Ipswich Unemployed Action.

Campaigning for Unemployed Rights.

As Rents Rise and People Risk Homelessness: End the Freeze on Local Housing Allowance!

with 33 comments

Housing benefit freeze leaving poorest private renters with shortfall of up to £140 a week

Low-income tenants in the private rented sector face a “heat, eat or pay rent” problem because housing benefit rates have failed to keep up with the soaring cost of accommodation, a study has found.

The benefit freeze is not just affecting people’s ability to pay bill, or to buy food in the shops (where massive price rises are predicted on basics)

Welfare Weekly reports,

Research from the Chartered Institute of Housing (CIH) reveals that more than 90% of Local Housing Allowance (the equivalent of housing benefit for private renters) rates across Great Britain are insufficient to cover even the cheapest rents, as they were originally designed to do.

LHA rates were frozen for four years in 2016 and CIH is warning that they have fallen so far behind even the cheapest rents that private renting has become unaffordable for most low income tenants – putting them at risk of homelessness as they are forced to choose between basic living expenses and paying the shortfall. The organisation is calling on the government to review the policy and to end the freeze immediately.

LHA rates are meant to cover the cheapest 30%t of homes in any given area. But they haven’t been increased in line with local rents since April 2013 and they remain frozen until April 2020.

As a result, renters are facing gaps ranging from £25 a month on a single room in a shared home outside London to more than £260 a month on one to four-bedroom homes in some areas of London.

Over 12 months, those gaps rise to £300 and £3,120 – making it increasingly likely that renters will be forced to choose between paying for basic necessities like food and heating or their rent.

The government introduced targeted affordability funding in 2014 to bridge the biggest gaps but CIH’s new report has found that its impact has been negligible, covering only a handful of the shortfalls completely.

CIH chief executive Terrie Alafat CBE said: “Our research makes it clear just how far housing benefit for private renters has failed to keep pace with even the cheapest private rents.

“We fear this policy is putting thousands of private renters on low incomes at risk of poverty and homelessness.

“We are calling on the government to conduct an immediate review and to look at ending the freeze on Local Housing Allowance.”

Matt Downie, director of policy and external affairs at Crisis, said: “This report highlights just how much housing benefits for private renters are falling short of the levels needed, leaving many homeless people stuck in a desperate situation and putting yet more people at risk of homelessness.

“There are 236,000 people across Britain experiencing the worst forms of homelessness – this includes those sleeping on the streets, living in unsuitable hostels, and sofa-surfing. In many of these cases, people simply can’t find a home because there isn’t enough social housing and housing benefits are too low to cover private rents.

“Homelessness is not inevitable – there is clear evidence that it can be ended with the right policies in place. The government must urgently reform housing benefits for private renters, so they not only match the true cost of renting but also keep pace with future rent changes.”

There is some serious research behind this: MISSING THE TARGET? Is targeted affordability funding doing its job?

What are the consequences of the uprating freeze for private renters?

• Tenants are expected to make up any gap out of their jobseeker’s allowance (JSA) (or other basic benefits) even though basic benefits don’t include an allowance for rent. Basic working age benefits are also subject to the uprating freeze and are now only worth 93 per cent of their 2012 value.

• Single people aged under 25 only get the shared accommodation rate and a lower rate of JSA (£57.90). On average they are expected to contribute 10 per cent of their JSA on the gap (equivalent to a 17 per cent contribution in real terms).

• Young jobseekers’ resilience is severely limited because the basic benefit allowance for this group

 

Background: the local housing allowance and uprating policy (2008-2020)

How LHA rates become misaligned with local rents

• In April 2008 the government introduced the local housing allowance (LHA) which set a maximum rent that housing benefit can cover for private tenants. The LHA is the rent figure which a set percentage (currently 30) of all of the rents in that market fall below (‘the 30th percentile’) – ensuring that same percentage of homes is affordable to low income households.
• For each of the 192 distinct local housing markets across Great Britain there are five LHA rates, one for each category of dwelling (e.g. shared accommodation, one bedroom, two bedrooms etc.). Each LHA rate is calculated using a database of rental market evidence compiled by rent officers (professional valuers who work for Her Majesty’s Revenue and Customs in England or the devolved governments in Scotland and Wales).
• In April 2013 the link with local market evidence was broken and henceforth (for an unspecified period of time) existing LHA rates were uprated by the consumer prices index (CPI) or a lower figure set by the government. From April 2014 for two years the uprating index was capped at one per cent, and from April 2016 LHA rates were frozen for four years.
• Over the medium to long term rents tend to rise faster than prices (i.e. CPI), so that from April 2013 when the link with local rents was broken, the LHA’s purchasing power receded and this has accelerated during the one per cent cap and the current freeze.
• From April 2014, to ensure that LHA rates remain reasonably well aligned with local rents, the government introduced targeted affordability funding (TAF). Under this policy a proportion of the savings that accrue from uprating by one per cent or zero instead of CPI is awarded to those LHA rates that have the lowest percentile value (i.e. cover the smallest proportion of the whole range of rents that are paid in that market).

