Here is a real ‘economic indicator’


Richard Moore

Bcc: FYI
rkm website

“Millions are living on the edge of a crisis, only secure in their homes for a matter of weeks. At the same time, support for people who have lost their homes is being stripped away.”

Don’t believe it when they tell you there is any kind of recovery going on. Wall Street’s computers may indicate this or that, but in the real world there’s nothing but a steady downward spiral.


People Living in Caves as UK Homelessness Reaches Five-Year High

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Homeless men and women are living in a network of disused sandstone caves near the town centre of Stockport, Greater Manchester. There have been up to four people a night sleeping rough in the cave system perched on a 20-foot precipice overhanging a river, only a short distance from public view.

A report in the Manchester Evening News noted that Stockport in the north of England has seen a 42 percent increase in homelessness in just one year. Jonathan Billings, a project manager with the local homeless charity Wellsprings, said, “The number of people turning up each day for support has soared from around 60 to 70 to around 140 in the last three years.”

His organization has witnessed a particular surge in demand among more middle class, affluent people. After having worked for years, they lost everything in the downturn, he said. Billings emphasised the risk these people face when sleeping without shelter:

“Unfortunately when people are sleeping rough they will come to very dangerous places. I know of people who have fallen into the river.”

Official statistics published by the government show a five-year high in homelessness across the UK. This includes 54,540 households declared homeless, with some 4,500 households now living in bed and breakfast accommodation (B&B).

This figure includes a year on year increase for a growing number of families who have been left stuck in B&B accommodation beyond the six-week legal limit. Many of these families are being forced to live in a single room with no cooking facilities, having to share a bathroom with many other families in the same building.

The number of people being housed outside the area where they initially are from has risen by 14 percent, with 9,000 of the households as of March 31, 2013 having to live in another local authority. This leaves many a long distance away from work, family and support networks.

Campbell Robb, chief executive of the homeless charity Shelter, said that many families were at the “breaking point”.

“Behind these numbers are thousands of families up and down the country who have lost the battle to stay in their homes,” he explained.

In the last two years the numbers of people defined as sleeping rough across the UK has risen by 31 percent.

Families face increasing pressure trying to make ends meet. Shelter reported that 4 out of 10 families with children have had to cut down on what they spend on food in the last year. A YouGov poll of 4,000 people carried out for Shelter showed that 27 percent of those polled had to cut back on gas and electricity bills to be able to pay for rent or mortgage costs. A total of 57 percent of adults, and 64 percent of families with children were struggling to pay their rent or mortgage last year.

Shelter have gone on to report that one in three people would not be able to pay their rent or mortgage for a month if they lost their job, with 35 percent of those polled—equivalent to 8.6 million people—saying they could not pay the rent or mortgage from their savings for a month. Some 18 percent of people polled—4.4 million people—would not be able to pay the rent or mortgage at all if they didn’t secure a new job immediately.

The financial precipice facing an increasing number of people each month is clear, with 3.9 million British families just one pay cheque away from the threat of losing their homes.

The enormous pressure this is placing on local authorities in trying to meet housing demand from ever greater numbers of people has brought things to breaking point. There has been a sharp rise in the numbers of people who have lost their homes who were tenants with Assured Short-hold tenancies (AST).

These tenancies are predominantly in the private rented sector, whereby the tenant has far less housing rights. It is estimated that over a fifth (21 percent) of people showing up at local authorities requesting assistance for rehousing were tenants who had lost their AST homes. This is compared to 14 percent of statutory homelessness cases two years ago who had lost an AST. The increase is being attributed to the recession, unemployment, stagnant wages and an increase in private rents.

Rising private rents are pushing up the numbers of working people having to claim top up housing benefit to be able to cover the payment. But housing benefit payments are also being cut. Renting a property is now considered more expensive than paying a mortgage across all regions of England, with the average renter paying an extra £75 more a month than people with a mortgage. Rents rose in 83 percent of areas across the country last year, with the average rent rising by £300.

A shortage of affordable homes, however, has left ever more people with no choice but to rent, leading to greater pressure of demand on the rental market and driving up costs.

The introduction of the bedroom tax—a penalty on unoccupied rooms for those on benefits in local authority and housing association accommodation—and the resulting debts incurred is threatening a further rise in homelessness. Housing benefit has been cut by 14 percent for people deemed to have one extra bedroom and by 25 percent for those with two extra bedrooms.

A survey by Scotland’s council umbrella body Cosla conducted 100 days after the introduction of the tax found social housing ren arrears increased to £2 million during April alone—covering just 8.4 percent of the UK population. Three-quarters of the councils reported rises in rent arrears, with four out of five councils collecting 50 percent or less in rent due from tenants affected by the cut and three in five collecting 40 percent or less. Requests for discretionary housing payments for those struggling to pay rent stood at over 22,000 by the end of May—over four times the number received in the same two-month period last year.

Further cuts to the welfare budget are to be implemented following the government’s spending review. Campbell Robb from Shelter commented, “Millions are living on the edge of a crisis, only secure in their homes for a matter of weeks. At the same time, support for people who have lost their homes is being stripped away. It’s easy to see why every fifteen minutes, another family in England finds themselves homeless.”