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Universal Credit: Private Rented Housing

Question for Department for Work and Pensions

UIN 122582, tabled on 10 February 2022

To ask the Secretary of State for Work and Pensions, if her Department will publish its data on the median (a) gap between rent and the Local Housing Allowance (LHA) for those households where rent exceeds the LHA and (b) deduction for universal credit claims in the private rented sector for which LHA does not cover the rent and which are subject to deductions for each of: (i) universal credit advances only (ii) universal credit overpayments only (iii)y tax credit overpayments only and any combination of (i) universal credit advances, (ii) universal credit overpayments and (iii) tax credit overpayments, in the most recent period for which figures are available.

Answered on

1 March 2022

In the private rental sector, Local Housing Allowance determines the maximum financial support available for renters. In April 2020, we increased Local Housing Allowance rates to the 30th percentile of local rents at a cost of nearly £1 billion, providing 1.5 million claimants with around £600 more housing support in 20/21 than they would otherwise have received. Local Housing Allowance rates have been maintained at their increased levels in 2021/22 and will remain at those levels for 2022/23.

Median differences between rent and Local Housing Allowance in different broad rental market areas reflect variation in rental markets.

We reduced the normal maximum rate of deductions in Universal Credit from 40% to 30% to 25% of a claimant’s Standard Allowance enabling them to retain more of the award. These changes were implemented from October 2019 to April 2021. These positive measures were put in place to support claimants to manage financial difficulties. Processes are in place to ensure deductions are manageable and customers can contact DWP Debt Management if they are experiencing financial hardship to discuss a reduction in their rate of repayment, or a temporary suspension, depending on financial circumstances.

Claims where the Local Housing Allowance is lower than rent (housing shortfall) by selected deduction types, November 2021

Deduction type

Number of claims

% of all claims

Median housing shortfall

Median deduction

Advance or UC Overpayment or Tax Credit Overpayment

324,000

7%

£100

£58

of which

Advance only

165,000

3%

£100

£42

Tax Credit Overpayment only

55,000

1%

£100

£61

UC Overpayment only

38,000

1%

£125

£59

Any combination of the above

67,000

1%

£100

£80

Any deduction type or advance repayment

362,000

8%

£100

£65

Notes:

1) Figures are rounded to the nearest 1,000. Percentages are rounded to the nearest whole percent.

2) The Universal Credit Overpayments and Tax Credit Overpayments figures do not include deductions due to fraud.

3) Only claims with private rent and housing entitlement have been included when identifying claims where LHA did not cover rent.

4) 'Any combination of the above' includes claims with Advance and Tax Credit Overpayments

or Advance and UC Overpayments or Tax Credit Overpayments and UC overpayments or all three deduction types.

5) Figures are provisional and are subject to retrospective change as later data becomes available.

6) Latest figures provided for November 2021 in line with published statistics on Universal Credit Households Statistics. 7) Median deduction refers to the specified deduction type

8) Figures are for Great Britain.