CUTS AND CONTEMPT by Research for Action

Experiences of austerity and council democracy in Newham

CUTS AND CONTEMPT

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EXECUTIVE SUMMARY Local government is in crisis. With up to 40% reduction in funding from central government since 2010, councils are struggling to meet their legal obligations to deliver services to residents. However, councils also spend a significant amount of their income on interest payments on debt. Payments are ring-fenced, which means that reducing them is not an option when cuts need to be made. The purpose of this study is to document residents’ lived experience of austerity in the London borough of Newham as part of evidence collection for a “citizen debt audit” that seeks to evaluate the social sustainability of the borough’s debt. Newham is one of the poorest boroughs in London and also one of the most heavily indebted, with more than £500m owed to banks. This borrowing is mostly in the form of LOBO loans, resulting in millions of excess interest payments a year. Since 2010, Newham has cut a third of spending on services. Our research, consisting of 51 in-depth interviews with Newham residents, shows how these cuts are felt by the community. Although a majority of residents are satisfied with the services they currently use, there are significant concerns regarding the cuts. Only a third of our respondents feel that their needs are met by the council, and most feel that the council’s spending priorities do not reflect their needs. Residents value council services even if they do not use them. People consider services important for the community - for example, providing youth services to address street crime - or because they might one day need them. Our findings suggest that despite widespread satisfaction with council services, too many people are being failed by Newham council. This is especially prominent with lack of housing, mental health support and cuts to benefits such as council tax support. Cuts have consequences: lack of services, increased barriers to proving eligibility for support, loss of benefits and increased charging for services cause stress, financial difficulties, as well as mental and physical health problems for residents and their families. We also found evidence of a significant democratic deficit in the council. Residents frequently voiced experiences of contempt and described the strenuousness of getting in contact with both elected representatives and council staff. Despite widespread disillusionment, most respondents expressed a desire to contribute to decision-making, with all agreeing that local residents should have some say in how the council spends money. Residents we interviewed had many concrete ideas for reducing barriers to decision-making, and should be listened to. Local authorities face huge pressures on their funding due to the removal of central government’s core grants. To make up for the lost income, councils are raising council tax and increasing charging for services that have previously been free. This comes at a price for residents. Our findings raise serious questions about the fairness and human rights implications of continued, ring-fenced interest payment expenditure to the financial sector. Public money would be better spent on improving the lives of the community that makes Newham the youngest and most diverse but also one of the most deprived boroughs in the whole of UK. 1

CONTENTS

INTRODUCTION Context .....................................................................................5 Local government in crisis The purpose of this study Newham: high poverty, homelessness and debt

Methodology.............................................................................6 Participants

Questionnaire

FINDINGS Summary...................................................................................9 Cuts to services......................................................................10 Services used

Satisfaction with services Importance of services General experience of cuts Reduction in staff Access to services Housing Council tax Impact of cuts Crime and youth services Improving services

Council democracy.................................................................17 Contacting elected representatives

Consulting residents about the cuts Participating in decision making Need for better communication

Policy recommendations........................................................19 Notes........................................................................................20

INTRODUCTION

CONTEXT Local government in crisis With up to 40% reduction in funding from central government since 2010, councils are struggling to meet their legal obligations to deliver services to residents. In February 2018, Northamptonshire County Council declared it was effectively bankrupt, suspending all new expenditure decisions.1 More councils are expected to follow. A recent survey among council officials2 suggested that 80% of councils fear for their financial sustainability and Northamptonshire CC is just the tip of the iceberg. There is significant uncertainty as to how local government will be financed post 2020 when nearly half of all councils will stop receiving core grants from the government altogether.3 Over 90% of councils in England plan to raise council tax and increase charging for services in 2018,4 with significant impacts on residents, especially those on low incomes. However, service provision and supporting residents is not a council’s only expenditure. Councils also spend a significant amount of their income on interest payments on debt usually taken on for capital expenditure (infrastructure, new buildings, etc). This can amount to as much as over 70% of what they receive in council tax income. Loan repayments and interest payments are ring-fenced, which means that reducing them is not an option when cuts need to be made. Particularly problematic are loans taken out from banks which in the great majority of cases come under the form of LOBO (Lender Option Borrower Option) loans. Not only do these loans carry high risk, but they also come with high interest rates and are very expensive to exit.5

The purpose of this study The purpose of this study is to document residents’ lived experience of austerity in one of London’s poorest boroughs. We hope it will add an important dimension to the comprehensive figures that show councils’ financial distress caused by cuts in central government funding, high interest debt and financial mismanagement. We interviewed 51 residents in different locations in Newham about their experiences with council services, their views on council accountability and to what extent they felt their opinions were heard in local decision-making.

work, together with interviews with focus groups, charities, and campaigners, impacted by or working on the effects of cuts, as well as financial and legal experts’ veiws on the council’s LOBO borrowing. As a result of the project, we hope to start a conversation about in whose interests financial decisions are made in Newham and contribute to efforts to make the council more democratic, accountable and inclusive.

Newham: high poverty, homelessness and debt Newham is an East London borough perhaps best known for hosting the London 2012 Olympic Games. It is one of the poorest councils in London. Average household income before housing costs in 2014 was only 71% of the national average - £302 per week.6 Over 43% of children in the borough grow up in poverty.7 Newham’s overall poverty rate is 37%, second only to neighbouring Tower Hamlets.8 Housing is a prominent problem: One in 25 residents is homeless.9 Newham has the highest number of people placed outside the borough as well as the highest number of people in temporary accommodation in London.10 But pressures extend to those who have a roof over their heads: the share of social housing tenants and owner occupiers has fallen since the turn of the millennium, with the share of owner occupiers less than half of the national average.11 This is contrasted by a steep rise in private renting: from 17% in 2001 to 37% in 2012.12 Combined with rising rents and low incomes, this amounts to a perfect storm for those experiencing housing crisis. Newham is also one of Britain’s personal debt hotspots: one in four residents has problem debts.13 Despite these severe social pressures on its population, since 2010, Newham has cut spending on council services by £129m - nearly a third.14 Newham is the council with highest LOBO debt: in 2017, it amounted to £563m. The council spends over £50m a year only on interest - equivalent to 77% of what it collects locally in council tax.

