Much fanfare, and the news that Local Housing Allowance is going up.
And that's a good thing, Yes?
Well, yes... and no, and nearly!
What does that mean?
Our Sue sits down with a coffee, and with a little help from the Shelter Blog tries to make sense of what's happening.
April increase
Yes, the Local Housing Allowance is finally going up in April. Which is a great headline, but in real terms, how much will it mean to those who rely on it to cover their private rental costs? Well, it goes up in line with CPI, the Consumer Price Index. This currently stands at 1.7%, so the increase will be very small, and make little difference to those already juggling to make ends meet.
It was a great headline during the Election -
"We will tackle rough sleeping and homelessness"
But without affordable homes available to rent, and with a dearth of social housing, in the real world the options are limited.
The LHA should make finding a suitable home that is affordable and available a real possibility, but on current allowances the market is very limited. Without a reasonable increase, it is almost certain that levels of homelessness will continue, and are likely to rise.
How does this LHA work then?
Well, Government Policy was to set the LHA to cover the bottom third of local rental markets across the country. Those claiming it should receive just enough to get by in the private rental market.
But - and there is always a BUT...
There has been a freeze on the allowance, and various other cuts since its introduction. The result? LHA rates don't cover the bottom third of rents in 97% of the country. In fact in 32% they don't even cover a tenth.
So the LHA is out of touch with the rental market.
What does that mean then?
People getting the LHA face huge shortfalls between the rent they pay and the LHA they can claim. The result? Arrears and eviction is the worst case, or juggling heating, rent and food for many.
The 1.7% increase is suggested to increase payments by, on average £10 a month. According to research by Shelter, for many on low or no income, the current shortfall between LHA and their rent each month is on average £113. £10 isn't going to bridge that gap.
What do you do in that position? Use other benefits to help pay the rent? Cut back on food for yourself so the kids can eat? Walk the 4 miles to your zero hours contract job - and 4 miles home? Turn off the heating? Eat cold beans from the can, cos you can't afford to cook? Take a payday loan?
It's a precarious existence, usually resulting in rent arrears and debt, and finally you face eviction and homelessness.
So. Sorry Government, this 1.7% increase clearly isn't enough.
As Shelter say "... the only way to ensure the availability of housing is adequate for those claiming LHA is to lift the rates back up so that they cover at least the bottom 30% of rents."
Food for thought? More of a call to action I think!
(Rents in England rose 14% April 2012 to November 2019
Index of Private Housing rental prices, Monthly estimates)
Information taken from the Shelter blog, written by Steph Kleynhans
(c) Shelter 2020.
You can find Shelter on Twitter @Shelter
Subjects for our blog are chosen and adapted by Sue, our volunteer @beanies_masato
