More dislike the LHA

The Local Housing Allowance system in which the allowance is paid directly into tenants’ bank accounts has been in place for just over a year now. See previous posts here from the Editor about the problems that the system is causing for landlords and tenants.

Crisis, the homelessness charity, has recently done a survey on the system and their findings suggest that just about everyone involved in the LHA dislikes it. They surveyed 180 councils and voluntary organisations working in benefits advice. 82% of the councils said that tenants are falling behind with their rent and more tenancies are being terminated, voluntarily or through the courts, under the new system. It leads to wasted work for their staff at a time when the demand for prompt, efficient assessment of benefits and allowances and for homelessness advice is on the increase as unemployment rises.

This article reaffirms that landlords and tenants don’t like the LHA. It quotes a tenant, Mr Chapman, who says ‘ if I know my rent is paid, I can go and look for work and get on with my life.’

So, landlords don’t like it, tenants don’t like it, staff in councils administering it don’t like it, voluntary advisors and homelessness charities don’t like it. The Department of Work and Pensions is carrying out a review of the LHA and will report on it in the second half of 2010.

In the meantime, perhaps it’s only the banks that like it. They get their money. They have more customers: more people have opened bank accounts since April 2008 in order to get their LHA paid to them and the Citizens Advice Bureau say they have seen cases of tenants whose allowance has been appropriated by their bank because the tenant’s bank account is overdrawn.

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