This report is part of evidence collection for a “citizen debt audit” that seeks to evaluate the social sustainability of Newham’s LOBO loan debt. The aim of a citizen debt audit is to improve the accountability and transparency of local government towards its residents in managing funds in the public interest. The audit will examine the financial sustainability, legality and legitimacy of the local authority’s debts, especially where interest repayments are preventing the council from meeting its obligations to provide a duty of care to residents and universal access to services. The findings of this report will feature in our final body of

by Annie Theby 5

METHODOLOGY Participants

10 Owner occupier

Council property

Private rental

Owner occupier

centre;

• in Stratford near the council’s debt advice and loan

service MoneyWorks, the library and the council’s Workplace service; in Canning Town Rathbone Market where the new library is located; and in Beckton by a large Asda store that is located at the heart of the area, a stone’s throw from the library and community centre.

Income 45 % 40 %

Newham residents

35 %

Interview participants

30 %

45 %

25 %

However, as these places had a lot of foot traffic, not every participant was a frequent user of council services and the respondents’ level of engagement with the council varied.

20 %

Interviewees were approached at random. The selection criteria we used was that people had lived in Newham for more than a year, still lived in the borough or had moved out less than six months ago, and that they had some familiarity with council services either from current or past use. Main obstacles we found for recruiting interviewees were lack of time, language barriers and people not feeling they had much to say about the council. (“Council? One word: Rubbish!”)

40 % 35 % 30 %

15 %

25 % 20 %

10 %

15 %

10 % 5%

Asian / Asian British

White Asian /

Asian British

Black / Black / Mixed White Mixed Black British Black British

Household incomes varied: 13 respondents gave under £10k as their household’s annual income and 11 gave over £30k. The rest were in the middle, and ten decided not to disclose their income.

Most interviews (37 out of 51) were recorded. They were based on a semi-structured questionnaire (see below) and lasted between 10 and 35 minutes.

Other

£10K to £20K

Less than £10K

£21K to £30K

Undisclosed

More than £30K

Housing 40

Of our respondents 13 lived in a council property, and 11 rented privately. Ten owned their property, plus two young people lived with parents. Five were with a Housing Association, and one each lived in supported accommodation, sheltered accommodation, temporary accommodation and unofficially renting from a friend. 35

Participants were asked to fill in a separate sheet with questions about age, gender, ethnicity, type of housing and household income. We asked people to self-describe their gender and ethnicity, rather than choose from a list.

Of the 51 respondents, 24 were male and 27 were female. They were between 18 and 79 years of age. Council property

Housing Temporary or Living Association supported with parents

Both White (31.4%) and Black (25.2%) ethnic backgrounds were somewhat overrepresented in our sample compared to Newham’s population, and Asian/ British Asian backgrounds (21.6%) underrepresented. In 27 24 2015, Newham residents were 46.5% Asian/Asian British, 26.5% White, 18.1% Black/Black British, 4.9% mixed/ multiple ethnic group and 4.0% any other ethnic group.16

The locations were the following:

The average age of our respondents was higher than the average age of Newham residents (43.4 compared to 30.8), but this is partly explained by the fact that we excluded under 18s who form a quarter of the borough’s population.

The single most common ethnicity was White British (9), followed by Black British (6), Indian or British-Indian (6), White European (5), Bangladeshi (3) and Black African 13 12 10 5 3 2 (3).

• near East Ham library, council office and leisure

Gender and age

Housing Temporary or Living Association supported with parents

The participants represented ten different nationalities and 16 27 different 24 ethnicities. Most (38) were British nationals.

These locations were chosen to represent different demographic profiles, as historically Newham comprises of the boroughs of East Ham, West Ham and part of the old Metropolitan Borough of Woolwich.15 To recruit Newham residents who used council services, we approached people in their vicinity.

•

12 Private rental

Nationality and ethnicity

We conducted 51 interviews between November 2017 and January 2018 in four different parts of Newham: East Ham, Canning Town, Beckton and Stratford.

•

13 Council property

Private rental

Owner occupier

Housing Temporary or Living Association supported with parents

5 0

Council property

Private rental

Owner 15 occupier 10

Libraries, Adult social community services centres and leisure centres

Housing services

Council tax or housing benefits

Housing Temporary or Living Association supported with parents

Education and learning

Art, v and

Questionnaire Our research method was shaped by participatory research on housing and mental health by Kate Hardy and Tom Gillespie.17 Before carrying out our interviews, we invited feedback to our draft questionnaire from campaigners in Newham as well as academic researchers. We modified the questionnaire based on this feedback and pilot interviews in Stratford, during which it emerged for example that we had to provide examples on council services rather than expect respondents to know what services are provided by the council. The questionnaire had two parts: one on council services and the other on experiences of participation in council decision-making. It was designed to elicit a combination of qualitative and quantitative data, and included open-ended questions. In many cases, quantitative data was easier to obtain due to the multiple issues raised, but the answers to open-ended questions provided invaluable perspectives that would have otherwise been overlooked. Topics covered by the questionnaire were use of council services and their importance; residentsâ&#x20AC;&#x2122; satisfaction with council services and how they had helped them; as well as how cuts in services had affected respondents. On council decision-making and democracy, we asked about peopleâ&#x20AC;&#x2122;s experiences of contacting the council (both staff and elected representatives) and participation in and awareness of consultations by the council. We also asked respondents about the level of their council tax and whether they felt they were getting enough from the council. Finally, we asked open questions about what the council could do better, how it could be made more accountable and whether the councilâ&#x20AC;&#x2122;s priorities reflect the needs of the community. We are committed to open, accessible and transparent research. If you would like to obtain a copy of our questionnaire, please email info@researchforaction.uk.

