Local Housing Allowance Levels Frozen In The Budget Will Hit Low Income Households

4th November 2024

Local Housing Allowance replaced Housing Benefit and it has wavered between uprating and being frozen. The October UK budget has frozen the allowance again.

With rents rising it will squeeze low income households.

The Conservative party froze it for seven out of the last 12 years, before increasing rates earlier this year.

Renters who have the Local Housing allowance could be £243 worse off a year as a result of the freeze, and £703 worse off by the end of parliament.

Here are some recent changes to the Local Housing Allowance (LHA) in the UK:

April 2024
The LHA was increased to reflect the cheapest 30% of local rents based on rental figures from September 2023. This was after a four-year freeze at September 2019 levels.

October 2024
The LHA was frozen again, which has raised concerns for low-income renters.

2025
The LHA will remain frozen at the current level unless the government chooses to unfreeze it.

The LHA is used to calculate Housing Benefit and the equivalent in Universal Credit for private renters. The LHA rate is based on the number, age, and sex of people in the household. For example, most single private renters under 35 only receive the shared accommodation rate.

Local Housing Rates Vary depending on he area in Scotland.
Highland and Islands (including Highland, Moray, Orkney, Western Isles(Eilean Siar),Shetland) - Weekly rates -
One Bedroom Shared £87.45
One Bedrooms £109.32
Two Bedrooms £136.93
Three Bedrooms £159.95
Four Bedrooms £195.62

For all counties rates go HERE

Read more at the Guardian

Other benefit affects
The chancellor confirmed the amount received in benefits will rise by 1.7% in April, in line with inflation.

The most common working-age benefit, claimed by seven million people (38% of whom are in a job), is universal credit. The rise would mean the standard allowance, for a single person aged under 25, is expected go up by £5.30 a month to about £317. For a couple aged over 25, the rise is likely to be £10.50 to £628 a month.

The total amount received in universal credit depends significantly on your circumstances.

Those on universal credit who owe money to the Department for Work and Pensions will pay that back at a lower rate.

The chancellor said there would be a widespread review of health and disability benefits.

Carers will be able to earn more before losing their allowance. The maximum earnings threshold will rise from £151 to £195 a week.