Extra 20,000 ‘under-occupiers’ to lose housing benefit entitlement

Published by 24publishing for 24dash.com in Housing and also in Central Government, Communities, Local Government

The Government has doubled the number of partial housing benefit claimants it believes will lose all of their entitlement as a result of the new under-occupation rules being introduced into the social housing sector next April.

A revised impact assessment published by the Department for Work and Pensions (DWP) last month estimates that 40,000 claimants – in receipt of partial housing benefit – are likely to find that their entitlement ceases, and they "float off" the benefit completely.

In the original impact assessment - published in February 2011 – it put that figure at 20,000.

On average, those claimants that float off housing benefit will lose approximately £8 per week, the impact assessment says.

The DWP says the revised estimates are based on "updated modelling" and that the 40,000 claimants "floating off housing benefit" are those who are on less than average housing benefit levels and also have other income.

As such, the DWP has revised the annual cost savings for local authorities – due to lower administration costs – from £1.5m to £5m.

Elsewhere, the document revises the total number of those affected – down from 670,000 last year to 660,000; increases the average weekly loss from £13 to £14 and decreases the number of households under-occupying by two or more rooms from 150,000 to 120,000.

It also increases the average loss of housing association tenants from £14 to £16 per week.

The assessment warns that the Government's projected savings are based on the “current profile of tenants”, adding that “if a significant number of tenants wished to move, this could alter the pattern of savings and place extra demands on social landlords”.

The revised assessment notes: “Updated estimates of the impact have been derived from the latest tested version (at the time of production) of the Department’s static micro simulation model, the Policy Simulation Model. This update now makes use of more up-to-date information than used in the previous Impact Assessment published in February 2011, and is based upon information collected as part of the 2009/10 Family Resources Survey.

"Because estimated impacts are based upon survey data rather than based on comprehensive information about all households in Great Britain, survey results are likely to vary from year-to-year due to sampling a different selection of households as part of the survey.”