Bedroom tax 'costs more than it saves'

Published Friday, 05 April 2013
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Housing experts in Northern Ireland are warning that a 'Bedroom Tax' will cost the region more than it will save.

Bedroom tax 'costs more than it saves'
Organisations are calling for Bedroom Tax not to be introduced in NI. (© Getty)

Around £21m will be needed to implement the changes to the benefit system, which will affect around 32,000 homes.

Figures released by two housing organisations show that the proposed new tax will leave a £4m shortfall, as it is predicted the tax will cut the benefits bill by £17m.

The NI Federation of Housing Associations (NIFHA) and the Chartered Institute of Housing (CIHNI) are now calling for the proposals to be dropped in the region.

The organisations estimate that housing association tenants will lose close to £4m in housing benefit in the first year that the Bedroom Tax is implemented.

It is likely to cost the Housing Executive at least £10m a year, and the reassessment of housing benefit will add a further £500,000 to the bill.

Cameron Watt, Chief Executive of NIFHA said reforms are necessary, but described the Bedroom Tax as an "ill-conceived policy".

"It will hurt vulnerable people in Northern Ireland, causing financial hardship for tens of thousands of families," he said.

"It's clear that the numbers don't add up on Bedroom Tax. Northern Ireland can't afford the human or economic damage this policy would inflict."

CIH NI Director Cecilia Keaveney added: "These figures confirm what housing professionals have long suspected - introducing the Bedroom Tax in Northern Ireland just doesn't add up.

"It will cause real hardship for some of the most vulnerable members of our society as well as posing huge challenges for social landlords, particularly given the unique profile of social housing here.

"We've always known that there would be a significant human cost to the bedroom tax, but these figures show that there is also considerable financial cost to the sector and Northern Ireland Executive."

The Welfare Reform Bill will be discussed at the Assembly later this month, when MLAs will have the opportunity to debate Bedroom Tax.

This research, while welcome, produces a figure of cost which I would suggest is a conservative one.

Mark H Durkan, SDLP

Mark H Durkan, the SDLP's Social Development spokesman, has welcomed the research.

He claims that the estimated cost of implementing the tax is too conservative.

"I want to praise NIFHA and CIH for the research they have conducted. The figures produced confirm what the SDLP have been saying, that the cost of imposing bedroom tax greatly outweighs any savings that may be made," he said.

"Our party has been continuously admonished by others for suggesting that the bedroom tax was unworkable. They have hidden behind a false premise that this tax will bring real savings and today's figures disprove that entirely."

The Foyle MLA added: "The money allocated for Discretionary Housing Payments should also be factored into this cost.

"Hopefully other political parties will take heed of this research and join with the SDLP to block the implementation of this invidious bedroom tax which will hit up to 32,000 across Northern Ireland."

Judith Cochrane, Alliance's East Belfast MLA, is calling on the Social Development Minister Nelson McCausland - and the Executive - to adopt a common sense approach on the issue.

"While many aspects of welfare reform have the potential to assist and empower people to move into employment and where appropriate to reduce their dependency on social security, a number of aspects are deeply controversial and counterproductive," she said.

"The 'bedroom tax' is perhaps the most offensive aspect of the so-called reforms. Fundamentally, it is a dehumanising measure, which doesn't adequately take into account personal circumstances the need for flexibility.

"There is now a strong case for the Minister for Social Development, the Executive and the Assembly adopting a Northern Ireland approach on this aspect of welfare reform, and to make a final case to Westminster for flexibility in this regard, and to consider all other options as to how common sense can prevail locally."

© UTV News
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26 Comments
Moira in Belfast wrote (524 days ago):
Instead of directly reducing housing benefit there should be a cap on private sector rents. This will reduce the benefit bill and improve the quality of the private rental stock
John in Creggan wrote (525 days ago):
Lets start by getting at least one fact right people on benefits pay tax, VAT for example. Now lets look at social housing, It's OK to introduce this tax if an ample amount of suitable properties exist to house people required to downsize. But the biggest issue is unemployment, It's not the job of government to provide jobs, it is the job of government to provide the right environment for job creation. The government refuse to build more social housing & refuse to create an environment for job creation, now it's up to the poor to find a home that hasn't been built & a job that doesn't exist. If it pays to stay on the dole what does that say about wages? No questions about exploit wages about multinationals exploiting the benefit system to lower pay, eg low pay supplemented by tax credits etc.
Tommy Atkins in London, england wrote (525 days ago):
Now the answer is simplistic folks.All people working should have to pay more taxes. These taxes in turn should be used to build houses with enough bedrooms for every qualification and category of non workers and for the many layabouts who dont want to work. Also include the single parents who have child after child out of wedlock. So cmon all you workers cough up more money for the above poor souls After all dont you deserve to pay for them? Havent you all had the cheek to work all your lives. So get motivated now and be a sport and help support your local layabouts.
sam in Belfast wrote (525 days ago):
I lost my job 2 years ago. Im struggling on JSA. i will lose some money because of this tax. Do i lose my home for a smaller one. Ive lived in my house 27 years. I would be alot better off in a United Ireland. NI has no future in the UK.
Ryan in Belfast wrote (526 days ago):
Its about time the people of the North of Ireland or Northern Ireland or whatever you want to call it, stop their bickering, accept each others differences and wise up because its news like this that effects everyone in BOTH communities and the bread and butter issues are the most important, so lets work together, both protestant and catholic and help fix the problems in our society. This bedroom tax, being just one issue, is going to cause huge problems for people, the NI executive should refuse to enforce it, even if it does mean the block grant being hit. Its not right that the poorest in society, YET AGAIN, have to take on more and more cuts.
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The voice above the crowd didn't come from within that increasingly tense and angry political arena.
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