Local housing allowance re-freeze

#34 —

Welsh Affairs Committee

Recommendation: We call on the Ministry of Justice and prison leaders to prioritise timely notification of upcoming releases to local authorities and other relevant stakeholders, giving them the best chance to identify suitable accommodation among an already limited stock of options. …

Response Pending

#2 —

Housing, Communities and Local Government Committee

Recommendation: We believe rents are only affordable when they do not exceed one third of household income. There are numerous ways to define this income and other related factors and the Government should identify its preferred method, in consultation with the …

Gov response: The Government does not a prescribe a definition of affordability, it is a complex and ever-changing picture that is better understood and monitored at a local level. However, we recognise that the fundamental purpose of …

Under Consideration

#23 —

Housing, Communities and Local Government Committee

Recommendation: The Government should review its decision to freeze Local Housing Allowance rates by maintaining the 30th percentile in cash terms only, and instead keep rates indexed at the 30th percentile long-term. This will help households across England to afford their …

Gov response: This Government has provided an unprecedented package of financial support to protect renters whose income has been affected throughout the COVID-19 pandemic. To help prevent people getting into financial hardship, we increased the local housing …

Under Consideration

#8 —

Work and Pensions Committee

Recommendation: 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 …

Gov response: On 9 June 2022, the Prime Minister announced a package of measures to turn Benefits to Bricks and improve access to home ownership, including for households in receipt of benefits. This is a cross-Government effort, …

Under Consideration

#25 — Maintain Local Housing Allowance rates at 30th percentile of market rents annually

Housing, Communities and Local Government Committee

Recommendation: We recommend that the Government reconsider its position on re-freezing local housing allowance rates from 2025–26 onwards. Instead, the Government must maintain LHA rates at least at the 30th percentile of local market rents each year to ensure that those …

Gov response: 47. The Government understands the importance of stable housing and is taking action to increase access to affordable housing. Increasing the Local Housing Allowance (LHA), in recognition of increasing rents, is a key part of …

Not Addressed

#24 — DWP temporary accommodation subsidy remains below full costs; MHCLG's consideration unclear

Public Accounts Committee

Recommendation: DWP explained that it sets the subsidy level using a rate that has never covered local authorities’ full costs, to incentivise them in their procurement of temporary accommodation. MHCLG added that it considers local authorities’ financial position with regard to …

Gov response: 4.1 The government agrees with the Committee’s recommendation. Recommendation implemented 4.2 The Department for Work and Pensions wrote to Committee, on 21 February 2025, setting out its justification for the levels of Local Housing Allowance …

Accepted

#23 — Local authorities face rising 'Temporary Accommodation Subsidy loss' from outdated LHA rates

Public Accounts Committee

Recommendation: LHA rates also impact the amount that local authorities can reclaim as a subsidy from DWP for temporary accommodation costs. The amount that can be reclaimed depends on a number of factors, including the January 2011 LHA rate appropriate to …

Gov response: 4.1 The government agrees with the Committee’s recommendation. Recommendation implemented 4.2 The Department for Work and Pensions wrote to Committee, on 21 February 2025, setting out its justification for the levels of Local Housing Allowance …

Not Addressed

#22 — Freezing Local Housing Allowance rates amidst rising rents increases homelessness and evictions

Public Accounts Committee

Recommendation: It its written submission, Shelter made the case for permanently linking LHA rates to the real cost of renting. It suggested that freezing the LHA rate at a time of record rent increases would trap families in homelessness and 25 …

Gov response: 4.1 The government agrees with the Committee’s recommendation. Recommendation implemented 4.2 The Department for Work and Pensions wrote to Committee, on 21 February 2025, setting out its justification for the levels of Local Housing Allowance …

Not Addressed

#21 — DWP unable to quantify system-wide consequences of increasing Local Housing Allowance rates

Public Accounts Committee

Recommendation: We asked DWP what analysis it had done on the extent to which homelessness is impacted by LHA rates not allowing people to afford rents in their area. It explained that the decision, for example, to freeze the LHA rate …

Gov response: 4.1 The government agrees with the Committee’s recommendation. Recommendation implemented 4.2 The Department for Work and Pensions wrote to Committee, on 21 February 2025, setting out its justification for the levels of Local Housing Allowance …

