§ Mr. Budgen
asked the Secretary of State for Social Services whether he has any proposals for changes in assistance with housing costs.
§ Mr. Fowler
I propose certain changes in the current arrangements for assistance with housing costs, details of which are as follows. They will take effect in April 1984. For housing benefit recipients they will be concentrated generally on the relatively better-off households and on those with non-dependants in work who will in future be expected to make a higher contribution towards housing costs. They also affect 18–20 year olds receiving supplementary benefit and living at home.
The changes do not affect the 1984 uprating of housing benefits, which, like other benefits, will be uprated in the usual way. For benefits generally, the uprating in November 1984 will be based on price rises in the 12 months up to May of that year; this protection will apply not only to pensions and other linked long-term benefits, but also to other benefits — including unemployment benefit, supplementary benefit and child benefit. The changes will save about £180 million in public expenditure, in a full year, and about £50 million from rate rebates.573W
Details of changes
Housing benefit provides help with rent and/or rates to people on low incomes. Most people on supplementary benefit have their rent and rates met in full by housing benefit. Other recipients normally receive partial help. The scheme is administered by local authorities.
For those not on supplementary benefit, housing benefit is worked out by comparing their income with the appropriate needs allowance. People with income equal to the needs allowance get 60 per cent. of their rent and/or rates met by housing benefit. People with income below the needs allowance get more than 60 per cent. People with income above the needs allowance get less than 60 per cent. The rates at which benefit changes to take account of income are known as tapers.
Only the tapers above the needs allowance—affecting the relatively better off claimants—are being altered. For each £1 of additional income their awards will be reduced by 31p for rent instead of 21p; for rates the reduction will be 9p instead of 7p.
Amounts to be deducted from housing benefit when non-dependants are in the household (Figures in brackets are deductions under existing rules) Level of deduction Types of non-dependant Rent rebates/allowances Rate rebates Notes £ £ 16–17 year olds on SB or Youth Training Schemes — (—) — (—) No change Others on SB, and pensioners 2.20(2.20) 0.90(0.90) No change 16–17 year olds in work etc. 2.20 (—) 0–90 (—) Deduction introduced 18–20 year olds in work etc. 6.15(3.95) 2.05(1.60) Full adult rate applied (increase of £2.20 and £0.45) Aged 21 to pension age, in work etc. 6.15(4.70) 2.05(1.85) Deductions increased by £1.45 and £0.20
High rent scheme
Some authorities can provide extra help to claimants not on supplementary benefit if local average rents are above a national threshold. This was set at about 150 per cent. of average rents in 1972 but over the years has declined to the present levels of 120 per cent. of average LA rents and 115 per cent. of private rents. The thresholds will be increased to a more realisitic level of 130 per cent. of average rents, so that fewer authorities will qualify.
No housing benefit is payable if entitlement is below a minimum level: currently 20p a week for help with rents and lop a week for help with rates. The current minima will be retained for people on supplementary benefit but increased to £1 and 50p respectively for other claimants.