This report reveals the capital has been hit hard by changes to the benefits system, particularly cuts to housing benefit. London households have lost almost £7 per week more than the average UK household.
The research by Child Poverty action Group which was funded by Trust for London, found that families are struggling and are unsure how they will afford to stay living in their area. It is based on interviews with councils, advice services and parents. All groups shared the same fear: a housing crisis forcing families to leave their local area and community, meaning children having to change schools.
The report shows that councils and families fear that this situation is set to get worse. They are already seeing a shortage of properties that are affordable to rent on housing benefit. Rents in London are set to rise considerably faster than housing benefit, meaning the pool of affordable properties is getting smaller and smaller.
Key points in the report are:
• Sixteen London boroughs already have more households claiming housing benefit than there are affordable properties. Councils are struggling to find local housing for local families and believe it is going to get harder.
• High childcare costs in London makes it harder for work to pay. A parent with four children working part time and paying average childcare costs in London will be £65 worse off per week than the same families outside of London.
• Financial work incentives alone have not been enough to enable parents to start work. Only 13% of households hit by the benefit cap have entered work.
• Families are relying on short term, discretionary payments from councils to stay in their homes.
• Councils are struggling to house homeless families in-borough or even in London. There has been 1000% increase in homeless families moved outside London between 2011/12 and 2013/14.
• Council run benefits schemes for Council Tax reduction, Discretionary Housing Payments and the localised Social Fund create a possible postcode lottery
• Welfare reform is hitting working and workless families, and families who have previously not been expected to work. This includes lone parents with very young children.