Pathways to housing-related poverty

Affordable housing concept.The JRF report What will the housing market look like in 2040?, released yesterday, provided an eye-catching and headline-grabbing answer to the question that acts as its title. Presumably grabbing the headlines was the point.

The answer is that under plausible assumptions about future trajectories on tenure, costs and incomes we are looking at a future of higher housing costs, more private renting, and a substantially increased incidence of poverty. The authors, from Heriot Watt and Sheffield Universities, forecast that private renting will accommodate 20% of the population by 2040 and half of them will be living in poverty.

The authors argue that four factors, all to an extent under policy control, could combine to prevent this unhappy outcome. We need to see housebuilding in England rise to 200,000 homes a year by the 2020s and 220,000 by the 2030s. We need the decline in the proportion of households living in social renting to be halted. We need social rents to remain indexed as they are at the moment to prices. And housing benefit needs to continue to meet the same share of housing costs as it does at present. If the stars align favourably in this way then the unpleasant future sketched out might be avoided. [Read more…]

The miraculous power of welfare reform

5078082286_61e24d05dd_nThe international news is pretty grim at the moment. This doesn’t really fit well with the traditional idea that we’re in silly season, when Prime Ministers travel to holiday destinations to point at fish.

Yet something that fits entirely comfortably with silly season is another self-justificatory speech by Iain Duncan-Smith. And today we were treated to a corker. It would be silly, if it weren’t so alarming.

I blogged about IDS’s last big speech back in January. Then I noted:

We have a fine smattering of slogans and soundbites.

There are some extraordinarily sweeping claims about the attitudes, lifestyles and behaviours of those who receive assistance from the state.

If you are looking for simplistic binary understandings of the world – those who work hard and those who are “trapped” in a lifetime on benefit – and implausible generalisations about the moral laxity or weakness of will of those who require state support then you’ve come to the right place.

We have an interpretation of the impacts of welfare reform that can only be sustained as long as we make little or no effort to understand what is actually happening on the ground. There’s a little statistical chicanery of the type that will be familiar to seasoned IDS watchers.

But then no one would mistake IDS for a member of the reality-based community.

Yet, mostly we have a great confused jumble of incoherent fragments of thought and inconsistent lines of argument.

Many of the same ingredients were very much in evidence today. But they were given some new twists and combined with some new ingredients. [Read more…]

Fighting talk

Why_PovertyThese days it seems we’re more likely to hear politicians talk about a “cost-of-living crisis” or, possibly, allude to problems of housing affordability than we are to find them discussing “poverty”. Indeed, we’re back in an era where the whole concept of poverty, and whether there are any households in genuine poverty, is being questioned. The translation of the banking crisis into a crisis of welfare has seen benefits cut and uprating mechanisms pared back. The prevailing policy narrative of over-generous welfare provision has caused the discussion to loose its moorings. The political elite fail to show any great appreciation of when or whether their cuts might be at risk of reducing citizens to an unacceptably low standard of living.

Yet, in recent weeks the term “destitution” seems to have made an unwelcome return to the political lexicon following the intervention by Archbishop – now Cardinal – Nichols to raise the issue of overzealous benefit sanctions.  And there’s been some discussion of quite how far the UK will miss its child poverty targets by, largely as a consequence of the Coalition’s welfare “reform” agenda.

Into this fog of political euphemism and misdirection comes Julia Unwin’s Why fight poverty? This brief book was published towards the end of last year, but I’ve only just got to reading it.

The book is a timely reminder of what is at stake. Unwin provides a restatement of why poverty is a major social problem – not just for those who find themselves poor at a particular point in time but for everyone. Poverty is risky, costly and wasteful. [Read more…]

Moralizing destitution

Just by way of a change, today I wrote a post at Medium.com. It’s a crisp, clean properly WYSIWYG writing experience. There is just enough formatting to allow you to make your point. But not a lot of bells and whistles to distract you from the writing. That is, I believe, the point. I may well use it again.

Here’s how I got going:

Moralizing destitution

Now the clergy are involved. That adds a whole new dimension to the debate.

A bench of bishops and a whole bunch of other church leaders have called on David Cameron’s government to act to address hunger. They note that:

“Britain is the world’s seventh largest economy and yet people are going hungry … Half a million people have visited foodbanks in the UK since last Easter and 5,500 people were admitted to hospital in the UK for malnutrition last year”.

While not placing the blame for this situation exclusively at the door of the Government’s welfare reform agenda, the church leaders claim that half those using foodbanks: [Read more…]

Messing with the minimum wage

Waitress serving a slice of all dressed pizzaMaking work pay.

