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"Bedroom Tax" Due to Begin in April 2013


A forthcoming change in housing benefit that has been dubbed the bedroom tax will affect over half a million tenants when it starts in April this year.  Strictly speaking it is not a tax at all, and the Government argues that it will help cut the annual £23bn bill for housing benefit, free up more living space for overcrowded families and encourage people to seek employment.  However, charities argue that it will lead to higher levels of rent arrears and homelessness.

The new rules will affect housing benefit, which is typically around £50 to £100 per week, payable to less well-off tenants.  But from April 2013, recipients of the benefit will be assessed under size-criteria guidelines.  Families deemed to have surplus living space by local authorities will have their payments reduced.

The changes affect those renting from housing associations and council tenants.  Initial Government assessments suggest that around 600,000 households will have their benefit cut, which equates to around a third of social sector claimants.  If tenants are deemed to have one spare room, their housing benefit will be cut by 14%.  Two or more will incur a cut of 25%.  Council tenants will be around £14 a week worse off and housing association tenants £16 per week, according to the Governments estimates.

The new rules allow one bedroom per adult or couple, but children of the same gender, under the age of 16, are expected to share.  Those under the age of 10 must share, regardless of gender.  Disabled tenants will be allowed a bedroom for a full-time carer.  The number of bedrooms will be determined by the landlords tenancy agreement to prevent tenants re-classifying.
Parents will not be penalised if a student is studying away from home, as long as he or she is at home for two weeks of the year.  This will change in the autumn when universal credit is launched however, when the student must be home for at least six months of the year.

The Department for Work & Pensions has produced a fact sheet which deals with the housing benefit changes in full; it can be found at www.dwp.gov.uk/docs/factsheet-hbsssc1.pdf.  For more details on the forthcoming universal credit scheme, see http://www.dwp.gov.uk/policy/welfare-reform/universal-credit.

Sources: bbc.co.uk, dwp.gov.uk (image courtesy of thisismoney.co.uk)