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Written by Andrew Coates

August 30, 2018 at 11:38 am

33 Responses

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  1. This post is personal to me the shortfall in my rent + bedroom tax takes 80% of my PIP; basically I am forced to not be Personally Independent and keep a roof over my head!

    jaynel62

    August 30, 2018 at 12:43 pm

    • We need to absolutely shout about these injustices

      Andrew Coates

      August 30, 2018 at 3:40 pm

      • We can shout until we are blue in the face it won’t make any difference because nobody gives a damn about benefit claimants.

        Violet

        August 30, 2018 at 6:04 pm

      • People do though, people like me.

        whoknew

        August 31, 2018 at 11:53 am

  2. Unmarried mother Siobhan McLaughlin wins Supreme Court benefit case
    https://www.bbc.co.uk/news/uk-northern-ireland-45355028

    superted

    August 30, 2018 at 4:28 pm

    • Good for her.

      Violet

      August 30, 2018 at 6:06 pm

    • It won’t make any difference though unless the law is changed and the current government is so shameless they could simply ignore the supreme court and leave everything as it stands. Aparently they think that treating cohabiting couples worse than married couples will “encourage” people to get married.

      Neil Milbourne

      August 31, 2018 at 11:17 am

  3. Reblogged this on sdbast.

    sdbast

    August 30, 2018 at 6:36 pm

  4. But it’s supposed to be like this. They cut the Housing Benefit to make people work. Duncan Smith always believed that if HB paid a full market rent, and people also got their weekly JSA on top. They wouldn’t need to work, so they wouldn’t want to work. Same with Universal Credit today. Poverty deliberately created as a whip to drive the reluctant into work.

    John Taylor

    August 30, 2018 at 8:37 pm

    • Thing is it’s not just the reluctant and the work shy but the sick, disabled, working-age elderly, isolated people, men and women living in places with few or no opportunities – all sorts of different kinds of innocent and needy people struggling and in difficulty through no fault of their own. George Osborne, a politician who came as close to true evil as I ever saw, is the person who made what was bad even worse by increasing the severity of cuts, caps, reductions and freezes in respect to benefits in order to make savings to give tax cuts to win elections. Osborne was so bad that he spurred the absolutely diabolical Iain Duncan Smith to resign and accuse his own party of hammering the poor because they don’t vote Conservative and can therefore be treated like dirt without political cost.

      It was bollocks coming from him of course although actually true generally.

      In reality George Osborne and Lord David Freud were much worse than IDS unbelievable as it sounds.

      Neil Milbourne

      August 31, 2018 at 7:45 am

      • Council tax reduction is a disgrace and should be totally abolished,penalising the poor is not moving forward only backwards.Purely political tightness as a something for nothing being addressed.

        ken

        August 31, 2018 at 2:03 pm

      • True that. When Thatcher brought in the Poll Tax they added an “average” increment to benefits to help people pay it. Eric Pickles brought in the “localism” farrago where councils were given the power to raise tax locally to pay for services and was “surprised” when cash strapped councils, something like 60% of what they used to get as a grant from central government has been cut now, decided to levy a minimum charge, usually 25%, in respect to council tax making people who never paid it before pay it for the first time.

        It is a disgrace but won’t change unless central government funds councils better from the centre.

        Neil Milbourne

        August 31, 2018 at 4:38 pm

      • On Council tax, not only was there not rise in benefits to cover the charge we pay now, but as it goes up benefits are still fixed.

        Will they end up like some medieval alms for the poor, Maundy Money, with no ordinary cash value at all?

        Andrew Coates

        August 31, 2018 at 4:53 pm

      • Next year, if they go ahead with it, the government will start “migrating” people receiving any of the six “legacy” benefits – Income-Based Job Seeker’s Allowance (JSA), Income-Related Employment and Support Allowance (ESA), Income Support, Working Tax Credit, Child Tax Credit, and Housing Benefit – onto Universal Credit. People affected will be “informed”, presumably by letter, that they have three months in which to apply for Universal Credit before their benefits are stopped; if they apply online for Universal Credit within the three month “window” they should begin receiving their (probably lower) entitlements, on a monthly basis, via the full digital service system of Universal Credit and experience different levels of “conditionality” based on their circumstances.

