How will tenants respond to the Local Housing Allowance reforms? Reflections on the existing evidence Yvette Hartfree and Grahame Whitfield Centre for Research in Social Policy
What is LHA? Most radical change to HB since its introduction Only applies to tenants in the PRS Replaced HB with flat-rate allowance based on location & household size Payments made to tenants Introduced in 9 pathfinder areas in 2003/04, national roll-out in April 2008
LHA national roll-out model Rates set at 50 th percentile / median 5 bed cap Claimants able to keep an excess of £15/week
Core Evaluation Findings Low awareness and understanding of how LHA worked Paying rent was a priority – claimants took this responsibility very seriously LHA did not appear to increase housing choice Claimants not motivated to move to cheaper accommodation to maximise an excess Safeguard provisions for vulnerable claimants did not work well
LHA reformed model Rates set at 30 th percentile New upper limits for each property size 4 bed cap Excess removed Shared room rate extended to under 35’s Increases to non-dependent deductions Increase to DHP fund New allowance for a non-resident carer
Implementing the Changes Raising understanding and awareness of the changes Transitional protection arrangements for existing claimants LA role to help claimants negotiate with landlords - incentive of transferring payments to landlords Allocation of Discretionary Housing Payment funds
What we think might happen – low concern Additional room allowance for a non- resident carer Removal of excess 4 bed cap Increases to non-dependent deductions
What we think might happen – high concer n Rents set at 30 th percentile / rent caps: - Minimal impact where rents are already below LHA rates - Negotiations with landlord - Moving - Staying put – ability to manage a shortfall Extension of shared room rate to u35’s Support for vulnerable claimants
Centre for Research in Social Policy Schofield Building Loughborough University Loughborough Leicestershire LE11 3TU Telephone: +44 (0)