by Fanny Malinen 7

FINDINGS

SUMMARY When interviewing residents in Newham, we found that only a third felt that their needs were being met by the council. Half had experienced cuts in services they used, and everyone was aware that cuts were happening. Most respondents did not think the councilâ&#x20AC;&#x2122;s spending priorities reflected their needs, and many voiced their frustration on vanity projects or cosmetic improvements such as the Olympic developments, whilst they felt that the most pressing needs of residents, such as housing, education and support for those who are struggling, were neglected. We found that the majority of residents were satisfied with the services they used. This shows that local government is still an invisible realm of cuts, with a relatively small number of people using council services that are most significantly affected: in 2016/17, 50% of council spending was on social care.18 However, the stories of those who feel left out in the cold, sometimes literally, because of lack of council services, should not be overlooked, which is why we have given emphasis in our study to the experiences of those most affected by cuts. Our findings suggest that the importance people place on council services does not depend on whether they personally use them. Many people value the support networks provided by the council, considering them important for the community or because they might one day need them themselves. Although our questionnaire did not directly ask about crime and security, it was one of the themes respondents brought up most in the open questions, calling for the council to provide more services for youth to help address street crime. Most respondents raised the need for better communication from the council: nearly everyone agreed that residents should have a say in how council money is spent, and many raised concrete ideas for how the council could engage people, such as publications, leafleting, open meetings, participation days and participatory budgeting. Many respondents wished it was easier to meet their elected representatives. Considering the scale of changes in local government since 2010, the failure of Newham Council to inform and consult effectively residents about the cuts is striking. We frequently encountered experiences of contempt and a general lack of accountability. With the removal of central government funding of local government (known as the revenue support grant) councils like Newham will move towards relying on locally raised council tax and business rates for most of their funding. This puts pressure on the council to collect more council tax. However, average incomes in Newham are 29% lower than the national average19 and a fifth of the people we spoke to are struggling with council tax, often due to changes in council tax support. There is a clear onus on the council to explain in simple language how it spends public money and to consult more widely on changes. At the moment, residents do not have an accurate picture of how the council spends public money.

CUTS TO SERVICES

uncil perty

Services used

Satisfaction with services

The most common services respondents told us they used were libraries, community centres and leisure centres. Rubbish collection was mentioned fewer times - despite the fact that it is a council service used by everyone, but perhaps reflecting a lack of awareness people have about what the council does. This also indicates that people’s recollection of the services they use is not always accurate, and our figures on how widely respondents used services are likely to be underestimates.

Most people were either somewhat satisfied (59%) or very satisfied (22%) with the services they used, with a minority somewhat dissatisfied (8%) or not at all satisfied (6%). However, only a third said their needs and those of their family and community were met by the council, with 24% respondents saying not at all and 41% somewhat.

Private rental

Owner occupier

Housing Temporary or Living Association supported with parents

Eleven respondents used services under the heading education and learning, and the same number had done so in the past. Seven currently used children’s services and one had done in the past. Nine said they used art, venues and events and two had done so in the past - although events organised by the council came up in several more interviews. This again indicates that the respondents tended to make use of more services than they thought they did when asked to choose from a list. Five used employment services and six had done so in the past, and three used the council’s debt advice and loan service MoneyWorks, and one had done in the past.

45 % 40 % 35 % 30 % 25 % 20 % 15 % 10 % 5% 0%

Approximately one in three (19 respondents) either used or had used housing services. Of these, 13 people were currently living in a council property. Four respondents said they had used and ten currently used adult social services. 15 currently received council tax benefit or housing benefit, and four had done so in the past. 5 3 2

Asian / Asian British

Thirty-seven respondents currently used libraries, community centres and leisure centres and seven have used them in the past.

White

Black / Black British

Mixed

Other

Only two said they didn’t currently use any council services. The categorisation we used was based on Newham’s 2015 consultation on the council’s “Budget challenge”,20 which asked residents which services they would most like to see protected, to which we added the employment service and MoneyWorks. 40

Current service users

Past service users

5 0

Libraries, Adult social community services centres and leisure centres

Housing services

Council tax or housing benefits

Education and learning

Art, venues and events

Children’s services

Employment MoneyWorks services

Our findings are thus broadly in line with the findings of the survey done as part of Newham council’s “Budget Challenge” consultation in 2015, which found that 52% of residents were satisfied with the way the council runs things.21 Reasons for this could be that people are generally satisfied with the services they use but would need more of them to consider their needs met, or that there is a tendency towards politeness when asked about their satisfaction with services they get. One responded ticked “somewhat satisfied” but when asked why, said “services are erratic and poorly run”, another one said “sometimes council stop my housing benefit money and put me in arrears”. The latter hypothesis is also supported by comments such as “I guess I have to give them some credit” and notions of gratitude for having a roof over one’s head which only came through in longer answers.

