Housing, incapacity and work benefits are all set to be slashed under the austerity measures, in what York Council is calling “the biggest shake-up of the Welfare system since its inception”.
However, a report outlining the impact the cuts will have on the city says changes to housing benefits are expected to hit people the hardest – resulting in a loss of £2.9m.
The council’s cabinet member for housing Coun Tracey Simpson-Laing said: “It’s the consequences of the changes that are going to affect us. York has an expensive private rental sector and because rents are set regionally, the city is going to receive a lower level of basic housing allowance that the actual market price of their rent. The second thing to hit people is if they are classed as unemployed, they will only be given enough rent to meet their needs rather than the equivalent of what they are renting. The Government said landlords will reduce their rents, which is complete pie in the sky.
“Next year will also see people under 35 only receive a shared house rent equivalent, which obviously affects people if they are living in a one-bedroom flat. At the moment this affects people under 24, so a lot of people could be caught out if they are still receiving benefits.” Coun Simpson-Laing said the changes would also affect people on a low income, who will also lose out on benefits under the new rules.
“It’s doom and gloom basically. It has already started to hit people and every week more and more people are affected. The figure has been predicted at around £3m at the moment, but things could be even worse,” she said.
York Central MP Hugh Bayley said the cuts were going to have a massive impact on the city’s economy, with less people being able to afford to buy food and use public transport.
He said the measures would also force people to move out of York and into cheaper housing in neighbouring areas, which would make it harder for people to get back into work as jobs are harder to find outside of the city,
A 57 per cent increase in homelessness in York was recorded earlier this year and it was revealed two-thirds of people on housing benefit could be priced out of the private rental sector.