CRISIS - HB/LHA Survey results

tbs624

Link here

Interesting reading for both LLs and Ts/claimants

Fire_Fox

The whole system doesn't encourage people back to work. I don't claim LHA only JSA which I simply cannot pay my basic bills on living alone. In my industry it wouldn't be difficult to find the odd bit of casual work, but I only get to 'keep' the first £5, a daily bus pass is over £3! It certainly isn't worth me getting the insurance and license I need to be legal working freelance. My professional membership is due this month and my emergency aid expires in the summer which I will be unemployable in the industry without.

Rant over!

poppysarah

Would they be better off asking for rents to be lowered?

Housing Benefit rates must be in line with real rental costs
The Government must ensure that Housing Benefit reflects the true cost of renting in the
PRS.

N79

poppysarah wrote: »

Would they be better off asking for rents to be lowered?

Housing Benefit rates must be in line with real rental costs
The Government must ensure that Housing Benefit reflects the true cost of renting in the
PRS.

Indeed. The problem is that LHA rates massively distort the bottom end of the rental market as with the shortage of housing stock and LL's willing to rent to this market the LHA rate effectively becomes the lowest rent that LL's will charge in any given area. This raises the rents of normal standard houses for working people as the bottom of the market is artificially raised.

This trend also acts as a disincentive for LL's to improve the housing stock at the lower end of the market as improvements to low standard properties (eg double glazing) will not result in higher rent as all low standard housing stock commands the LHA rate.

Indeed, if I had any confidence in the stability of government policy I would now be tempted into this letting area. LHA is holding the rents of certain low standard properties above what normal market returns would dictate based on the (now reduced) prices that these properties can be bought for. By running a low cost maintainance regime and even allowing for high rates of default on rents I think this is now one of the largest rental yield markets provided you are prepared to gamble on the cost of the assets (which will be devalued if government policy changes). Of course, this is really making a living at the UK taxpayers expense. Still - if I have noticed the opportunity then I am sure that plenty of other people will.

(Note: low standard does not mean substandard)

BitterAndTwisted

Fire_Fox wrote: »

I don't claim LHA only JSA which I simply cannot pay my basic bills on living alone. In my industry it wouldn't be difficult to find the odd bit of casual work, but I only get to 'keep' the first £5, a daily bus pass is over £3!

I did three day's work in December for which I received £400 after tax and NI was deducted which I then declared. This resulted in my claim for JSA to be suspended and it took two months to sort out and in the meantime I was living off fresh air. However once they had finally got all the correct documentation and reviewed my case in the end I lost only one week's worth of JSA. My LHA/HB and CT was not suspended at all, thank the Lord. The JobCentre's systems are not set up to deal with people who find temporary or casual work. As soon as I declared my earnings they made the assumption that I would be earning that £400 a week every week.

My main worry at the moment is how to survive if I do get a job and have to wait until month-end to receive a salary cheque. I guess I'll have to go into overdraft to pay my fares.

I can survive on my JSA, sort of, but this meant sitting at home with no heating on while the temps outside were sub-zero for weeks on end. This is not to recommended. After paying my bills I have around £12-£15 a week available to spend on food which can be done. Just.

Fire_Fox

BitterAndTwisted wrote: »

I did three day's work in December for which I received £400 after tax and NI was deducted which I then declared. This resulted in my claim for JSA to be suspended and it took two months to sort out and in the meantime I was living off fresh air. However once they had finally got all the correct documentation and reviewed my case in the end I lost only one week's worth of JSA. My LHA/HB and CT was not suspended at all, thank the Lord. The JobCentre's systems are not set up to deal with people who find temporary or casual work. As soon as I declared my earnings they made the assumption that I would be earning that £400 a week every week.

:eek: So sorry to read that. I was told my claim would be fast-tracked if I had to sign off! I do have savings (ISAs, already emptied the instant saver) so I am not in the dire straits that you and others are in; surely this sort of thing will discourage genuine claimants from working?? :huh:

BitterAndTwisted wrote: »

My main worry at the moment is how to survive if I do get a job and have to wait until month-end to receive a salary cheque. I guess I'll have to go into overdraft to pay my fares.

I can survive on my JSA, sort of, but this meant sitting at home with no heating on while the temps outside were sub-zero for weeks on end. This is not to recommended. After paying my bills I have around £12-£15 a week available to spend on food which can be done. Just.

I can't anywhere near pay my bills on JSA, not until support for mortgage interest kicks in at three months which will help with my £120 a month service charge and ground rent commitment. I do wonder whether the clock resets if I get casual shifts and sign off .... that is not the way I want to be thinking.

I kept my heating at 14C throughout the snow which means I don't have to tap my savings account again, the money is not going to last forever. I read up on 'fuel poverty' and you are deemed to be there if it *would* cost more than 10% of your income to heat your home to safe levels and single people on benefits are known to be at high risk, puts us squarely in the bracket I think? I have been worrying how others without savings can cope, thank God we have MSE!

I don't know where you are in the country but have you looked into concessions? We have this which could be used to halve public transport on your first month back to work if you got it stamped before you signed off:
http://www.wymetro.com/TicketsAndPasses/concessionarytravel/MetroRover.htm
There is also this if you are on New Deal:
http://www.railsaver.co.uk/railcard-vs-railpass.html

princeofpounds

Indeed. The problem is that LHA rates massively distort the bottom end of the rental market as with the shortage of housing stock and LL's willing to rent to this market the LHA rate effectively becomes the lowest rent that LL's will charge in any given area. This raises the rents of normal standard houses for working people as the bottom of the market is artificially raised.

One of the more interesting points I have seen on the system is very similar to your criticism, although I haven't verified it myself.

Apparently the LHA is set at the average rent for particular level of property in each area. This effectively condemns poorer working people to the worse-than-average properties. As many claimants would be in this section if they moved into work, they can afford more expensive properties by staying on the allowance.

There is also a distortion on family sizes - you end up with large families (we've all seen them in the daily mail!) who are paid vast sums of money in allowance to rent houses for their children, effectively subsidising them to living a lifestyle they could only afford (at least in housing terms) by earning huge sums of money, something they would be incapable of doing through their own efforts. This is a tough one, as you don't want to penalise children for their parent's inability to support them, but it again produces all the wrong incentives.