Changes to support for housing costs
The Government is making changes to housing costs support from April 2016. We explain these changes and the financial help available.
Housing Benefit backdating period reduced
Claims for Housing Benefit can be backdated if you can show that there was ‘good cause’, a strong reason for not claiming the benefit earlier if you met the qualifying conditions.
From April 2016, the backdating period for working age claimants will be reduced to four weeks maximum instead of six months under the current system.
Claim period for Housing Benefit and Pension Credit during absence abroad reduced
If you are getting Housing Benefit and Pension Credit, you are able to continue to receive payments for a period while you are temporarily absent from the UK. From May 2016 this will change and you will only be able to receive payment for the first four weeks of an absence abroad. This is reduced from the current 13 week period for most cases.
Waiting period for help with Mortgage Interest Costs increased
If you are a homeowner who is receiving Income Support, Income-based Jobseeker’s Allowance, Income-related Employment and Support Allowance or the guaranteed Pension Credit you can claim Support for Mortgage Interest (SMI) costs to help meet your mortgage interest costs.
After making a claim for SMI, a waiting period has to be met before payments are made. From April 2016, the SMI waiting period will return to the pre-recession length of 39 weeks (nine assessment periods for Universal Credit (instead of the current level of 13 weeks). The capital limit for SMI will stay at the higher level of £200,000.
If you are already in a waiting period on or before the 31 March 2016, you will be subject to transitional protection, meaning that the current waiting period will still apply to you.
The waiting period does not apply if you are getting Pension Credit or if you or your partner are the qualifying age for pension credit in most cases, other more remote exceptions can also apply.
Family Premium in Housing Benefit abolished
From 1 May 2016, the additional amount paid in Housing Benefit to you if you care for children - called the ‘family premium’ - will not be available for new claims. If you are already receiving Housing Benefit with a child on your claim before or on 30 April 2016, you will continue to get the family premium.
Local Housing Allowance rates to be frozen for four years
From April, there will be a four year freeze to Local Housing Allowance rates which set the maximum amount of Housing Benefit (Universal Credit housing cost element) that private renters on a low income can receive towards their housing costs. The new four year freeze will create added pressure for renters, who are already struggling because private rent prices are increasing at a faster rate than the amount of housing support provided to renters.
Social housing rents reduced by 1% a year for four years
Social tenants from April will see their rents reduced by 1% a year for the next four years. Previously social housing rents could increase by 1% more than inflation.
The change will be a welcome cut in rent for tenants who pay rent themselves.
Social housing providers however argue that the change will cause a significant loss to their income as a result of a limit effectively being placed on the amount of Housing Benefit they receive for tenants.
The National Housing Federation chief executive David Orr fears that the loss of income will prevent ‘at the very least 27,000 new homes being built’, although the figure could be much higher.
The government however believes the changes will reduce average rents in the social rented sector by around 12% by 2020. The government also claim by 2020/21 there will be an in-year Housing Benefit saving of £1.995bn
What help is available if you are affected by these changes?
If you are on a low income and are struggling to meet housing costs, you can apply for Housing Benefit (Mortgage Interest Support if you are a homeowner and getting certain benefits) or Universal Credit and also Council Tax support.
If you are already claiming Housing Benefit (or Universal Credit that includes a housing element for paying rent), you can apply for Discretionary Housing Payments (DHP) to help meet your costs. DHP is provided on a discretionary basis by local authorities and are usually awarded for a limited period of time.
Use our Benefits Calculator to make sure you are claiming your full entitlements.
Even if you have checked your benefit entitlements in the past it is worth checking again, especially if there has been a change in your circumstances.
You can also check if you are eligible for a charitable grant or other support by using Turn2us Grants Search.
There are further details on all the upcoming benefit changes on our Benefits Changes Timetable for 2016.
If you are worried about any of the benefit changes and would like further advice, you can use the free Turn2us Find an Adviser tool to find a local adviser. Direct housing advice can also be obtained from Shelter.