Accepted

#20 — DWP acknowledges 45% of households face Local Housing Allowance shortfall amid rising rents

Public Accounts Committee

Recommendation: The LHA sets the maximum amount of housing support that claimants of housing benefit and universal credit can usually receive, to help with housing costs in the private rented sector.26 Since 2011, DWP has introduced welfare reforms designed to reduce …

Gov response: 4. PAC conclusion: We are not convinced that, in setting Local Housing Allowance (LHA) rates, the Department for Work & Pensions (DWP) has given due consideration to the impact on homelessness. 4. PAC recommendation: Alongside …

Accepted

#4 — Set out DWP's detailed justification for Local Housing Allowance rates and temporary accommodation subsidy.

Public Accounts Committee

Recommendation: We are not convinced that, in setting Local Housing Allowance (LHA) rates, the Department for Work & Pensions (DWP) has given due consideration to the impact on homelessness. Reforms to welfare benefits since 2011, including periodically capping and freezing LHA …

Gov response: The government agrees with the Committee’s recommendation. Recommendation implemented The Department for Work and Pensions wrote to Committee, on 21 February 2025, setting out its justification for the levels of Local Housing Allowance it has …

Accepted

#22 — Evaluate the link between welfare reforms, Local Housing Allowance, and homelessness prevention funding.

Housing, Communities and Local Government Committee

Recommendation: MHCLG and the Department for Work and Pensions must use the Inter- Ministerial Group as an opportunity to evaluate the link between welfare reforms and homelessness, particularly regarding LHA rates. We agree with the Government on the principle that, as …

Gov response: The Government currently spends around £34 billion annually on housing support including around £12 billion in the private rented sector. Local Housing Allowance (LHA) rates, which set the maximum level of support in the private …

Not Addressed

#21 — Re-freezing Local Housing Allowance rates risks undermining homelessness funding and increasing costs.

Housing, Communities and Local Government Committee

Recommendation: We are also concerned that the Government’s decision to re-freeze Local Housing Allowance (LHA) rates from April 2025 will undermine the impact of additional homelessness grant funding. We have seen compelling evidence that this is a false economy. Re-freezing LHA …

Gov response: The Government currently spends around £34 billion annually on housing support including around £12 billion in the private rented sector. Local Housing Allowance (LHA) rates, which set the maximum level of support in the private …

Not Accepted

#34 — Reconsider freeze on Local Housing Allowance rates and extend support for housing acquisition

Housing, Communities and Local Government Committee

Recommendation: As we recommended in our previous report, England’s Homeless Children, the Government should reconsider its decision to freeze Local Housing Allowance rates and should extend its support for local authorities to acquire new housing stock through the Local Authority Housing …

Gov response: As the Government set out in our response to the Committee’s Report on Children’s Temporary Accommodation, when considering Local Housing Allowance (LHA) rates for 2025–26, the Government considered a range of factors, such as the …

Partially Accepted

#40 — Assess Local Housing Allowance impact on pensioner living standards; include older people's housing in strategy.

Work and Pensions Committee

Recommendation: The Government should assess the impact of the Local Housing Allowance on pensioners and whether it leaves them with the income needed for a minimum, dignified, socially acceptable standard of living and report back to the Committee by the end …

Gov response: The Local Housing Allowance (LHA) determines the maximum housing support for tenants in the private rented sector. It ensures that households, including pensioners, in similar circumstances living in the same area are entitled to the …

Not Addressed

#39 — Rising number of private renting pensioners are at increased risk of poverty from Local Housing Allowance.

