A report commissioned by London Councils argues for higher benefits because of a higher cost of living in the capital.
Where to start with this report?
Let’s start with the good things. It is great that London Councils are starting to think seriously about the impact of welfare reform on each of the boroughs of London. It is great that they have begun to identify a list areas where they can focus their questions and concerns. The change from RPI to CPI in uprating benefits, Housing Costs, the Benefit Cap, Childcare and Transport costs are all likely to disproportionately affect London. Sadly, this analysis is compromised by a misleading title and a narrow list of recommendations without a great deal of work behind them.
The analysis by CESI using the Ferret benefit calculator is not about the Universal Credit, it is about the combined impact of cuts to welfare that will affect London Councils combined with the introduction of the Universal Credit. I’m not sure whether this was down to London Council’s using the wrong title, CESI conducting poor analysis or limitation’s of the model used. At a roundtable to discuss the paper, London Councils conceded that the Universal Credit was one reform that actually had a positive impact on London’s citizen’s by improving incentives and incomes for most in work, and that the report was not a valid basis for assessing the Universal Credit.
There was some useful discussion of other options to deal with London’s challenges, the DWP do make regional awards for housing subsidies, the case for extending these to childcare and transport need to address why these costs are so much higher in the capital than elsewhere. Although clearly a major challenge, policy that looked to reduce the costs and improve the flexibility of childcare, transport and housing to improve conditions for all londoners would make the capital more competitive. Other issues including the meaning of a job outcome under the Work Programme and whether to fight a benefit cap on grounds of principle led to interesting debate.
London Councils have more to do before they have a convincing case, but at least they have identified the areas they want to focus on.