Local Housing Allowance Freeze

November 2017

Reforms to Housing Benefit are a central part of the Government’s plan to create a welfare system that supports the most vulnerable and is also fair to taxpayers. Around £24 billion a year is spent on Housing Benefit to support people with their housing costs, with over £800 million in Discretionary Housing Payments provided to local authorities to help support vulnerable claimants.

In addition, I am assured that around 30 per cent of potential savings from the LHA freeze will be used to create further Targeted Affordability Funding to help tenants in those areas where local housing allowance rates have diverged the most from local rents. I welcome that this has already been used to increase 48 LHA rates by 3 per cent in areas with high rental costs this year. I understand that further funding will be available for this purpose in 2018-19 and 2019-20.

The government believe the key to improving affordability in the private rented sector across England is to build more homes. That is why the Housing White Paper, which was published in February this year, outlined an ambitious plan to boost the housing market and build more homes. This includes getting the right homes built in the right places, speeding up house building, and diversifying the market. The Prime Minister also recently announced an increase in the affordable housing budget by £2 billion to more than £9 billion.