Housing benefit changes: Who will be affected?
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- Housing benefit in its current form was introduced in the early 1980s, but it has been modified several times by subsequent governments. Over the years the cost has increased. The coalition says the housing benefit bill was £11.2bn in 1997/98 but will be £24.7bn by 2014/15 without reforms.
- The government is making 10 changes to housing benefit, including local housing allowance (LHA), which is paid to those in privately-rented accommodation. Eight of the changes result in savings and two involve new costs. Overall, the measures will cut £2.4bn from the housing benefit bill.
- This change will restrict housing benefit for working-age tenants who are occupying a larger social rented property than required, such as a couple in a three-bedroom house (size restrictions already apply to private sector tenants). The measure results in the biggest saving of all the changes. Introduced: April 2013
- This change will mean that local housing allowance (LHA) rates will be calculated on the 30th percentile of local rents rather than the mid point. This means LHA tenants will have, in theory, access to the bottom 30% of the market instead of the bottom 50%. Introduced: April 2011
- At present, if you are a local housing allowance (LHA) claimant in a property where the rent is cheaper than the average, you can keep the difference, up to £15 a week. The withdrawal of this payment was first announced by the Labour government in 2009. They deferred it until April 2011. Introduced: April 2011
- LHA will be set in line with the Consumer Prices Index (CPI) instead of the Retail Prices Index (RPI). CPI and RPI are both measures of inflation, but while RPI includes housing costs and mortgage interest payments, CPI does not. A switch to CPI is expected to lead to lower benefits. Introduced: April 2013
- Household welfare payments will be capped at £500 per week in 2013. The limit would not apply to people on disability living allowance, war widows' pensions and working tax credit. It will see those affected lose an average £93 a week - the biggest loss of any other change. Introduced: April 2013
- Single people under the age of 25 receiving local housing allowance are restricted to the rate for a single room in a shared house, rather than for a one-bedroom property. The restriction to this lower rate will be extended to those up to the age of 35. Introduced: Jan 2012
- Deductions can be made from the benefit claimants receive if they share their home with adults not dependent on them, such as adult children. The deductions - from £7.40 to £47 a week - are made as it is assumed the individuals pay towards the rent. These deductions will be increased. Introduced: April 2011
- The government plans to remove the five-bedroom local housing allowance (LHA) rate so the maximum will be for a four-bedroom property. It will also introduce caps on LHA weekly rates. The Chartered Institute of Housing predicts within 30 years, all areas of Britain will be affected. Introduced: April 2011
- More money is already being made available to offset the impact of the cuts to housing benefit. However, the Chartered Institute of Housing says this equates to less than 2.5% of the total package of housing benefit cuts, or about £8.30 per year per case. Introduced: Oct 2010
- The government says, in recognition of the important work done by carers, it will provide extra money to help fund an additional room for them. The National Housing Federation welcomes the move but adds that wider benefit reforms will have a negative impact on disabled people's income. Introduced: April 2011
The figures come directly from the Department for Work and Pensions, including from its Budget 2011 report and its previous impact assessments.
All losses or gains are at 2010/11 prices, except where indicated. Comprehensive figures were only available in cash terms and were not adjusted for inflation.
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