Cover the Cost

Government has heard our calls to increase Local Housing Allowance to cover the bottom 30% of rental properties in this year’s Autumn Statement.

We wrote to the Chancellor with the Cover The Cost Coalition in October calling for the Government to stop more people from becoming homeless by ensuring that housing benefit (Local Housing Allowance or LHA rates) will cover the bottom 30% of private rented accommodation.

What are Local Housing Allowance Rates?

Local Housing Allowance (or LHA) are the rates used to calculate how much housing benefit people can receive when they’re privately renting.  

LHA rates are meant to cover the bottom 30% of market rents in each local area. However, since 2020, these rates have been subject to a freeze, meaning that while private sector rents have rapidly risen over the past three years, the amount of housing benefit people receive has remained unchanged.

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Why is the freeze on Local Housing Allowance rates driving homelessness?

The LHA freeze has meant that people are losing their homes as their rents rise. They are then unable to find another because no available homes are affordable.

Analysis from the Institute of Fiscal Studies (IFS) has found that just 5% of private rental properties in the country are now affordable at Local Housing Allowance (LHA), with the issue even more acute in large urban areas.

We are seeing a dramatic increase in homelessness and rough sleeping, with the highest number of households homeless in temporary accommodation ever recorded and a 26% rise in the number of people sleeping rough.   

The main driver of homelessness is affordability, so if it’s to be tackled, people must at least be helped to afford the cheapest end of the market.

What does Government need to do?

The Government must urgently unfreeze Local Housing Allowance rates and restore them so they cover the bottom 30% of private rents.  

The unfolding homelessness crisis is not inevitable and the Government has a choice at the upcoming autumn statement. That’s why we are leading the Cover the Cost Coalition’s call to Government to intervene, so people can afford to keep a roof over their head.

Get involved

The UK homelessness crisis is unacceptable. 

Join us in calling on the Government to raise Local Housing Allowance to cover the cost of the bottom 30th percentile of rented properties and stop more people becoming homeless.

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