A LARGE NUMBER of London boroughs are buying and renting property in Thurrock and other nearby towns as part of plans to house their homeless.
The survey revealed in The Guardian highlights that the councils are acquiring the properties for vulnerable families due to welfare cuts and high rents.
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The councils are making the plans due to what is described as the “perfect storm” of high rents and welfare cuts that will kick in from next April.
Defending their actions, the councils say they are in an impossible position with no option but to reluctantly kickstart an exodus of poorer families from the capital by placing homeless households in cheaper areas such as Thurrock.
Draft guidance issued by ministers in May says councils must “as far as is reasonably practicable” secure accommodation for homeless families within their own borough. This was ordered by the then housing minister Grant Shapps in the wake of reports that Newham council planned to relocate households to Stoke-on-Trent, a proposal Shapps, now Conservative party chairman, described as “unfair and wrong”.
Guardian research shows London councils have acquired rental properties in Thurrock and Luton, Northampton, Broxbourne, Gravesend, Dartford, Slough, Windsor, Margate, Hastings, Epping Forest and Basildon.
Councils said the exodus of homeless families was inevitable because there is virtually no suitable private rented temporary accommodation for larger families in London that is affordable within government-imposed housing benefit allowances, which are capped at a maximum £400 a week.
All but four of the 33 London boroughs responded to the Guardian survey. Seventeen said they are already placing homeless families outside the capital, or have secured or are considering temporary accommodation outside London for future use.
Hackney council, which said it currently manages to house 93% of families accepted as homeless within the borough, and the remainder elsewhere in the capital, said it was now “reluctantly looking to procure accommodation outside London”.
MPs are expected to debate regulations which will set out the detail of how the benefit cap will work at a Commons legislation committee meeting on Tuesday.
The Child Poverty Action Group report, based on detailed interviews with 11 London local authorities, found many working households will also face substantial income shortfalls as a result of housing benefit caps.
Although it had been anticipated that affordable private rents in expensive inner city areas such as Westminster would be scarce, the acute housing shortage in the capital means market rents outstrip benefit cap levels in cheaper outer London boroughs including Haringey, Waltham Forest, and Barking and Dagenham.
Families have already begun to move from inner London to the capital’s outer boroughs, with more expected from this month as transitional support for families affected by the housing benefit caps runs out. The government had hoped that the housing benefit reforms would force landlords to reduce rents to within cap limits.
But councils say the spiralling demand for private rented property from tenants priced out of the housing market means most landlords see no reason to drop rents, and a substantial number say they will no longer consider renting to people who are claiming housing benefit.
Some councils have estimated that up to a third of families affected by the introduction of the £26,000 benefit cap, the local housing allowance cap and under-occupation penalties, known as the “spare room tax”, will lose around £100 a week. They face the option of finding work, moving into smaller and cheaper accommodation, or presenting to the local authority as homeless.