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Social Housing Speed Read – capping housing benefit

We look at the Prime Minister's latest comments on the effect of capping housing benefit to the Local Housing Allowance ('LHA') on refuges and the potential impact on providers.

The Government’s initial proposal

In their Autumn Statement 2015, the Government announced plans for the LHA to apply to all social rents from April 2018 onwards.

In response, several organisations including Women’s Aid and the National Housing Federation raised their concerns on the effect this would have on refuges, citing the potentially disastrous consequences this could have on vast sections of the population.

Providers and charities have repeatedly called for the exemption of such refuges under the proposed cap, as some providers have previously estimated that the alternative would effectively lead to the closure of over half of those institutions that provide vital housing and support at a critical time in people’s lives.

Prime Minister’s latest comments

During Prime Minister’s Questions on 7 September 2016, Theresa May was asked by Labour leader Jeremy Corbyn to respond to the sector’s concerns that women’s refuges would be subject to the housing benefit cap.

Mrs May responded on the topic of domestic violence, confirming “Across this house we are doing all we can to stop these terrible crimes taking place and obviously provide support to the victims and survivors of these crimes. That’s why we are working on exempting refuges from the cap…”

What could Ms May mean?

Although not definitive, the Prime Minister’s latest comments will come as welcome news to those providers who had raised previous concerns regarding the proposed cap on housing benefit and seems to indicate the way in which Ms May’s Government will enforce the cap.

However, this potential exemption was only discussed in relation to domestic violence refuges and will undoubtedly raise questions from those providers of other refuges of the possibility of extending any potential exemption to all or at least a greater scope of refuges.

What will the future hold?

The Government has yet to publish the results of a review on the costs of supported housing and we wait with baited breath for its findings and more importantly the Government’s response to those results.

It may be that the results of the review provide little comfort to providers, but it may also prove to be a useful tool in their armoury when challenging the Government on the housing benefit cap and any potential exemptions.

Let us not forget that the proposed housing benefit cap does not come into force until April 2018, although expect there to be movement ahead given Ms May’s most recent comments on the subject and the inevitable challenges and requests the Government is likely to receive in relation to exemption for all other refuges.

If you have any questions on the implementation of the housing benefit cap and how it will affect social housing providers, or any other questions as a social housing provider, please do not hesitate to contact John Murray or a member of our expert Social Housing Team.

Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.

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