Few sensible people would object to this as a policy aspiration. It’s at the core of the Coalition Government’s justification for its reforms to the social security system. So that’s got to be good.

The cracks begin to appear when we move on to consider quite how we’re going to make work pay.

The Government has broadly three options, in the short run. It can try to mandate an increase in low wages. Increasing the gap between income in work and income out of work should incentivise people to (re)join the active labour force. It can reduce the amount people are paid when out of work, thereby increasing their incentive to take up employment at prevailing wage rates. This is what we might call the “starve them back to work” strategy. Or it can tackle the tangle of rules and regulations in the tax and benefit system that interact to create perverse incentives and high marginal tax rates. Or it can combine these options.

The Government’s strategy so far has largely focused on options two and three. The introduction of Universal Credit is an attempt to address the perversities of the tax and benefit system. The restrictions in the uprating of out of work benefits so their real value declines, and arguably the changes to disability benefits, are a case of option two.

So how’s it going in relation to increasing low wages? No so good. [Read more…]

Housing strategies in challenging times

[On 10/01/13 I gave a brief overview of the context facing rented housing as part of an event called Housing Challenges in Exeter organised by Exeter City Council. This is the text to accompany my presentation.]

Building a StrategyOur housing system faces significant pressures. Short term pressures generated by the fallout from the financial crisis have been overlaid upon longer term problems. These pressures are felt particularly acutely in the rented sectors. Difficulties accessing home ownership boost the demand for private and social renting. Social housing is only able to rehouse a relatively small proportion of those on the waiting list. Difficulties accessing social housing boost the demand for private renting. But in many areas the demand of private renting is such that there are access difficulties here too.

These are challenging times for those seeking to ensure populations are adequately housed.

The other key component of the context is cuts. [Read more…]

Osbo’s poverty trap and pinging the elastic of reality

Message opposed to unemployment.Since they entered office the blue-tinged contingent of the Coalition has been engaged in a systematic process of stigmatising those in receipt of social security benefits. Great emphasis has been placed upon the undeserving and the fraudulent. There is support for the hard working strivers, but condemnation for the skivers. The spotlight has been on the most extreme cases of households receiving substantial financial support from social security in order to create a smoke screen for cuts in benefits to the poorest. The Tories are convinced that welfare “reform” – particularly the overall weekly benefit cap – is their most popular policy. Yet many of the components of this policy have yet to be fully implemented. The general public has yet to grasp their full impact. It may transpire that once they do, the Tories will feel they acted precipitately in drawing such a positive conclusion. [Read more…]

Policy challenges around welfare reform

[This is the text to accompany my presentation to open the South West Observatory seminar “Welfare reform: challenges, impacts and evidence”, 13/11/12]

Where to start?

Politicians are prone to hyperbole. The most minor modification to a relatively peripheral policy is portrayed as a groundbreaking initiative. However, in the case of welfare reform a hugely ambitious agenda is being pursued in the name of making work pay. Nothing like it has been attempted for decades. The challenges are therefore enormous. There is a huge amount at stake. The well-being of the most vulnerable members of society depends on its successful delivery.

We should begin by distinguishing politics from policy, although there is not such a bright dividing line between the two as is sometimes assumed. [Read more…]

There’s money to be made from “responsibilizing” the poor

This morning the Social Market Foundation launched their report Sink or Swim? which highlights some of the likely problems to follow if the Government pursues Universal Credit in its current form. Jules Birch blogged today over at Inside Housing on some of the many problems that have already been identified with Universal Credit (UC). There is much more to say on the issue. UC has all the makings of a multidimensional policy fiasco.

One area of concern is the plan under UC to change the mechanics of benefit delivery. In particular, the plan is to move to paying benefits monthly in arrears. Concerns have, rightly, been expressed that vulnerable households will struggle to budget effectively over these longer periods.

The more hardcore liberal/libertarian would no doubt argue that this is the sort of shock therapy required to shift people out of dependency. These scroungers need to be forced to take responsibility for themselves. [Read more…]

On the woeful Work Programme

Information on the performance of the private contractors responsible for delivering the Government’s Work Programme is beginning to leak out, seemingly despite the best efforts of the Department for Work and Pensions to keep us all in the dark.

And the news is not good. It appears that A4e is seriously undershooting on the targets set for it, failing to achieve even the lowest level of performance anticipated by the DWP. Only 3.5% of the jobseekers referred to it were found sustained employment. Is A4e a particularly bad performer? Ian Mulheirn in his piece in yesterday’s Guardian thinks this unlikely: it is more likely that all the other providers are performing similarly badly.

The question then becomes: what should be done about the woeful Work Programme? [Read more…]