shortfall in their rent.
David Orr, the chief executive of the National Housing Federation responded to the report by saying: “Surely now it is time for the government to admit they got it wrong and repeal this ill-thought-out policy”.
Unfortunately, the political culture in this country does not allow politicians to admit they may have got something wrong. That’s a shame because if ever there was a measure that just isn’t working, something admitted in private by supporters of the governing coalition, it is the bedroom tax. It is time that the bedroom tax is put out of everyone’s misery!