Government announces enquiry on LHA

The Work and Pensions Committee has announced an inquiry into Local Housing Allowance (LHA).

The allowance was introduced last year, replacing Housing Benefit for new tenancies.

The move was aimed of increasing tenant choice as LHA is paid direct to the tenant, whereas Housing Benefit is paid to the landlord.

Problems have arisen in cases where tenants have not passed the allowance on to their landlords, leading to claims that LHA is contributing to a shrinking supply of homes for benefit claimants in the private rental sector, with more pressure being placed on social housing as a result.

The Committee says it will be examining the objectives of LHA and whether they are met in practice.

It will also look at whether LHA is understood by claimants and landlords and consider the impact of direct payments to claimants, on both tenants and landlords.

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