The second reason is that housing benefit is believed to be undermining efficient operation of the labour and housing markets and to be particularly prone to fraud. For example, loss of housing benefit can be a major disincentive to return to work - the unemployment trap. Organisations like Shelter are critical of housing benefit as well. It is very complex and therefore errors are frequent. The split between the DSS, which administers other benefits and decides on policy, and local councils is a further source of confusion.
Local councils vary enormously in how well they administer the system.
The poverty trap deepens and affects more people, the higher the level of rents. It is important, therefore, that housing benefit is part of a programme of welfare reform. The Government's 1998 Welfare Reform Green Paper recognises that, as in many aspects of the social security system, reforms to housing benefit do not always start with housing benefit. If there are concerns about the cost of housing benefit, the first thing to do is examine the reasons for rising cost. Restoration of the massive housing cuts of the 1990s should be a priority, although it should be recognised that it would take time to ease pressure on housing benefit.