Listening to Ian Duncan Smith you would imagine that Universal Credit (UC) would soon become the eighth wonder of the world. Reality is somewhat at variance with his steadfast refusal to accept that it is in fact a disaster in the making. The latest news is that working tenants will be targeted under UC. Currently the ‘sanctions’ regime, which has seen a massive increase in the withdrawal of benefits payments to claimants, only applies to out of work benefits such as Job Seekers Allowance or Employment Support Allowance. However, the Department of Work and Pensions has confirmed that under UC, where a tenant is working less than 35 hours a week at minimum wage, sanctioning could involve losing their HB on the grounds that they might not be ‘doing enough’ to find more hours of work. This would impact both on tenants and their landlords. It would create rent arrears, which as they mounted, could lead to eviction of the tenant and their family.
In the case of Housing Association tenants if arrears were 8 weeks or more and their landlord applied to evict them, a magistrate has no discretion, having to give ‘vacant possession’ to the landlord. If the tenant has children, then eviction could lead to the Council having to pay for alternative accommodation which would be more than the cost of HB.
The government’s “welfare reforms” operates a system of pressuring out of work benefit recipients, on the premise that there are lots of them for whom, in the words of George Osborne, unemployment is “a lifestyle choice”. The main problem, however, is that there is a shortage of jobs and the growth of ‘under-employment’. According to the government’s own estimate there were 1.457 million people in part-time work in September 2013 only because they have not been able to find a full-time job . In addition there were 606,000 people in temporary jobs because they could not find permanent posts. Claimants have also been pressured into taking zero hours contracts for fear of losing their benefits even though this gives them no guaranteed earnings.
The picture which the government paints is one where a large group of people chose to live on benefits because they don’t fancy working for a living. The reality, however, is that most of them are victims of circumstance, be it redundancy, illness, or financial disaster. Rather than a body of people forever on benefits there is a constant stream of people on and off. This is shown by the DWP figures on HB ‘flows’ for Swindon. In 12 months across 2012-13 Swindon had 5,460 HB claims, whilst 5,620 people’s claims ended. This obviously reflects the reality of today’s job market where people are constantly in and out of work, surviving on whatever they can get, even if temporary.
The whole tenor of the policy carried out by the DWP is designed ‘smoke’ out people who supposedly don’t want to work. In order to do so the whole body of benefit recipients is harassed, penalised and treated as if being on benefits is their fault. Stories of sanctioning for ludicrous reasons abound, including claimants in comas, claimants being treated for cancer, claimants applying for only 19 jobs one week when their ‘target’ was 20, claimants attending job interviews, to name but a few.
Forcing people to work for their Job Seekers Allowance, is supposedly to end the “something for nothing” culture. Yet most people in receipt of benefits will have paid tax and national insurance for many years whilst in work. They have paid for these benefits.
The precarious nature of much work is also reflected in the big increase in the numbers of people who are ‘self-employed’. Sometimes this status reflects an imposition by employers rather than free choice. Far from a renaissance of ‘entrepreneurial’ activity, this increase reflects a situation where more and more people are forced to scramble for what work they can find, especially those over 50 who have suffered redundancy and find it difficult, if not impossible to find the secure employment that they previously had. Despite an increase in the number of people ‘self-employed’ to 4.147 million people in September of last year, their average earnings have declined. In Swindon, HMRC figures for 2010/11 showed that the average annual income for ‘self-employed’ in the town was £13,200. The median, or mid point, was only £9,790, so 50% earned less than that. Some tenants who are ‘self-employed’ and have this low level of earnings will be in receipt of HB.
Harassing the working poor as well
Given the decline in the value of wages over the last five years, and the precarious nature of much employment, there has been a big increase in the number of people in work who are claiming Housing Benefit (HB). In 2012 the Building and Social Housing Foundation carried out some research which estimated in 2010 and 2011 that 9 out of ten new HB claimants were in work. According to Inside Housing there are now more than one million people in work and in receipt of HB, up from 691,000 in 2010.
The threat to take HB off of people who are in work, struggling to earn a living as best as they can, is yet another indication that the execrable Ian Duncan Smith’s ‘flagship’ scheme is not designed to “help people into work”. It can only add to the distress of people struggling financially to keep their head above water. It is a a form of harassment of the working poor. The main problem we face, is not legions of people who cannot be bothered to work, but the absence of well-paid and secure jobs. The growth of zero hours contracts is only the latest example of the insecurity of a growing section of the job market. What possible purpose can be served by creating conditions where somebody in work could be thrown out of their home because of a bureaucratic decision that they are not trying ‘hard enough’ to get more hours work? If there are children in the family, then a local Council would have to face the responsibility of re-housing them in any case, which would be more expensive than the HB.
Speaking in the House of Commons the other day, John McDonnell MP, recounted what he had been told by disabled victims of the government’s welfare reforms. They felt ‘terrorised’ and harassed by the pressure they were being put under. It is one of the ironies of a government which says it wants to “make work pay”, that the way they are doing so is not by promoting a living wage but by trying to starve people into work. This latest idea, threatening tenants’ HB even when they are working, is even worse since it would probably have the impact of starving people out of their home.
March 1st 2014