MPs debate impact of 'bedroom tax' changes in Wales

The Welsh Tenants Federation claims the changes could increase homelessness

MPs will discuss the impact of a so-called "bedroom tax" which will impose an under-occupancy penalty on tenants.

Newport East MP Jessica Morden hosts a debate later over changes which will see housing association and council tenants have housing benefits cut if they are deemed to have spare bedrooms.

From April it will mean a 14% cut for one spare room and 25% for two.

The Welsh Tenants Federation has warned that up to 4,000 people could be forced into homelessness by the changes.

A UK government impact assessment calculates that a total of 40,000 households in Wales will be affected.

Mark Littlewood, director of think tank the Institute of Economic Affairs, admitted it was a "far from perfect" solution, but said it was a "pretty good second best solution".

He told BBC Radio Wales: "Housing benefit is costing the country a small fortune.

"I think if you are on housing benefit ... then it is only reasonable that you respect if you like the scarcity of housing that is around.

"It is not really acceptable, without some sort of penalty, that, say, two people live on housing benefit in a house or a flat that's more than capable of housing five or six people."

However, Duncan Forbes, chief executive of Bron Afon Community Housing in Torfaen, said the new scheme "makes scarcity worse".

He said: "For example, in one area we've got it'll take 17 years to re-house people into smaller accommodation because we simply don't have it.

"It's a London problem and a metropolitan area problem of having a scarcity of large properties.

"We have a scarcity of small properties, so it's making our housing problems worse."

Mr Forbes claimed the changes would not make the predicted savings because "the logical economic choice for a tenant who's getting the bedroom tax imposed on them is to move to more expensive, smaller private sector accommodation".

He added: "It costs £75 to rent a three-bedroom house off us.

"It costs £100 to rent a two-bedroom flat in the private sector."

Last November, the Department for Work and Pensions said: "From April 2013, housing benefit entitlement for working-age tenants in the social rented sector will reflect household size.

"We will expect tenants to make a contribution towards the rent if they are living in accommodation which is larger than they need in the same way that housing benefit claimants living in the private sector do now."