DHP: awarding for shortfall
I have a client who is in receipt of UC HCE.
She applied for DHP and was awarded towards deposit and rent in advance, but not for shortfall.
The LA’s explanation was: “DHPs can be used to compensate for the LHA as per pt 2.9 of Discretionary Housing Payments Manual, this is correct if a client is making a claim for shortfall after being in the property some time”
My client has just moved into the property and she has not been living there for “some time”.
We addressed fully the issue of “affordability”.
I cannot find anything about shortfall awards being made only to established (as opposite to new) tenants.
I would like to challenge that statement and ask for a review. Do I have grounds?
So their position is that they can, but don’t want to, award a DHP to make up the shortfall between LHA and rent in circumstances where she has just moved into a property at higher than LHA rates - but you are saying that it was appropriate for her to move there because it was affordable.
Yeah you can ask for a review if you want. I don’t think this raises any legal point; its just up to the council which way they exercise their discretion.
But can they limit their discretion to only those who have been in a property “for some time”? I cannot see anything about this in the DHP Manual…
I wouldn’t read too much into the letter which I think is just imprecisely worded They can’t have a policy which says “never award DHPs to people who have not lived in their home for at least 12 months”, but they can consider the length of residence as a factor in exercising their discretion.
if the question of affordability was raised and addressed, how come a DHP is required?
its either affordable to the customer and no DHP needed, or there is a shortfall she is going to struggle with - in which case why sign up to a tenancy thats not affordable?
Clearly the property ISNT affordable if the customer needs a dhp to be able to afford the rent from day 1 of the tenancy
How much is the shortfall? Is the customer benefit vcapped, or has income tapers, or is it purely that the rent is more than the LHA?
We would look at spending and look at whether altering non essential spending would mean the customer could afford the shortfall. I would want to know why the tenant took this particular property if she couldnt afford the rental payments. Did she need to be in that particular location for some reason?
I read the question as saying that CAB had addressed the question of affordability in the DHP application, rather than that they thought it was affordable.
The problem with challenging DHPs is that they are discretionary, and unless you can point to something unlawful about a decision there’s not usually a lot you can do about it.
The authority must apply its DHP policy when making awards, and it would be unlawful for them to fetter their discretion by saying they will rule out DHPs in broad ranges of cases. However, if their policy said something like “it will not normally be appropriate to award a periodic DHP for a shortfall which has existed from the start of the tenancy” then that would be fine - it’s a statement of how they’re likely to make the decision but it allows for the applicant’s circumstances.
Ultimately, I think the point of DHPs is homelessness prevention, so I have always thought about it in terms of whether it will look like intentional homelessness if the tenant is evicted - which means importing the definition of affordability from housing law (which is actually quite generous - see Samuels v Birmingham CC  UKSC 28), but also the question of deliberate act or omission.
So I am not surprised at an authority refusing a DHP in a situation where the tenant deliberately took on an unaffordable property, but if they took it on because it was all that was available that met their needs, or if they took it on and then their circumstances quickly changed, the decision maker should take account of those factors. Of course, taking account of other factors doesn’t guarantee a different (or more favourable) result.