Local Housing Allowance: Nottingham
(5 years, 4 months ago)
Commons ChamberRead Hansard Text Read Debate Ministerial Extracts
Lilian Greenwood (Nottingham South) (Lab)
It is just over nine years since I became the Member of Parliament for Nottingham South and in that time, I have secured a number of debates on housing and homelessness. I wish I could say that my contributions had led to an improvement in the situation for some of my constituency’s most vulnerable citizens, but I am afraid that things have got worse, rather than better. I suggest that every one of us here will have witnessed a sharp rise in the most visible form of homelessness: rough sleeping.
Back in 2010, the official count for rough sleepers in Nottingham was three. I first raised the issue in Parliament in December 2011, because it had risen sixfold in a year. Andrew Redfern, the chief executive of local homelessness charity, Framework, was warning that cuts to services and welfare changes were undermining years of success in tackling homelessness. Earlier this year, the number of rough sleepers in Nottingham reached a record high of 55. In eight years it was no better; it was much, much worse.
In March 2013, I secured an Adjournment debate on the under-occupancy penalty. Despite the best efforts of the coalition Government, the official title never stuck, and we all know it as the bedroom tax. That measure left 6,000 of our city’s poorest households with “nowhere to go” as the Nottingham Post put it.
In March 2015, I led a Westminster Hall debate on affordable housing, and in 2018 I used another Adjournment debate to highlight an Opportunity Nottingham report into persistent rough sleeping. The thing I find most shocking, looking back on those debates, is that on each occasion I was drawing attention to the problems faced by people in the city I represent, not as a result of lack of effort or even just bad luck, but as a direct result of Government policy. What is most shameful is that on each occasion Ministers were warned that their policies would cause hardship, poverty and debt but pursued them anyway.
Last week, the Minister assured us that he wanted everyone to have security in their home and a roof over their head. I hope that he is serious, because if he is, he will not want to continue with policies that he knows will make the lives of people in my city and this country harder and poorer.
Jim Shannon (Strangford) (DUP)
The hon. Lady and I came into the House at the same time, in 2010, and these are issues that we are both very interested in. Does she agree that it is nigh impossible for people to find a private rented property within the LHA even in what are often known as council estates and that this must be urgently reviewed in areas where the number of houses does not tally with housing need? This causes landlords to push for more to cover their overheads, to the detriment of our vulnerable constituents on housing benefit living on the breadline and having to make up the difference.
Lilian Greenwood
The hon. Gentleman pre-empts much of my speech, but he is entirely right.
Today’s debate was prompted by research undertaken by Hannah Clemson, policy and communications officer at Advice Nottingham, into the availability and affordability of private rented accommodation in Nottingham city, specifically property within the local housing allowance rate. Advice Nottingham is a consortium of six advice agencies based in Nottingham and providing free, confidential and impartial advice on a range of issues, including benefit, debt, employment and housing. They do an incredible job supporting people who are often in desperate circumstances, and I am glad to have the opportunity to put on the record my thanks to them for the work they do.
The availability of affordable homes to rent is clearly an issue of importance to many of my constituents in Nottingham, but it is not only an issue in our city. This debate is particularly timely, given last Thursday’s urgent question on the Supreme Court ruling in the case of Samuels v. Birmingham City Council led by my hon. Friend the Member for Battersea (Marsha De Cordova). That case highlighted the impact of the growing gap between actual rents and the amount of rent covered by local housing allowance, following the Government’s decision to freeze LHA rates from April 2016.
Analysis by Shelter has revealed that there is now a shortfall between LHA rents at the 30th percentile in 97% of broad market rental areas in England. As the hon. Member for Strangford (Jim Shannon) said, people cannot find affordable rents, and that is true almost everywhere in this country. Nottingham is one such area, where the freeze on local housing allowance is leaving people homeless and in poverty. Many of my constituents simply cannot afford a home in the private rented sector, yet that is the only choice they have. The Government’s outdated LHA rates from 2016 show rents in Nottingham to be as low as £42.54 per week. In reality, Advice Nottingham has found the cheapest property is now at least £63 per week.
