Chancellor of the Exchequer George Osborne’s Budget announcement earlier today included a few surprises for the Private Rented Sector (PRS), landlords and tenants. The following is a reflection of the welfare proposals.
Welfare was expected to play a major role in the Budget announcements and the following is a breakdown of the aspects that will affect landlords most:
- Benefits uprating – Most working-age benefits will be frozen for 4 years from April 2016. This will apply to Jobseekers’ Allowance; Employment and Support Allowance; Income Support; Child Benefit; applicable amounts for Housing Benefit; and Local Housing Allowance rates, with provision for high rent areas.
- Limiting backdating in Housing Benefit – From April 2016, Housing Benefit claims will be backdated for a maximum of 4 weeks.
- Discretionary Housing Payments –The government will provide £800 million of funding for Discretionary Housing Payments over the next 5 years.
- Universal Credit waiting days updated delivery schedule – The government plans to implement 7 waiting days for Universal Credit in August 2015.
- Lowering the household benefit cap – The government will lower the household benefit cap, which caps the amount of benefits out-of-work working-age families can receive, to £20,000, except in Greater London where the cap will be £23,000. The current exemptions to the cap will continue to apply.
- Removing the Family Element in tax credits, the first child premium in Universal Credit and the Family Premium in Housing Benefit – In Housing Benefit, the family premium will be removed for new claims and new births from April 2016.
- Restricting Housing Benefit entitlement for young people – From April 2017, those out of work aged 18 to 21 making new claims to Universal Credit will no longer be automatically entitled to the housing element. Parents whose children live with them, vulnerable groups, and those who were living independently and working continuously for the preceding 6 months will be exempt from this measure.