Importance of services Nearly all respondents said council services were either very important (78%) or somewhat important (16%) for them. The rest chose “don’t know” – not a single person said council services were unimportant for them. Interestingly, some of the respondents used services very infrequently (6% more rarely than monthly, 10% monthly, 10% several times a month) yet they still considered them important for the community or in case their life circumstances changed. “A lot of people rely on them,” said one of the two respondents who did not use any council services but still considered them very important. Other reasons non-frequent council service users gave for considering them important were: “I would use council services more often if there was a change of circumstances, for instance if I had kids or lost my job.” “They are very important for community, it’s good for people on low incomes to access services they wouldn’t otherwise be able to.” “It wouldn’t affect me if I couldn’t use these services because I could afford private, but it

is important for the community to have these services.”

“[They should] answer phone calls! Especially as I’m paying for it.”

Two-thirds (34) said they would use council services more often if it was possible, and 70% (36) said they would use other council services than those that are currently available. Arts, youth services, work and career advice services were mentioned, as were better opening hours for libraries and leisure centres. Many people expressed disappointment that they were not eligible for services, housing or council tax deduction despite their circumstances.

“By the time you get through some people give up.”

“Maternity pay is a third of my normal income, I would like a council tax reduction if I was eligible.” “I’m disappointed with my daughter’s nursery, she’s 3 years so should get 30 hours but they haven’t got enough staff.” “I used to get full council tax rebate. Now there’s also a cap on housing benefit.”

General experience of cuts Half of respondents (26) had experienced cuts or drastic changes in the services they used and everyone was aware of the cuts happening. The most common ways in which people described the cuts were: • lack of staff and increased bureaucracy • closures of community centres, venues and libraries; • changes to benefits • increased need to justify eligibility for services and benefits • increased travel time to services that had previously been near • charges on services that had previously been free.

As one of the consequences of increased online and phone communication, some respondents mentioned the lack of human contact: “A lot is online in terms of council and payments, which is bad for people like my wife who is depressed and wants and needs to speak to people. Having to do everything online increases her depression.” “Everything is online now, it seems all the offices are getting shut. You can’t go to the main office building and get an appointment and see somebody, it’s always just phone up. There’s no face to face and another person talking to another, it’s all just online. Would be nice if it was an appointment with someone and another person.” “If I’m on the phone, the person I’m speaking to won’t understand my situation, whereas if it was face-to-face, it would be easier to provide the information and documentation.” A few respondents also mentioned having a one-stop shop and being able to do things online as positives.

The effects respondents described this had had on them varied from not much effect or “nuisance” to “feeling ditched”, “rejected” and suffering increased stress as well as financial and mental health problems.

Reduction in staff On contacting the council, people described that it had become harder to get through; their previously direct point of contact (for example for council tax and housing benefits) had been removed; and it was harder to get to speak to a staff member in person. This increased stress, especially for those with complex needs and mental health issues, and in some cases had a financial impact as people had to wait on the phone to a pay number: “There is maybe one person doing three persons’ job, so it becomes harder to work with people with problems. It seems to have escalated due to cutbacks. It feels like banging your head against wall, the council is not there to help.”

by Fanny Malinen 11

“Council services are now all in one building, whereas before was separate buildings.” Of the 37 people who had contacted the council regarding an issue, 15 were at least somewhat satisfied with the response and response time, although only four were satisfied with both. Eleven were dissatisfied with both, citing delays, being passed on to different people and the council being generally hard to get hold of. Lack of accountability when things went wrong was also mentioned. In general, people’s experiences of the council paint a worrying picture of unaccountability. “Staff did not want to understand and resolve my problem, it felt like a box ticking exercise.” “They kept passing me on, no accountability – the rubbish department is rubbish!” “They are hard to contact, had problem with bin collection and it was impossible to contact them. Online it takes 3 days – they should have a helpline. “ “When you come to Newham and you come out of that council you feel like... why did I sit there all day for that? For nothing! I’m not heard. It’s important to be heard.” “Deaf ear! It’s like I haven’t said anything. They rejected social housing application because of [family member’s] different surname, there is no office where you could go and complain, they are not approachable.”

Access to services Respondents expressed frustration with the increased requirements to prove that they needed the services or benefits they are entitled to: “After being diagnosed by a doctor you have to prove to council you’re not well, which happens every few years. Who will get injections in their joints if they are not suffering?” “For those who are struggling to rebuild their lives in skills and everything, it should be easier - everything needs funding & referrals.” “I find it difficult to qualify for services, they’re picky. I don’t even bother because I know it’s difficult and I’ll never qualify.” For some, cuts were seen in the reduction in activities that used to exist or stricter limits for qualifying for them: “There is a lot happening, but often the same things for kids, so you have to travel or pay [for different activities]. The basic stuff is good, but there is not much for teens, like my son is 12 and cannot play basketball.”

Often people were told there was a lack of funding when they tried to access services:

“There are quite a few issues with [disabled daughter’s] school. Everything seems to come down to money.” “Council says lack of money in everything you ask for, which is wearing a bit thin.” “Everything is under huge cost pressure and staff are too busy to adequately assist people.” The increased difficulty in accessing services found by our respondents meant that some had turned away from the council altogether and sought help from charities instead. One of them was 47-year old Marie. After being released from prison, Marie tried to rebuild her life and overcome an addiction. She lived in Newham for 4 years but moved to another London borough recently when she got housed there. She had a harrowing story to tell about how Newham failed her and many other women in her situation, and she only recovered due to help from her church. “Housing was a serious issue. We come from prison and street homelessness in different boroughs, so when we came here to do recovery, you had to have been living in this borough for 2 years before you get any recognition. Even then you’re put into supported housing that’s full of chaos, people on drugs, drink, domestic violence. When you’re on recovery you can’t go to them kind of places. You’re in a Catch-22 situation.” “There were a couple of drop-in centres in Stratford but that doesn’t work for me, I have to be an a resident house. I was given free funding from the church so I was lucky in that respect. But I found it quite difficult regarding contact with my children, they weren’t listening unless you’ve got a court order [for full custody]. It’s like you’re not adequate enough to have that extra space to have your children with you.” “I feel the council doesn’t really work for women who are struggling to rebuild their lives in skills, education, with their children, there’s not that many services to guide that kind of women in the right places. Everything needs funding and referrals.” “Of course I would use services more if they were available more. I think they’re really important if they work in the right direction. If they’ve got plan A, B and C put in place it’s constructive, but if there’s no follow-up plan, you just feel like you’re in a vicious circle. You become a tick-box exercise with no purpose.” “By the grace of God I went to other services but Newham did nothing for me.” Marie thinks the pressures on staff have increased due to budget cuts. “I can understand the staff under a lot of pressure, maybe one person is doing three people’s jobs. And because of that they have