Advice Nottingham knew that LHA was not meeting local needs from the work it did with its clients. It knew that rents were too high and that local people were struggling to find affordable accommodation, but it decided to do its own research to find out exactly how many properties were available in the city within the LHA rates. It undertook this research last November within a one-week period. Using Rightmove, Zoopla and Gumtree, it searched the city to find properties. It found only 12 properties at or below the rate for shared accommodation, and many of those were specifically marketed as student properties—I will explain the significance of that later in my speech. It found just five one-bedroom flats in the city at or below the LHA rate. Family homes proved even harder to find: there were only two two-bedroom properties at or below LHA rate; three three-bedroom properties; and one four-bedroom house, in the whole of the city, at a rent covered by LHA.
More recent work by Nottingham City Council confirms Advice Nottingham’s findings. The LHA rate is intended to reflect the bottom 30th percentile of local rents, but it found that it actually covered less than 7% of one-bedroom flats, less than 3% of two-bedroom properties and less than 5% of three-bedroom homes. With a shortage of council or housing association properties available, many families are forced to rent properties that they cannot really afford, forgoing other essential household expenditure, including food, heating and clothing, simply to put a roof over their heads.
Alex Norris (Nottingham North) (Lab/Co-op)
As usual, my hon. Friend is making a passionate case for our city. The bedroom tax was cruel because even if an individual complied with what the Government were trying to coerce them to do, there was not the housing there for them to go to, and we are seeing that repeated with the LHA. She correctly highlights the gap that people must make up just to get a roof over their head. Does she share my concern that my constituents in the north of the city, like hers in the south, are going without essentials—food, heating, things for their children—just to maintain these tenancies and that that is a sign of a system that fundamentally is not working?
Lilian Greenwood
My hon. Friend makes a very important point, and I will seek to explain precisely the problem our constituents are facing. The problem is that the gap they are seeking to fill between the LHA they receive and the rent they need to pay is not trivial but significant. According to Shelter, the gap between 30th percentile rents and the LHA rate in Nottingham is £15.17 a month for a room in a shared house; £55.01 for a one-bedroom flat; £54.57 for a two-bedroom property; £56.61 for a three-bedroom property; and £121.93 per month for a four-bedroom house. These are not trivial amounts. Trying to cover the shortfall is leaving people in a very vulnerable and insecure position and, as my hon. Friend has said, in poverty.
Jim Shannon
I am sure the hon. Lady, like others, will know from her constituency experience that whenever people’s income is reduced because of rental accommodation or benefit changes, more often than not they are pushed towards food banks. In my constituency, the Thriving Life food bank has been extremely busy due to benefit changes, rental accommodation not being available and being unable to pay the money. As a result, they are falling back on food banks—which we are very glad to have, by the way—with dismaying regularity.
Lilian Greenwood
The hon. Gentleman makes a really important point, and I cannot imagine how many people would get by without food banks, but some people will not go to a food bank—perhaps because they are too proud—and so will be going hungry, sitting in a cold house because they have not turned the heating on or sending their children to school in clothing that is too small or simply not appropriate. I have heard of children going to school in their pyjamas because they do not have proper clothing. It is shameful.
Martyn Neal, a senior adviser at the Meadows Advice Group, spoke to Advice Nottingham’s researcher about his experiences trying to support clients with local housing allowance. He described meeting two clients, one already homeless and one threatened with homelessness. The housing plans given by Housing Aid were almost identical and contained instructions to the client to look for affordable accommodation in the private sector. The LHA was quoted as a guide to affordability, but absolutely no other guidance was given about how the client should go about this or what difficulties, if any, they would likely encounter. No other support was offered, at least for the next few weeks.
