Government crackdown on £2,000 a week housing benefit

Property News Desk 02/22/2010 12:38

The Government has vowed to crackdown on excessive housing benefit payments in London, with Yvette Cooper the Work and Pensions today announcing plans to cap the practice of families renting out homes in London's most luxurious postcodes costing the taxpayer up to £2000 a week in housing benefit in some cases.

Due to the chronic shortage of council homes in the capital, the private sector is being used to house families, with The Times reporting that private landlords setting "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 one of the councils which as seen its housing benefit rocket with 26 families currently living in accommodation costing £1,600 per week, and 900 families on £500 a week rents. Westminster has written a letter to the Secretary of State which underlines the councils concerns at the current system:

"We are, therefore, extremely concerned that the current local housing allowance system fails to offer taxpayers value for money.

Indeed, 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% of working households in the UK, should be regarded not only as unsustainable but wholly unfair and plainly wrong."

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