resentment, it becomes hard to work with people with problems because they feel like they’ve got their own problems too.” “I think the council offices in Newham are very hostile places, it’s not a very welcoming environment. When someone comes in with anxiety and stress and doesn’t know how to communicate, and they say go over there, take your number and sit down, it feels like waiting for a handout and it’s off-putting. It makes me feel like I shouldn’t be there in the first place. There’s a lot of people in Newham with a lot of problems, and one person can’t take care of however many people are under their care per day. That’s just impossible to manage and get their targets met. You can phone up the council and they tell you to come and then the person is off sick, or the information is not available because somewhere in the chain people are not aware of the information that has been sent or received. So you’re constantly going over old stuff, constantly, it feels like you’re banging your head up against a brick wall.” “Back in the 1980s there were hardly any problems with housing or councils. It just seems to have escalated over the years and I wonder if that is due to cutbacks.” She believes that those affected by problems should be listened to when budgeting and designing solutions.

Housing Housing was one of the main issues respondents brought up in the open questions about what the council could do better, which did not surprise us considering the housing situation in Newham. Although we were interviewing people about the council rather than the private rented sector, it came up in many answers. Respondents felt the council should do more to regulate the private rented sector and help with affordability: “Housing prices have increased, they should review rents and have tax breaks and schemes to help people out.”

by Fanny Malinen

congestion, even rats would not live like that.” “Main issue is that the rental market not controlled, landlords are ripping people off hard earned money. How can people survive? They should regulate the rental market.” The need for more council housing was addressed, both by those who were in the need of it themselves and by those who were worried about the effects of homelessness on the whole community. “It has become more difficult to find a permanent place so I can contribute to society. I have been on register for a while. The delay causes stress and vulnerability: once you’re stable, you’re happy.” “Housing needs more investment. How many new builds are affordable?” “There is more need for especially housing, the homeless should be taken care of.” “Housing and homelessness services are under immense pressure. The scale of homelessness in Newham forces people into unacceptable housing situations. I fear for my family.” Council tenants raised issues with delays in repairs or works being done: “There’s a lot of problems in housing, repairs take a long time to get done. It’s hard to keep ringing every week, they should have reminders instead of us ringing.”

“They should make it easier to get a house for people who are willing to pay, even private flats should meet standards, council should enforce standards.” “Housing can be difficult for people who have grown up here, even shared ownership. Council should have in mind youth who want to remain in the area.” “The problem is landlords and HMOs [Homes in Multiple Occupation], little houses turned into 5 flats – it’s terrible, but the council has let it happen. So it puts more stress on the community, more people, more pollution, more

by Fanny Malinen 13

“Living in a council property I pay my rent, and sometimes I feel that I have to wait a while for them to come when something goes wrong. It just takes a while. Sometimes they don’t turn up at all. My shower just broke, it broke on Sunday and I called them on Monday first thing, and it’s taken them a few days to come, a shower is quite an important thing so you’d think they’d come the next day... but they said to me Wednesday and I said really, that’s two days, and they said you’re quite lucky it’s not a week.”

to pay at least 20% of their council tax bill.23

“Housing services and repairs and maintenance are getting worse.”

“It’s a bit hard, they charge a lot.”

We also came across clear failures by the council to support residents such as Leonard. Leonard is 73 and has lived in Newham for 25 years. “I can’t use the housing service, they say I’ve got no chance. I have tried to. But it is nonexistent. I have been waiting ever since I’ve been in Newham. I went in and they said I’ve got no chance, I’m not eligible because I haven’t got special needs. At that time I was living in a tent in a park. That was about 4 years ago. If it wasn’t for my friend, I’d still be there. They were not interested I don’t think. I’m losing out a lot on housing benefit, I’m entitled to it but I can’t use it because I haven’t got a house. It affects me financially, I have to pay £70 a week out of my own pension. My friend is not a landlord, he’s a friend. They should be spending more on housing really. They should supply more housing.”

“It impacts us financially, we have to work longer to pay the bills. And if you are late with one payment they treat this as a massive issue, yet ignore any complaints or problems.”

“We have less money [than before the increase].” “Now we start to see it, before didn’t notice.” “It didn’t make much difference, only when [council tax] benefit stopped.” “We’re poorer and our health, including my child’s health, has deteriorated.” “I have had to add income to make up for it.” “It has had an impact, there’s things we can’t afford.” “I appreciate they pay housing benefit but I’m struggling with council tax. I’m on benefits and a mental health patient, and I’m paying £100 a month, all my benefits I’m spending on council tax. I’m struggling, because if I have to part with £100, how much am I left with to feed my kids?” Our findings support concerns24 that the change in council tax support has hit the poorest households hardest, making council tax more regressive in that it does not take into account people’s ability to pay.