Both Martyn’s clients were or had been living in the Meadows area of Nottingham and understandably preferred to remain local to be near schools for their children. Martyn says:
“Under the LHA, both clients were entitled to a three-bedroom home. I logged onto Rightmove and using a 3-mile radius as a start, which would fit in with school transport rules, I began my search. There was not a single property available for rent less than £50.00 a month above the local housing allowance.
I extended the radius to 5 miles, which revealed one property, in Bulwell”
—which is in the constituency of my hon. Friend the Member for Nottingham North (Alex Norris)—
“this met the local housing allowance.”
The Minister may or may not know Nottingham well. Bulwell and the Meadows are at opposite ends of the city, a tram ride or two bus rides away from each other. The journey is time-consuming and costly, especially for a large family.
Sally Denton, from Nottingham Law Centre, has described the problems that she has witnessed. She said:
“In the current rental market where there is a shortage of social housing there is an increased demand on the private sector. This means that landlords can charge more due to the demand.”
She said that tenants
“cannot do anything to challenge the level of rent and cannot move to cheaper accommodation as it does not exist.”
She added:
“We see clients regularly who are struggling to pay for unaffordable rents. If an unexpected expense occurs, or there is a change in income (like the 5-week wait under Universal Credit), people can very easily fall into rent arrears and risk losing their homes.”
Nottingham Law Centre is not alone in identifying this problem. Terry Alafat, the chief executive of the Chartered Institute of Housing, has said:
“Our research makes it clear just how far housing benefit for private renters has failed to keep pace with even the cheapest private rents.
We fear this policy is putting thousands of private renters on low incomes at risk of poverty and homelessness.”
How can the Minister preside over a system that forces people to put themselves at risk of debt and eviction? I am sure that when he responds to the debate he will talk about the Government’s targeted affordability funding, but while that is of course welcome, it is nowhere near enough to address the problem. In Nottingham, the targeted affordability funding means that the LHA rate for three and four-bedroom houses has increased by 3% in the last year. The monthly shortfall for an LHA claimant renting a three-bedroom house at the 30th percentile is now £56.61 rather than £60.22, and for a four-bedroom house it is £121.59 rather than £126.14. Yes, that is an improvement, but does the Minister really think that it is sufficient?
While the freezing of LHA rates is creating this issue, a much bigger problem is the lack of affordable housing. Since 1980 Nottingham has lost 22,010 social homes through Right to Buy, and although Nottingham City Council, Nottingham City Homes and other local housing associations have built new homes, there are nowhere near enough to make up for those that have been lost. Indeed, the problem has accelerated since discounts were increased in 2012. In the last year there were 664 applications to Nottingham City Council for Right to Buy, whereas 134 homes were bought in 2012-13. There is a huge gap between the demand for and the supply of social housing. Nottingham City Homes made 1,431 new lets in the last year, but the housing register stood at 8,393.
Of course, some of those on the housing register are in permanent accommodation, but I know from my constituency casework that too many are inadequately housed, such as young families living with their parents in overcrowded conditions or in properties that are unsuitable for their needs—perhaps forced to live in high-rise housing. According to a survey carried out by Inside Housing in 2017, nearly 40% of council homes sold under Right to Buy have been resold and are being let in the private rented sector, at higher rents and, even with LHA restrictions, at a higher cost to the taxpayer. What discussions has the Minister had with his colleagues in the Ministry of Housing, Communities and Local Government about this ludicrous situation?
I am proud to represent a vibrant and extremely popular university city, but the rise in the city’s student population has also contributed to the lack of affordable family housing. Landlords have sought to capitalise on the student market by converting family homes into highly profitable shared accommodation. That increase in the number of houses in multiple occupation does not even help the under-35s whose LHA rate is restricted to the shared room rate. Many private rented properties in Nottingham are student-only lets. As students make up the majority of tenants, if someone entitled to LHA lived in a student let, the whole cost of the council tax would probably fall on the non-student tenant. Even when there appears to be an abundance of private rented accommodation, much of it is closed off to my constituents who receive LHA.
