Inner London Feels Effect Of Housing Benefit Cap

By · February 19, 2012 at 15:45 pm · 6 Comments · Latest News · Report an error ·

We’ve been looking at housing this week, and now comes evidence of the predicted effects of the Local Housing Allowance cap as families are moving into outer London.

Barking and Dagenham’s head of children’s services says there’s been an influx of new families to the area which, combined with the borough’s rising birth rate, mean they expect to have to find space for an extra 200 reception class places this September. Gateway primary school in Marylebone estimates that 50 of its 700 pupils are affected by cuts and may have to move, while in the wider Westminster area the council reckons around 2,000 families won’t be able to afford their rent.

A Westminster council press officer told the Guardian:

To live in Westminster is a privilege, not a right, because so many people want to live here

While that might be a good slogan for Westminster to adopt for many of its policies (“Westminster: parking here is a privilege, not a right”) it does beg the question of whether it’s fair that the outer boroughs should have to cope with increases of people on low incomes, rather than spreading them evenly around the capital. Westminster may not be as wealthy as it has been (its reserves were badly hit by the Icelandic banking collapse) but it’s still in a better financial position than many other London councils.

The housing benefit cap is based on the “30th percentile of rents” in an area with absolute limits per different types of property (for example, the maximum payable for a two bedroom property is £290 a week). As rents increase and more people become reliant on housing benefit because of the pesky economy, plus the ‘affordable rent‘ system leading to ‘affordable’ housing being let at up to 80% of market rates, people who were previously fine are getting caught out, living in places they can suddenly no longer afford. It’s worth taking a look at Shelter’s prediction of where in London will be considered affordable by 2016.

Last week the Evening Standard reported a construction boom in central and inner London, but around 50% of these (bloody pricey) homes are bought off-plan by foreign investors. Meanwhile, outer London is having to deal with the effects of inner boroughs becoming too expensive to live in.

Photo by Simon Crubellier from the Londonist Flickr pool

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  • HoosierSands

    I’d love to have that council press officer say: “To do business in Westminster is a privilege, not a right, because so many people want to do business here”

    Think it’ll ever happen?

    • http://www.facebook.com/richard.evanslacey Richard Evans-Lacey

      But that’s taken for granted isn’t it?  If you want to do business, you pay a business rent. If you are offering what the market wants, you thrive.  If not, then it’s back to the drawing board.  These are the risks that entrepreneurs take, this is what creates genuine jobs, and this is the way some of them earn enough money to afford the reward of living in central London.

  • http://www.facebook.com/richard.evanslacey Richard Evans-Lacey

    Why should the poor get to live where middle earners can’t afford to be?  Government should sell off council houses so there is more housing on the free market and everyone can benefit from lower prices (not just those on a list).  What about the able-bodied unemployed who can’t afford their rent?  Camps in the country where they can have access to healthy food, education, and exercise without the distraction of junk food, satellite TV, and the sofa.  Too harsh?  That’s exactly what the Army does to help soldiers break their addiction to comfort and develop a sense of self-respect and self-reliance.

    • http://twitter.com/Jolph Jonathan Kent

       Ha ha ha ha ha ha.  That’s great.  If you can turn that into a routine, a bit like Harry Enfield’s ‘Tory Boy’and put something up on YouTube it’ll go viral in no time.  Oh and stick in some stuff about immigrants too.  Mind you there are probably a few dim right-wing types who’ll take it at face value – but go for it. 

  • Lomo171

     I work in inner london and live in outer london , my daily commute is about 3 hrs total (per day). I do this because i cant afford to live in london. yet alot of people live in innner london are long term unemployed. Moving some of these out to make way for the likes of me and my family can only be a good thing in my opinion.

    • Anonymous

      Problem being – why would them moving out mean you can afford to move in? Or would you even want to move into the places they’ve vacated? (Bottom end of the market.)

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