Local Housing Allowance 2022-12-05
2022-12-05
TAGS
Response quality
Questions & Answers
Q1
Partial Answer
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Context
The local housing allowance (LHA) is a critical lifeline for tenants needing assistance with housing costs, especially in Liverpool Walton where it faces significant challenges.
What assessment has the Department made of the potential impact of real-term reductions in local housing allowance rates on levels of poverty?
First, on behalf of the whole House, may I welcome the hon. Member for City of Chester (Samantha Dixon) to this House, and wish her every happiness and a productive time in the House? The Government have maintained the uplift they provided in the local housing allowance in 2020, at a cost of almost £1 billion, targeting the 30th percentile of rents. Those who need assistance with housing costs also have recourse to the discretionary housing payments administered by local authorities.
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Assessment & feedback
The specific impact on poverty levels was not addressed
Welcoming A New Mp
Response accuracy
Q2
Partial Answer
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Context
The government has frozen the Local Housing Allowance (LHA), a critical support for tenants in Merthyr Tydfil, despite raising other benefits to match inflation.
Why have they chosen to freeze the local housing allowance, which will have a disproportionate impact on constituents in my constituency of Merthyr Tydfil and Rhymney? Will he commit to reviewing that situation urgently?
As the hon. Gentleman will know, annually I review all benefits, including LHA—indeed, around this time next year, I will do precisely that. It has to be borne in mind that we are currently spending almost £30 billion a year on housing allowance and that figure is expected to increase to around £50 billion by 2050, so there are cost considerations.
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Assessment & feedback
Urgent review commitment was not made
Cost Considerations
Response accuracy
Q3
Partial Answer
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Context
The freeze on the Local Housing Allowance (LHA) is causing more people to be priced out of the private rental sector, with only 4% of three-bedroom homes being affordable on LHA rates.
Will the Minister commit to annually raising the local housing allowance in line with inflation?
As I have just indicated, I will review that in just under a year. There are of course the discretionary housing payments, which are administered by local authorities for those who feel that they need additional support, and I also point the hon. Gentleman in the direction of the significant cost of living payments that we are providing at the moment to support those in most need.
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Assessment & feedback
Commitment to annual increase was not made
Direction Towards Other Forms Of Support
Response accuracy
Q4
Partial Answer
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Context
The Department has cut the funding for discretionary housing payments by 18% last year and a whopping 27% this financial year, affecting local councils in Wales.
Will the Secretary of State now commit to reversing that latest cut, so that local councils in Wales can at least offer some help to those in most dire need and avoid further evictions?
I would just say to the hon Lady that there is the household support fund as well, which she did not mention. That is there to provide support in the circumstances that she described, along with the discretionary housing payments that I set out and the fact that, in 2020, we did indeed raise LHA to be in line with the 30th percentile of local rents.
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Assessment & feedback
Commitment to reverse funding cut was not made
Mentioning Alternative Funds
Response accuracy
Q5
Partial Answer
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Context
A family in the cheapest three-bedroom home in Luton faces a shortfall of about £2,300 over the last year due to the freeze on Local Housing Allowance.
When the Secretary of State chose to freeze local housing allowance for another year, did he consider how that might make more and more families across the country homeless?
I did of course very carefully consider the points that the hon. Lady has made, just as I very carefully considered the extent to which there should be an uprating of benefits more generally; they went up by 10.1%—the level of the consumer prices index at that time. I also considered very carefully what the uplift in pensions should be and, again, that was 10.1%, the level of CPI. For pensioners, we also stood by the triple lock.
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Assessment & feedback
Specific consideration of homelessness impact not addressed
Consideration Of Other Benefits
Response accuracy
Q6
Partial Answer
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Context
In Liverpool, the shortfall between housing benefit and cheapest rents has risen to £1,360 over a year.
Does the Secretary of State recognise that high housing costs and completely inadequate housing benefit lie at the root of the cost of living crisis and that the choice for the Government should be between capping rents and raising support?
The hon. Gentleman rightly raises inflation, which we are all having to contend with at the moment. That is why my right hon. Friend the Chancellor came before the House at the time of the autumn statement and set out a clear plan as to how to bring inflation down. The Office for Budget Responsibility forecasts that it will be half its current level in a year's time. A large amount of support has been put forward, with the £650 cost of living payment this year to those low-income households that he describes, covering some 8 million people up and down the country.
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Assessment & feedback
Specific recognition of root causes not addressed
Plans For Reducing Inflation
Response accuracy
Q7
Partial Answer
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Context
Private renters on universal credit face substantial rent gaps, with 59% of them having rents above the local housing allowance maximum. This issue is exacerbated by rising homelessness.
I welcome my hon. Friend to her place. Fifty-nine per cent of private renters on universal credit—844,000 households—are facing substantial rent gaps above the local housing allowance limit. They either reduce spending on necessities or fall into arrears, risking homelessness. With homelessness rising and local authorities predicting increased costs, does the Secretary of State acknowledge that savings from freezing housing allowances are merely shifting to additional homelessness prevention grants? Is it time for a new approach?
The amount spent on housing and housing support is almost £30 billion annually, with a projected increase to £50 billion by 2050. The Government are providing substantial support in this area through local housing allowance and discretionary housing payments. For homelessness issues, we have introduced a £2 billion package.
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Assessment & feedback
The specific ask about recognising the shift of savings to additional spending on homelessness prevention grants was not directly addressed.
Broad Statements About Overall Support
Reference To Existing Packages Without Addressing The Funding Shift
Response accuracy