        If they government push on with this, and they might while Esther McVey is in charge, the suffering and chaos resulting will be massive and much worse than anything we have seen so far. I am on Universal Credit, hate it and find it difficult and can hardly bear to think of old age pensioners currently receiving housing benefit transparently on an automatic basis being forced to create a Universal Credit account for themselves online and use it to manage heir claim for the “Housing Element” of Universal Credit, UC’s version of Housing Benefit destined to be subsumed into UC, and having to pay to their rent to their landlord directly for the first time.

        The word “tragedy” springs to mind.

        Neil Milbourne

        September 1, 2018 at 9:33 am

      • Very well summarised.

        We really have to push on this issue.

        Suggestions?

        Andrew Coates

        September 3, 2018 at 12:01 pm

      • Since it hasn’t happened yet all people can do is to try to flag up and expose what’s in the pipeline so people realise what’s coming. Publicity and protest is the only thing I can think of that anybody can do in advance of something happening even though, based on what has happened and is happening more and more, we all have a very good idea of the difficulty and misery that Universal Credit has already caused to so many claimants.

        Ten years ago a policy as bad and harmful as Universal Credit would have brought down the government responsible. These days, temporarily, Brexit seems to be acting like a smoke screen hiding the scandal of Universal Credit from the general public and gobbling up media interest. Eventually, as the numbers of people suffering under the yoke of Universal Credit increases nobody will be able to ignore it, Brexit or not, although by then many hundreds of thousands of people will have had their lives convulsed and even ruined by it.

        The government’s £214,000 investigation into the causes of escalating food bank usage doesn’t report for over twelve months (October 2019). How daft can these people be? Why food banks? well, let’s see… um… all working-age benefits frozen for FOUR YEARS even though inflation and rents are rising, cash strapped councils forcing benefit claimants to pay council tax from monies never designed to meet such expenses, draconian sanctions regime with people set up to fail from the get go, long delays in receiving entitlement driving the poorest and most needy applicants into debt and rent arrears by design, with 30% of Universal Credit recipients already suffering up to 40% of their entitlements deducted from benefits, before they get them, by the DWP, in order to pay off advances, rent arrears and other debts like utility bills and such like.

        Why waste a couple of hundred thousand pounds to find out why more and more end up at food banks?

        Isn’t it obvious?

        Neil Milbourne

        September 3, 2018 at 3:21 pm

      • Just one of many examples: tomatoes rising from 69p to 75p. That is an 8.7% increase! All these price rises are adding up. The rising cost of living set against a backdrop of benefit ‘freezes’.

        The Savvy Shoppers

        September 4, 2018 at 10:41 am

  5. Blairite Frank Fields sinks knife into Corbyn.

    Violet

    August 31, 2018 at 12:49 pm

    • Well Frank was a Conservative party member for years before leaving (over apartheid) and joining Labour. He’s always been a Tory at heart. When Tony Blair asked him to look into welfare and “think the unthinkable” one of Frank’s dafter thoughts was to get people to sign-on at Jobcentres four times a day to make sure they weren’t moonlighting! His ideas were so unworkable and extreme that Tony sacked him. Field is right about Labour making a rod for its own back by not stamping out anti-Semitism quickly, but full of shit when it comes to social security. It wasn’t so long ago that he was congratulating Iain Duncan Smith for Universal Credit!

      Neil Milbourne

      September 3, 2018 at 3:26 pm

  6. Andrew Coates

    August 31, 2018 at 4:12 pm

    • A DWP spokesperson said: “Universal Credit replaces an out-of-date, complex benefits system that often trapped people in unemployment. Universal Credit provides claimants with more sanctions than the out-of-date, complex benefits system so as to force them them into low paid and or iinsecure work.

      whats new

      September 4, 2018 at 10:19 am

  7. Reblogged this on Britain Isn't Eating!.

    A6er

    August 31, 2018 at 5:20 pm

  8. Andrew Coates

    September 3, 2018 at 3:37 pm

  9. Footballer’s son (Argyll, son of Ally McCoist) leaves man with fractured skull and bleeding on the brain after ramming into him after running a red light in his uninsured sports car and walks from court with 280 hours of unpaid work in the community. Jeez, back in the day the unemployed could be sentenced to 900* hours of unpaid work not necessarily in the community for the ‘crime’ of being unemployed. And this was REAL work like toiling in recycling plants or sorting through shitty knickers in so-called ‘charity shops’ not the Mickey Mouse joke that ‘Community Payback’ is. The most ‘work’ you will do on ‘Community Payback’ is brush a few leaves. Oh, and you get a full lunch thrown in, even though you are only their for a few hours. On ‘Community Payback’ you also spread your hours over a period of years. On the DWP workfare schemes (MWA/CWP) you worked full-time. And lunch? You must be joking! No wonder the Supreme Court declared these schemes illegal.

    http://www.heraldscotland.com/news/16685724.ally-mccoists-son-sentenced-for-high-speed-hit-and-run

    *The maximum number of hours of ‘Community Payback’ open to the courts is 300 hours. ‘Community Payback is also a direct alternative to custody.

