HB for Temporary Accommodation

Hi all,

Wondering if any of you kind people could help me out with difficulties I’m experiencing with a local authority in London .
The LA are capping the maximum rent they will pay for a property to the 2011 LHA rate (to do with the subsidy). They basically admitted to us that they technically weren’t allowed to do this, but would do so anyway. The problem is that the tenants whose rent they are capping have been placed in their borough by other local authorities and they basically don’t want to pick up the tab.

I’d be grateful of any advice you could offer on how we could go about challenging this as this is going to be affecting a significant number of our tenants.

There are two answers to this.

The first is that, if the authority paying HB is the “receiving” authority and not the “placing” authority, the subsidy limits based on the 2011 LHA rates do not apply in my opinion.  The cases should be assessed as vanilla housing association cases and attract 100% subsidy.  The cases still attract HB as opposed to UC, because they satisfy the definition of “temporary accommodation” in Schedule 1 to the UC Regulations.  But in Articles 17B and 17C of the Income Related Benefits (Subsidy to Authorities) Order 1998 (which limit subsidy by reference to the 2011 LHA rates), the subsidy limits only apply when HB is payable by “an authority” and the claimant was placed in HA temp acc by “the authority” - the reference to “the authority” having made the placement must refer back to “an authority” who is paying the HB.
https://www.legislation.gov.uk/uksi/1998/562/article/17B
https://www.legislation.gov.uk/uksi/1998/562/article/17C

The second answer is that normally the placing and receiving authority agree between themselves that the placing authority should carry out the HB functions.  Section 134(1B) of the Social Security Administration Act 1992 makes the receiving authority responsible for paying HB where it will be in the form of a rent allowance (which it will when the claimant is placed in HA temp acc); but subsection (5) allows authorities to carry out functions on one another’s behalf.  It has always been conventional for authorities to do this in the case of an out of borough HA homeless placement.  Whether the subsidy limits would apply is an interesting legal point: HB is administered literally by the same authority who made the placement, so at first sight Articles 17B and 17C are engaged, but they are only doing so on behalf of the receiving authority to whom those Articles would not apply in the absence of a s134(5) arrangement.