Unfortunately, however, that is not the only reason property is closed off. Shelter has revealed that many landlords discriminate against people on universal credit, and the position is no different for other LHA claimants. With the cost of renting so high and the rates so low, private landlords are reluctant to let to LHA claimants; 43% bar them completely, while a further 18% prefer not to let to them. What plans do the Government have to ensure that landlords cannot discriminate in that way?
The struggles that my constituents are facing are being replicated across the country. Last week the Supreme Court ruled in favour of Mrs Samuels, a single mum with four children, who was found to be “intentionally homeless” by Birmingham City Council because she did not use the subsistence benefits, intended for essential living costs, to pay the shortfall between her LHA and her rent. Shelter estimates that the majority of LHA households—65%—in private rented accommodation also face a monthly shortfall. Its survey of private renters detailed some of the impossible trade-offs that families receiving LHA are having to make. For example, one in three renters has cut back on food for either themselves or their partner, and 37% have been forced to borrow money to pay their rent in the last year.
This cannot go on, but last week the Minister seemed unwilling to address the issue. Can he tell me what assessment he has made of the hardship suffered by households as a result of the freezing of LHA rates? Does he accept that the freeze has increased homelessness in Nottingham and across the country? Is he really saying that families should be forced to live below the breadline and use subsistence benefits to pay their rent? The Supreme Court ruling in favour of Mrs Samuels set a precedent, and his Department needs to respond urgently.
There is a very clear solution: 92% of local authorities responding to the Local Government Association’s LHA survey thought that lifting the freeze on LHA rates, and better aligning them with rents, would help to reduce homelessness in their areas. The Residential Landlords Association has said:
“The LHA has a ‘double whammy’ effect that is driving homelessness. This double whammy means that; first, tenants in receipt of Housing Benefit are more likely other tenants to have their tenancy ended by their landlord; and, secondly, these households are finding it increasingly difficult to find suitable, affordable accommodation in the private rented sector.”
The Chartered Institute of Housing has said:
“We are calling on the government to conduct an immediate review and to look at ending the freeze on Local Housing Allowance.”
Shelter, the Child Poverty Action Group, and many other housing and homelessness charities are saying the same thing. It is time to act and lift LHA rates, so that housing benefit covers the true cost of renting in the private sector.
The Government have pledged to halve rough sleeping in this Parliament, and to end it by 2027. I’m afraid that that shows a real lack of urgency, but how can I take the commitment seriously when Ministers have repeatedly ignored warnings over the past nine years, and have pursued the very policies that have caused homelessness to rise? They have cut Supporting People funds, changed the basis on which LHA rates are set from the median to the 30th percentile of market rents, restricted people aged 26 to 35 to the shared room rate, introduced the bedroom tax, subjected families to the benefit cap, and restricted and then frozen LHA rates.
I do not hold the Minister responsible for things that happened before he was even a Member of Parliament, but I will hold him accountable for his actions now. Before he became a Minister, he chaired the all-party group on ending homelessness. Now that he is in a position to make a real difference, will he do so?
Matt Downie, director of policy and external affairs at Crisis, said recently:
“Homelessness is not inevitable—there is clear evidence that it can be ended with the right policies in place. The government must urgently reform housing benefits for private renters, so they not only match the true cost of renting but also keep pace with future rent changes.”
Will the Minister end the freeze on local housing allowance, and if so, when? Will he provide additional targeted affordability funding to help those who are struggling to pay their rent right now? Will he ensure that LHA rates are restored to at least the 30th percentile of local rents? Given that this is a housing crisis, will he call on his colleagues at the Ministry for Housing, Communities and Local Government to act now to provide more social housing and controls on rent rises? Now that he is in a position to help to end one of the causes of homelessness, will he do the right thing?
The Parliamentary Under-Secretary of State for Work and Pensions (Will Quince)
I thank the hon. Member for Nottingham South (Lilian Greenwood) for securing this debate. I have not yet had an opportunity to visit Nottingham in my role but I look forward to doing so, hopefully over the summer.
