Official data shows that across the county, 63.9% of renters who receive housing benefit have a shortfall between the support they receive and the rent the pay – with the average gap being £93.11 a month.
The Local Housing Allowance is used to calculate the amount tenants can receive to support housing costs as part of a Universal Credit payment. The Government increased this allowance two years ago in response to the pandemic, so that it covered the bottom 30% of private rents in any given area. In April last year, however, the rate was frozen in cash terms, and remains frozen in 2022/23.
As a result of the freeze, the link between local rent levels and the amount of housing benefit support received has been broken. This means the number of properties that private renters in receipt of Universal Credit can afford is likely to steadily decline – despite rents across the East Midlands having increased by less than inflation.
Teresa Kaczmarek, East Midlands spokesperson for the National Residential Landlords Association, said: “The benefits system fails to provide renters and landlords across the East Midlands with the security they need.
“It cannot be right that housing benefit support fails to reflect the reality of current rent levels. The freeze merely exacerbates the already serious cost of living crisis for tenants across the region.
“The Chancellor needs to listen and respond to the concerns of both renters and landlords by unfreezing housing benefits as a matter of urgency.”
The full data for each local authority in Derbyshire can be found here.