Lib Dem leader Nick Clegg appeared on BBC1’s Andrew Marr show this morning, and stuck up for the Coalition policy that there should be a £500 a week benefit cap:
“It surely can’t be fair, can’t be right, that you can be earning more on benefits than someone going out and earning £35,000, which is the equivalent if you were to go out and work.”
You can watch an excerpt below:
(Clip available on the BBC website here.)
You can watch Nick’s appearance in full on BBC iPlayer here for the next 7 days.
* Stephen was Editor (and Co-Editor) of Liberal Democrat Voice from 2007 to 2015, and writes at The Collected Stephen Tall.
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24 Comments
Well lets hope that Nick Clegg discusses the preposterous Welfare Bill that is coming up in the HOL next week. To Cap Benefits and Housing Benefits.
I was not aware until last night when my Nephew visited me, who is homeless, and today he is moving into a Hostel, and get this, The Hostel is charging Housing Benefit £170 a week.
At first, I thought he must be wrong, We live in Norwich and the total LHA for a single person in a shared bedroom is £55 a week, for a single person in a self contained room it is £75 a week, so in my eyes i thought how on earth can a hostel be charging £170 a week.
So I decided to look into it and sure enough, Charities and Hostels are “Exempt” from Housing Benefit Caps and the max they can charge is £170 a week.
The Hostel that my nephew is staying in is a terraced town house converted into 6 bedrooms, Thats a total of £5000 a month this landlord is charging for these 6 residents, He also owns the terraced house a couple of doors down, which again, houses 6 homeless people for which he is receiving another £5k a month.
As i said, the only people who can get away with this, are places like Hostels, women refuges and registered charities.
Why on earth is this Government proposing to Cap benefits at £25k & housing Benefit at £400 a week (For Families) renting from “private landlords” risking hundreds of thousands of people being thrown out of their homes and risk homelessness, but guess what, become homeless and move into charity housing or hostel and there will be no caps.
This is absolutely ridiculous and all it will do is encourage unscrupulous landlords to become “Hostels” where they can then rip of HB for even more money.
This government says it needs to cut welfare, and by doing so they are targeting the sick and disabled people unfairly with the cuts, but at the same time they are throwing millions of pounds a week at these “hostels & charities”
Just to add, the owner of the Hostel told him “Not” to get a job as he would not be able to afford the rent.
These Hostels are supposed to help people with their problems and get back into work, not trap them with ludicrous rents.
What a complete joke, this government needs to sort its self out and fast.
Hopefully the house of Lords will Vote against these reforms next week
Why don’t they bring in the benefit cap gradually. Start it at £30,000 and bring it down by £1,000 a year until it reaches the median income. That should give people reliant on massive benefit payments time to adjust their lives and remove the risk of suddenly dramatically cutting people’s incomes leading to homelessness etc.
In the long term it would still save the same amount of money. It would only cost slightly more in the short term and would be a fair compromise between ending ridiculously high welfare payments and ensuring people are suddenly thrown into poverty and homelessness.
Stephen – getting £26,000 a year tax-free is not the same as being ‘suddenly thrown into poverty and homelessness’. More than half the working population earn less than that before tax.
I’m not one of those who wants a punitive benefits system. Far from it – given that we are bound to have at least a few million people unemployed at any time, mostly through no fault of their own, I think the benefits system should err on the side of generosity and allow people to live decently. But claiming that someone getting, tax-free, more than most people get before tax, is being treated unfairly is just ludicrous. I don’t think it unreasonable to say “if you want more than £26,000 a year you have to get a job”.
So in order for in-work pay to be attractive (no matter how stingy it is) the process of claiming benefits must be turned into a distressing, traumatic, demeaning obstacle course. Got it.
Mike, that’s not what he said.
And if you think that claiming benefits wasn’t already distressing and traumatic, you’ve clearly never tried claiming them or known anyone who has. Placing a cap on total benefits doesn’t make the claims process any easier or more difficult.
Surely the whole point should be “Not Capping Benefits”, but for the Government to introduce Laws that Private Landlords can only charge a pre determined amount set by the government.
It is Private Landlords, Property Agents that are screwing the system, not the claimants.
There is a shortage of affordable, social housing and private Landlords and buy to let mortgages are taking advantage of this and screwing the country.
It is also worth noting that Britain’s welfare bill of £185 Billion is mostly down to Housing Benefit. Over half of the welfare Bill is also claimed by Pensioners who also claim Housing Benefits.
