The government has doubled its estimate of the number of people who will lose any entitlement to housing benefit as a result of its controversial under-occupation penalty. An updated impact assessment on welfare reform, published by the Department for Work and Pensions last Thursday, showed that 40,000 people are expected to lose housing benefit completely due to reductions in payments.

Previous estimates published in February 2011 put the figure at 20,000 people. All 40,000 people affected currently receive partial housing benefit. The bedroom tax, which will penalise working age social tenants in receipt of housing benefit on average £14 a week if they have a spare room, will be higher than the amount of benefit they receive. The penalty is based on a percentage of the total rent on a property, rather than the amount of housing benefit received.

The DWP said the change in the number of people affected was due to ‘updated modelling’. “These are people who are on less than average levels of housing benefit and also have other income,’ a DWP spokesperson added. Ruth Cooke, chief executive of Midland Heart, said: “It’s a significant change for customers to move from having partial housing benefit to no benefit at all so we would want to engage those people in terms of their options.”

Source: Inside Housing

6th July 2012


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