Tewkesbury Council in Gloucestershire has defended plans to provide a specially adapted six-bedroom home to a resident with 11 children.
The controversial announcement has been labelled a ‘scandalous’ use of public money.
But despite which view you take on the matter, this mother and her children are in line with the forthcoming regulations soon to be introduced for recipients of Housing Benefit in the social rented sector…
The current position
Housing Benefit claimants living in the social rented sector currently have no restrictions placed on the size of accommodation that they occupy. The amount of Housing Benefit that they are entitled to is unrelated to the size of the property that they require. When tenants are placed into accommodation, the housing needs of the household will be considered by the housing provider. However while these needs can change over time, there is no systematic review to consider whether the accommodation that has been allocated remains the most appropriate. As a consequence, eligible rent levels for claimants in the social rented sector are not currently determined by reference to the size of a claimant’s household.
The Under Occupancy rules
In order to address the differences between private rented and social rented claimants, the coalition government has announced that from 1 April 2013 it will introduce a ‘size criteria’ for new and existing Housing Benefit claimants living in the social rented sector. This will mean that both social and private sector claimants are assessed using the local housing allowance rules.
According to the Department of Work and Pensions (DWP), the applicable maximum rent will be reduced by a national percentage rate depending on the number of spare bedrooms in the household. The reduction rates will be:
- Where under occupying by one bedroom – 14%
- Where under occupying by two or more bedrooms – 25%
The new rules allow one bedroom for each adult or couple. Children under the age of 16 are expected to share if they are the same gender. Those under ten are expected to share a bedroom whatever their gender.
Interestingly the guidelines do not define what a bedroom is. Rather, the regulations state that it is for a landlord to specify the size of the property; this ought to be in the tenancy agreement reflecting the amount of rent charged. The bedroom tax will not take account of whether a room is a single or double bedroom. A room is either a bedroom or not a bedroom. The number of bedrooms in the property will be determined by the landlord’s tenancy agreement, so tenants cannot claim that a bedroom is actually a living room.
Who will be affected?
The change will affect council tenants and those who rent from housing associations. But it has also been argued that some groups will be affected more than others. The introduction of the size criteria is likely to affect an estimated 660,000 – 43% of those are resident in the North West.
- Pensioners – The changes will only apply to working age housing benefit claimants which is now marked at those under the age of 66. From April 2013, if either half of a couple are of pensionable age, they will not suffer reductions to housing benefit.
- People with disabilities – The proportion of disabled claimants affected by the measure is higher than for non-disabled claimants – a total of 56% of working age housing benefit claimants or their partners who are affected by the size criteria would be classified as disabled. However, a bedroom for a non-resident carer will also be taken into account in determining the relevant size criteria where that carer provides necessary overnight care for the claimant or their partner.
- Separated parents – Those who share the care of their children and who may have been allocated an extra bedroom will be affected. Benefit rules mean that there must be a designated ‘main carer’ for children (i.e. the parent who receives child benefit will not be affected by the rules).
What can you do if you are ‘under occupying’?
The average cost to affected claimants has been estimated at £14 per week in 2013/14, which in times of austerity is a significant amount for many. However this will be predicated upon the circumstances of each claimant. The Department of Work and Pensions has claimed that affected claimants will be faced with a choice to either continue to live in accommodation which is assessed as larger than their household needs or move to accommodation which better reflects the size and composition of their household.
As a component of the Welfare Reform Act 2012, the implementation of the under occupancy rules is not legally challengeable.
At Stephensons we have been advising our clients to consider the following points:
Is there any reason why you cannot move to a smaller property?
The movement of tenants will be determined not just by their own willingness to move, but on the availability of suitably sized accommodation in the area, and the approach taken by their landlord to enable such moves to happen. It was recently reported for instance that nearly 600 family households under Knowsley Housing Trust have been reclassified as smaller properties and will now be exempted from the new rules.
The DWP has set aside an additional £49 million over the Spending Review period to help local authority housing teams make the transition to the Housing Benefit reforms. It is aimed at giving claimants affected by the reforms help with moving and the additional costs.
Can you take in a lodger if approved by your landlord?
From April, claimants with a paying lodger will be allowed to keep the first £20 of weekly rent. But housing benefit will be then cut, pound for pound, on the rest of the rent they receive. However following the establishment of Universal Credit in October 2013 tenants will be able to keep all the rental income (although only the first £4,250 of annual rent is free of income tax).
However taking in a lodger will have an impact on many home contents insurance policies, potentially invalidating a policy or raising the premium. It is therefore important to check your policy prior to letting out a room.
Can you apply for a discretionary housing payment?
From 2013/14, an extra £30 million per year has also been added to the Discretionary Housing Payment fund. This allows local authorities to give extra discretionary help to those facing difficulties meeting their housing costs. The extra funding is intended to provide additional help to disabled claimants living in properties where significant adaptations have been made; as well as additional help to foster carers, including those in between fostering placements. While there is no right of appeal if these payments are not awarded, claimants are able to ask their local authority to review the decision.
By Kelly Faulkener
If you are unsure about whether these changes will affect you and your family, contact our Welfare Team. There will be a withdrawal of legal help for the majority of Welfare Benefit Advice from April 1st, but Stephensons will be offering Pro Bono assistance (subject to capacity) for a limited selection of Appeals.
Alternatively if as a result of the cuts you are experiencing rent arrears, our Housing Team can assist you with this.