Since taking up my post two months ago, I have been keen to engage with as many people as possible, including key stakeholders such as Shelter, Crisis, Homeless Link and the Joseph Rowntree Foundation, to understand housing issues from all perspectives. Like the hon. Lady, I have a keen and long-standing interest in housing and ensuring that people have a safe, decent and affordable place to live that meets the needs of the household, and I would like to start by confirming that we have committed to end the freeze on local housing allowance in March 2020.
Reform of housing support was a central part of this Government’s plan to create a welfare system that both supports the most vulnerable and is fair to taxpayers. To help ensure a fair balance between these two elements, LHA rates are not intended to meet rents in all areas. The intention behind the welfare reform programme is that the same considerations and choices faced by people not in receipt of benefits should be faced by those claiming benefits, and the LHA policy is designed to achieve this.
Between 2000 and 2010, housing benefit expenditure had risen by over half in real terms, reaching £25 billion in today’s prices. If left unreformed, by 2014-15 housing benefit would have reached £29 billion. That was not sustainable.
The measure to freeze LHA rates for four years from April 2016 built on reforms introduced in the previous Parliament, which saved £6 billion in total by 2015-16. Savings from freezing LHA rates are estimated to be around £655 million for Great Britain over the four-year period of the measure. Our reforms provide greater fairness and are part of our wider goal to move people from welfare and into work.
However, we have recognised that some places have seen big increases in rents, so we have made provision to further help people in those areas. That is why we have used a proportion of the savings from the freeze to create more targeted affordability funding, which is used to reduce the gap between frozen LHA rates and the 30th percentile.
Initially, targeted affordability funding was based on 30% of the savings from the freeze, but at autumn Budget 2017 we invested an additional £125 million in targeted affordability funding for the final two years of the freeze—2018-19 and 2019-20. This was based on 50% of the savings rather than 30%.
This additional funding enabled us to increase 213 LHA rates—there are 960 in total—by 3% last year, in 2018-19. This year, a total of £210 million has been made available, the highest amount of targeted affordability funding since its introduction in 2014, enabling us to increase 361 LHA rates by 3%. As a result, it is estimated that this year 500,000 households will benefit from an increase of around £250 per year.
In addition to this targeted affordability funding the Government have provided over £1 billion in discretionary housing payments to local authorities since 2011. Discretionary housing payments allow local authorities to protect the most vulnerable claimants and support households affected by different welfare reforms, including the freeze to LHA rates.
In Nottingham specifically, two of the five LHA rates in the broad market rental area were eligible for targeted affordability funding this year: the three-bedroom and four-bedroom LHA rates, both of which have been increased by 3%.
Lilian Greenwood
I thank the Minister for taking an intervention. As he rightly says, the levels for three and four-bedroom properties have been increased. I set out the levels of increase: for example, for a four-bedroom house, it has been increased by £4.55, but that still leaves a shortfall of £1,452 over the year for someone in that position renting that four-bedroom house. The Minister has quoted the rates but the shortfall that people are being asked to make up is huge. Is he really saying that that is the sort of money someone should have to find from their other benefits, whether child benefit or disability benefits? Is that really right?
Will Quince
I thank the hon. Lady for her question. That is exactly why we have introduced the targeted affordability funding and we have made available discretionary housing payments, but it is also why more broadly, as I explained in the urgent question last week, I am looking at this in some detail, as I did before being a Minister as part of the all-party group for ending homelessness.
As I said, the three-bedroom and four-bedroom LHA rates in Nottingham have both been increased by 3%. The remaining rates in Nottingham did not fall within the criteria of those rates that had diverged the most from local rents and therefore were not eligible for targeted affordability funding this year, and so remain frozen. As I have said, the Government have committed to end the freeze to LHA rates in March 2020 alongside the freeze on other working-age benefits.
