REFORMS to cut housing benefit from council and housing association tenants with spare rooms - branded a bedroom tax by critics - have saved taxpayers £1 million a day since they were imposed a year ago, according to the Department for Work and Pensions (DWP).

On the first anniversary of the controversial cutback, the department released figures showing that almost half a million households were having cash deducted from their benefits.

Under the new rules, social housing tenants deemed to have one more bedroom than they need lose 14% of their eligible rent and those with two or more lose 25%. DWP figures showed that in November 2013, 498,000 social housing tenants in England, Scotland and Wales were having their benefits reduced under the policy.

Loading article content

Changes to housing benefit in the social rented sector are expected to save £490m in 2013/14 and a total of around £1 billion by the end of 2014/15, equating to more than £1.3m per day, the DWP said.

However, the Scottish Federation of Housing Associations said social housing providers were facing spiralling costs and falling revenues due to the Westminster Government's reforms and branded the policy "unfair and incompetent".

Maureen Watson, the organisation's head of policy, said: "Whilst taking a cautious view in our modelling, we have still arrived at an overall cost of the bedroom tax for Scottish housing associations and co-operatives of almost £80m over three years.

"This will, ultimately, drive up rents and, ironically, increase the cost of the housing benefit bill for the UK Government."