Cuts To Social Rents Will Benefit Exchequer More Than Tenants

Reductions in social rents announced in the July Budget will be of little or no direct benefit to most of the 3.9 million households in England living in social housing. Most of those renting their home from councils or housing associations have low incomes and hence receive housing benefit to cover all or part of their rent. Entitlement to housing benefit will typically be reduced pound-for-pound as their rent falls. The reduction in housing benefit will save the exchequer money, and will strengthen tenants’ work incentives as they have less means-tested support to lose by entering work or increasing their earnings. Social landlords – housing associations and local authorities – will lose money. These are among the conclusions of a new report on social rent policy, published by the Institute for Fiscal Studies (IFS) and funded by Trust for London. Download a copy of the report from the IFS website.