Chancellor warned homelessness will rise if LHA freeze continues

The Telegraph is reporting on a letter sent to them regarding the freeze on  the Local Housing Allowance (LHA), it can be seen in full here (subscription may be necessary), and says:

Jeremy Hunt has been warned he will force more people into homelessness unless he ends a three-year freeze on housing rental benefits given to some of the country’s poorest households.

Nineteen bodies, including some of Britain’s best-known homelessness charities, have written to the Chancellor urging him to increase Local Housing Allowance (LHA), The Telegraph can reveal.

The rates of LHA, which is paid to people who qualify for housing benefit but rent in the private sector, have remained frozen since April 2020 – see Telegraph article (subscription may be necessary)

Since then rental prices have soared, pushed up during the cost of living crisis that has seen inflation rise sharply, which has meant in real terms the financial support’s value has been eroded.

The Chancellor, who in the past has accepted the argument for increasing other benefits in line with inflation, is now facing mounting pressure to increase the rates in the Autumn Statement on Nov 22.

The decision to keep frozen the rates of LHA, which vary between post codes, has been blamed as a major factor in rising homelessness detected in the UK.

Senior figures for 19 different organisations, which together call themselves the “Cover the Cost coalition”, signed the letter sent to Mr Hunt, and have set out their demands in a letter to The Telegraph.

The organisations are St Mungo’s, Shelter, Z2K (Zacchaeus 2000 Trust), St Martin-in-the-Fields Charity, Glass Door Homeless Charity, Centrepoint, Joseph Rowntree Foundation, Crisis, Independent Age, YMCA England & Wales, National Housing Federation, Homeless Link, Roma Support Group, Save the Children UK, Trussell Trust, Local Government Association, Chartered Institute of Housing, Generation Rent, and Switchback.

‘Dramatic increase’

The letter said: “The main driver of homelessness is affordability, so if it’s to be tackled, people must at least be helped to afford the cheapest end of the market.

“At a time of high inflation and rising rents, the LHA freeze is not only resulting in renters of all ages (including thousands in work) losing their homes as their rents rise, it is then leaving them unable to find another, even with the council’s help, because there are no available homes that are genuinely affordable.

“Consequently, there has been a dramatic increase in homelessness and rough sleeping, with the highest number of households homeless in temporary accommodation ever recorded, and a 26 per cent rise in the number of people sleeping rough.

“Temporary accommodation systematically damages the life chances of children and young people who are homeless with their families, and rough sleeping is degrading and leads to premature death. Both are highly damaging to health and well-being.”

A Government spokesman said: “We’re helping to ease the pressure of rising rents and investing over £30 billion on housing support this year on top of record financial support worth around £3,300 per household.

“We’ve also maintained our £1 billion boost to Local Housing Allowance while our Discretionary Housing payments provide a safety net for anyone struggling.

“But, the key is preventing homelessness before it occurs which is why we have given £2 billion over three years to help local authorities tackle homelessness and rough sleeping.”

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