Work and Pensions Committee

Recommendation: The Pensions Policy Institute expects the number and proportion of pensioners renting privately to grow from around 6% now to 17% in 2041. As many as 400,000 households could become dependent on means-tested benefits. Pensioners renting privately are already at …

Gov response: The Local Housing Allowance (LHA) determines the maximum housing support for tenants in the private rented sector. It ensures that households, including pensioners, in similar circumstances living in the same area are entitled to the …

Not Addressed

#24 —

Housing, Communities and Local Government Committee

Recommendation: Government must work with mortgage providers and regulators to ensure that renters cannot be denied a mortgage on the grounds of affordability despite evidence of consistent payment of rent at higher monthly values than they would be paying in mortgage …

Response Pending

#23 —

Housing, Communities and Local Government Committee

Recommendation: Mortgages are a vital part of the housing market in this country, and as such a necessary component of improving access to home ownership to first-time buyers. The increased availability of high-Loan to Value mortgages can make it possible for …

Response Pending

#20 —

Housing, Communities and Local Government Committee

Recommendation: The government is right to prioritise social rent as the main form of truly affordable housing, but this should not lead to it entirely neglecting intermediate housing such as Rent to Buy and Discount Market Sales, which are intended to …

Response Pending

#19 —

Housing, Communities and Local Government Committee

Recommendation: Shared ownership is a useful tool for getting people into home ownership, but it is not a long-term affordable option for many of the buyers to whom it is marketed. We welcome the government’s announcement of improvements to the shared …

Response Pending

#18 —

Housing, Communities and Local Government Committee

Recommendation: The government should clearly and officially define affordable housing in a way that can be used for all relevant purposes, not just as part of the planning system. The definition should refer to local average income levels instead of just …

Response Pending

#17 —

Housing, Communities and Local Government Committee

Recommendation: There are mixed views about what makes housing affordable, and no statutory definition of affordable housing. The main official definition, in the National Planning Policy Framework, is not reflective of the housing needs in the country. While we support the …

Response Pending

#16 —

Housing, Communities and Local Government Committee

Recommendation: Government must make it easier for councils to take control of empty properties in their local authorities. This should include clarifying councils’ existing powers, such as Empty Dwelling Management Orders and Compulsory Purchase Orders; making the existing powers less risky …

Response Pending

#15 —

Housing, Communities and Local Government Committee

Recommendation: There are at least hundreds of thousands of residential properties that are currently empty, many of which have been empty for many months or years. While the number of empty homes is much smaller than the total number of new …

Response Pending

#2 —

Housing, Communities and Local Government Committee

Recommendation: The affordability of home ownership is a complicated and multivariant problem, with no easy or straightforward solutions. Demand-side solutions cannot work in isolation (as they often counterproductively increase house prices as a secondary effect), but supply-side solutions also are not …

Response Pending

#32 —

Housing, Communities and Local Government Committee

Recommendation: We recommend that the Government restore the Local Housing Allowance rates to 30th percentile. (Recommendation, Paragraph 94)

Gov response: We recognise some private renters need support with their rent. That is why we will work across government to keep Local Housing Allowance rates under review in order to deliver on the government’s priorities, including …

Response Pending

#31 —

Housing, Communities and Local Government Committee

Recommendation: We remained concerned the government’s decision to freeze the Local Housing Allowance is contributing to more people being more at risk of homelessness and in need of temporary accommodation. The freeze also makes it difficult for councils to help households …

Gov response: We recognise some private renters need support with their rent. That is why we will work across government to keep Local Housing Allowance rates under review in order to deliver on the government’s priorities, including …

Response Pending

#26 —

Housing, Communities and Local Government Committee

Recommendation: We recommend that the Department for Work and Pensions unfreeze the subsidy rates by increasing the rate councils are reimbursed to match the current Local Housing Allowance rate. We also recommend that the Government conduct a detailed review of the …

Gov response: The Department for Work and Pensions is keeping the levels of Housing Benefit subsidy for temporary accommodation under review, with any future decisions on the levels of Housing Benefit subsidy for temporary accommodation to be …

Response Pending

#25 —

Housing, Communities and Local Government Committee

Recommendation: The rules that determine the amount of money councils can claim through the Housing Benefit subsidy system is restricting their ability to source good-quality temporary accommodation for households. The Department for Work and Pension’s ongoing freeze of the subsidy rates …

Gov response: The Department for Work and Pensions is keeping the levels of Housing Benefit subsidy for temporary accommodation under review, with any future decisions on the levels of Housing Benefit subsidy for temporary accommodation to be …

