Councillor Kevin Price, the City’s Executive Councillor for Housing, has welcomed news that the Government is to relax part of its freeze on benefits by raising the amount of housing benefit some private sector tenants can claim, known as Local Housing Allowance (LHA), for 2018/19 but said that the disparity between private rents and the LHA cap in Cambridge is so great that it will be of little use to most renters in the City because the formula used is an average from a wider geographical area.
Councillor Price said: “Those housing affordability crisis in Cambridge not only drives the market sale price of homes but also the rental value so even getting an affordable private sector tenancy is difficult for many, including those who work but are on low incomes. Housing benefit - called Local Housing Allowance for private sector tenants - is designed to help but the way it is set by averaging out rents across a wide area and then capping it at a low level simply doesn’t recognise that Cambridge has a much bigger affordability problem than our neighbouring districts.”
“It’s been frozen since 2015 so any change is welcome but the reality is that the planned increase of 3% to the cap for LHA rates within the Cambridge Broad Rental Market Area (BRMA), which includes the City, still won’t reflect the reality of rents in Cambridge, even at the lowest end of the market.”
Councillor Price added: “ Cambridge mustn’t become somewhere only the wealthy can afford to buy a home and only the well paid can afford even to rent a home. We do everything we can to help. In 2017/18 we have used over £41,000 to top up housing benefit through our Discretionary Housing Payment funding and we are also now using the Homelessness Reduction funding to help families stay in their homes, but we need changes to how the LHA rates are calculated and for the freeze on LHA itself to be dropped. Until that happens many will continue to be faced with a risk of homelessness or moving out of the city to cheaper areas.”