The Cap on benefits is Immoral and deeply unfair, this government is penalizing the poor, sick and disabled, when really they should be targeting the landlords with tougher rules on rents
Andrew, having reached my half-century, I clearly recall the process of claiming benefit under the Thatcher/Major governments, and compared with what it has become today it was straightforward and hassle-free. I am keenly aware of the difficulties experienced by claimants today, and it is notable that the Clegg leadership has never ever aimed the slightest comment or criticism at the distressful, authoritarian attitudes shown by those claimants have to deal with. Point is, Clegg is pressing for better rates of pay, but for a benefits system which inflicts illiberal stringency on claimants as a spur to find work.
Assuming that there is work to be had, of course. If there is no work to be had, then these measures amount to little more than institutionalised cruelty.
Gah – should read – “authoritarian attitudes shown by those officials that claimants have to deal with” and “Point is, Clegg is not pressing for better rates of pay”. In the name of the gods of syntax, why is there no edit function? Or….why didnt I proofread it first – doh
what if no one will employ you but you do great voluntary work?
Does his calculation of the median wage include the benefits that people on median wage still get (things like child tax credit)? As I understand it it doesn’t, which makes this comparison somewhat false for anyone who would be getting benefits on that income level anyway surely?
Am I correct (I’ve done a little research since my last comment) that there will be two rates; 1 for single adults with no children at £350 a week, 1 for couples/single parents at £500 a week. That means someone with 4/5/6 children gets the same cap as someone with 1 child, despite the fact that they clearly have higher costs, and would have higher income (because of tax credits etc) if they were in work; if so that seems like it isn’t really about the motivational effect of the in work/out of work division, if it was you’d stagger it based on number of children. Is there any credible research into how this will effect child poverty rates, particular for children with a lot of siblings (for example, how many children would need to be in a family for the cap of £500 a week to count as child poverty?). I’ve also found a stat the 35% of those affected will be families with only 1 parent and 5 or more children which seems to support my guess work – is this accurate?
Uncapped housing benefit is one part of the huge subsidy the rest of the UK pays for Londoners. If Londoners want higher benefits then Londoners should pay higher taxes for it rather than taking it from hard working northern folk.
And this is from the governments own report;
“Analysis shows that the introduction of the cap will, for larger households claiming benefit in some parts of the country, limit the income necessary to afford housing at the (new) Local Housing Allowance (LHA) rates, i.e. the 30th percentile of the market.”
I agree in principle the idea of capping benefits to median earnings seems sensible, but given that most people would have child tax credits in addition to that earnings the comparison is surely false, and whilst I haven’t found statistics directly on predicted effect on child benefit the stats on demographics suggest this will largely affect large, single parent families. Surely that will cause an increase in child poverty?
@AI – surely the fact that living cost in London are undoubtedly higher means that to maintain what we consider a reasonable standard of living benefits in that area must also be higher. And it seems that standard of living is a more important measure than just gross income? (In case you were wondering, I’m not from London).
@Andrew Hickey
“Stephen – getting £26,000 a year tax-free is not the same as being ‘suddenly thrown into poverty and homelessness’.”
I entirely agree. But there is a reasonable argument that suddenly cutting people’s income from say £30,000 to £26,000 overnight may cause significant disruption to people’s lives, possibly throwing them into homelessness and other problems. It takes time to adjust, move to a cheaper area, re-tool one’s lifestyle, especially with large families with many children.
I entirely agree that people should not receive ludicrous amounts in welfare, but I can also see how cutting someone’s income overnight by several thousand pounds may cause hardship. It is not the fault of these families that the welfare system under Labour handed out ludicrous amounts of money to them. A process of bringing down a cap gradually to a reasonable level (And I think median income is extremely reasonable) would give families a chance to adjust, move to cheaper areas, etc, without risking serious disruption or homelessness.
They’ve had almost a year already since the bill was published…
…and the bill permits the government to do exactly this. In fact, I just looked it up and this decision has been explicitly deferred in the bill. The government will later have to pass a statutory instrument to bring large parts of the bill into effect on specific dates, and I don’t see anywhere that the value of the cap is required to be immediately at the minimum.
So, your proposal is reasonable but not really part of the current debate.
When the Coalition was formed and these benefit cuts were announced, both Tory and LD alike were at great pains to say people on HB had nothing to worry about: landlords would lower their rent prices in line with the lower HB threshold.
Except this is not what has happened. The Opposite has happened. Rents have continued to rise under this government. Private landlords are simply not lowering their rents and probably will not do so when/if these changes actually become law.
http://news.bbc.co.uk/today/hi/today/newsid_9614000/9614436.stm
http://www.bbc.co.uk/news/uk-15284892
There’s plenty of talk of the disabled being “scroungers” and anyone on JSA being “workshy” (even though the jobs market is, to put it bluntly, crap). Why does nobody in the media or government talk about the “well-off scroungers” who fleece the taxpayer through artificially high rent rates? As the recent C4 documentaries have shown, a new breed of private slumlord has come into existence and it is usually these people who are charging such high rents and leaving their tenants in squalid, unsuitable housing. There are quite possibly tens of thousands of greedy buy to let landlords out there who are getting their second and third mortgages nicely paid off by the taxpayer – while all the while the finger is being pointed at the disabled claimant who has no power or really any representation in government (as all parties now buy into the disabled as scroungers rhetoric).
