Social housing allowance U-turn provides ‘crucial certainty’ for councils

Rented social housing will not be part of the future housing benefit cap after the prime minister announced changes to the controversial policy.

Theresa May announced the new plans yesterday in Prime Ministers Questions, saying that the government was reacting to the negative outcry from local authorities and care providers.

The Local Housing Allowance (LHA) proposals were set to heavily affect housing association tenants but the biggest worry was for those in support accommodation who stood to be harmed by the freeze because their costs were higher.

Councils were expected to suffer heavily from the policy because they would need to spend more on vulnerable people than was available from central government.

“It is great that the government has listened to our call for the LHA rate not to apply to social housing, including supported housing,” commented the LGA chairman Lord Porter.

“This will provide some crucial certainty for councils and their partners to provide housing for some of the most vulnerable people in our society, and to invest in improving and building more affordable homes.

“We look forward to seeing more details of this encouraging step from the government next week.”

May added that the government would expand and announce further detail of a new housing policy on Tuesday.

David Orr, chief executive at the National Housing Federation (NHF), said his organisation was “delighted” that the prime minister had heard the concerns of the sector.

He added: “Housing associations have been vocal and clear that the LHA cap bore no relation to the real cost of providing supported housing, a view which had gained cross-party consensus. I know all social housing tenants will be relieved with the news.

“Things are really starting to change and it is great to see social housing getting the right kind of attention it deserves. We look forward to seeing the detail of the government’s new proposed funding model for supported housing, hoping it will truly put in on a sustainable and secure footing.”

The controversial housing cap has been in limbo for over a year, with fears over supported housing being a central factor. Early last year, the NHF predicted more than 50,000 households could be affected and 40% of specialist homes might be in danger of closures.

Top image: Alberto Pezzali/NurPhoto/Sipa USA

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