Vulnerable people are bearing brunt of the cuts

Housing associations continue to be the main provider of affordable homes – what will East Thames be developing in the next five years?

We currently have over 13,300 affordable homes in east London and Essex and we see building new homes as a critical part of what we do. At present, we're working on significant regeneration developments including the Ocean Estate in Tower Hamlets, and providing over 1300 affordable homes on the Athletes’ Village after the 2012 Olympics, as part of the Triathlon consortium with Southern Housing Group and First Base.

The government has recently changed the way affordable housing is subsidised, bringing in a new affordable rent model. This involves fewer grants from the government, higher rents and housing associations having to borrow more money privately. We recently bid to the Homes and Communities Agency (HCA) for a grant to build new affordable homes under the affordable rent model. As part of the bid we concentrated on maintaining our existing high standards and ensuring that around 40 per cent of the homes we wanted to provide had at least three bedrooms. As a result of the reduced grant, we bid for fewer homes than in the past. We're still negotiating with the HCA to finalise the programme, however we hope to build 1000 homes over the next four years, and we'd like to do more.

The affordable rent model is a new concept for social landlords – how do you see this working in practice?

Guidance on the affordable rent programme included rents on the new homes being up to 80 per cent of market rents. We were concerned about the impact this would have on people moving into our homes who are on very low incomes, so we researched how this would work in the east London boroughs we work in. The issue is that the average income in areas such as Newham and Tower Hamlets is lower than in many other parts of London, but housing prices are high. We could see that homes, especially larger family-sized homes, at up to 80 per cent of market rent, would mean that over half of local families on low incomes could not afford the rent without claiming higher levels of housing benefit. It appears that, in cases like this, the social impact of this model may work against our important aim to move people into work and out of benefit dependency.

We therefore submitted a bid to the HCA to build new homes, settings our rents at an average of 65 per cent of market rent across our areas of operation. This is in line with the London mayor's expectations, but still means increasing rents at a time when people on low incomes are seeing higher living costs, static wages and cuts in benefits.

How does East Thames view the other welfare reform proposals – housing benefit caps and reductions to benefits for under occupiers?

We are very concerned that many of the cuts in public spending that have been made or are due to be made are impacting on poor people more than other people in the population. In particular the cap on housing benefit and to benefits overall will make it difficult for families to live in more expensive areas such as Tower Hamlets, but also give them little chance of moving to a cheaper part of London. Housing demand in London continues to rise and all the boroughs we work with have long waiting lists which are not in any way matched by new supply.

East Thames already does a lot to facilitate household mobility, including helping people exchange their homes and arranging chain moves to help both our under-occupying households and those who are overcrowded.

We are worried about the penalties the government is planning to introduce for households that are under-occupying their home. While many of these households want to move to a smaller home, there is not the supply to allow this to happen easily. London has the highest levels of social housing overcrowding in the country and the lowest levels of under occupation. In other parts of the country this situation is reversed – in other words housing stock and household size don't match. In this situation, it seems hard to penalise people for under-occupying when other options may not be available.

Aside from the research, what is East Thames doing to help residents through these changes?

We're trying innovative ways to help people manage their finances, get into training and find work.

We have just launched a pilot project to help residents with high rent arrears facing eviction to escape the poverty trap, with a tailored package of debt advice, mentoring and employment support. We aim to fight financial exclusion by working with those most at risk of getting into rent arrears to stop debt developing in the first place. We are working with tenants to ensure that they have a bank account that works well for them; can budget and manage their money; can set up a direct debit for rent payment; and can move closer to the job market.

This project is especially important as we know that more than 13 per cent of housing association households don't have a bank account. Government is proposing that, in future, housing benefit will be paid direct to tenants, and not directly to housing associations as happens at present. This will require people to have bank accounts and to be good at managing their money. Along with other housing associations, we are calling for government to give the choice to our tenants so that they can have their housing benefit paid direct if they choose.

To this end, we are concerned about our tenants potentially getting into debt and putting their homes at risk. Also, the way we fund our new homes relies on a secure income stream which supports our ability to borrow private finance to support building new homes and keep our existing homes in good order. This proposal by government could be a double whammy, hitting both our existing tenants and our ability to provide more homes.

Is East Thames having much success in helping residents to access training and find work?

Our employment team achieved their best ever result in the last financial year, helping 234 residents to find a job and others move into training. We're really proud to have helped so many local people and businesses by offering a range of support and training aimed at improving a person's chances of finding work, including a construction course that helped around 50 residents gain work experience on the Olympic site.

We're also working with our partners in the G15, London's 15 biggest social landlords, to help residents who live a distance from their work to move to sustain their employment. G15 London Moves is a new programme that allows G15 social tenants in London to bid for other G15-owned social homes located closer to where they work. The programme was recently opened up to include under occupiers wanting to move across London to downsize, and aims eventually to allow many more of our residents to move. East Thames alone has already moved four of our households closer to their job and one family to a smaller home, which has vastly improved their quality of life.

Is East Thames concerned about the future in light of the changes and cuts?

There's no getting around the fact that the poorest and most vulnerable people are bearing the brunt of the impact of the cuts and reforms. We're taking action and making ourselves as lean and efficient as possible, so that we can continue to provide new affordable homes and support services to an increasing number of vulnerable people – such as those with learning disabilities or mental health needs. We're working with local authorities to find a way to do it now but, if funding cuts continue, these important services will become even harder to maintain in the long term. Our core concern is that the changes could impact on our ability to build and support sustainable neighbourhoods which give people the foundations they need to maintain and improve their family's wellbeing.