It’s been almost a year and a half since Local Housing Allowance was rolled out to the whole country. This was quite a big change to the Housing Benefit system in relation to the private sector, which changed the focus of deciding reasonable rents from valuing particular properties to looking at how families are set up. Rates are set each month based on the average rent in local areas for properties with between 1 and 5 bedrooms and this is the maximum amount the Local Authority are able to cover depending on the number of bedrooms a claimant is considered as requiring. This does offer more structure and certainty because everybody knows exactly how much Housing Benefit they could potentially receive before committing themselves to a Tenancy Agreement and can search for properties to rent with a budget in mind.
However, not everyone can feel the benefit of this new scheme. There are a large number of people who have become ‘stranded’ on an old Housing Benefit claim from before the new rules were introduced who would be better off if they were on the new scheme. To date there has been no way in which these claims can be seamlessly transferred from the old rules to the new rules and this is leaving some people in a worse position just because of the date they claimed Housing Benefit. The only way these people can get the extra help Local Housing Allowance would provide is to create a break in their claim, which in practice means either moving to a different property or giving up their Housing Benefit for a week then making a new claim under the new rules. This would immediately leave them with a week of rent to pay by themselves, which can be impossible for people on benefits. Any less of a gap and their new claim would treated as a continuation of their old one and they would be no better off.
Surely people should be given the choice whether or not to make use of Local Housing Allowance, especially in these hard times. However, so far these calls have remained unanswered. Anyone who finds themselves in this position should consider seeking advice as to whether it would be worth trying to switch to Local Housing Allowance.
By Steven Higham