If we want to bring the HB bill down, throwing people out of their homes and breaking up families is not the way to do it. Rent controls need to be brought back in as a matter of urgency. It works well on the Continent, where tenants have far more protections than we do (and rightly so) but the Tories would never do this as I wager most B2L landlords are exactly the type of person who votes Tory.
Until we have tens, possibly hundreds of thousands of new council homes and proper rent controls brought in, nothing will change. Anyone who believed the government when they said private landlords would lower their rents, as if they would do it out of the goodness of their hearts, was horribly naive at best.
@Scott. Rising prices are caused by too much money chasing too few goods. The cost of living is higher in London because the people there have more money on average over their lifetimes than in other parts of the UK. More money sloshing around there leads to higher prices – its simple economics. Taking money away from hard working northern folk to subsidise rich London landlords makes the problem worse because you are moving even more money into London.
You made that up. I challenge you to find an example of anybody – even the Tories! – saying this.
What they need to stop is councils paying Housing Benefits directly to the greedy private landlords! They set their rents (often for sub-standard, ill-maintained properties) because they know the councils will be paying the bills. When you fill in a HB form there is a question about payments to be made into your own bank account or directly to the landlord. Some tenants, however, are NOT given this option and the council insists on paying the benefits to the landlords. This is a win-win situation for the landlords not for the benefit recipients! That’s where the real rot is – it needs to be stopped quickly! I don’t know of anyone who is on that level of Benefit – the highest rents are in London, Oxford and the Inner Cities. In Oxford the rents are very high [£2000 for a modest 3 bed house on the outskirts of the city] mainly because it is a University City and there are students clamouring for accommodation. This puts the price of rents up for families!
@Matt – “Over half of the welfare Bill is also claimed by Pensioners who also claim Housing Benefits.”
Please stop and think for a minute – these Pensioners [of whom I am one] have an annual income of less than £13,000 per annum – nothing like £26k or £35k which are the figures being bandied about. Pensioners don’t get Housing Benefit if they don’t qualify for it. If the State Pension was to be set at a reasonable level – [after all we have all worked all our lives and paid into the system] then we wouldn’t need to apply for HB. The whole system is skewed I’m afraid – IDS & NC are not really in touch with the realities of the people living in the real world.
@mike cobley – A wee tip [because I have been caught out in the past]
“Select all” and “copy” your text – paste into a document and check, replacing it in the comments box if necessary it before hitting the Post Comment button. I have to do it every time.
@Pensioner
You miss understood my post, or i did not do well enough in explaining myself.
I was in no way suggesting that pensioners should not receive HB. I was merely pointing out that the government keeps trotting out the line about the benefit bill being £185 Billion a Year, along with these stats they trot out the same old mantra about Housing Benefit and “work shy scroungers” and people of working age should not receive yadah yadah yadah.
What they fail to do is present the statistics in a factual and comprehensive way for everyone to understand.
When discussing People of Working Age Benefits, they have a moral responsibility to use the “actual” figures this group of people are in receipt of from the welfare bill and not use the £185 Billion figure which is also made up largely of pensioners.
Yes the benefit bill is expensive, but we really must put things into perspective, as i said in my previous post
More than half of the Benefit bill is made up from
Pensions and serps
On top of that “some pensioners” are in receipt of DLA if claimed before reaching 65, Severe disabled allowance and attendance allowance if claiming after 65, a,long with pension credits, winter fuel allowances e.t.c
(Please Note, I am not suggesting they should not get this)
The next largest Welfare Bill is
Housing Benefits (claimed by Pensioners, sick, unemployed, and families of low incomes)
Working Tax Credits
Child Tax credits
Child Support
Incapacity/ESA
DLA
JSA
Income Support
So when the government refers to people of “working age” on out of work benefits it is only fair that they use the part of the benefit bill that applies to them and not the entire £185 Billion.
Maybe then the sick, disabled and disadvantaged can stop being labelled as scroungers and work shy
@Matt – thank you for setting it out in such clear terms. I was not “having a go” at you, but it felt [maybe wrongly] as though the implication was that Pensioners were responsible for over half the Welfare bill and weren’t entitled to it. Your explanation of it does put it into better perspective.
Many Pensioners don’t actually claim for many of the Benefits to which they ARE entitled simply because they don’t want to be labelled as ‘scroungers’. It’s very sad that these Pensioners are going without basics when a little more help to which they are entitled has not been claimed and would make a difference in their lives. We aren’t actually talking riches here.