Welsh Lib Dems call on the Chancellor to end stealth cuts to Local Housing Allowance in the budget

The Welsh Liberal Democrats have urged the Government to urgently unfreeze Local Housing Allowance and carry out a long-term review on its future, as rental costs have increased by 5.5% in the past year.

Local Housing Allowance is intended to support households with housing costs and, therefore, ease pressure on social housing, as well as prevent homelessness in the long term. It is calculated to cover rental costs for the lowest third of properties in the private rented sector in a particular area.

The Government’s decision to freeze LHA at its September 2024 value means that it is being cut in real terms month after month, reducing the number of affordable properties for families.

In Wales, 182,235 households currently claim housing entitlement through Universal Credit, and 104,360 households receive support via legacy housing benefits. This means that hundreds of thousands of households across Wales are impacted by the stealth cut and risk being unable to afford their home.

Liberal Democrat Chief Whip Wendy Chamberlain has tabled an Early Day Motion, supported by Welsh Liberal Democrat Westminster Spokesperson David Chadwick, which calls on the Government to urgently review Local Housing Allowance and to consider linking the benefit to rental market inflation.

Commenting, Welsh Liberal Democrat Westminster Spokesperson David Chadwick said:

“I’m deeply concerned that hundreds of thousands of people in Wales are unable to access rental properties because Local Housing Allowance is simply not in line with the reality of the rental market.

“We’re a month out from the Budget, and I urge the Government to unfreeze and restore LHA so that it covers at least the bottom 30% of rents in Wales.

“This is a major way in which we can prevent and alleviate homelessness and I hope that the Labour Government have the compassion to do so.”

ENDS