Boris Johnson, the Mayor of London, has petitioned the Government to stop Chancellor George Osborne’s planned cuts to housing benefit hitting Londoners and said it could drive up inequality in the capital, it emerged this week. Mr Johnson said he had warned Work and Pensions Secretary Iain Duncan Smith not to implement the cap on housing benefits in a “draconian, thoroughgoing way”.
The news came after London Councils, which represents the capital’s 33 local authorities, published a report estimating that nearly 15,000 families in London would be forced to leave their homes or overcrowd them with extra tenants as their rents became unaffordable.
In last month’s Budget, Mr Osborne announced he was capping local housing allowance at a maximum of £400 a week for a four bedroom property. Three bedroom homes will attract a maximum payment of £340 and two bedroom homes £290. But the average private rent in London in 2006-8 was £900.
Mr Johnson told the BBC’s Politics Show: “London has particular needs, it’s very, very expensive living here. If you put in this cap in this way, in a very draconian, thoroughgoing way, it will have a damaging effect on many households in London. Therefore, what we need are transitional arrangements whereby Londoners are spared.”
In a letter co-signed by London Councils chair Jules Pipe, Mr Johnson urged Mr Duncan Smith to delay the capping, saying there was “a strong case for having transitional arrangements in London, pending a complete review of the housing benefit system”.
London Councils found that there are some 18,645 households in the capital which claim LHA, and which will face a shortfall in rent they will have to make up from their own pocket. Of them, 14,661 are households with children.
LHA is calculated on a council by council basis and according to the size of the claimant’s property. But the Government’s cap will instantly render homes of every size in four inner boroughs – Camden, Kensington and Chelsea, Westminster and the City – unaffordable to benefit claimants.
Mr Pipe, Labour Mayor of Hackney council, said: “Many of the people who will be affected are in work but on low incomes and play an important role in keeping London’s economy and public services going. In some inner London boroughs as many as half of the families in receipt of this benefit work for a living, but if they are forced to move away they may have to give up their jobs.”
