Change is overdue

With housing benefit reform high on the political agenda, it is disturbing that the focus of debate often appears to be built on a series of misapprehensions - that expenditure is out of control, that claimants are out to defraud the system, and that the scheme encourages claimants not to take up work and to seek to rent more expensive property than they need. The reality is in fact very different.

Citizens Advice Bureau evidence shows that the real failures of housing benefit relate to poor administration and to shortfalls between benefit payments and the rent due, leaving tenants unable to avoid housing debt and homelessness. As a result, many private landlords are now refusing to let to people on housing benefit altogether. And in the social rented sector CABx report large numbers of clients facing possession proceedings for arrears which are due to housing benefit failure. Claimants are left with the distress and cost of court action for arrears over which they have no control.

Even tenants of the same authority as the housing benefit department are affected: one CAB recently reported a council tenant facing possession proceedings for rent arrears because of a delay in processing his benefit. When the CAB contacted the housing and the housing benefit departments, each admitted they did not communicate with the other: the housing benefit department was unaware of the repossession threat and the housing department was unaware of the delayed benefit claim.

The current DSS project to simplify and improve housing benefit is therefore welcome. The evidence from CABx, which deal with some 200,000 housing benefit problems every year, points to a number of areas where reform is needed to reduce unnecessary burdens on both housing benefit departments and claimants.

For example is it reasonable that some authorities insist on every claimant completing their own claim form as well as the standard NHB1, thus inevitably adding to processing delays? Is it really necessary for all claimants on income support to have to renew their claims periodically as well as reporting every change as it happens? And is it realistic in the age of the flexible labour market that people in work should have their housing benefit adjusted every time their income changes?

We are recommending reforms to ensure claimants only have to complete one form, to end unnecessary renewals and to fix the level of benefit for people in work for a six month period, unless the claimant requests a reassessment. Better and faster links with the Benefits Agency would also help reduce delays, and we hope that the advantages of the Lewisham prototype, featured in the White Paper Modernising Government as an example of the joined-up approach to service delivery, can quickly be rolled out nationally.

But it is not just the processing of claims which causes problems. In an effort to control expenditure, rules on entitlement have been tightened, leaving many tenants facing shortfalls between their housing benefit and their rent, or in some circumstances with no entitlement at all.

CAB evidence repeatedly shows how a narrow preoccupation with containing expenditure compromises broader government objectives, resulting in increased expenditure in other areas.

Rent restriction rules result in increased rent arrears and homelessness, undermining strategies to improve the quantity and quality of private rented sector accommodation. CABx report many cases where families have had to be rehoused under homelessness duties as a direct result of the rent restrictions. As recent DETR research has demonstrated, the impact of these restrictions has not been a reduction in rent levels. Instead landlords have withdrawn from the market and the quality of accommodation available to claimants has fallen.

The single room rent takes this policy to the extreme and CAB evidence demonstrates how this policy results in extreme poverty and homelessness for the young people affected, thus undermining the government+s wider policy objectives to tackle social exclusion and rough sleeping and to encourage welfare to work. Its abolition must be a priority for any reform.

One CAB client was an 18-year-old woman who had left home at 15, and lived with various friends before managing to find a bedsit. She had managed to find a full-time job but only earned £72 per week and because of the single room rent she was having to contribute £35 towards her rent. Inevitably she got into arrears and returned home one Friday to find that the locks had been changed and she had been illegally evicted. Without accommodation she was likely to lose her job.

Benefit shortfalls resulting from non-dependant deductions are another source of unfairness and hardship, with DSS figures showing council tenants disproportionately affected as rates have been repeatedly raised well above inflation. The top rate of £46.35 now exceeds the average council rent. Not surprisingly, many tenants fall into arrears because their non-dependants' view of what might be a reasonable contribution differs from that of the DSS. CAB evidence shows how NDDs encourage new household formation and less efficient use of housing, fuelling pressure for housing growth as families resolve the problem by the non-dependant moving out.

The rules are riddled with anomalies. Non-dependants on income support are expected to contribute £7.20 although income support rates include no provision for housing costs, and even non-dependants such as asylum seekers who have been refused benefit altogether can trigger a non-dependant deduction. One CAB reported a client threatened with possession after her mother - an asylum seeker with no entitlement to benefits - moved in with her. In the end social services resorted to making up the shortfall as this was cheaper than paying for the mother to live in bed and breakfast.

The priority for reform must be to create a scheme which meets the legitimate requirements of landlords and tenants for the prompt and full payment of rent owed. A reformed housing benefit system, which delivered housing security, would provide a sound platform on which other social policies can be built.