Welfare Reform - From April 2013

Housing Benefit is Changing

From April 2013 the Housing Benefit system will be changing. This will mean some people will have their Housing Benefit reduced.

Find out if these changes will affect you and where you can get help and advice.

Summary of the changes

The Government is making changes to Housing Benefit which will mean many people will have their benefit reduced. This will mean people will have to pay to the difference between their housing benefit and their rent. These changes only apply to people of working age claiming benefit.

Working Age = from 16 years to pension credit age (61½ at April 2013)

Size Criteria - How many ‘spare’ bedrooms do you have?

From April 2013, your Housing Benefit may be reduced if you have one or more ‘spare’ bedrooms in your home. The new rules will restrict the size of accommodation you can receive Housing Benefit for, based on who is in your household.

One bedroom will be allowed for:

  • Each adult couple
  • Any other person aged 16 or over
  • Two children of the same sex aged under 16
  • Two children under the age of 10 regardless of their sex
  • Any other child
  • A carer (who does not normally live with you) but provides you or your partner with overnight care

The new rules will apply even if:

  • You and your partner need to sleep apart because of a medical problem
  • You have a spare room for a child whose main home is elsewhere

If you have more bedrooms than what has been decided you need for your household, your Housing Benefit will be reduced by:

  • 14% of the rent and eligible service charges for one spare bedroom
  • 25% of the rent and eligible service charges for two or more spare bedrooms
Examples
Karen lives alone in a 2 bedroom flat and gets housing benefit based on an eligible rent of £95.00. As she is only eligible for 1 bedroom, a 14% cut will be applied to her eligible rent, making her new eligible rent £81.70. If Karen is on maximum Housing Benefit and doesn’t currently pay any rent, she will have to start paying £13.30 per week. If Karen was only receiving some Housing Benefit to help her pay her rent, this will now be reduced by £13.30 per week.
Richard and his partner live in a 4 bedroom house with their two sons, aged 15 and 13 and get housing benefit based on an eligible rent of £123.00. As their sons will be expected to share a bedroom, they will only be eligible for 2 bedrooms. Applying the 25% cut will make their new eligible rent £92.25. If Richard is on maximum Housing Benefit and doesn’t currently pay any rent, he will have to start paying £30.75 per week. If Richard was only receiving some Housing Benefit to help him pay his rent, this will now be reduced by £30.75 per week.

If your Housing Benefit is cut you will have to pay the Council the difference between you Housing Benefit and your rent.


Benefit Cap - How much do you receive in benefits?

From April 2013, your Housing Benefit may reduce if the overall amount of benefit you receive is above a certain amount. If you are out of work, the maximum amount of benefit you will be able to receive will be:

  • £500 per week for single parents and couples with or without children
  • £350 per week for single people without children

If the total amount of benefit you receive come to more than the maximum amount allowed, your Housing Benefit will be reduced.

A range of benefits are included in the calculation including Housing Benefit, Jobseeker’s Allowance, Employment Support Allowance (except where the Support component has been awarded), Child Benefit, Child Tax Credit and Carer’s Allowance.

Example
Steve and Sarah have five children and are receiving Housing Benefit. They get Job Seekers Allowance of £111 per week, Child Tax Credit of £230 per week and Child Benefit of £73 per week, making their total income is £414 per week. They are currently eligible for £160 per week Housing Benefit to cover their rent, giving a total benefit income of £574 per week (£414 + £160).

Applying the £500 cap will mean their Housing Benefit is reduced to £86, a loss of £74 per week.

If your Housing Benefit is cut you will have to pay the Council the difference between you Housing Benefit and your rent.

Other Changes

There are a number of other benefit changes taking place:

Universal Credit

Universal Credit is being gradually introduced across the country as part of the government’s welfare reforms. It is a single working age benefit, replacing the current benefits for employment, housing and childcare, with one monthly payment to claimants.

Once you receive Universal Credit you will need to arrange to pay your rent yourself directly to Winchester City Council, if you are a Council tenant, or your landlord if you are a tenant of another Housing Provider. Paying your rent is a priority payment and you could lose your home if you do not pay it.

Universal Credit was introduced in Winchester on 21 September 2015.

For more information about Universal Credit including how to claim, please go to: www.winchester.gov.uk/benefits/universal-credit/

Disability Living Allowance

Disability Living Allowance (DLA) will not form part of the new Universal Credit or fall under the Benefit Cap. However, it will be changing from April 2013 to the new Personal Independence Payment (PIP) for all new claimants. If you already claim DLA you will be reassessed under the PIP criteria when your current DLA is up for renewal (unless you are over 64 or under 16). You will probably have to complete a claim pack and attend a consultation with an independent assessor.

Pension Credit

As Housing Benefit is going, Pension Credit will need to change from October 2014. It will include a new housing element called housing credit to help towards rent. It is expected that this will come in for new claimants in October 2014, while if you are already receiving Housing Benefit you will be transferred to the new Pension Credit system between 2014 and 2017.

Where to get help & advice

We understand that these new benefit changes are complex and we are committed to helping you through them as they come into effect.

If you think you may be affected by the changes we can help you to check if you are and what the impact may be. Please contact us or use the online calculators on our website.

If you are worried about being able to pay your rent from April 2013 contact us now for advice! You can talk to your Area Housing Manager about:

• Ways of paying your rent and help with money management
• Exchanging or transferring to a smaller property
• Ways to boost your income and reduce your outgoings

We also work in partnership with the Citizens Advice Bureau and can refer you to their Money Advice Service for specialist assistance.

Contact
Winchester City Council Housing Services on 01962 84 84 00 or email housing@winchester.gov.uk

Winchester City Council Benefits Section on 01962 848 539 or email benefits@winchester.gov.uk

Citizens Advice Bureau - Winchester Branch on 01962 848 000 or email winchesterdistrict@cab.org.uk

Money Advice Service - An independent service, set up by government to help people make the most of their money, giving free, unbiased money advice to everyone across the UK. Call 0300 500 5000 or visit www.moneyadviceservice.org.uk

Turn2us - A national organisation that provides advice to people in financial need. Call free on 0808 802 2000 or visit www.turn2us.org.uk