LHA AND Bedroom Tax for social housing?

Just trying to think this through.

When LHA is introduced to social tenancies, this will place (further) restrictions on a claimant’s eligible rent and s/he will end up paying more of the rent.

As far as I can see, the Bedroom Tax will also apply, and so the claimant will be hit twice, once by a reduction on eligible rent and again by a cut in actual HB for ‘under-occupancy’.

I am not, so far, having a good day. Clear thinkers welcome.

As I understand it the LHA will be an alternative to the bedroom tax.  LHA already has limits for under-occupation built in: if you live in a three bed house but only need two bedrooms, you will get the two-bed LHA.  The eligible rent for HB will be the lesser of LHA for the household and whatever it would be under the current rules.

Until we see any regulations this is speculation but Lord Freud’s model letter a few months back suggested that was the policy intention: in any case where the LHA would be less than what you get now, you will be restricted to LHA.  Otherwise it’s as you were.

The vast majority of people affected will be single under 35s.  Social sector LHA could also have a severe impact on people living in shared accommodation even if they are not single <35s, which in the regulated social sector normally means supported accommodation.  But as discussed at length elsewhere the funding of supported accommodation is the subject of a much wider review in which social sector LHA may or may not feature alongside other measures.

Basically whichever is the higher deduction will apply, according to Lord Freud’s letter.

The other group affected are customers in high rise accommodation or any flats with shared entrances or communal areas.  The rents for these tend to be considerably higher than the LHA because of the service charges.