Before I go on, I am aware that the hon. Lady mentioned a few other points which I would like to cover: homelessness, housing supply and “no DSS”. I did a huge amount of work, alongside the hon. Member for Bermondsey and Old Southwark (Neil Coyle), on the causes of homelessness and rough sleeping as co-chair of the all-party group for ending homelessness. Those causes are understood to be both complex and multifaceted. In order to fully evaluate these factors, we have commissioned a feasibility study and a rapid evidence review of the causes of homelessness in partnership with the Ministry of Housing, Communities and Local Government. This report has now been finalised and we are working on the next steps.
As I said earlier, we want everyone to have security in their homes and a roof over their head, and that is why we have committed over £1.2 billion to tackle homelessness and rough sleeping. We published a strategy to end rough sleeping by 2027 and halve it by 2022, and that is backed by £100 million of initial funding. And we have changed the law so that councils can place families in private rented accommodation so they get a suitable place sooner. Last year, statutory homelessness acceptances fell, and we are going to build on this; and the Homelessness Reduction Act 2017 will mean that more people get the help they need sooner.
The hon. Lady rightly touched on landlords not letting to those in receipt of benefits, also known under the old term of “no DSS”. This is a hugely important issue, and in February, the Under-Secretary of State for Housing, Communities and Local Government, my hon. Friend the Member for South Derbyshire (Mrs Wheeler), announced a Government campaign to end “no DSS” practices. We recently had a No. 10 roundtable on this very issue with a number of key stakeholders, and we are working with those stakeholders to find a satisfactory resolution.
Everyone deserves a safe and secure home, regardless of whether they are in receipt of benefits. Blanket bans do not take account of the individual and their circumstances, which is why we strongly discourage them. We would encourage landlords and agents to consider all potential and existing tenants in receipt of housing benefit and universal credit on an individual basis. We have already seen some positive changes from property sites that have committed to remove “no DSS” wording adverts from across their platforms, and lenders have changed their policies to remove mortgage restrictions that would prevent landlords from renting to tenants in receipt of housing support. Metro Bank is one of the latest to remove such restrictions, and I hope others will follow, but work is ongoing and we will continue to bring the sector together to tackle these practices.
Jim Shannon
It would annoy us greatly to find that rental landlords were discriminating against people because they were in receipt of benefits or were DSS applicants. Does the Minister agree that if there is discrimination, which clearly many of us in this House think there would be, under discrimination laws it would be illegal to do that? Also, what action would the Minister, in co-operation with colleagues of course, take to make sure that did not happen?
Will Quince
The hon. Gentleman makes a good point. Although that might be discrimination in terms of the terminology we would use, it might not fall under the legal definition of it. As a result, we believe that the best way of tackling this issue is to work with key stakeholders such as landlords and mortgage lenders, as well as with those who provide insurance, because we know that there is a particular issue in that regard. We had a successful roundtable at No. 10 recently, where I genuinely believe we had a good cross-section of all the key players from across the board. We are starting to see progress in this area, and I am sure that by taking this collaborative approach, with the Government working with business, key stakeholders and the charitable and voluntary sector, we will truly get a grip on this issue and tackle it. We do not want to see anyone who is in receipt of benefits being discriminated against in this way.
Alex Norris
I am grateful to the Minister for allowing an intervention before he moves on. I am going to test your patience, Mr Deputy Speaker, but I know that the Minister’s dogs were successful in the dog of the year competition not so long ago, as were my own, and I just want to raise a point about pets. Has he had a chance to consider the fact that another hidden way of excluding people in an overheated rental market is to adopt a no-pets policy? The Opposition have said that we want to get rid of that policy in tenancies, and I wonder whether the Minister has considered that as well.
Will Quince
The hon. Gentleman is a dog owner, and I am as well. I would not be without our Charlie, and I think that my two daughters would rather throw me out than the dog. In answer to his question, this is an action issue for the Ministry of Housing, Communities and Local Government, but I can assure him that I am working closely across the board with my counterparts in that Department, and I have a meeting with them tomorrow at which I shall raise that very issue.
