Brexit Noise Drowns Out London’s Cry for Help
(Bloomberg) -- In the heart of London’s theater district opposite the Savoy Hotel, with rooms for up to $800 a night, scores of people are lingering patiently on a balmy summer evening.
The snaking line near a branch of Coutts & Co., the bankers to the Queen, displays a portrait of contemporary London: men and women of all ages and ethnic backgrounds, some speaking English and some Polish amid a cacophony of other languages. Some are dressed smartly in shirts and trousers, others in jeans and baseball caps. One man is wearing a food delivery company uniform.
But they’re not there for a deal on tickets to a West End show or a table at Gordon Ramsay’s joint. They’re there for food handouts from a local charity.
Images of rich aside poor, homelessness and soup kitchens are hardly new in a city that inspired Charles Dickens and George Orwell, or even unique among major urban centers across the world. But in Britain today, they reflect a society under increasing strain as Brexit – the relentless quest to leave the European Union – drains the country’s political energy and focus from confronting other pressing matters.
Government policy making has been paralyzed, unable to address the causes of the disillusionment that led to 2016's vote for Brexit while eight years and almost 140 billion pounds ($184 billion) of spending cuts hit public services and social aid. In London, the wealth and glamour of Europe's most global city mask a struggling underclass in jobs that don't pay enough to afford the basics.
“I don’t have much food so I need to get it somewhere,” said Sean Gibson, 41, standing at the back of the line patiently waiting for his dinner from the pink marquee run by Friends of Essex and London Homeless.
He said he can’t earn enough to pay rent and eat as a courier for a food delivery company. At most, he says he was earning 960 pounds every six weeks in a city where average monthly rents are about twice that. “Half the rents here are 600 pounds and up. How can people afford that? It’s ridiculous,” he said.
Britain is increasingly a country of parallel universes.
Employment is at a record thanks to flexible work contracts like Gibson’s, the economy is healthy enough for the Bank of England to be raising the cost of borrowing, and absolute poverty rates are at record lows.
Yet a report by the Resolution Foundation think tank published on July 24 found living standards rose last year at their slowest pace since 2012. The recovery in incomes following the global financial crisis has even gone into reverse for the poorest 30 percent of families, it said. While London is the wealthiest region in northern Europe, the U.K. is also home to nine of its 10 poorest regions.
Public spending in Britain has fallen to about 38 percent of gross domestic product from 45 percent in 2010, according to figures from the Office for Budget Responsibility.
Research by charity Shelter found that 55 percent of homeless families in temporary accommodation are working. The 33,000 families represent an increase of 73 percent since 2013, according to the research based on freedom of information requests.
“Everybody’s fighting for themselves now,” Mohammed Nazir, the cabinet member for housing in Slough Borough Council on the fringes of London, said after a meeting in the U.K. Parliament about homelessness. “Social consciousness is rapidly disappearing.”
Prime Minister Theresa May, meanwhile, is battling daily to hold on to her leadership. Eight members of the government quit since she announced her Brexit road map earlier this month. Policy making has become fire-fighting as the clock ticks down to Britain’s formal departure from the EU in March next year.
There have been four different housing ministers in as many years. Policies to reduce homelessness and help provide security to a new generation of vulnerable workers are routinely overshadowed, according to Neil Coyle, an opposition Labour lawmaker who co-chairs parliament’s cross-party group on homelessness.
“We call it ‘neglexit,’” he said. “It’s when every other major policy issue is being neglected because of Brexit.”
The government had planned to unveil proposals in July to meet its 2017 pledge to halve the number of people sleeping on the street by 2022 and eradicate it completely by 2027. The Ministry for Housing, Communities and Local Government said it still aims to publish something over the summer.
Yet it’s unlikely any plan would account for the growing numbers like food courier Gibson who are sleeping on the sofas of friends and families or in bed-and-breakfast accommodation.
“It’s very difficult for us to judge if someone is or isn’t homeless because we’ve had people dressed quite nicely, and they make an effort,” said Steven Stuart who set up the Friends of Essex and London Homeless charity 18 months ago with his wife. “We think of homelessness as a man sleeping in a doorway under a blanket, but it’s on many levels now.”
Harriet, 21, an east London real-estate agent, fell into the ranks of the homeless when the lease on her apartment expired earlier this year. She then took to renting rooms through Airbnb for two months.
“I was living in horrible flats with four rooms and the others were rented out to people who were smoking joints in the kitchen or travelers,” said Harriet, who declined to be identified by her full name as she struggles to make ends meet. “I was constantly stressing about not finding a room.”
In London alone, the number of “hidden homeless” could be 13 times greater than the number of people on the street. As many as 12,500 people don’t have a fixed abode in the capital, though they aren't included in statistics.
Others use public transportation. The number of sleepers on night buses more than doubled to 213 by the winter of 2015 and 2016 from the same season in 2012 to 2013, according to the mayor’s office.
Single homeless people often have to rent from private landlords who are more likely to evict tenants that can’t keep up payments. Phil, who didn’t want to give his full name, now sleeps in the Westminster underground station, meters away from the Houses of Parliament. “You’re only one paycheck away from being on the streets,” he said. “A lot of people don’t realize it.”
©2018 Bloomberg L.P.