Council tax

Impact of cuts

We asked people if their council tax had gone up during their time in Newham, and whether the increase had had an impact on their finances.

Cuts affected people’s health, finances and family life:

Newham prides itself with the lowest level of council tax in outer London. Of our respondents, 45% said their council tax had increased during the time they had lived in Newham. As some people had lived in the borough for decades, they did not necessarily consider small increases in line with inflation worth noting, and for many increases were linked to moving property. What is noteworthy however is that 20% mentioned they are struggling with the level of council tax. This was especially linked to loss of council tax support or other benefits. Council tax benefit, which made sure that those on low incomes did not need to pay council tax, was abolished as part of the Welfare Reform Act 2012. The Local Government Finance Act from the same year laid out the provisions for localising council tax support, and the possibility for a full rebate was removed, except from pensioners.22 In Newham, every working age resident has 14

It is therefore not surprising that council tax caused people financial difficulties - even though many respondents treated increases in their council tax as a natural phenomenon.

“I feel rejected, cheated, promises not kept… I lost my job due to council cuts at school, I used to be a teacher.“ “They are cutting teaching assistants, it affects the children, the teacher is overworked. I pity him.” “We’re a bit stretched – many people here have not got much money, council should listen to people who have lived here long. There’s been more cuts and changes in the last 10 years.” “I have become poorer. It causes stress, also to the kids – and stress gives bad health to the whole family. I feel ditched, I have paid tax all my life. Christmas is coming and I can’t buy anything. I’ve paid my tax and all, now just getting cuts.”

We also found a cumulative impact of government and council cuts on people’s lives, illustrated by Jay’s story. Jay is 33 and has lived in Newham six years. He lost his job due to government cuts. “Before I could have a car, pay my bills, buy things. Now I’m struggling to get by without my own fault. It’s very stressful and it has increased mental health effects. All the benefits have gone into Universal Credit. My housing is paid for which is a great relief. The biggest fear is not to have a roof over your head due to redundancy, not one’s own fault.” Jay is just on his way from trying to attend a Councillor’s surgery in Stratford, but he says the Councillor did not turn up. He has contacted the council regarding various issues, and does not feel satisfied with the response: “With housing, you have to call, then follow up, they never get back to you. And you have to email to leave a trail. Support into work is inadequate although I have been appointed. Workplace, the only agency that can help, is overloaded so they can’t give good service, don’t have the capacity. Employment support and job centre don’t support you, it’s just a tick box exercise to get funding. They are not supporting you into work, you have to prove things. I have had to be more assertive and luckily I have been able to be, but would be in a bad situation if not. But it shouldn’t be like that as not everyone has the strength to be assertive. It has caused increased stress levels, worry, I’m unhappy and anxious... Because you don’t know the future, you have an idea of repercussions if you’re left without income and support but you can’t do anything about it. I’m left with a few pounds a day.”

Many of those using services more often called for their better integration, especially with mental health services. This highlights the importance of adequate support for those who are made vulnerable due to the cuts: “My child is autistic, and there is not much support at the moment. Would be good if Newham offered some therapy: Education, health and care, mental health as well, if it was available obviously I’d use it.” “Mental health services, especially counselling, there is none really. I’m looking for combined physical and mental health therapy.” “Lack of funding. Mental health service is absolutely diabolical, I think most people are gonna end up having nervous breakdown because of lack of services. It’s absolutely terrible.”

by Fanny Malinen

Crime and youth services Our study did not directly address security and crime, but 24% of respondents brought it up. This is not surprising as Newham has a higher crime rate than the London average,25 including the most murder investigations of all London boroughs in the last year and violent crime up by over 7% between 2016/17 and 2017/18.26 Residents associated increased crime to the lack of council services, especially youth and mental health services, as well as general deprivation in the borough: “There’s a lot more crime, our car has been broken into several times, you see more people hanging about and begging on the streets. If those people accessed services they wouldn’t be on the streets committing crimes.” “There’s lots of crime, which needs attention. Since the Olympics there has not been as much focus on residents as should be. The legacy has not changed anything.” “There’s so many bookies opening – the High Street is taken away from us. It shows how deprived the area [East Ham] is. Council should use it for community. There should be more services for young people, they don’t have anywhere to go, should keep them busy, this increases crime.” “The council should be more accountable in terms of safety - there’s acid attacks, the [Beckton Asda] parking lot is quite crazy and scary weekend nights with people driving around, nobody pays attention, the council doesn’t care.” It is no wonder residents feel youth services are lacking. Newham has cut its youth service budget by 81%, over twice the London average, in five years. Spending has decreased from £2,107,310 in 2011/12 to only £400,000 in 2016/17.27 The consequences of cuts are alarming, and we are calling for an immediate reverse in cuts to youth services. “There should be more interfaith & youth programmes, tackling gang violence, 15

employment services…” “There’s no youth clubs, there’s nothing for the youth. Absolutely nothing. It’s sad.” “No social responsibility, gambling in High Street is bad for kids.” “There is nothing here, especially for kids. Where would they go? And there’s increased mental health problems, and what are they doing for mental health?”

Improving services People who had lived in multiple London boroughs or work in other boroughs were able to compare service levels across councils, often finding significant variation. Benchmarking of public service provision across London councils in a way which is accessible to residents could help identify areas of neglect and spread best practice. “I work in Ealing borough, and the difference between the two is that Ealing has got a lot more community services and things going on... I don’t see that here, I remember back in the days, I went to a few youth centres but I don’t see that anymore. If I compare the two boroughs, Ealing is a lot better. I work in a community centre there and I see how many things they offer compared to Newham.” An example of how to support residents who are being made vulnerable by cuts comes from Islington Council. When the “bedroom tax” came into effect in 2013, the council informed affected residents about their options to adapt to the change, including by applying to discretionary housing payments.28 In responses to open questions about what the council could do better, respondents also addressed other issues regarding the public realm, such as pollution and general cleanliness. This suggests people do expect more from the council than just collecting their bins every two weeks or providing other services, but that the council has a certain social responsibility residents expect it to take on. Residents expect the council to take care of everyone in the community, but also maintain life on the high street and make sure businesses in the area contribute to the community, and generally make Newham a healthy environment.

