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Housing Benefit - Local Housing Allowance

 

Local Housing Allowance is a way of working out, and paying, Housing Benefit for tenants of private landlords.

Local Housing Allowance affects tenants of private landlords from 7 April 2008

Local Housing Allowance does not affect council tenants or tenants of social landlords, such as Bield Housing Association, Almond Housing Association or Weslo Housing Management, or tenants of charities like the Abbeyfield Society.

From April 2011 the UK Government has made changes to the way the Local Housing Allowance is worked out.

What are the changes?

There are three main changes to the way that Local Housing Allowance is worked out.

Firstly, the way the maximum rent is calculated changes.

  • The Rent Officer, an official who is independent of the council, will still set a Local Housing Allowance Rate for each size of property in our area (a single room in shared accomodation, and a one bedroom, two-bedroom, three-bedroom and four-bedroom flat or house). But the UK Governement has changed the way that the Local Housing Allowance rate is calculated.
  • Before April 2011 it was calculated so that people on Housing Benefit could afford to rent about 5 in 10 properties in the area.
  • From April 2011 the Local Housing Allowance is reduced to a lower amount, which means that about 3 in 10 properties in a local area will be affordable to people on Housing Benefit.
  • The Local Housing Allowance rates are published on this website, Click here to see the Local Housing Allowance rates for this year.
  • Up until April 2012, the LHA rates could change each month. Click here (new window) if you want to see previous rates of LHA in West Lothian.
  • The LHA Direct Website (new window) also publishes the Local Housing Allowance rates and gives some comparisons with rates before and after the April changes.

Secondly, from April 2011, the Local Housing Allowance is no longer paid at the five-bedroom rate.

  • From April 2011, the maximum Local Housing Allowance amount is limited to the four-bedroom rate.

Thirdly, from April 2011, tenants will not be paid a Local Housing Allowance that is more than their actual rent.

  • In the past, some tenants were able to choose to rent cheaper property and keep some of the difference between the Local Housing Allowance rate and the actual rent charged. This will no longer happen.
  • Existing tenants who were in this position will have this payment phased out.

As well as these changes, from April 2011, the way Local Housing Allowance is paid can also change in some circumstances.

  • In many cases payment of Housing Benefit will continue to be made to the tenant directly into their bank accounts.  The tenant will have the responsibility to pay their rent to the landlord.
  • If things go wrong  and the tenant is 8 weeks or more in arrears with rent then the council, when it is given evidence that this is the situation, must usually pay the landlord direct.
  • Also, where the council considers that a tenant is unlikely to pay their rent, or is incapable of managing their affairs, it may choose to pay the landlord direct for a period.

In addition to these situations, which are explained in more detail in our Safeguard Arrangements document (new window), the Government has introduced a new policy:

  • From April 2011 the council may decide to make payments of a tenant's Local Housing Allowance direct to the Landlord it it considers that this would assist the tenant in securing or retaining a tenancy.
  • The Government's Guidance, issued to council's by the Department for Work and Pensions, outline circumstances where this could be used - most likely where the ladlord agrees to provide accommodation at an affordable cost - which, for those tenants on Housing Benefit is likely to mean at the new Local Housing Allowance rates.

How do I find out what the Local Housing Allowance Rate for my property will be?

The Rent Officer will supplies councils with the Local Housing Allowance rates for various sizes of property in each of the Broad Rental Market Areas.

We publish the Local Housing Allowance rates on this website click here to see this year's LHA rates.

Please note that the Local Housing Allowance rate is only the starting point for the calculation of a tenant's benefit entitlement - it is not necessarily the actual amount a tenant will receive as this will be influenced by other factors such as the tenant's income and savings and the actual rent being charged.

There are three Broad Rental Market areas in West Lothian, split by postcode.

  • EH postcodes (this covers the majority of West Lothian properties)
  • ML postcodes
  • FK postcodes

For each of these Broad Rental Market Areas, the Rent Officer will supply the council with a Local Housing Allowance rate for each of the following size of properties:

  • Single room with shared facilities 
  • 1 bedroom property
  • 2 bedroom property
  • 3 bedroom property
  • 4 bedroom property
  • The Local Housing Allowance rate used for the calculation of a tenant's housing benefit will be determined by the number of bedrooms that tenant's household is entitled to, up to a maximum of four bedrooms.
  • The LHA Direct (new window) website helps you to work out how many bedrooms you are entitled to under Local Housing Allowance.
  • The maximum rent most people under 35 who live alone will be the single room with shared facilities rate.

What if the tenant's Local Housing Allowance is lower than their rent?

The tenant will have to make up any shortfall out of their other income, or negotiate with the landlord to reduce the rent to the LHA rate. Where there is evidence that this has been done, an application for payment direct to the ladlord can be made.

 

Updated 22/05/12