Bedford housing benefit tenants forced to find extra £59 per month to meet rising rents

Housing benefits tenants in Bedford are being forced to find an extra £59 every month to meet rising private rents and put a roof over their heads, new analysis suggests.

Local Housing Allowance (LHA) is a housing benefit payment set by the Government made to those eligible for Universal Credit and is meant to cover the cheapest 30% of rooms in a shared house on the private rental market.

But, according to Bedford Borough Council, the allowance is now significantly less than typical rents.

And it is concerned, that despite its own efforts to help – including giving council tax discounts and discretionary housing payments – the Government needs to step in and urgently review LHA rates.

Figures from youth homelessness charity Centrepoint show people renting from private landlords who are eligible for housing benefits in Bedford will receive £341 per month from the LHA this year.

The median rent for a room in a shared house in Bedford is £500, while the cheapest 25% of rents cost up to £400.

Housing allowance would cover just 85% of that price, leaving people needing to find an extra £59 per month to put a roof over their heads.

A Bedford Borough Council spokesperson said: “LHA rates are set by the Government and are now significantly less than typical rents in Bedford borough. This is making renting in the private sector unaffordable for many households and contributing to homelessness in the borough.

“Bedford Borough Council provides a safety net by offering temporary accommodation for people who become homeless, but this doesn’t solve the problem of unaffordable rents and results in additional costs for the council and local taxpayers.

"Whilst the council provides a range of additional support to low-income households, including up to 100% council tax support discounts, discretionary housing payments and household support grants, it is concerned about the impact the combination of unaffordable rents and increased cost of living is having, and calls upon the Government to urgently review LHA rates.”

Centrepoint said people on low incomes renting homes are competing with one another, paying soaring costs and offering lump sums to secure properties.

And without the Government raising housing benefit rates, people will face homelessness amid soaring rental prices.

Alicia Walker, head of policy, research and campaigns at Centrepoint, said: "This is particularly worrying for those vulnerable young people who rely on Universal Credit to keep a roof over their heads.

"The fact is that if you’re on a low or fixed income then no amount of clever budgeting is going to help you.

"The Government has asked low-income renters to defy the gravity of this crisis and somehow find the money to cover the spiralling costs.

"That simply isn’t possible for most young households and, without the Government increasing rates immediately, many of them could face losing their home."

A Department for Work and Pensions spokesperson said: "During the pandemic, we increased LHA significantly and beyond inflation, benefiting over one million households by an average of over £600 over the year.

"We’re maintaining that boost, keeping support for private renters above pre-pandemic levels.

"The benefit cap provides a strong work incentive and ensures fairness for hard-working taxpaying households by encouraging people to move into work where possible."