Children’s services in outer London could be swamped as families from inner parts of the city are forced out because of housing benefit changes, MPs claimed today.
During a parliamentary debate Liberal Democrat work and pensions minister Steve Webb was told that changes announced by chancellor George Osborne in June would force tens of thousands of people out into the suburbs, putting huge pressures on schools and child protection services among others.
Labour’s Margaret Hodge, who is chair of the public accounts committee, said: “It will place an unacceptable strain on the more deprived outer boroughs who are already struggling to meet the needs of populations.”
Chancellor George Osborne announced plans in June to claw back £1,765m a year from housing benefit, known as local housing allowance (LHA), by 2014-15.
Measures include capping payments so claimants can only afford to live in the 30% of cheapest properties in their local area, down from 50%; increasing LHA in line with the consumer price index measure of inflation, rather than the higher retail price index; and chopping benefits by 10% for those who have been on jobseeker’s allowance for more than a year.
LHA will also be capped for each property size, with a maximum of £400 a week for a four-bedroom property.
MPs also warned that the changes would force many into homelessness, meaning they would have to be housed by councils.
This comes with local authorities already under pressure as a result of anticipated budget cuts.
The MPs called for a rethink and demanded that research was carried out to fully understand the impact of the proposed changes.
Lib Dem MP Bob Russell warned that the “forced migration” of large parts of inner London communities would impact badly upon the areas they were leaving and upon the children of families being forced to move.
Appearing for the government, Webb, who is pensions minister, said the government had trebled the discretionary housing allowance payments from £20m to £60m. The intention was for most of that to go to the places most affected, he said.
However, he refused to give any ground on the changes.
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