To ask the Secretary of State for Work and Pensions, if she will make an (a) estimate of the cost to the public purse of restoring local housing allowance to cover the cheapest third of local rents over three years, (b) assessment of the potential effect of that policy on the number of (i) individuals and (ii) families including children (A) able to remain in existing accommodation and (B) no longer classed as being in poverty and (C) assessment of the potential effect on the public purse of changes resulting from that policy in the level of demand for temporary accommodation and other homelessness services.
Answered on
5 November 2019
We estimate the cost of restoring Local Housing Allowance rates to the 30th percentile of local rents would be about £800 million in 2020/21, £1,000 million in 2021/22 and £1,200 million in 2022/23. This excludes any changes in behaviour by tenants and landlords.
We have not made an estimate of the effect on staying in the same accommodation, or on savings that might arise in temporary accommodation and other homelessness services.
Poverty projections are inherently speculative as they require projecting how income will change for every individual in society, and this is affected by a huge range of factors.