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Housing Benefit

Volume 487: debated on Wednesday 11 February 2009

To ask the Secretary of State for Work and Pensions what steps he has taken to reform the housing allowance scheme in the last five years; what discussions he has had with local authorities on this issue in the last two years; and if he will make a statement. (255102)

Local housing allowance was rolled out nationally in April 2008 for customers in the deregulated private rented sector who make a new claim for housing benefit, and for existing customers who move address. It is a new way of calculating the rent element of housing benefit based on the area in which a customer lives and his/her household size. Local housing allowance is paid to the tenant rather than the landlord in most circumstances. Tenants are able to keep any excess benefit up to a maximum of £15 per week that is over and above the cost of their rent.

Local housing allowance was introduced in nine pathfinder authorities in 2003-04 and was subject to extensive and independent evaluation. A further nine authorities implemented the scheme in 2005 to test operational readiness.

We are closely monitoring how the local housing allowance scheme is working in practice and will undertake a review during the first two years of operation following national rollout.

At Budget 2008 the Government announced a review of the working age housing benefit system. This joint DWP/HMT internal review of housing benefit is looking at the effectiveness of the system, particularly in promoting work incentives, efficiency and fairness and to ensure that it represents value for money for the taxpayer.

The December Welfare Reform White Paper, “Raising expectations and increasing support: reforming welfare for the future” provided a formal update on the review outlining our next steps and the key issues we would like to address.

We also announced our intention to launch a public consultation on housing benefit reform this year, a process which will begin with the publication of a housing benefit reform consultation document.

We meet with local authority representatives regularly, both formally, through statutory liaison with the local authority associations, and through regular liaison with individual local authorities. We often discuss the local housing allowance at these meetings.