Warning for thousands on Universal Credit facing cut to payments – check if you’re affected

HARD-UP households on Universal Credit are facing a real terms pay cut after the government confirmed it won't be reviewing payments.

A number of benefits will rise from next April in line with inflation for September this year - 10.1%.

Chancellor Jeremy Hunt announced the news in his Autumn Statement in the House of Commons in November.

But the 10.1% rise from next April won't apply to all benefits - including Local Housing Allowance (LHA).

LHA was introduced in 2008 and calculates the maximum amount people renting from a private landlord can claim in Housing Benefit or Universal Credit.

Work and Pensions Secretary Mel Stride promised to look “very closely” at local housing allowance (LHA) when he reviews the benefits next.

But he said the next time he will look at the allowance would not be until “in about a year’s time”.

Around 844,000 households now have rents above the maximum level that LHA will cover.

Shadow work and pensions minister Karen Buck told the Commons that 59% of private renters on Universal Credit have rents above the maximum.

She said this means households "have to make up the difference by either reducing spending on other necessities like food and heating or else getting into arrears at risk of homelessness”.

A government spokesman told The Sun: “During the pandemic we increased Local Housing Allowance significantly and beyond inflation, benefiting over one million households by an average of over £600 over the year.

"We’re maintaining that boost, keeping support for private renters above pre-pandemic levels.";

What is Local Housing Allowance?

Local Housing Allowance (LHA) was introduced in 2008 and calculates the maximum amount people renting from a private landlord can claim in Housing Benefit or Universal Credit.

What you get through the allowance will depend on the area you live in and the size of your rental property.