The government will lift the freeze on Local Housing Allowance rates, meaning the amount of housing benefit received is set to rise by £10 per month on average. Rates will rise in line with the Consumer Price Index, which is currently around 1.5%.
Will Quince, parliamentary undersecretary of state for welfare delivery, said in a statement: “Ending the freeze to LHA rates ensures we are continuing to support the most vulnerable in society. And, as announced at the Spending Round in September 2019 there will be an additional £40m in Discretionary Housing Payments for 2020/21, to help affordability in the private rented sector.”
However David Cox, chief executive of ARLA Propertymark, said that the changes don’t go far enough: “When LHA was first created it allowed low-income families the ability to afford half of all private rented sector accommodation. However, due to successive cuts and the freeze, this number has dropped to less than 10% in most parts of the country. While any increase is welcome, this uplift does not go far enough. Ultimately, the government has missed an opportunity here to really help vulnerable and lower-income tenants.”
Meera Chindooroy, policy and public affairs manager at the NLA, added: “While we are pleased the government will finally end the freeze on LHA rates, an inflation-based increase is insufficient to address the shortfall between LHA levels and market rents in many areas. The financial support offered by the government is simply not enough for many tenants to cover their rent.”