Local Housing Allowance: Nottingham — House of Commons, 2019-06-17
Topic: Housing
William James Quince (Conservative, Centre-right): I thank the hon. Member for Nottingham South (Lilian Greenwood) for securing this debate. I have not yet had an opportunity to visit Nottingham in my role but I look forward to doing so, hopefully over the summer Since taking up post two months ago, I have been keen to engage with as many people as possible, including key stakeholders such as Shelter, Crisis, Homeless Link and the Joseph Rowntree Foundation, to understand housing issues from all perspectives. Like the hon. Lady, I have a keen and long-standing interest in housing and ensuring that people have a safe, decent and affordable place to live that meets the needs of the household, and I would like to start by confirming that we have committed to end the freeze on local housing allowance in March 2020 Reform of housing support was a central part of this Government’s plan to create a welfare system that both supports the most vulnerable and is fair to taxpayers. To help ensure a fair balance between these two elements, LHA rates are not intended to meet rents in all areas. The intention behind the welfare reform programme is that the same considerations and choices faced by people not in receipt of benefits should be faced by those claiming benefits, and the LHA policy is designed to achieve this Between 2000 and 2010, housing benefit expenditure had risen by over half in real terms, reaching £25 billion in today’s prices. If left unreformed, by 2014-15 housing benefit would have reached £29 billion. That was not sustainable The measure to freeze LHA rates for four years from April 2016 built on reforms introduced in the previous Parliament, which saved £6 billion in total by 2015-16. Savings from freezing LHA rates are estimated to be around £655 million for Great Britain over the four-year period of the measure. Our reforms provide greater fairness and are part of our wider goal to move people from welfare and into work However, we have recognised that some places have seen big increases in rents, so we have made provision to further help people in those areas. That is why we have used a proportion of the savings from the freeze to create more targeted affordability funding, which is used to reduce the gap between frozen LHA rates and the 30th percentile Initially, targeted affordability funding was based on 30% of the savings from the freeze, but at autumn Budget 2017 we invested an additional £125 million in targeted affordability funding for the final two years of the freeze—2018-19 and 2019-20. This was based on 50% of the savings rather than 30% This additional funding enabled us to increase 213 LHA rates—there are 960 in total—by 3% last year, in 2018-19. This year, a total of £210 million has been made available, the highest amount of targeted affordability funding since its introduction in 2014, enabling us to increase 361 LHA rates by 3%. As a result, it is estimated that this year 500,000 households will benefit from an increase of around £250 per year In addition to this targeted affordability funding the Government have provided over £1 billion in discretionary housing payments to local authorities since 2011. Discretionary housing payments allow local authorities to protect the most vulnerable claimants and support households affected by different welfare reforms, including the freeze to LHA rates In Nottingham specifically, two of the five LHA rates in the broad market rental area were eligible for targeted affordability funding this year: the three-bedroom and four-bedroom LHA rates, both of which have been increased by 3%.