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Housing benefit
[ch 6: pages 83-85]Social rented sector claims
Rules restricting eligible rent if you are considered to be under-occupying your accommodation, the “bedroom tax”, came into force in April 2013. Any working age claimant who is considered to be under-occupying has a:
• 14% reduction in their eligible rent for one spare bedroom;
• 25% reduction in their eligible rent for two or more spare bedrooms.
You are entitled to one bedroom for the following people in your household:
• every adult couple (married or unmarried);
• any other adult aged 16 or over, including non dependents;
• any two children of the same sex aged under 16;
• any two children aged under 10;
• any other child who would share, where the shared bedrooms are already taken;
• a non-residential carer providing you or your partner with overnight care.
One spare bedroom is allowed for:
• an approved foster carer who is between placements but only for up to 52 weeks from the end of the last placement; and
• a newly approved foster carer for up to 52 weeks from the date of approval if no child is placed with them during that time.
Rooms used by students and members of the armed or reserve forces are not counted as “spare” if they’re away and intend to return home.
The campaign group False Economy reported in September 2013 that nearly one in three council house tenants affected by the bedroom tax had fallen behind on their rent in the first four months of its operation and that more than 50,000 faced eviction. A more recent study published in the Journal of Public Health in March 2015 concluded that the bedroom tax has “increased poverty and had broad-ranging adverse effects on health, wellbeing and social relationships”. This is contrary to the government’s claim when the policy was introduced that it would have no negative impact on health and well being.
Legal challenge to the ‘bedroom tax’
In July 2013, several disabled tenants argued that the new Housing Benefit rules discriminated against people with disabilities. The High Court accepted that the rules were discriminatory but decided that for disabled adults the discrimination was justified and therefore lawful.
However, the same did not apply to a disabled child unable to share a bedroom with another child because of their disabilities. Following the Court’s ruling the government introduced new regulations exempting households from the Housing Benefit reduction where children are unable to share a room because of their disability.
The High Court held that discrimination against adults with disabilities, even those in the equivalent situation to children with disabilities who could not share a room, was justified.
The case then went to the Court of Appeal with the disabled adults arguing that their position was indistinguishable from that of the disabled children who were now exempted.
However, the Court of Appeal refused this argument on the basis that the differential treatment of adults and children was reasonable and justified.
In February 2015, the Court of Appeal judges found that the new Housing Benefit regulations discriminated against people with disabilities, who have a need for accommodation larger than the rules allow because of their disability. But the Court was satisfied that the secretary of state for work and pensions had justified the discriminatory effect of the policy.
In particular, it was satisfied that the needs of disabled people subject to the bedroom tax were being met by means of Discretionary Housing Payments (DHPs) which it said dealt with their needs for assistance with payment of their rent better than Housing Benefit. The change to the ruling was despite the government making clear that it will cut the funding available for discretionary housing payments.
In January 2016, the Court of Appeal declared the bedroom tax to be unlawful in two cases. In one legal challenge from a survivor of domestic violence, the DWP had claimed that the specialist police-funded panic room fell under the remit of the “spare room subsidy”, while in the second, the grandparents of a severely disabled child were facing benefit cuts for a third bedroom needed for overnight carers and to store equipment. After Judges ruled that in both cases the government’s policy amounted to unlawful discrimination, lawyers have called for the rules to be altered. However, the government has appealed and the case will now go to the Supreme Court.
How is Housing Benefit paid?
There is no set amount of Housing Benefit as it falls within the Benefit Cap which is currently set at:
• £500 per week for families with children; and
• £350 per week for individuals.
The cap is applied as a reduction in the amount of Housing Benefit awarded.
The government’s commitment to reducing the Benefit Cap to £23,000 outside London will see a reduction in the weekly allowances of families with children to £385 (outside London). This is set to be phased in from 2016.
In addition, from April 2017, young people aged 18-21 will no longer be entitled to claim the housing element of Universal Credit, with some exceptions. See Chapter 1 for further information about Universal Credit, the Benefit Cap and Housing Benefit.
Local Housing Allowance (LHA)
LHA is housing benefit that helps pay the rent if you rent from a private landlord. It is administered by your local council. How much you get is usually based on the Local Housing Allowance Limit in your area, your income and circumstances.
For example, from February 2016, the LHAs for central London are:
| Property | Weekly amount |
|---|---|
| Room in a shared property | Up to £136.52 |
| 1 bedroom (or shared accommodation) | Up to £260.64 |
| 2 bedrooms | Up to £302.33 |
| 3 bedrooms | Up to £354.46 |
| 4 bedrooms | Up to £417.02 |
These totals will be frozen until 2020. Given the continued increase in rent prices throughout the country, this is likely to act as a further reduction to the household incomes of working families.
If you’ve been getting Housing Benefit since before 7 April 2008, these limits only apply if you:
• change address;
• have a break in your claim for Housing Benefit.
The amount of Housing Benefit you get from the council may not be enough to pay all of your rent. If this happens, housing and homeless charity Shelter advises that options could include:
• applying to the council for a discretionary housing payment;
• looking at your monthly outgoings to see if you can make any savings;
• negotiating a cheaper rent with your landlord, in return for the council making your Housing Benefit payments directly to them; or
• moving somewhere cheaper.
Usually, Housing Benefit is paid directly to the person who claims it, and that person is expected to pay the rent. However, the council must make the LHA payments direct to your landlord if:
• you have rent arrears of eight weeks or more;
• it is already making deductions from your Income Support, Jobseeker’s Allowance or Employment and Support Allowance to pay for rent arrears.
In some circumstances, the council can choose to pay your Housing Benefit direct to your landlord. It is up to the council to decide whether to do this, but it might do so if:
• you are likely to have problems paying your rent, for example if you have you have problems with drugs or alcohol, or you have a serious medical condition;
• you are unlikely to pay your rent, for example if the council is aware you have consistently failed to pay the rent in the past.
The council can also decide to make payments direct to your landlord if you have trouble managing your money.
Councils also have the right to pay Housing Benefit direct to a landlord if doing so will help someone to get a tenancy, or keep an existing tenancy.
Before a council decides to pay LHA direct to your landlord, it will get information from people who can help determine whether it is in your interests to do so. The council might talk to your doctor and other health professionals, support workers, probation officers and others who know about your situation.