London hit hardest by housing benefit funding reductions

  • By London Councils

Statement on the impact of the government's decision to reduce Discretionary Housing Payments funding:

Mayor Jules Pipe, Chair of London Councils, said: “Discretionary housing payments (DHPs) are an invaluable safety net for Londoners, who are struggling with their housing costs (1).

“This reduction will hit the capital harder than the rest of the country – we calculate that London boroughs will see a cut of more than 35 per cent in 2015/16, compared to a 24 per cent decrease nationally (2).

“This decision comes just weeks after central government announced it will stop funding for local welfare provision, another vital form of emergency funding (3).

“Any reduction in DHP funding will place more London families at greater risk of homelessness, and we strongly urge against it.”


Editor’s notes: 

1. Discretionary Housing Payments are awards that councils may make to claimants of housing benefit who are experiencing a shortfall between the rent due and the amount of benefit payable. London boroughs made more than 50,000 DHP awards last year – including almost 13,500 to households affected by the benefit cap.

2. It was announced on Friday (30 January) by the Department for Work & Pensions that the overall amount of funding it makes available nationally for Discretionary Housing Payments (DHPs) will be reduced from £165m to £125m – a cut of around 24 per cent. The element linked to the bedroom tax/removal of the spare room subsidy which is worth £60m, will be protected. This means the reduction must be found from the other elements including that linked to the benefit cap. Estimates are that London will receive between £33-35m in 2015/16, down from £51m in 2014/15. Around £20m of DHP funding went to families affected by the cap in 2013/14. For more details see the government's website.