5 fold increase in families affected by Benefit Cap

ANALYSIS by Liverpool City Council shows that an additional 710 families will be affected by the Government's lowering of the Benefit Cap; and there are fears some could lose their homes as a result. A total of 130 families are already subject to the £26,000 limit, and they will be joined by an additional 710 households starting from 7 November when the new cap of £20,000 is introduced. It means it will apply to a total of 840 households; including 2,800 children who are already among the 1 in 3 youngsters in Liverpool living in poverty. New claimants will also be subject to the cap after Christmas.

A study by welfare chiefs shows it amounts to a total weekly cut of £37,200 to Housing Benefit payments in the City. It means an average reduction in rent contributions of £44 per household per week, with 340 families losing more than £50 a week. There are concerns that some people won't be able to afford their rent, will end up in arrears and be evicted. When this happens, the Council will have to re-house them in temporary accommodation at a cost of £400 per week.

The City Council is writing to those affected in the social and private housing sectors to remind them of the forthcoming changes and advise them of the assistance that may be available to help them. The Council offers 2 assistance programmes for people affected by hardship caused by welfare reform:-

► The Liverpool Citizen Support Scheme; which in 2015/16 made payments worth £2.5 million to 12,000 people to help with the cost of food, fuel, clothing and furniture

► Discretionary Housing Payments - to help with the cost of rent where there is a shortfall in benefits, which in 2015/16 made payments worth £2 million to 8,700 people affected by welfare reform and hardship

Councillor Jane Corbett, Cabinet member for fairness, social inclusion and equalities, said:- "Thousands of our most vulnerable residents are already facing a tsunami of cuts and regressive changes to the benefits system. We've already seen the introduction of the bedroom Tax, the freezing of benefit rates and cuts to equivalent working Tax credits for those on Universal Credit. Many of these are hitting families where there is someone in work and it is dragging more children into poverty. We're now really worried about the impact of the lower benefit cap and we know it will tip some families over the edge. Aside from the devastating social consequences and stress that this will cause, all it is doing is shifting the cost from the Government over to the Council, housing associations and other partners at the same time as we're facing cuts to our budgets. The truth is that the money saved on the benefits bill must be set against the cost to the public purse of paying Discretionary Housing Payments and housing families in temporary accommodation if they are evicted. Put simply it is a false economy. Together with our partners in the voluntary, faith and community sectors, we're doing all we can to support as many people as possible. As a local authority, we're continuing to shield people from the full impact of cuts to Council Tax benefit using £3 million of our own money, topping up the Discretionary Housing Payments by £600,000 and giving £3 million to help people in crisis pay for food, fuel, clothing and essential white goods. But with another £90 million of savings to find over the next three years it's going to get much harder to respond and give the support needed."

Councillor Corbett added:- "Our message to people affected by the benefit cap is not to suffer in silence. If you're struggling with your rent, get in touch with your housing association or landlord and contact the Council to apply for a Discretionary Housing Payment to the Council. If you need benefits and debt advice, our Benefit Maximisation Team may be able to help, and for urgent help with household expenses such as food and white goods, then our Citizen Support Scheme could well help you out."

More information about the help and support available can be found online. You can also call the freephone number:- 0151 233 3009 (Benefits Maximisation Service) or call:- 0151 233 3053 (Citizens Support Scheme).

WELFARE IN LIVERPOOL - THE NUMBERS

► 30.5% of children living in low income families.

► 50% children in poverty in households where at least 1 adult is working.

► 840 households affected by the new benefit cap.

► 8,200 households affected by the Bedroom Tax.

► 66,860 residents fed by the Trussell Trust foodbanks from 2012 to 2016.

► 43,000 households affected by reductions in Council Tax benefit.

► 48,500 households affected by the freezing of main benefit rates.

LOWER BENEFIT CAP - CASE STUDY 1

A family with four children living in a 3 bedroom privately rented property paying a rent of £156 per week and receiving other benefits they are entitled to will face a reduction of £155.50 per week in their Housing Benefit. The Council could cover the cost of the rent shortfall for three months at a cost of £2,020 under a Discretionary Housing Payment, but when this expires the family could quickly build up arrears and be made homeless. The Council may then need to house them in temporary accommodation at a cost to the Council of £389.29 per week.

LOWER BENEFIT CAP - CASE STUDY 2

A family with three children living in a 3 bedroom housing association property paying a rent of £100 per week and receiving other benefits they are entitled to will face a reduction of £45.85 in their Housing Benefit. The Council could cover the cost of the rent shortfall for 3 months at a cost of £596 under a Discretionary Housing Payment, but when this expires the family could quickly build up arrears and be made homeless. The Council would may then need to house them in temporary accommodation, at a cost of £389.29 per week.