Changes to the Local Housing Allowance scheme
The Government is making changes to the way in which Housing Benefit is calculated for private rented sector tenants whose claims are assessed under the Local Housing Allowance rules. These changes started to come into effect from 1 April 2011.
What is changing?
- The £15 weekly Local Housing Allowance excess provision will be removed
- There will no longer be a five bedroom Local Housing Allowance rate
- The maximum level customers can get will be for a four bedroom property
- There will be an overall weekly maximum Local Housing Allowance rate for each category of property as follows:
£250 - 1 bedroom
£290 - 2 bedroom
£340 - 3 bedroom
£400 - 4 bedroom
- Local Housing Allowance rates will be set at the 30th percentile instead of at the median as currently
- The size criteria for private rented sector properties will include an additional bedroom where a customer or their partner has a need for overnight care that is provided by a non-resident carer
- There will be transitional protection for up to nine months for most existing customers who see a reduction in their Local Housing Allowance rate
The changes in more detail
Removal of £15 excess
Currently, some customers, whose rent is lower than the Local Housing Allowance rate for their size of home, are getting an additional payment of up to £15 per week included in their Housing Benefit. This additional payment will stop from the first claim anniversary date on or after 1 April 2011. This means that for these customers the amount of Housing Benefit that they get will go down.
Removal of the 5 bedroom rate
There will no longer be a 5 bedroom Local Housing Allowance rate. The maximum level that customers will be able to get is for a 4 bedroom property. Customers currently getting Housing Benefit paid at the 5 bedroom Local Housing Allowance rate will have their Housing Benefit reduced to the 4 bedroom rate from the first claim anniversary date on or after 1 April 2011. However, this change may be deferred for a further 9 months from the claim anniversary date see When will these changes affect me? below
Overall weekly maximum LHA rate for each property size
There will be an overall cap on the 1, 2, 3 and 4 bedroom Local Housing Allowance rates so that the maximum Housing Benefit that anyone can get on each of these bedroom sizes is restricted to the following rates;
£250 - 1 bedroom
£290 - 2 bedroom
£340 - 3 bedroom
£400 - 4 bedroom
For existing customers, the caps will take effect from the first claim anniversary date on or after 1 April 2011. However, this change may be deferred for a further 9 months from the claim anniversary date - see When will these changes affect me? below
At the moment, this change is unlikely to affect customers in East Hampshire because currently all of our Local Housing Allowance rates are below the caps.
LHA rates set at 30th percentile
Local Housing Allowance rates are currently fixed at the mid point in the range of rents for properties within each area. This is changing and Local Housing Allowance rates will reduce to a lower amount so that about 3 in 10 properties for rent in the area should be affordable to people on Housing Benefit rather than 5 in 10 properties as now. The new rates will be at what is known as the 30th percentile.
For existing customers, the new rates will take effect from the first claim anniversary date on or after 1 April 2011. However, this change may be deferred for a further 9 months from the claim anniversary date - see When will these changes affect me? below
If you would like to compare the current rates against what the new rates are likely to be for where you live please follow the link below to the Valuation Office Agency website;
www.voa.gov.uk/lhadirect/LHA_percentile_rates.htm
Additional bedroom for non-resident carers
Currently there is no provision for the Housing Benefit assessment to include a room that is used by a non-resident carer staying overnight with a customer.
From 1 April 2011, there will be a new provision that permits an extra bedroom to be included in the Housing Benefit assessment for tenants in the private rented sector who have care provided by someone who lives elsewhere. This will apply where a customer or their partner has a need for overnight care and has a bedroom that is used by a non-resident carer or carers for overnight stays as part of caring for the customer or partner.
This change applies to all private rented sector tenants not just those whose claim is assessed under the Local Housing Allowance rules
Please contact the Benefits team if you feel that you might qualify for this extra help.
When will these changes affect me?
People making new claims for Housing Benefit from 1 April 2011 will be affected by the changes straight away.
Existing customers who are getting Housing Benefit on 31 March 2011 will not normally be assessed under the new rules until the anniversary of their claim occurring either on or following 1 April 2011.
However, these existing customers will also be entitled to have the changes deferred for up to a further 9 months from their claim anniversary date under the Transitional Protection arrangements.
The Transitional Protection period will normally last for 9 months. So, for example, if the next claim anniversary date was in June 2011, the changes would not take effect until March 2012.
The protection period will, however, end sooner if the customer either moves to a different property; or has a break in their claim; or has a change in household size that means they become entitled to a smaller category of property.
Where to go for more information
East Hampshire District Council’s Benefits team our contact details
Directgov who provides information on public service in one place including up to
date information on the Housing Benefit changes. You can get more information at www.direct.gov.uk
The Valuation Office Agency (VOA) is an executive agency of HM Revenue &
Customs and holds information on local housing allowance, fair rents &
council tax and many other related topics website www.voa.gov.uk
The Citizens Advice service provides a wide range of advice. To find your
local Citizens Advice Bureau, look in the phone book or Yellow Pages, or visit
their website at www.citizensadvice.org.uk or www.cas.org.uk for Scotland.
Shelter offers confidential housing, welfare benefits and debt advice through a
network of advice services; freephone Housing Advice Helpline on 0808 800
4444 8am-8pm Monday-Friday and 8am-5pm Saturday-Sunday and online at
www.england.shelter.org.uk/get advice or www.shelter.org.uk .