MPs to probe ‘£700mn shortfall’ in DWP housing subsidy to councils
MPs on the Work and Pensions Committee will hold a one-off session to probe a shortfall of £737.3 million across 5-years in DWP refunds to hard-up local authorities in temporary housing costs reported by Local Government Association research.
Meeting details
Councils have to put people in temporary accommodation as part of their duty to reduce homelessness, the costs for which should then be reimbursed by the Department for Work and Pensions at a rate linked to local rental costs. But while the DWP pays individuals a rate linked to 30% of 2024 private rental levels (Local Housing Allowance), the cash handed to struggling local authorities is pegged to 2011 rates. According to ONS data, between 2015 and 2024 rents in the private sector jumped by almost a quarter.
Witnesses, which include the Local Government Association, National Residential Landlord Association and charities will also be asked about the impact of insufficient support to individuals to cover housing costs and on the supply of social housing.
The session comes after the Committee heard that housing policy is putting pressure on those in poverty, particularly for those who are renting privately, as part of its Pensioner Poverty inquiry.