The findings in new research from Shelter show that Local Housing Allowance (LHA), which is replacing Housing Benefit in the private rented sector, is leaving many tenants with significant shortfalls in rent - which they either have to find themselves or move into poorer areas because their benefit doesn't cover the rent.
The research warns that many areas in towns and cities could become too expensive for LHA claimants. Instead, people may have to move to rural outskirts, where there could be far fewer employment and training opportunities.
LHA is a flat rate of benefit (after means-testing) according to household size and location. It is calculated using the average rent in a given area - known as a Broad Rental Market Area (BRMA). BRMAs are large and there are often large differences in the rents that people are asked to pay across the area, pricing claimants out of many parts.
As a result, claimants in expensive parts of BRMAs can be forced to move out, or find extra cash to make up large shortfall in rents when they are switched to the new LHA system.
Also worrying is that in the cheapest parts of BRMAs, anecdotal evidence shows some landlords are hiking up rents when they know local housing allowance will pay out a higher rent than they are charging.
An example used in the report is Cambridge, where it finds only four out of 90 properties enquired about in the City were affordable to LHA claimants, whereas the surrounding rural areas had in excess of half of their rental market affordable to those receiving LHA.
The Social Security Advisory Committee (SSAC) was asked by the Secretary of State for Work and Pensions to consider proposals for the Housing Benefit Amendment Regulations (2009).
The main change that these proposals would introduce is for the Regulations to provide for levels of Housing Benefit (HB) to be capped at a maximum level of the five bedroom Local Housing Allowance (LHA) from April 2009.
These changes would affect:
The SSAC is the main UK advisory body for all social security matters except those relating to industrial injuries, war pensions, occupational pensions, and National Insurance contributions. Most proposals for social security Regulations have to be submitted to the SSAC before they are made.
One hundred years ago (1st January) the first pensioners went to the Post Office to collect a State Pension of 5 shillings a week.
In 1909, half a million people over the age of 70 years received a pension. Now they number over 12 million, with more than 700,000 people reaching State Pension age in 2009 alone.
Today the Basic State Pension is worth around four times more than the amount received in 1909. Help with fuel, Council Tax and rent plus the one-off payment of £60 on top of the regular £10 Christmas payment bonus boosts it further.
The first pension was non-contributory but was means tested. Pensions Officers visited people's houses to check how much money and what possessions they had - including the kitchen sink. People also had to prove they were of 'good character' before they received a penny.