The hon. Member for Nottingham South also touched on the question of supply, which follows neatly on from the hon. Gentleman’s point. As I have said, I work very closely indeed on this with my counterparts at the Ministry of Housing, Communities and Local Government, and I am sure that the hon. Lady would expect nothing less. Any changes to LHA rates must go hand in hand with how we look at supply, which is why it is essential that we have those meetings. I have them regularly, and I shall have one tomorrow. It will come as no surprise to her that I will continue to push my colleagues in the Department to look at how we can increase the supply of council, social and affordable housing. She mentioned Matt Downie of Crisis, but she missed the three letters that he now has the end of his name. I understand that he was recently awarded an MBE by Her Majesty the Queen, and I would like to send my congratulations to Matt, who is a huge asset to that organisation.
As a Government, we are proud of the progress we have made on our welfare reforms. We now have a record-breaking labour market, with over 3.6 million more people in work across the UK than in 2010 and with unemployment at its lowest rate since the 1970s, having fallen by more than half since 2010. This Government will continue to reform the welfare system so that it promotes work as the most effective route out of poverty. That is fairer to those who receive it and to the taxpayer who pays for it. Work is the pillar of a strong economy and a strong society. We believe that work should always pay, and we need a welfare system that helps people into work, supports those who need help and is fair to everyone who pays for it.
Lilian Greenwood
I hear what the Minister says, but he must be as concerned as I am that so many of the people who are now in poverty are also in work. In addressing the issue that we are talking about today, why is it right to force those who are least able to pay for the cost of welfare reform to do so, rather than looking at placing a control on rents as a way of controlling expenditure on welfare payments and protecting those who are most vulnerable from the impact of having to reduce expenditure?
Will Quince
I do not entirely recognise the picture that the hon. Lady paints. There have been huge positive changes for some of the lowest paid in our country. The national living wage has risen to £8.21, increasing a full-time worker’s pay by more than £2,750 since 2016. Our tax changes will make basic rate taxpayers more than £1,200 better off than they were in 2010, and we have doubled the free childcare available to working parents of three and four-year-olds to 30 hours per week, saving them up to £5,000 per child.
I was about to mention universal credit. Universal credit replaces the outdated and complex benefit system of the past, which too often stifled people’s potential, creating cliff edges at 16, 24 and 30 hours and punitive effective tax rates of more than 90% for some. The system was punishing claimants for doing the right thing. In the autumn Budget last year, we listened to concerns about universal credit delivery and funding, and announced a £4.5 billion cash boost to universal credit to ensure that vulnerable claimants and families would be supported in the transition to universal credit and that millions would keep more of what they earned. We announced a package of additional support worth £1 billion for all those being moved on to universal credit. This includes a two-week continuation of legacy benefits, a 12-month exemption period from the minimum income floor, a reduction in the deductions cap and an extension of the advances repayment period.
In conclusion, this Government remain committed to a strong safety net for those who need it. That is why we continue to spend more than £90 billion a year on welfare benefits for people of working age—
Lilian Greenwood
I would not like the Minister to finish without ensuring that I have understood what he is saying. He said earlier that the freeze on local housing allowance rates would end in April next year. Can I check whether LHA rates will also be restored to at least the 30th percentile of local rents, or whether they will just be allowed to rise from the level that they are now? Given that he has said that the freeze will end in April 2020, what additional help will he provide for those who are struggling to pay their rent now?
Will Quince
I thank the hon. Lady for her further intervention, just as I was reaching the end of my conclusion. I will comment on what she has just said in a moment. The Government continue to spend more than £90 billion a year on welfare benefits for people of working age, and the freeze to LHA rates and working-age benefits will end in March 2020. In answer to the further questions she rightly asked, that is a decision for the Secretary of State, and I will be working closely with her on that in the coming days, weeks and months.
Question put and agreed to.