Cross-party group considers the future of Local Housing Allowance

The NRLA joined a meeting of the Cross-Party Group (CPG) on rented housing and leasehold properties last week to discuss Local Housing Allowance (LHA) and how it can best support households in Wales.

Chaired by Mike Hedges MS, the group explored the effects of the LHA freeze on renters’ access to housing and the need to ensure that an incoming government commits to annual alignment of LHA to market rents. A recent report from the UK Government’s Work and Pensions Select Committee called on the Government to peg LHA to the 30th percentile of rents, however there was consensus at the meeting from organisations including the Bevan Foundation and Chartered Institute of Housing (CIH) Cymru that alignment with the 50th percentile of rents would open up far greater choice for tenants.

Having campaigned for LHA to be unfrozen, the NRLA welcomed the UK Government’s decision to realign LHA rates with the 30th percentile in April 2024, but this is not a problem resolved. An incoming UK government must end the cyclical uncertainty of LHA alignment and consider housing costs as part of living cost benefits and commit to uprating LHA in line with market rents to provide certainty for tenants and landlords.

Though less of an issue in Wales, the impact of the benefit cap must also be assessed. The cap means some households will not feel the full benefit of the LHA rate adjustment and an increasing number of organisations are calling for the cap to be lifted. An incoming government must review the interaction between LHA rates and the benefit cap to ensure support reaches those who need it the most.

The CPG provides a forum for Members of the Senedd (MSs), housing sector representatives and other stakeholders to debate housing policy in Wales. More information, including details of previous meetings, can be found here.