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Tenants told to make up Housing Benefit shortfall

September 30 2010
Cut may affect 80k households in the West Midlands

The coalition government has announced cuts of £1.8 billion to housing benefits, with changes to Local Housing Allowance (LHA) due to take effect in October. LHA is the benefit paid to tenants in the private rented sector. According to an impact assessment conducted by the Department of Work and Pensions, the reduced benefit is likely to affect every one of the 80,140 households that rely on it in the West Midlands.

With absolute caps to be introduced to the LHA and allowance rates being calculated differently, less housing benefit will be paid out for the same accommodation, and tenants will have to pay the difference. In the West Midlands, the changes are likely to cause an average loss of £520 a year to housing benefit, which will decrease by £10 a week.

Homeless charities have reported a significant increase in the number of people accessing their services over the last year, and the changes to housing benefit are likely to put further strain on vulnerable groups. As many of these tenants are unemployed, it is feared that the changes will lead to rent arrears, an increase in debt and people being forced out their homes, ultimately increasing levels of homelessness.

Leslie Morphy, chief executive of Crisis, pointed out that the changes are counter-productive: "The cost to society of somebody who has lost their home is huge compared to keeping someone in accommodation". Politicians are failing to protect the most vulnerable, despite their promises, so Homeless Link is asking them to sustain current levels of investment in homelessness support and services to ensure that those who want to help, actually can.

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