The National Residential Landlords Association (NRLA) is backing proposals from MPs on the Work and Pensions Select Committee to increase housing benefit rates annually.
Chief executive of the NRLA Ben Beadle said: “We welcome the committee’s call for housing benefit rates to be reviewed annually in line with housing costs. This has been a long-standing call from the NRLA and others.
“Too often, the rental subsidy system means that tenants and responsible landlords do not know whether rents can be covered from one year to the next. What should have been a safety net has become a source of frustration and fear.
Beadle stressed that all parties must provide certainty to those dependent on benefits that they can keep a roof over their heads by ensuring rates remain permanently linked to market rents.
In its March 21 report on benefit levels, the Work and Pensions Select Committee argued that: “The Government should make a commitment to increase the Local Housing Allowance (LHA) annually so that it maintains its value at the 30th percentile of rental prices in a Broad Rental Market Area (BRMA).”
LHA rates have been frozen since April 2020. The Institute for Fiscal Studies has noted that since then the proportion of new private rental properties on Zoopla, affordable to those receiving an LHA, has fallen from 23%A| to just 5%.
From April this year, the LHA rate will once again cover the bottom 30% of rental prices in a given area. However, the Institute for Public Policy Research has warned that even if the interest rate is lifted, more than 800,000 households on Universal Credit will continue to face shortfalls between the payment of their housing support and the rent they pay.
Rent allowance rates are currently being frozen again from next year.