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Cap on welfare spending confirmed - SFHA reaction

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Cap on welfare spending confirmed - SFHA reaction


Published by Anonymous for Scottish Federation Of Housing Associations in Housing and also in Central Government, Communities

Following George Osborne’s Budget speech today (Wednesday 19 March), the Scottish Federation of Housing Associations (SFHA) expressed its disappointment that the cap on government welfare spending first mooted in the 2013 Autumn Statement is being consolidated. The 2014 Budget caps welfare spending in scope for the years 2015-16 to 2018-19.

Maureen Watson, SFHA Head of Policy, said:

“The Chancellor’s focus on capping welfare spending, including Housing Benefit, sadly doesn’t recognise that measures such as the ‘bedroom tax’ will actually end up costing the public purse more. This is partly because it risks forcing social tenants into the private sector where rents are higher and partly due to the extra costs for councils and housing associations. We call upon the UK Government to exclude Housing Benefit from the envelope of welfare benefits being capped.

“The SFHA’s recently published research on the real cost of the ‘bedroom tax’ for Scottish housing associations and co-operatives estimates the total real cost over the first three years of the policy to be £79 million. (1)

“Scotland’s housing associations and co-operatives provide affordable rented housing in communities across the country – a place to call home and a place to build a life. In the face of the evolving welfare reforms and the continuing cap on welfare spending, housing associations and co-operatives remain determined to ensure that every possible help is given to tenants to maintain their tenancies and to keep rents affordable.  However, the environment for tenants and housing providers is becoming increasingly challenging and costly.

“The SFHA will continue to press the UK Government to repeal the ‘bedroom tax’ that is still very much with us. It is an incompetent and unfair policy.

“We are also disappointed to see that the opportunity has yet to be taken by either the Chancellor of the Exchequer or the Secretary of State for Scotland to respond to the Scottish Government's request for consent to raise the cap on Discretionary Housing Payments. Scotland's housing associations and their tenants are keen to see the additional monies identified by the Scottish Government for ‘bedroom tax’ mitigation, but we need the uncertainty removed. We should have had arrangements in place by now. We are only days away from the start of the new financial year.”


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1. SFHA (January 2014), The Real Cost of the Bedroom Tax for Scottish housing Associations and Co-operatives.  Available at 
2. Discretionary Housing Payment figures for Scotland  FOR 2014-15
• Total est’d need for mitigation  £50m
• DWP allocation for Scotland  £15.2m
• Total upper limit / cap (DWP x 2.5)   £38.1m
• SG funding  permitted (DWP x 1.5)  £22.8m
• Additional budget pledged for mitigation* £12m
• Total SG contribution thus £35m
* SG preferred via DHP
3. The SFHA was established in 1976 and has around 116 members providing affordable housing and wider community services in Scotland, as well as a further 200 commercial members. The SFHA is owned by its membership and exists to support the work of housing associations and co-operatives in Scotland by providing services, advice and good practice guidance.
4. The SFHA is the voice of the principal builders and managers of new affordable housing for rent in Scotland. Housing Associations own and manage around 40% of the country’s affordable rented housing stock, over a quarter of a million homes across Scotland.
5. Housing associations and co-operatives are not-for-profit bodies regulated by the Scottish Housing Regulator.


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