Cost of housing benefit is set to treble by 2050

THE cost of housing benefit will treble to more than £70billion a year by 2050 because successive governments have failed to build enough council houses, says the Centre for Social Justice.

As the Chancellor puts the finishing touches to Monday’s Budget, the CSJ warns that so-called “affordable” new homes help only the middle classes and will do nothing to reduce the growing housing benefit bill, which is forecast to hit £23.4billion in 2018-19.

The findings come after the Prime Minister tried to strengthen councils’ ability to build more homes by scrapping their borrowing cap, and clamped down on private developers dodging their social housing commitments.

The CSJ warns the lack of council houses has led to a surge in the number of housing benefit recipients renting in the private sector, with the number of private renters doubling since the millennium. A benefit recipient in the private rented sector costs the taxpayer 25 per cent more on average than one living in social housing.

CSJ analysis shows half the housing benefit bill – £34.5billion a year – will go to private landlords by 2050. According to the Office for Budget Responsibility, spending on housing benefit is set to rise from £21.9billion in 2017-19 to £23.4 billion in 2018-19, with 4.6million recipients paid an average of £5,035 each.

The CSJ warns that it will hit £70billion as the struggle continues for today’s “generation rent” to get on to the housing ladder.