Changes to Housing Benefit and Local Housing Allowance (LHA)

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• Changes to allowances

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April 2011

Removal of £15.00 LHA excess payment

Under LHA, if your rent payable is less than the LHA rate, the rent used in the assessment will be calculated on the LHA rate, to a maximum of £15.00 extra on top of the rent you are charged.  From April 2011 we will stop paying this extra LHA on new claims. For existing claims we understand that you will keep this excess payment until the anniversary of your claim or until your circumstances change if this is earlier. We do not have the legislation for this yet, so we do not know the details about this protection.

Removal of 5 bed rate.

The rate of LHA your claim is based on is calculated from the area you live in and the size of accommodation you need for the size and composition of your family. From April 2011 the highest LHA level we will be able to allow you is for the 4 bed rate, even if your family is large enough to require more than 4 rooms.

You can see the current LHA levels on the Directgov website www.direct.gov.uk

Absolute Caps on LHA level

LHA will have a maximum cap nationally of

• £250 for a one bedroom property
• £290 for a two bedroom property
• £340 for a three bedroom property
• £400 for a four bedroom property

These caps will not affect South Derbyshire because our LHA rates are already below these levels

Calculation of the LHA rate

The LHA rate is published each month by the Valuation Office Agency each month.  You can check the rates here https://lha-direct.voa.gov.uk/

The way the rates are calculated each month will change from April 2011. The rates will be lower, meaning that 3 out of 10 rented properties will be at a rent equivalent to the LHA rate or less.

For further details view the rates for April 2011: Local housing allowance (LHA) rates

Transitional Arrangements for Existing LHA Claimants.

If you are an existing LHA claimant before April 2011 and you do not move and your household size and composition remains the same, we will review your LHA rate on the anniversary of your claim (a year from when you started to receive LHA). When we review your claim, the LHA rate for that month will be lower than the rate you currently receive. To help claimants adjust to this lower level of benefit, you will get protection from the new rate for up to 9 months form your anniversary date. This means that we continue to award your LHA based on your old, higher rate.

This protection will end after:

• 9 months
• when you move
• when you cease claiming
• when your household size or composition changes

whichever is the sooner. 

If you currently receive up to £15.00 excess benefit, you will NOT receive protection on this. It will end on the anniversary of your claim.

Room for Carers who stay overnight

The rules are changing so that we can allow an additional room where a carer, who does not normally live with, stays overnight. This means that you may receive more benefit. Please contact us you think this may apply to you.  (can you put the link in the normal contact form to e-mail customer.services@south-derbys.gov.uk)

Single and under 35?

The Government is planning to extend the age group for single young people who can only claim a shared accommodation rate to help with their rent (rather than being able to claim for self-contained one-bedroom accommodation).

This means you may only be entitled to the lower rate of Housing Benefit for a room in shared accommodation if all of the following apply:

• you are a single person
• you are occupying one-bedroom self-contained accommodation in the private rented sector
• your Housing Benefit is due to be reviewed from January 2012 onwards at the date of the review you will be aged 25 or over but under 35 years, and
• you are not covered by any of the exemptions on sharing accommodation.

The change means that from January 2012 onwards, instead of the one-bedroom self-contained rate for those aged 25 - 34, you would move onto the shared accommodation rate applying at that date.  The details of the change will not be known until they are agreed in Parliament later this year. Even when this happens, we will not be able to tell you the exact Local Housing Allowance (LHA) rate for shared accommodation as these change from month to month. However the current shared accommodation rate for property can be found on the Local Housing Allowance Rates page which, will give you an indication of the likely rate. If you are not assessed under LHA rules we cannot provide you with an estimate at present, although the rate you get is likely to be much lower than the rate you currently get.

Longer term changes

It has been announced that Housing Benefit will become part of the new Universal Credit that will be introduced from late 2013/early 2014.  This means that for some people housing costs will be paid as part of the Universal Credit instead of as a separate benefit. These changes are under consultation and we do not yet have any further information. We will update this website when we have more details.