Response Pending

#11 —

Housing, Communities and Local Government Committee

Recommendation: It will take time to meet social housing need. In the short-term, we support the Government’s intention to improve the experience of tenants in the private rented sector, including on security of tenure, quality of housing, and affordability. We encourage …

Gov response: The Government is committed to introducing a package of reforms to enhance renters’ security and improve protections for short-term tenants. This includes repealing Section 21 of the Housing Act 1988 to abolish so-called ‘no fault’ …

Under Consideration

#24 —

Housing, Communities and Local Government Committee

Recommendation: We also call on the Government to temporarily boost funding to discretionary housing payments to meet the needs of the tens of thousands of households who are receiving no extra income from welfare increases due to the benefit cap. This …

Gov response: This Government has provided an unprecedented package of financial support to protect renters whose income has been affected throughout the COVID-19 pandemic. To help prevent people getting into financial hardship, we increased the local housing …

Under Consideration

#22 —

Housing, Communities and Local Government Committee

Recommendation: We call on the Government to deliver a specific financial package to support tenants to repay rent arrears caused by covid-19, having considered the examples in Scotland and Wales as well as many other international examples. This should be one …

Gov response: This Government has provided an unprecedented package of financial support to protect renters whose income has been affected throughout the COVID-19 pandemic. To help prevent people getting into financial hardship, we increased the local housing …

Under Consideration

#6 —

Housing, Communities and Local Government Committee

Recommendation: We call on the Government to deliver a specific financial package—we prefer discretionary housing payments—to support tenants to repay rent arrears caused by covid-19, in consultation with the Local Government Association and appropriate bodies representing renters and landlords. We received …

Gov response: This Government has provided an unprecedented package of financial support to protect renters whose income has been affected throughout the COVID-19 pandemic. To help prevent people getting into financial hardship, we increased the local housing …

Under Consideration

#22 —

Housing, Communities and Local Government Committee

Recommendation: The failure of local housing allowance (LHA) rates to keep pace with market rents is quite obviously making the private rented sector even less affordable for many people who are only there because the social housing sector has been cut …

Gov response: The Local Housing Allowance (LHA) determines the maximum housing support for tenants in the private rented sector. It ensures that claimants in similar circumstances living in the same area are entitled to the same maximum …

Under Consideration

#24 — Delay in increasing Local Housing Allowance rates exacerbated family housing crisis

Housing, Communities and Local Government Committee

Recommendation: We welcome the Government’s decision to increase Local Housing Allowance rates to the 30th percentile of local market rents from 1 April 2024. However, this is an urgent matter that required the Government’s immediate action. It is therefore disappointing that …

Gov response: 47. The Government understands the importance of stable housing and is taking action to increase access to affordable housing. Increasing the Local Housing Allowance (LHA), in recognition of increasing rents, is a key part of …

Accepted

#22 —

Housing, Communities and Local Government Committee

Recommendation: Before the summer parliamentary recess, MHCLG must update us on its progress in developing and implementing its new policy package to address issues in the Section 106 market. (Recommendation, Paragraph 95) Mortgage finance and other lending

Response Pending

#21 —

Housing, Communities and Local Government Committee

Recommendation: We echo concerns voiced by the Committee of Public Accounts that an unacceptable number of homes constructed through Section 106 agreements remain unsold to registered providers of social housing, and welcome the fact that MHCLG is developing a policy package …

Response Pending

#14 —

Housing, Communities and Local Government Committee

Recommendation: MHCLG should initiate a review into different mixes of home around the country, including by tenure, type and price, to assess what impact different mixes have on local absorption rates. This review should consider developments for sale since the start …

Response Pending

#13 —

Housing, Communities and Local Government Committee

Recommendation: MHCLG’s new and upcoming guidance on local plan-making is welcome, but in addition to guidance for how local plans should be prepared it should provide guidance for what local plans should include, which local authorities can then interpret for their …

Response Pending

#12 —

Housing, Communities and Local Government Committee

Recommendation: While it is right for planning decisions to be driven primarily by local authorities through the production of local plans, MHCLG still has an important role in ensuring that new homes being built are sufficiently varied by type, tenure, size …

