12,000 younger Scots face up to £8.6m rent short­fall from LHA cap, new re­port con­firms

Campbeltown Courier - - PROPERTY/ PUBLIC NOTICES 17 -

Around 12,000 main­stream so­cial ten­ants across Scot­land aged un­der 35 could col­lec­tively face an an­nual rent af­ford­abil­ity gap of be­tween £5.3 mil­lion and £8.6 mil­lion when a UK gov­ern­ment cap on hous­ing ben­e­fit (or the hous­ing el­e­ment of Uni­ver­sal Credit) for so­cial hous­ing ten­ants at Lo­cal Hous­ing Al­lowance (LHA) rates comes into force in April 2019. This is a key find­ing of new re­search com­mis­sioned by the Char­tered In­sti­tute of Hous­ing in Scot­land in part­ner­ship with the Scot­tish Gov­ern­ment and pub­lished on Oc­to­ber 11. The re­search was con­ducted by the Indigo House Group. The cities of Ed­in­burgh and Glas­gow are likely to be the most se­verely af­fected by the pol­icy with 27 per cent of all of Scot­land’s sin­gle Hous­ing Ben­e­fit claimants aged un­der 35 liv­ing in th­ese two cities, equiv­a­lent to more than 6,500 peo­ple. The to­tal weekly short­fall in Ed­in­burgh is ex­pected to be £19,600 and in Glas­gow, those af­fected face a col­lec­tive weekly short­fall of £18,800. Anal­y­sis of av­er­age so­cial sec­tor rents shows the po­ten­tial fi­nan­cial im­pact for in­di­vid­u­als varies con­sid­er­ably de­pend­ing on the size of home they are liv­ing in and how so­cial rents com­pare with LHA rates for the area. Across Scot­land, sin­gle ten­ants un­der the age of 35 liv­ing in a one-bed­room home and af­fected by the cap will face an av­er­age short­fall in rent of £6.60 per week. The high­est short­fall for one-bed­room homes will be ex­pe­ri­enced in Ed­in­burgh at £22.09 per week. Mean­while, there are eight ar­eas show­ing no short­falls be­tween the av­er­age lo­cal one bed­room so­cial rents and the ‘cap’ LHA rate. Since Oc­to­ber 2015, the UK gov­ern­ment has made var­i­ous pro­pos­als and amend­ments to cap Hous­ing Ben­e­fit or the hous­ing el­e­ment of Uni­ver­sal Credit for so­cial hous­ing ten­ants at LHA rates, in­clud­ing for those liv­ing in sup­ported or tem­po­rary ac­com­mo­da­tion. The pro­pos­als are in­tended to bring pay­ments for so­cial hous­ing ten­ants in line with those liv­ing in the pri­vate rented sec­tor. Leg­is­la­tion to im­ple­ment th­ese pro­pos­als has yet to be in­tro­duced. How­ever, as the pro­pos­als cur­rently stand, sin­gle peo­ple un­der 35 years of age will see their al­lowance capped at the Shared Ac­com­mo­da­tion Rate (SAR). An up­per es­ti­mate of the im­pact of the pol­icy sug­gests that around 14,400 ten­ants could face a col­lec­tive short­fall of £8.6 mil­lion an­nu­ally. Th­ese fig­ures were ar­rived at by cal­cu­lat­ing the dif­fer­ence be­tween av­er­age rents by prop­erty size sub­mit­ted an­nu­ally to the Scot­tish Hous­ing Reg­u­la­tor by in­di­vid­ual so­cial land­lords, com­par­ing this with the SAR in the cor­re­spond­ing lo­cal au­thor­ity area and mul­ti­ply­ing this by the es­ti­mated to­tal num­ber of so­cial ten­ants aged un­der 35 liv­ing in that area. An al­ter­na­tive method us­ing Depart­ment for Work and Pen­sions (DWP) fig­ures was also used. By ex­clud­ing an es­ti­mated 2,500 Hous­ing Ben­e­fit claimants aged un­der 35 who are thought to live in tem­po­rary or sup­ported ac­com­mo­da­tion and may there­fore ben­e­fit from a par­tial or to­tal ex­emp­tion from the pro­posed LHA cap, the re­search es­ti­mates that the LHA cap would still hit around 12,000 so­cial ten­ants liv­ing in main­stream ac­com­mo­da­tion with a col­lec­tive rent short­fall of £5.3 mil­lion per year. Although it is an­tic­i­pated that some ten­ants liv­ing in spe­cial­ist and tem­po­rary ac­com­mo­da­tion will be pro­tected from the cap, it is not yet clear what ex­emp­tions will be made or how much fund­ing will be avail­able to plug this gap.

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