Housing benefit insufficient for nearly half of Luton families with children

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Housing benefit is insufficient for nearly half of households with children living in private rental accommodation in Luton, new analysis suggests.

A think tank has warned almost a million children could be forced into poverty due to benefit shortfalls by 2026.

Research by the Institute for Public Policy Research found welfare reforms, rising numbers of children in the private rented sector and a lack of investment in social housing have led to increasing child poverty.

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The rate of Local Housing Allowance is determined by the Department for Work and Pensions and is based on private market rents in the local area.

Model houses on a pile of coins and bank notes. Picture: Joe Giddens/PAModel houses on a pile of coins and bank notes. Picture: Joe Giddens/PA
Model houses on a pile of coins and bank notes. Picture: Joe Giddens/PA

It is paid to tenants renting from private landlords in receipt of Universal Credit or housing benefit, to help support the cost of their home.

However, the IPPR said cuts and freezes made to LHA rates over recent years have made at least two-fifths of private rental properties across the UK unaffordable and has led to an increase in child poverty.

Its analysis shows around 48 per cent of the 5,877 households in Luton receiving some form of housing benefit with at least one child would not have their full rent covered by the LHA.

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Meanwhile in Central Bedfordshire, around 52 per cent of the 2,422 households receiving some form of housing benefit with at least one child would not have their full rent covered by the LHA.

Nationally, the IPPR said there are now an estimated 440,000 households with children whose housing support no longer covers the costs of their rent.

A government spokesperson said: "No person should be in poverty – that’s why we’ve extended the Household Support Fund again, are maintaining Discretionary Housing Payments and are giving an extra £233 million to councils directly for homelessness, including the largest-ever investment in prevention services, taking the total to nearly £1 billion for 2025-26.

"Alongside this, we are uprating benefits and the State Pension, increasing the National Living Wage and helping over 1 million households by introducing a Fair Repayment Rate on Universal Credit deductions, while our Child Poverty Taskforce develops an ambitious strategy to give all children the best start in life."

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