CIH responds to Conservative's proposal to cut LHA to help meet defence spending commitments

CIH has warned that Conservative Party plans to cut Local Housing Allowance (LHA) risk pushing more households into hardship and homelessness, as the party looks to fund higher defence spending through welfare savings.

The party has said they would make defence spending hit 3% of GDP by 2029/30 through £10 billion of savings, primarily from social security. 

The bulk of the savings would come through cutting at least £4 billion from housing benefit, which currently costs £38 billion a year. It was announced that around half would come from setting benefits at the 10th percentile of local market rates, instead of the 30th, and the rest from freezing social rents, which are often paid from housing benefit. 

Responding to the proposals, Rachael Williamson, CIH director of policy, communications and external affairs, said: "Cutting housing benefit by reducing Local Housing Allowance to the 10th percentile risks taking us back to a situation where support bears little relation to the real cost of renting. At a time when record numbers of households are already struggling with housing costs, this would almost certainly increase financial hardship and homelessness. Any short-term savings to the welfare bill could quickly be outweighed by higher costs to councils, the NHS and other public services dealing with the consequences of people losing their homes."