London could see an 'exodus' of tenants

25 October 2010

Some London local authorities have said that they have block booked bed-and-breakfast accommodation in Hastings, Reading, Luton and other towns outside the capital because there could be an exodus of around 200,000 people (82,000 families) who will no longer be able to afford to say in private rented housing if housing benefit is capped.

In the comprehensive spending review, Chancellor George Osborne announced that from next April housing benefit will be capped at £400 a week for a four-bedroom house, £340 for a three-bedroom home, £290 for a two-bedroom property and £250 for a one-bedroom property.

The council leaders gave the warning to the Work and Pensions Select Committee and said that landlords will not reduce rents following the government's changes so tenants will have no choice but to move out. One Labour MP has called the policy a form of "social cleansing".

Jon Cruddas said: "It is an exercise in social and economic cleansing. It is tantamount to cleansing the poor out of rich areas – a brutal piece of social engineering."

And David Orr, chief executive of the National Housing Federation, reckoned that the changes would see people out on the streets, saying: "Unless ministers urgently reconsider these punitive cuts, we could see more people sleeping rough than at any stage during the last 30 years."

But the government stuck by its policy, issuing this statement: "The current way that it is administered is unfair. It's not right that some families on benefits have been able to live in homes that most working families could not afford."