Thank you to all those who contacted me about Local Housing Allowance (LHA).
LHA is a critical element of people’s income, but I am concerned the Government has no consistent policy on how it should relate to real-world rents. Since 2010, Ministers have imposed a series of below inflation-increases and freezes to LHA rates and despite rising rents and cost of living pressures, they said LHA will remain frozen in 2023-24 for the third year in a row.
This is causing hardship for hundreds of thousands of families. According to the Institute for Fiscal Studies (IFS), the decision to freeze LHA in 2023-24 instead of increasing it in line with local rents will reduce support for nearly 1.1 million households by an average of £50 per month.
Increasing number of households are having to make up the difference between their rent and LHA, by reducing spending on other necessities such as food and heating or by getting into rent arrears, which puts them at risk of becoming homeless. We can see the consequences playing out in our communities with rough sleeping on the rise, growing poverty and homelessness services stretched to breaking point.
The IFS has warned that the freeze will also lead to increasingly “large and arbitrary” regional variations in the support available because of differences in rent growth. While some families will see little change in the share of housing costs they have to pay, others will be covering much more than previously.
The freeze to LHA rates will therefore not only undermine living standards when families are already struggling but will also lead to increasing inequalities between different areas.
I want to see a serious plan from Ministers to keep people in their homes and get a grip on unaffordable rent rises. I support calls on the Government to introduce a Renters’ Charter that includes an end to automatic evictions for rent arrears, four month notice periods for landlords, and a ban on section 21 ‘no fault’ evictions, which currently allow landlords to evict tenants with little notice and minimal justification.