Payments of Universal Credit and Housing Benefit to claimants are to rise by 3.1% this year, it has been confirmed.

MPs have voted through the annual review despite criticism from some fellow MPs and charities the Joseph Rowntree Foundation that the rise will be much less than the predicted rate of inflation this year – which is currently 4.8% and expected to top 7% later this year as inflationary pressures bear down on the economy.

The government claims that, although inflation is on the rise, the ‘peaks and troughs’ of inflation will be smoothed out by falls next year.

Details

Benefit increases will see claimants under 25 years old see their UC payments rise from £257.33 to £265.31 for a single person and £403.93 to £416.45 for a couple.

For those over 25 years old, their monthly UC payments will rise from £324.84 to £334.91 for a single person and £509.91 to £525.72 for a couple.

Those with children will also see their monthly payments per child rise.
Housing benefit, which is still paid to many people who do not fit the criteria for UC, will see their payment rise.

The rises range from £59.20 to £61.05 a week at the bottom of the list to £294.90 for a retired couple.

A vote at the House of Commons saw the changes pass by 298 votes to 29. The rules will come in effect from April 11.

LHA freeze

The vote did not pass without a fierce debate, including accusations that the wording of the legislation did not recognise that Local Housing Allowance rates have been frozen for two years in a row, and that this would lead to tenants falling behind in their rent.

“We know what happens when the local housing allowance is allowed to fall away from rent inflation, because we have been here before,” said Shadow Minister for Work and Pensions, Karen Buck (pictured).

Conservative MP Peter Aldous added: “Although it is necessary to approve the orders before the House, this debate also provides the opportunity for us to highlight the serious challenges that currently face the most vulnerable in society as a result of inflation rising to levels we have not seen for decades.”

Read the benefits rates rise in full.


5 COMMENTS

  1. The problem with increasing LHA is that while temporarily helping claimants to pay their rent it also feeds into the general housing market and increases all rents. Without more social housing increases in LHA just result in higher rents for all.

    • I think every LL would welcome the sudden build of 500,000 social rent houses – that way, we have less dross to weed out.

      But it hasn’t happened for 35+ years as social and local authority house numbers have actually fallen not increased.

      This 3.1% increase is only half of what it should be – it needs to catch historical rents then add this years 7% inflation and then try to account for next years – otherwise LHA tenants will fall even more behind those applicants free of such benefits.

      Be aware that Rent Controls will be bought in by a Labour Gov and a Cons Gov will be forced to introduce it eventually too.

      Those rents are estimated to be 80% of current PRS rents – so my advice to LLs is to help get rents as high as you possibly can – ready for losing 20% of that higher figure.

      • I’ve raised my rent on one of the houses I now have available. Last year it was £450 pcm. This year it’s £595 and I’ve been inundated with prospective tenants and will be hanging on for the most perfect tenant and I think I’ve just found him. I’d like to add that I was happy with £450 but due to the gov’s LL bashing I’ve decided to get as much rent as I can before EPC rating of C comes in and I have to sell the property.

        • If you were in Bristol and they manage to bring in Rent Controls then you’d only get 80% of market rent – so by increasing yours to £595, they’d kindly let you have £476 so just a little more than before.

          Heaven help the LLs who haven’t done what you have – imagine them taking 20% off your £450, then throwing in an annual landlord licensing fee – and then insisting you get EPC C

          Be sure to keep adding an annual increase if market rents or costs go up.

          PUT THOSE RENTS UP PEOPLE !!!

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