Welfare Reform: Two Years On

This week marks two years since the introduction of some of the most radical changes to our social safety net in its history. The Welfare Reform Act, spearheaded by Iain Duncan Smith, was welcomed by the Tories as an important piece of legislation intended to deliver "a welfare state fit for the 21st century that's both fair to claimants and the taxpayer".

Two years on seems like an appropriate time to assess the impact of these sweeping changes, especially now that the same government that introduced them is asking for another five years to take their ideological agenda even further.

Bedroom tax:

Probably the best known – and most pernicious – of the measures introduced in April 2013 was the bedroom tax. This cruel measure, which cuts the housing benefit of council tenants by up to 25%, has caused untold damage up and down the country, but in Islington, where both rents and the demand for social housing are much higher than elsewhere, the impact has been particularly severe.

Over the last two years I've had many conversations with people in Islington who have been the victims of this tax. I'll always remember the woman who had fallen out with her daughter, who had then moved away. The mum was desperately holding onto her two bedroom place, hoping her daughter would come home. So she was paying the extra charge and having to live on sandwiches.

Many others were forced into poverty by the bedroom tax, with 60% of affected tenants falling behind with their rent within the first six months, for the simple reason that its stated goal – encouraging people to downsize – was unattainable.

There is an acute shortage of one and two bedroom homes in the social rented sector. Even in Islington, where the council has made heroic efforts to build more affordable homes, more than half of the 19,000 people on the waiting list are in need of a one or two bedroom property. The Tories, who under David Cameron have built fewer than half the homes needed just to keep pace with demand, have completely failed to address this underlying issue.

The bedroom tax is both a moral outrage and a failure on its own terms. According to the DWP's own figures, fewer than 5% of those affected have been able to downsize to a smaller property in the social rented sector. And it didn't save any money from the housing benefit bill either. In fact, because of the Tories' failure to tackle the underlying causes of the housing crisis, the national housing benefit bill has actually increased by £1 billion in the two years since the bedroom tax was introduced.

Benefit cap:

The Welfare Reform Act represented cruel and myopic policy making at its worst, putting ideology ahead of evidence and common sense. The bedroom tax was perhaps the most egregious example of this, but it was hardly the only one.

The total benefit cap, which limited weekly benefit payments for families to £500, was based on an understandable principle but was introduced with no accounting for regional variations in the cost of living.

When this proposal was first put forward, I led a delegation of London MPs to see Iain Duncan Smith twice, to explain in full what the effect of the cap would be in the capital, where rents are so very much higher than the rest of the country.

I told him that whilst it sounded fair that no-one should get more than average pay if on benefits, in practice most of the money doesn't go to my constituents but to their landlords. And no-one on average pay would be able to survive without having their incomes topped up by in-work benefits like tax credits and help with rent.

Over the last two years I've seen first hand how much damage this policy has caused. The near impossibility of looking after a family with £500 a week was well illustrated by a woman who contacted me earlier this year, who had three children to support.

She had survived polio as a child, and her leg was permanently affected by the disease, leaving her unable to work. She was struggling with unsuitable housing that forced her to climb 28 steps just to reach her front door. And this cost her £400 a week in rent, paid to a private landlord, leaving her with only £100 a week for food, bills, transport, clothing and other essentials. In Islington, that simply isn't enough to live on.

The sad fact is that these policies are forcing people out of their homes and communities. We see the effects of this as vacancies in our schools increase, and I've met several women who have moved miles away but continue to make the long journey to Islington each day to keep their children in school. They don't want to uproot their children while they still have hope that they will be able to come back one day.

The choice:

Two years is more than long enough, and if elected next month, Labour would scrap the bedroom tax. We would build 200,000 homes a year by the end of the next Parliament (double what the Tories have built) and tackle the cost of living crisis by introducing stable rents and longer tenancies in the private rented sector.

We would force the big energy companies to cut consumers' bills as early as this winter, and we would raise the minimum wage and ban exploitative zero hour contracts to help ensure dignity, security and a decent wage in the workplace.

The last five years was just a warm-up act for the Tories. Imagine how much more damage they could do in twice that time. Looking back at the misery that's been wrought by their reckless welfare reforms, in two years alone, is a timely reminder of what's at stake on 7th May.


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