Excessive housing payments in London will be the subject of a crackdown by the UK government, The London Daily News has reported.
Yvette Cooper, the Work and Pensions Secretary of State, recently spoke about ways to limit the practice of families renting out homes in London?s most luxurious postcodes. This can leave the taxpayers paying the cost of ?2,000 a week in housing benefit.
With council homes in the capital suffering from a chronic shortage, families are now housed in the private sector. The Times has said that private landlords set ?rents ?1 to ?2 below the maximum allowed by the Department of Work of Pensions, which has led to rents of almost ?2,000 a week?.
Westminster Council, has seen a dramatic increase benefit increase with 26 families currently living in accommodation costing ?1,600 per week, and 900 families on ?500-a-week rents. The Secretary of State had received a letter which stated that the council were ?extremely concerned that the current local housing allowance system fails to offer taxpayers value for money?.
Westminster Council went on to say: ?A system which can support families to live in accommodation costing at least ?500 per week, which makes it beyond the reach of an estimated 96 per cent of working households in the UK, should be regarded not only as unsustainable but wholly unfair and plainly wrong.?
The council then requested the Government give local authorities sufficient powers to work out where to house residents who receive the local housing allowance so that the system was fair on both them and taxpayers. Westminster Council also want a thorough review of the ?broad market rental area system? to ascertain whether local housing allowance rates can be reduced at all.
Currently the housing benefit for the whole of the UK is estimated to be ?17 billion.
