How the number of housing benefit claimants has soared under the coalition

New figures show that 320,738 more people are claiming housing benefit than in May 2010.

At every opportunity, Iain Duncan Smith and other Conservative ministers seek to give the impression that they're reducing the number of benefit claimants, counterposing themselves to Labour - "the welfare party". But as so often, the statistics tell a different story.

The latest figures from the Department for Work and Pensions show that the number of housing benefit claimants rose by 40,526 to 5.1 million in the year to May 2013, an increase of 320,738 since the coalition came to power. Of the total, nearly a million (987,610) are in work, a rise of 52 per cent (337,059) since May 2010. 

May 2010 4,7521,526

May 2011 4,879,182

May 2012 5,031,738 

Jan 2013 5,070,291  

Feb 2013 5,078,523  

Mar 2013 5,060,689  

April 2013 5,062,172  

May 2013 5,072,264  

It's a reminder that by imposing punitive welfare cuts (the benefit cap, the bedroom tax), rather than addressing the underlying structural causes of the inflated housing benefit bill (substandard wages, the lack of affordable housing, long-term unemployment), the government will only increase the number forced to rely on state subsidy to stay in their homes.

Before the recent Spending Review, Boris Johnson and Vince Cable, among others, urged George Osborne to remove the cap on the cap on councils' borrowing and allow them to build more affordable housing. Boris said:

We should allow London’s councils to borrow more for house building - as they do on continental Europe - since the public sector clearly gains a bankable asset and there is no need for this to appear on the books as public borrowing.

In policy terms, it is a no-brainer. The Chartered Institute of Housing estimates that raising the caps by £7bn could enable the construction of 60,000 homes over the next five years, creating 23,500 jobs and adding £5.6bn to the economy. But for almost entirely ideological reasons, Osborne refused to act. As Vince Cable commented on The Andrew Marr Show last month: 

Well that’s where the big gap is [social housing] and certainly as Liberal Democrats at conference, we’re going to be arguing how the government through local councils should be doing much more to build social housing. Absolutely right, that is a big problem area.  Nothing like enough has been done.
There is a better way to reduce the benefit bill than the coalition's salami-slicing: building 1.25 million affordable homes over five years (the level required to meet need), extending use of the living wage and investing more in skills and training. After the government's failure, it will be up to Labour to demonstrate it. 
Work and Pensions Secretary Iain Duncan Smith speaks at last year's Conservative conference in Birmingham. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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By refusing to stand down, Jeremy Corbyn has betrayed the British working classes

The most successful Labour politicians of the last decades brought to politics not only a burning desire to improve the lot of the working classes but also an understanding of how free market economies work.

Jeremy Corbyn has defended his refusal to resign the leadership of the Labour Party on the grounds that to do so would be betraying all his supporters in the country at large. But by staying on as leader of the party and hence dooming it to heavy defeat in the next general election he would be betraying the interests of the working classes this country. More years of Tory rule means more years of austerity, further cuts in public services, and perpetuation of the gross inequality of incomes. The former Chief Secretary to the Treasury, Seema Malhotra, made the same point when she told Newsnight that “We have an unelectable leader, and if we lose elections then the price of our failure is paid by the working people of this country and their families who do not have a government to stand up for them.”

Of course, in different ways, many leading figures in the Labour movement, particularly in the trade unions, have betrayed the interests of the working classes for several decades. For example, in contrast with their union counterparts in the Scandinavian countries who pressurised governments to help move workers out of declining industries into expanding sectors of the economy, many British trade union leaders adopted the opposite policy. More generally, the trade unions have played a big part in the election of Labour party leaders, like Corbyn, who were unlikely to win a parliamentary election, thereby perpetuating the rule of Tory governments dedicated to promoting the interests of the richer sections of society.

And worse still, even in opposition Corbyn failed to protect the interests of the working classes. He did this by his abysmal failure to understand the significance of Tory economic policies. For example, when the Chancellor of the Exchequer had finished presenting the last budget, in which taxes were reduced for the rich at the expense of public services that benefit everybody, especially the poor, the best John McConnell could do – presumably in agreement with Corbyn – was to stand up and mock the Chancellor for having failed to fulfill his party’s old promise to balance the budget by this year! Obviously neither he nor Corbyn understood that had the government done so the effects on working class standards of living would have been even worse. Neither of them seems to have learnt that the object of fiscal policy is to balance the economy, not the budget.

Instead, they have gone along with Tory myth about the importance of not leaving future generations with the burden of debt. They have never asked “To whom would future generations owe this debt?” To their dead ancestors? To Martians? When Cameron and his accomplices banged on about how important it was to cut public expenditures because the average household in Britain owed about £3,000, they never pointed out that this meant that the average household in Britain was a creditor to the tune of about the same amount (after allowing for net overseas lending). Instead they went along with all this balanced budget nonsense. They did not understand that balancing the budget was just the excuse needed to justify the prime objective of the Tory Party, namely to reduce public expenditures in order to be able to reduce taxes on the rich. For Corbyn and his allies to go along with an overriding objective of balancing the budget is breathtaking economic illiteracy. And the working classes have paid the price.

One left-wing member of the panel on Question Time last week complained that the interests of the working classes were ignored by “the elite”. But it is members of the elite who have been most successful in promoting the interests of the working classes. The most successful pro-working class governments since the war have all been led mainly by politicians who would be castigated for being part of the elite, such as Clement Atlee, Harold Wilson, Tony Crosland, Barbara Castle, Richard Crossman, Roy Jenkins, Denis Healey, Tony Blair, and many others too numerous to list. They brought to politics not only a burning desire to improve the lot of the working classes (from which some of them, like me, had emerged) and reduce inequality in society but also an understanding of how free market economies work and how to deal with its deficiencies. This happens to be more effective than ignorant rhetoric that can only stroke the egos and satisfy the vanity of demagogues

People of stature like those I have singled out above seem to be much more rare in politics these days. But there is surely no need to go to other extreme and persist with leaders like Jeremy Corbyn, a certain election loser, however pure his motives and principled his ambitions.

Wilfred Beckerman is an Emeritus Fellow of Balliol College, Oxford, and was, for several years in the 1970s, the economics correspondent for the New Statesman