LHA slammed by charity

14/12/2009

"Flaws" in the benefits system could have led some tenants to seek out debt help due to money problems, analysis from Shelter has suggested.

The charity said today that Local Housing Allowance (LHA) is in "urgent need of reform" and suggested that "thousands" of tenants are facing financial hardships in the current system.

Specifically, Shelter said the current pricing system of LHA is unfair and is leading to some tenants finding it difficult to find affordable property in their local areas.

The benefit is calculated through the use of Broad Rental Market Areas (BRMAs), with a single level of LHA support applying across the area.

Shelter suggested that these BRMAs are "too large", meaning that tenants living in a more expensive part of the area face financial hardships and are forced to move elsewhere.

Anecdotal evidence also suggests that landlords are deliberately hiking prices in cheaper parts of the area because they know the LHA will cover residents for "extra".

The charity's director of policy and campaigns, Kay Boycott, said: "LHA is currently failing tenants and landlords.

"Our research shows the government must make urgent changes to LHA to ensure claimants do not continue to be disadvantaged."

A Shelter survey shows that 95 per cent of LHA claimants are currently struggling to manage their finances.

Tags; Housing Debt and Bills, Credit Card Lifestyle, Recent Graduate Debt,

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