More Benefits Caps – Implications to LHA Landlords?

Basically this all comes down to the short sighted and narrow minded voters voting Tory, now they will screw every one they can including the national health service who haven't received a pay increase for the past 8 years, as well as landlords.

I am very pleased and proud to have had the foresight to vote tory, the budget just puts the icing on the cake, instead of bigotry we have progressive thinking, and a very bright future. If labour had got in we would certainly have been facing an abyss.

Bigotry???foresight??? Hmmm

Reply to the comment left by "paul johnson" at "10/07/2015 - 22:07":

That will create yet another incentive for young women to become young single mums, their ability to pay the rent is dependent upon them getting pregnant!!!! - Hmmmmm, how would that save the taxpayer any money? I think the Tories need to think through the possible consequences of their policies.

Exactly, Robert it his budget will be forgotten and in 7or 8 years time there will be screaming headlines in the Sun saying "Teenage mums get pregnant for benefits". And the public will demand their pound off flesh and we'll have the usual suspects who will pour their bile and feel a lot better for it.
It depresses me because I have to collect rents from people who are struggling.in Teesside the pay is low unemployment is also relatively low,their is work it's just poorly paid

A very great many ARE better off in work, just not (as they see it), better off ENOUGH to warrant being out of the house grafting for 40hrs and missing out on being with their children.

The problem is, if the majority of tenants ARE going to work/work more, they want 'compensating' for that, and unrealistically so.

If a stay-at-home-mum (or even one that works just 16hrs) is to be coerced into full time work and to total self-funded household sustainability, then they want to be absolutely no worse off than they are now.

The problem is, this equates to a job of about £70k gross. By the time you have taken off tax/N.I, the fact they now have to pay their own Council tax (in full), they're no more government handouts or top-ups, childcare whilst they're at work has to be covered, no more free prescriptions or kids' school dinners, covering the cost of their travel to/from work, the lack of ESA, DLA, JSA, IS, CTC, WTC etc. because they're now a 'big girl' looking after themselves (not forgetting their version of 'compensation' due to the fact that IF they are going to leave the house and have their nose to the grind all day, they actually want to see some real monetary benefit to it all over and above what they were used to in their life before work), they have less money than if they sat on their backside all day.

I know because I have many many tenants that openly tell me and laugh at the thought of going to work/becoming wholly self-reliant.

The latest trend is to give your own mum (whose eldest has finally flown the nest and the government are now expecting to go out and work), half of your kids, legally, -though they still live with you in reality- and you can BOTH claim! I have two tenants doing just that.

I have a number of (professional) friends where both parents are working, whose household income is no more than £40,000 yet manage (only just) to survive and pay childcare etc. I'm sure they'd love to spend those extra 40hrs a week each with their children -who, incidentally, are highly likely to become productive members of society, unlike the offspring of benefit claimants- watching them grown etc.

I recall a programme a year or two back where benefit claimants were given a trial period at Poundland. Most enjoyed it and were good at the job, but in summing up the experience and when asked if they would stay on (most were offered full time positions), they ALL said no because they would either end up with the same amount of money as they had now by not working, or in some cases a little more (just not enough for them to be bothered with it all).

THIS. CANNOT. CONTINUE.

We've all got anecdotal evidence to support our claims but facts are facts. The claim that a single mum in this country needs 70k a year to maintain her lifestyle would be laughable if not for the case that it gets peddled. The fact is (not opinion) that we have a high employment rate but poor wages. We have been subsidising companies for too long with WTC . First raise pay rates then reduce WTC.
WE landlords will soon be getting our fair share of unjust villifaction and it will be as ill informed and as ignorant as the demonising of a few dysfunctional families on the lower end of our society is

hece a substantial lowering of the cap.

Reply to the comment left by "Alan Loughlin" at "11/07/2015 - 18:32":

Alan,

As I'm sure you're aware, lowering the Benefits Cap is only one of a number of welfare benefits measures being introduced, following last week's budget. But it's the one that attracts most comment; some positive, some negative, as demonstrated by this thread.

If you examine the Institute of Fiscal Studies analysis of the proposals you'll find it's very critical of the Chancellor's proposals. One of the cornerstones of the Government's election pledge was "it would make work pay". IFS says hat's simply not true; it does the very opposite for 3 million working households.

The following is an extract from one of its authors:

Welfare cuts

The biggest single cut to welfare spending is set to come from extending the freeze in working age benefits, tax credits and local housing allowance out to 2020. That will affect 13 million families who will lose an average of £260 a year as a result of this one measure.

After about 2017 this will mean that most benefit rates will have fallen back behind their 2008 levels both relative to price inflation and relative to earnings growth.
The next biggest cut comes from the reduction to work allowances in Universal Credit. This represents a substantial shift in the design of the UC system. The work allowance is the amount that a claimant can earn before benefit starts to be withdrawn. Significant allowances were an integral part of the design of UC, intended to give claimants an incentive to move into work. This
reform will cost about 3 million families an average of £1,000 a year each. It will reduce the incentive for the first earner in a family to enter work."

So from its analysis, the poorest "workers", 3 million, no less, are set to be the biggest losers!

Many of these people are working full-time for rubbish wages but choose to work, rather than sitting around doing nothing. The abolition of "work allowances" for single workers means that for every £1 earned they lose, at the very least, 65% of their Housing Benefit. The Benefits Cap doesn't apply as they're working full time, but, nevertheless, their housing costs will no longer assisted as it may have been in the past.

We also know from earlier research, that the highest risk group, in terms of "rent arrears" is young single people who work, NOT the unemployed.

Landlords who traditionally provide accommodation to this group will find many tenants will end up with shortfalls which they'll struggle to pay, causing rent arrears and the need for recovery action.

For those of you interested in this topic I'd recommend you read http://www.ifs.org.uk/tools_and_resources/budget/505

You can also check out my latest bulletin on the topic at http://universalcreditadvice.com/ha/2015/07/budget-report---an-update

I hope this helps your understanding of the overall impact the proposed changes could make.

Bill Irvine

Thanks for that bill. It does shed light on what was announced.
Unfortunately people would rather take their info from the Daily Mail and watch an episode of "benefit Street" than have their prejudices challenged by irritating facts