COUNCIL DEMOCRACY Contacting elected representatives Many of those who had not contacted their elected representatives had not done so because they had not had any reason to. A few also expressed such mistrust in the council that they would not even consider contacting them. We find this very worrying for local democracy, especially as those expressing these views were often those who most needed the council. The below quotes are from a parent of a disabled child and an unemployed mental health patient who is also a carer for family members. “I feel like an ant. It’s a big authority and I’m an ant, that’s how I feel, they won’t listen to me anyway.” “I’ve never thought there’s any point, they don’t listen anyway. It’s very corrupt as well you know, very corrupt... from the top. We all know the reason for example Carpenters’ Estate is laying empty when there’s thousands of homeless is because the council wants to sell it to a private developer to make money. That’s all this council is really interested in, lining their own pockets.” Thirty-one percent had contacted their Councillor or Mayor. Of those who had, 63% had received a response and half felt their issue was resolved. As electoral representatives are supposed to be there to listen to electors’ concerns, we find this an alarmingly low response and satisfaction rate. Sometimes, the Mayor and Councillors did not turn up to surgeries: “My wife tried to attend [Mayor] Sir Robin Wales surgery about a housing issue, but he did not show up.” “I’m just coming from my Councillor’s drop-in surgery and they didn’t turn up!”

“I signed petition for nearby library. I have written to council, met Councillor regarding housing, been to events, written to them, nothing happens…”

Consulting residents about the cuts Newham, like all councils, occasionally consults residents on new or changing policies, major decisions and prioritising resources. Consultations are done online, face-to-face, by post or telephone, or in events or focus groups.29 In 2015, Newham council commissioned Opinion Research Services to run a high-profile survey called “Newham’s Budget Challenge” to find out resident opinions on what the council should prioritise, needing to make £50m in savings in the following financial year. The consultation was widely publicised through street adverts and was available in libraries and other public spaces. To find out if residents felt they had been approached about the cuts, we asked respondents if they had participated in a consultation about the cuts by Newham council. Three people had: the reasons they gave were working with the council, knowing a councillor, and being interested. This was despite everyone being aware that there were cuts happening and half of respondents having experienced them first hand. Of the 47 who had not participated, 43 had not known that there was a consultation; three said they did not have time for it; three said they would not have responded anyway as they believed it would not change anything; one quoted anxiety issues and one laziness. (Some respondents named several reasons why they had not participated.) Three said they definitely would have participated in a consultation if they had known about it as they feel strongly about the issue.

by Fanny Malinen 17

Participation in decision-making Overall, we found that respondents had a desire to contribute to council decision-making and they felt that the council’s spending priorities did not reflect their needs. Some also raised feelings of injustice as they felt money was spent on the wrong things, such as vanity projects. “[Council should] declare what money spent on – all the services, not just some. Even the Mayor, I’d like to know what he’s spending money on.” “Listen to residents. Spend more money on community rather than their pockets – Mayor’s office has got chandeliers, why does the Mayor need chandeliers? They should improve services.” “Money is wasted on council paper, public sculptures & Olympics related public events. Public realm is not a priority. More than 70% of council tax goes on servicing debt.” “[There should be] more public consultations, we should know about them – Council should be more visible, I don’t know who is my Councillor.” “Think of community and stop trying to only profit from it!” When asked whether residents should have a say in how council spends money and which services it prioritises,

63% strongly agreed. 25% agreed somewhat, usually emphasising that it would be important to give the final decision to those who had a bigger picture or make sure people were not acting out of self-interest. The rest did not know or reply – no respondent disagreed. This shows that residents have a strong will to participate in matters that concern them, as long as they are approached in a way that is accessible for them.

Need for better communication To an open question about what the council could do better, half of respondents (25) brought up communication. Residents expected their elected representatives to attend their surgeries, council offices to answer phones and wished for them to be open evenings or weekends so that those working could attend them. Also mentioned was providing information through the door so that residents would not have to seek out for it: “A lot of the people in this community are not aware what is going on, it is either online or you have to visit a library. So how can they get the information? It might be in the weekly or fortnightly magazine, which I think is a waste of council money – really. It is not controversial, it just talks about all the fantastic things that are happening in Newham. There is no redress.” Our findings suggest that residents do have an interest in how the council is run, as long as communicating their views is made easy enough. Some suggestions that were brought up in the interviews were participatory budgeting, open forums, public meetings and consultations, and visits to community. “It would be nice if there was a newsletter with a pie chart how money spent. I think that would make it more accountable because you could see where the money goes. There could be an annual meet-up with citizens to say this is what we’ve done, make it more participatory and involve people in decision-making…”

by David Nicholls 18

POLICY RECOMMENDATIONS Based on our findings we believe Newham Council should: 1. Provide clearer information and real opportunities for residents to have a say on issues that affect them. Residents need to be given better information about what the council does and how it spends public money, as well as real opportunities to influence financial decision-making. Expecting residents to seek out opportunities to participate in consultations is unrealistic, and consultations should be brought to where people are. 2. Better identify individuals who are at risk due to cuts. Despite widespread satisfaction with council services, there is a segment of the population that is at significant risk of marginalisation, poverty and ill mental health due to the pressures cuts put on council services as well as the combined impact of cuts on local and national level, which need to be evaluated. These residents also need better information about their eligibility for support. 3. Stop cuts in youth services. Many Newham residents feel unsafe in their borough due to increased crime and voice concerns over the presence of young people on the streets. More spaces and activities would provide the youth with meaningful things to do, helping to tackle the violent crime epidemic. 4. Ensure better integration of services, especially those related to mental health. Mental health problems affect every aspect of peopleâ&#x20AC;&#x2122;s lives and cannot be treated in isolation. This is true especially for those who are experiencing poverty, difficult housing situations and unemployment, and mental health support should be integrated with other services. 5. Monitor council service provision more efficiently to avoid neglect and inaction. Benchmarking of public service provision across London could help monitor the quality of the services that councils provide for their residents and help to spread best practice.

