Latest Public Sector News

26.01.16

Housing benefit cap to leave thousands of specialist homes on the edge

Over 40% of specialist homes, including women’s refuges, dementia accommodation and veteran’s services, could be forced to close as a result of the government’s housing benefit cap planned for April.

Figures from the National Housing Federation (NHF) revealed that more than 50,000 household could be affected over just one year, losing an average of £68 per week each.

Across the specialist sector, over four in 10 homes would become unviable, despite the country’s ageing population necessitating this type of housing more than ever.

Around 2,400 construction plans for new specialist homes have already been scrapped as a result of the cap, and another 9,270 would not be able to be built if the local housing allowance cap goes ahead.

David Orr, chief executive of the NHF and one of the main supporters of the government’s expansion of Right to Buy to housing associations, said he is now “urgently seeking clarity” from Whitehall in light of these figures.

“Will this cap apply to those who are, by definition, the most in need of extra help? If this cap applies to specialist housing, tens of thousands of vulnerable people will be unable to afford the cost of their home and care,” he said.

“Huge numbers of people will be affected from older people and dementia patients, to disabled people and women fleeing domestic violence - they cannot go without specialist care and support.

“With building on new homes grinding to a halt, pipeline plans scrapped and schemes already preparing to shut up shop, this matter can no longer go unresolved.”

The housing benefit cap, introduced in last year’s Spending Review, was devised by the chancellor as a way to “better align the rules” in the private and social rented sectors. The ceiling, which will limit the amount of rent that the benefit will cover in the social sector to the relevant housing allowance, will stop the benefit from funding families living in social houses they can’t afford.

It will apply to tenancies signed after 1 April, with benefit entitlement changing from April 2018 onwards.

Despite NHF claims that these proposals will effectively shut down 82,000 specialist homes, a spokesman for the Department for Work and Pensions claimed this is “unnecessary scaremongering which does nothing to help those it purports to represent”.

“The truth is that nothing will change until 2018,” he said.

John Healey MP, shadow housing minister, called on the chancellor to exempt specialist housing from this cuts in the Commons this week, and to consult fully with housing providers to “safeguard this essential accommodation”.

The government’s highly controversial Housing and Planning Bill, which is set to introduce a raft of other often transformational measures, will be read for a second time in the Lords tomorrow.

According to the Mirror, a trio of Lords who strongly oppose key elements in the Bill, including plans to end lifetime social tenants, are set to make personal speeches during the debate.

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