NRLA backs calls for annual review of housing benefits
Plans for an annual review matching housing benefits to real-life rents have been put forward by a Parliamentary committee, mirroring calls from the NRLA.
MPs on the Work and Pensions Select Committee have called for Local Housing Allowance rates to be ‘uprated’ on an annual basis – meaning they will be adjusted to cover the lowest third of rents in a given area.
Matching benefit payments to real-life rents would give claimants confidence their benefits will cover their rent, after a freeze at April 2020 levels left hundreds of thousands facing shortfalls.
LHA rates govern the maximum amount of support for rental payments that low-income private renters can get.
But while rates have been frozen, rents for new lets have increased by more than a fifth on average. This meant that just 5% of properties advertised for rent on property portal Zoopla, for example, have been affordable for benefits claimants.
The Government announced earlier this year that the freeze on rates would be lifted this April, but frozen again from next year.
The NRLA is one of a number of groups that spoke out against this, calling instead for an annual review to keep payments in line with rents.
Recommending this annual uprate, the Work and Pensions Select Committee said: “When and if claimants experience a shortfall in rent, this can impact other parts of household budgeting and erode income otherwise intended for daily living costs.
"The Government should make a commitment to uprate annually Local Housing Allowance so that it retains its value at the 30th percentile of rents in a Broad Rental Market Area.”
NRLA Chief Executive Ben Beadle said: “We welcome the committee’s call for housing benefit rates to be reviewed annually in line with housing costs. This has been a longstanding call by the NRLA and others.
“Too often the housing benefit system has left tenants and responsible landlords not knowing if rents can be covered from one year to the next. What should be a safety net has become a source of frustration and anxiety.
“All parties need to provide certainty for those reliant on benefits that they can keep a roof over their heads by ensuring rates permanently remain linked to market rents.”
More information
The NRLA’s written evidence to the inquiry can be accessed here. The transcript of the oral evidence provided by Ben Beadle, is available here.
