Labour would aim to save £1 billion from Housing Benefit Bill 

Labour have announced that they would aim to save  £1 billion from the Housing Benefit bill in the next Parliament.

This has come from the party’s Zero-Based Review, which looks into how every pound of government money is spent. Labour have said they’d save money from the Housing Benefit Bill by cutting the cost of overpayments because of error and fraud.

The Housing Benefit Bill has since by £1.5 bn since 2010, and after pensions it’s the second largest area of DWP.

Rachel Reeves, Shadow Secretary of State for Work and Pensions, explained the reasoning behind this announcement:

“Under David Cameron the cost to tax payers of Housing Benefit error and fraud has risen to £1.4 billion, its highest ever recorded level, an increase of £470 million a year since 2010. And the number of working people forced to rely on Housing Benefit to pay the rent is set to double by 2019. Working people can’t afford another five years of Tory failure on Housing Benefit.

“Labour has a better plan to control the cost of Housing Benefit. We will tackle the root causes of rising spending by building at least 200,000 homes a year and tackling low pay with an £8 minimum wage before 2020. And a Labour government will reverse the rise in error and fraud seen under this government by increasing the use of data from credit reference agencies to tackle Housing Benefit overpayments and scrapping the government’s plan to take fraud investigation measures away from local authorities, to save £1 billion in the next parliament.” 

Meanwhile, Chris Leslie, Shadow Chief Secretary to the Treasury, who is also one of the leaders on the Zero-Based Review, outlined the important of Labour’s research:

“David Cameron’s government is set to break its promise to balance the books and get the national debt falling. The next Labour government will get the deficit and debt down, but we will do so in a fairer way and by examining every pound of spending and maximizing value for money for taxpayers.

“Labour’s interim Zero-Based Review has identified at least £200m of annual savings in the housing benefit bill. We will get a grip on overpayments, which have soared by more than 50 per cent since 2010, and ensure councils retain the powers they need to tackle fraud locally. It would be wrong to centralise anti-fraud controls in a government department which is currently limping from crisis to catastrophe under the coalition.

“By reducing on official error, and tightening controls on the small minority who try to cheat the housing benefit system, we will get a better deal for taxpayers and support those people who need help with the cost of a home.”