Reply To: New Claims


Peem, let me clarify this for you and others. LHA is not more or less generous than previous schemes, Peter may present examples to show that it is but the public spending review provided no additional resource for HB – this is the same amount of money between the same amount of claimants. LHA is the first scheme that addresses continually increasing HB costs and as it is based on the median rent level 50% of properties will be at or below LHA levels and 50% of properties will have rents above these levels.

Tenants on statutory ongoing tenancies have the same rights as tenants under a six month tenancy but they are not liable for paying however many months remain of the rent should they choose to move. There will be no incentive for landlords to end tenancies because of the introduction of LHA. Why would they? The very very broad market rental areas will severely reduce benefit levels in towns. In addition to this, the tenant has the ability to get paid HB direct to their landlord, but not under LHA.

I have heard many criticisms about LHA, in particular the ghettoisation of benefits but not that one. The £15 cap is making people think that the scheme is a bonanza for claimants and this is not the case. Again, I say – DWP – VERY STUPID MOVE and I am glad to say I am not alone with this thought.

[quote:fa4034bf72]34. Tenants on LHA can keep any benefit they receive over and above the amount of rent they have to pay. The DWP proposes that these gains should be capped to remove discrepancies between different areas some of which have more generous LHAs than others, to protect work incentives and remove any incentive to overcrowd. This proposal will reintroduce complexity into the scheme and negate the administrative gains which have been made so far. Whilst there is some evidence that claimants use the money gained from LHA to subsidise low benefit levels, for instance using it to pay off rent arrears caused by previous shortfalls, there does not seem to be any evidence that claimants move into overcrowded accommodation to gain from the LHA; gains seem to reflect existing overcrowding.[/quote:fa4034bf72] (Welfare Reform Bill: Second Reading briefing from CPAG )