Response Pending

#11 —

Housing, Communities and Local Government Committee

Recommendation: Government bodies and developers will not be able to maximise the increase to the supply of homes through homebuilding unless they also consider the types, tenures, prices and sizes of homes being delivered. While it is true that many areas …

Response Pending

#1 —

Housing, Communities and Local Government Committee

Recommendation: The price of homes in England has risen faster than wages and inflation, and the average home now costs more than seven times the average income; in the 1990s, the average home cost less than four times the average income. …

Response Pending

#25 —

Housing, Communities and Local Government Committee

Recommendation: There is a case for reforming the Community Infrastructure Levy, but it is less clear that Section 106 agreements needed replacing. The Government should be mindful of the cumulative effect of the challenges posed to affordable housing provision by the …

Gov response: 51. The Government has considered the recommendations in the predecessor Land Value Capture report and the 2017 review of the Community Infrastructure Levy alongside the responses to the white paper. The proposal for a new …

Under Consideration

#20 —

Housing, Communities and Local Government Committee

Recommendation: We heard concerns about the Government’s First Homes programme, especially its potential impact on the provision of other forms of affordable housing. First Homes has an important part to play in delivering homeownership, and we hope that the Government has …

Gov response: 46. First Homes are an important part of our plans to make home ownership more widely available and affordable for local people and key workers. The Government has already changed national planning policy and issued …

Under Consideration

#99 —

Scottish Affairs Committee

Recommendation: Our survey on the experiences of people with social security in Scotland found that a majority (68%) felt that the money they received in support payments would not cover their bills for rent, food, internet, council tax and utilities. One …

Gov response: Universal Credit has provided a vital safety net for six million people during the pandemic, and the UK Government announced the temporary uplift as part of a £400 billion package of measures put in place …

Not Addressed

#9 —

Welsh Affairs Committee

Recommendation: However, in light of concerns about the rising costs of living, there is a need for a discussion about how to ensure benefits are adequate, affordable and sustainable. On the basis of the evidence presented there is a need for …

Gov response: The UK Government rejects these recommendations. The Department for Work and Pensions Ministers already have constructive engagement channels with Ministers in the Welsh Government on matters of mutual interest, and where areas of devolved and …

Under Consideration

#7 —

Work and Pensions Committee

Recommendation: The Housing Support Fund was designed to be a short-term measure but is now in its third funding cycle. While we all hope to see far more stability in the economy in coming years, the need for such funds highlights …

Gov response: The Government does not intend to conduct a specific review into the adequacy of benefit levels. There is no objective way of deciding what an adequate level of benefit should be as everyone has different …

Not Accepted

#17 — Make a commitment to annually uprate Local Housing Allowance to retain its 30th percentile value.

Work and Pensions Committee

Recommendation: The evidence is clear that support for housing costs cannot be viewed in isolation from wider support provided through other benefits. When and if claimants experience a shortfall in rent, this can impact other parts of household budgeting and erode …

Gov response: The Government understands the importance of stable housing and is taking action to increase access to affordable housing. Increasing the Local Housing Allowance (LHA), in recognition of increasing rents, is a key part of helping …

Under Consideration

#1 — Shared ownership becomes unaffordable due to full repair costs and expensive staircasing.

Housing, Communities and Local Government Committee

Recommendation: Shared ownership products can often become unaffordable over time due to having to pay for 100% of repairs and maintenance costs despite only owning a proportion of the property. This is exacerbated by the fact that these service charges can …

Gov response: 1. The Government launched its new model of shared ownership in April 2021, alongside the start of our £11.5bn 2021-26 Affordable Homes Programme (AHP). As noted by the Committee, the new model contains a ten-year …

Not Addressed

#2 — Families face prolonged temporary accommodation stays amid England's severe housing crisis.

Housing, Communities and Local Government Committee

Recommendation: During our inquiry we have also heard that, for many families, life in temporary accommodation is far from ‘temporary’. In some cases, families spend years in temporary accommodation, stuck in limbo without the stability of permanent accommodation and knowing that …

Gov response: 13. The Local Government and Social Care Ombudsman (LGSCO) provides an essential service investigating complaints when a homeless applicant is not satisfied with how the council has handled their case. It is important to have …

Under Consideration