NOTES 1. http://www.bbc.co.uk/news/uk-england-northamptonshire-42920716 2. https://www.lgiu.org.uk/report/lgiu-mj-state-of-local-government-finance-survey/ 3. https://www.local.gov.uk/about/news/council-funding-be-further-cut-half-over-next-two-years-lga-warns 4. https://www.lgiu.org.uk/report/lgiu-mj-state-of-local-government-finance-survey/ 5. http://lada.debtresistance.uk/ 6. http://eprints.lse.ac.uk/58039/ 7. http://www.newhamrecorder.co.uk/news/http-www-newhamrecorder-co-uk-news-newham-has-the-highest-level-ofchild-poverty-in-london-1-5379763-1-5379763 8. https://www.trustforlondon.org.uk/data/boroughs/newham-poverty-and-inequality-indicators/ 9. http://www.itv.com/news/london/2017-11-08/homeless-rates-grow-to-1-in-25-in-parts-of-london-as-total-uk-figure-outstrips-population-of-newcastle/ 10. https://www.trustforlondon.org.uk/data/boroughs/newham-poverty-and-inequality-indicators/ 11. http://eprints.lse.ac.uk/58039/1/CASEreport83.pdf 12. http://eprints.lse.ac.uk/58039/1/CASEreport83.pdf 13. https://www.theguardian.com/business/2017/sep/18/britain-debt-hotspot-newham-borrowing 14. https://www.ifs.org.uk/publications/8780 15. https://en.wikipedia.org/wiki/Newham_London_Borough_Council 16. http://www.newham.info/factsandfigures 17. https://www.research.manchester.ac.uk/portal/en/publications/homelessness-health-and-housing-participatory-actionresearch-in-east-london(4151810e-ac21-40c2-b39d-463d8634bbd7).html 18. https://www.local.gov.uk/sites/default/files/documents/A4%20STATIC%20IMAGE_04_1.pdf 19. http://eprints.lse.ac.uk/58039/ 20. https://www.newham.gov.uk/Documents/Council%20and%20Democracy/BudgetChallengeFAQs.pdf 21. https://www.newham.gov.uk/Documents/Misc/NewhamBudgetSurvey.pdf 22. researchbriefings.files.parliament.uk/documents/SN06672/SN06672.pdf 23. https://www.newham.gov.uk/Pages/Services/Council-Tax-Reduction.aspx 24. https://www.ippr.org/files/2018-03/a-poor-tax-council-tax-in-london.pdf 25. http://www.newham.info/factsandfigures 26. http://www.newhamrecorder.co.uk/news/crime-court/murders-newham-london-borough-met-police-figures-1-5495065 27. https://www.london.gov.uk/sites/default/files/london_lost_youth_services_sian_berry_jan2017.pdf 28. https://www.islington.gov.uk/advice/benefits/changes-to-benefits/what-are-changes/housing-benefit-changes-bedroom-tax 29. https://www.newham.gov.uk/Pages/Services/Current-consultations.aspx 30. https://www.newham.gov.uk/Documents/Misc/NewhamBudgetSurvey.pdf

About this report This study was conducted by Research for Action to document residents’ lived experience of austerity in the London borough of Newham. It is part of evidence collection for a “citizen debt audit” that seeks to evaluate the social sustainability of Newham council’s borrowing from banks in the form of LOBO loans. The aim of a citizen debt audit is to improve the accountability and transparency of local government towards its residents in managing funds in the public interest. The audit will examine the financial sustainability, legality and legitimacy of the local authority’s debts, especially where interest repayments are preventing the council from meeting its obligations to provide a duty of care to residents and universal access to services. The findings of this report will feature in our final body of work, together with interviews from focus groups, charities, campaign groups and individuals impacted by or working with the effects of cuts as well as financial and legal experts’ views about the council’s LOBO borrowing. As a result of the project, we hope to start a conversation about in whose interests financial decisions are made in Newham and contribute to efforts to make the council more democratic, accountable and inclusive. Note: this report was written before the local elections of May 2018 that resulted in change in the council leadership. Lead author Fanny Malinen

@fannymalinen

Contributors Ludovica Rogers Joel Benjamin Steve Rushton

@ldvcrgrs @Gian_TCatt @steve_rushton_

Thank you to the following people and groups for their time in helping to shape our research and provide invaluable feedback and points of view: Megan Waugh, Marini Thorne, Rachel Collinson, Kate Hardy, Tom Gillespie, Focus E15 campaign.

About Research for Action Research for Action is a workers’ co-operative that produces research to support social, economic and environmental justice issues and campaigns. Through in-depth investigations into vested interests and corporate power as well as researching alternative economic and democratic models, Research for Action produces informative, reliable and accessible material for the general public, the media, civil society and grassroots organisations to help strengthen their activities in bringing about long lasting change. @Research_Act http://researchforaction.uk info@researchforaction.uk