Lib Dem MP: why cutting benefits is not regressive
Lib Dem MP John Hemming, with the latest attempts to explain why the Budget was not regressive:
"There are changes which are intended to get shifts in behaviour. These should not affect the disposable income of the households and should not be treated as either progressive or regressive. These also do not apply to all households that live on benefits. "
"Arguing, however, that people should downsize is not in itself regressive...People who fund their own housing move down market when short of funds."
Hemming's argument here is that cutting housing benefit for people on low incomes is "intended to get shifts in behaviour", and that "people should downsize when short of funds". Therefore, he argues that cuts to housing benefit should not be defined as regressive because people can downsize to cheaper properties, and the cuts are intended to change their behaviour by forcing them to get a job.
I thought the people who are in denial about the consequences of the Budget had scraped the barrel with Nick Clegg's arguments that the IFS hadn't taken into account future policies which the government might choose to introduce, or that the Budget was progressive because cutting corporation tax would create loads of new jobs. But the idea that cutting benefits doesn't count as regressive if it is intended to change people's behaviour, and anyway cutting housing benefit is not regressive because poor people can always move to cheaper housing, is a new low.
Here's Patrick Murray, who was a Lib Dem councillor in charge of housing, and who has had personal experience of being homeless, explaining the real consequences of the policies which Hemming is defending:
“The complex arrangements governing the calculation of housing benefit have been changed, leaving many people with less benefit to pay the rent in the private sector homes that councils have placed them in, in an effort to cut expensive temporary accomodation. Many will become homeless as a result.
What happens then? Well, they come back through the council’s doors, and are put in even more expensive temporary accommodation, immediately negating any potential savings from this move…
…The result of the current Coalition policies will be more over-crowding, more misery, and more people sleeping on our streets. And that should not sit easy on the conscience of any Liberal Democrat.”