The Government is changing the rules for Housing Benefit for working age tenants in Council and Housing Association housing.
What has changed?
The Government has reduced the amount of Housing Benefit paid to working age tenants who have spare bedrooms in their homes. This applies to all council and housing association tenants.
This means that for people aged between 16 and Pension Credit eligibility age, the amount of Housing Benefit they can receive to help pay their rent is limited to the payment for a property judged to be appropriate to the size of their family.
The criteria will allow one bedroom for each for the following:
- A couple
- A person who is not a child (aged 16 and over)
- Two children of the same sex (under 16)
- Two children who are under 10 (regardless of their sex but there may be exceptions for severely disabled children)
- Any other child, (other than a foster child or child whose main home is elsewhere)
- A carer (or group of carers) providing overnight care
If you receive full or partial Housing Benefit and have spare rooms in your home you may be assessed as under-occupying your accommodation and a reduction could be made to your Housing Benefit. This reduction is based on a percentage of your eligible rent.
The Government has said that this reduction will be set at:
- 14% for one extra bedroom
- 25% for two or more extra bedrooms
When maximum Housing Benefit is paid
Samantha and Greg have two children, Catherine who is 8 and Susan who is 6.
They live in a three bedroom apartment and currently receive £85 Housing Benefit a week to cover the full rent.
Under the new size limit rules they would only be entitled to Housing Benefit for two bedroom accommodation, one bedroom for themselves and one for Catherine and Susan who would be expected to share a room because they are both under 10.
The local authority would consider Samantha and Greg to be under-occupying their current accommodation by one bedroom and would apply a 14% reduction. This would be a reduction of £11.90 per week so Housing Benefit would be £73.10 per week.
14% of £85 equates to £11.90 so this is the amount Samantha and Gregs' Housing Benefit would be reduced by per week
When partial Housing Benefit is paid
Phil and Natalie live alone in a three bedroom house, Phil works with take home pay of £210 per week and currently receive £22.20 Housing Benefit a week towards their rent of £83.00 per week.
Under the new size limit rules they would only be entitled to Housing Benefit for one bedroom accommodation.
The local authority would consider Phil and Natalie to be under-occupying their current accommodation by two bedrooms and would apply a 25% reduction. This would be a reduction of £20.75 per week so Housing Benefit would be £2.15 per week.
25% of £83 equates to £20.75 so this is the amount Phil and Natalies' Housing Benefit would be reduced by per week
What does this mean for people in Nottingham?
People renting a Council or Housing Association home and receiving Housing Benefit who are deemed to have at least one spare bedroom will not have the full rent paid from April 2013.
- Separated parents who share the care of a child. New rules state that there must be a designated main carer. The child would be included in the main carer's household when the Housing Benefit is calculated
- Couples who use their spare bedroom when recovering from an illness or operation
- Foster carers because foster children are not part of the household for benefit purposes
- Parent whose children visit but are not part of the household
- Families with disabled children
- Disabled people including people living in specially adapted
People won't be affected if they:
- Live in a one bedroom flat or bedsit, or if
- They have a home of an appropriate size
- They or their partner are old enough to receive pension credits
The Government have stated that there are a number of options open to people who are affected by any benefit reduction because of the under occupancy rule.
These options are:
- Move to more appropriately sized accommodation
- Transfer to another property
- Mutual exchange
- Take in a boarder/lodger
- Ask family members to contribute more to cover extra rent
- Increase income through employment or increasing hours worked
- Some people may be able to apply for a Discretionary Housing Payment (e.g. disabled people living in specially adapted homes or foster carers)