Second Report - The Cost of Living

The reset of Local Housing Allowance to cover the 30th percentile of rents was a welcome intervention at the start of the COVID-19 pandemic, but the increase has since been eroded by rising housing costs. Some parts of the country … Read more The reset of Local Housing Allowance to cover the 30th percentile of rents was a welcome intervention at the start of the COVID-19 pandemic, but the increase has since been eroded by rising housing costs. Some parts of the country are experiencing acute shortages of affordable housing, and we have heard this is leaving some unable to move on from temporary accommodation. DWP should work with other Departments to make housing more affordable for those on low incomes, as it did in 2020. This must include an increase to Local Housing Allowance to ensure that it supports people on low incomes to access secure, affordable housing in their local area. (Paragraph 31) Benefit cap Show less

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We welcome the decision by the Government to exempt the cost of living payments from the benefit cap so that those most in need of support can receive it. This decision suggests, however, that the Department knows that the cap … Read more We welcome the decision by the Government to exempt the cost of living payments from the benefit cap so that those most in need of support can receive it. This decision suggests, however, that the Department knows that the cap is set too low to effectively cover households’ now spiralling costs of living. Regardless of the changes made when the Fixed Term Parliaments Act was repealed, it was clearly not the intention of the original legislation that the benefit cap go more than six years without even being reviewed, let alone adjusted for inflation. The benefit cap should be reviewed urgently—and certainly no later than the end of 2022—to ensure it is in line with average household incomes and increasing rent/energy/food costs—the results of this review should be published. Furthermore, the cap must be uprated this year. (Paragraph 39) Deductions Show less

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The Committee welcomes the Government’s swift action and range of measures introduced in response to the cost of living crisis. It is clear that these will offset some of the increased costs for households living in poverty. However, we have heard very concerning evidence about the impact of the crisis …

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