Concern of lenders revealed in bedroom tax report
- 16 Jul
A report by the Department for Work and Pensions has found that funders are concerned about the long term impact of the bedroom tax on ‘tenants, organisations and themselves.'
The report states that funders feel the ‘cumulative impacts of welfare reform' could lead to ‘build-up of arrears, reduced liquidity, reduced profitability, more stretched management and less development', reports Inside Housing.
It was also reported that there was no positive impact for funders from the improved work incentives from the bedroom tax. Researchers found that few tenants affected by the bedroom tax had found work.
The report also discusses a ‘widespread concern' about the impact potential future evictions may have on local services and on landlord finances as well as on the lives of people with vulnerabilities. The research also found that four out of five tenants affected by the bedroom tax were paying some or all of their shortfall. Half of these had failed to pay in full.
Commenting on the report, David Orr, chief executive of the National Housing Federation, said: "We have published a series of reports highlighting the flaws of the bedroom tax, as have many of our members. Time and time again it has been shown that the bedroom tax is pushing people into rent arrears and people have been unable to downsize because of a lack of smaller properties. Now the figures from the DWP prove it is not working, surely now it is time for the government to admit they got it wrong and repeal this ill-thought policy."
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