    Aggy

    September 4, 2018 at 4:36 am

    • Given that as with any court case we don’t know the full facts (except that the offender’s father is the son of very rich ex-footballer) and only the judge is privy to all the information, and notwithstanding it’s a derisory sentence compared to the exemplary punishments handed down to the unemployed by Jobcentre ‘judges’ for the most trivial of ‘offences’ often times just for being unemployed it is still a ‘light’ sentence compared to anyone’s standard.

      The worst part of the sentence though is the driving ban (no doubt he will be appealing this decision in an attempt to get his licence back early). Having to re-sit his driving test would have been a far worst punishment that this ‘community payback’ nonsense. Noting that amongst the charges he we convicted of driving whilst uninsured it is reasonable to wager that he was uninsurable at the time. These convictions only make him even more un-uninsurable. Probably not even rich dad could afford the premiums. So we won’t be seeing Argyll McCoist on the roads – at least legally – anytime soon. And if he is caught whilst banned an uninsured especially after a dangerous driving conviction he can expect to have the book thrown and him.

      Wonder what the ‘Nazi pug’ guy now rotting behind bars for posting a video on youtube is thinking, or the fellow Scotchman who received four years in a Scotch dungeon for posting the ‘riot in the toon’ comment on Facebook. Or indeed the TV and radio stars of the 70s who received lengthy custodial sentences for a bit of ‘arse-slapping’. Not to mention fellow Scotchman Alex Salmond who should expect to receive a far harsher sentence if he is ever convicted of what he has been accused of even though Salmond has not been accused of almost killing anyone and putting them in hospital for three weeks. Law and justice, not quite the same thing, eh?

      Law and Order

      September 4, 2018 at 10:10 am

    • Cases this this only serve to highlight how ridiculous utterly abhorrent and pure criminal the DWP now declared illegal workfare schemes were!

      CWP Victim

      September 4, 2018 at 10:17 am

    • The 280 hours of unpaid work will look good on Mr McCoist’s CV though 😀

      The Joker

      September 4, 2018 at 10:20 am

    • spoilt brat syndrome if u know wot i mean like innit

      romeo beckham

      September 4, 2018 at 10:33 am

    • Spare the rod and spoil the child!

      Miss Lumley

      September 4, 2018 at 10:35 am

    • No insurance company in their right mind would underwrite a 21-year-old driver of a sports car.

      Loss Adjuster

      September 4, 2018 at 10:47 am

    • Government workfares were never about ‘helping claimants into work*’. As Herr Iain Duncan Schmidt himself explained the real purpose of workfare was to “break claimants down so that when they returned to the Jobcentre they were ready to re-engage with their advisor”.

      *CWP (Community Work Placement) was part of George Osborne’s laughable ‘Help to Work’ scheme.

      Oskar Schindler

      September 4, 2018 at 12:48 pm

  10. A Lament to JSA

    I’ve been given my notice now.
    My transfer date to Universal Credit
    is in a month’s time.
    I come here to my former, now closed down Jobcentre and imagine
    that this is the spot
    where
    everything I’ve lost since
    my childhood has washed up.
    I tell myself
    if that were true,
    and I waited long enough,
    then a tiny bald-headed figure
    would appear on the horizon
    across the field next to where the Jobcentre car park once stood
    and gradually get larger
    until I’d see it was Iain Duncan Smith.
    He’d wave
    and maybe call.
    I don’t let the fantasy
    go beyond that.
    I can’t let it.
    I remind myself
    I was lucky to have had
    any time on JSA at all.
    What I’m not sure about
    is if our lives have been
    so different from the lives
    of the people who don’t sign on.
    We all complete.
    Maybe none of us
    really understand
    what we’ve lived through
    or feel we’ve had
    enough time.

    Kathy

    Kathy

    September 6, 2018 at 5:14 pm

    • A sad, all too true, heartfelt expression of feeling.

      Andrew Coates

      September 7, 2018 at 3:29 pm


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