Autumn Statement: Jeremy Hunt has constructed short-term solutions to help people with housing costs
As part of the ‘autumn statement for growth’ Jeremy Hunt announced the government will be unfreezing housing benefits, but experts have expressed their concerns that this may only be a temporary fix.
At 12:30PM today Jeremy Hunt delivered his Autumn Statement to the House of Commons. In what will be one of his last economic announcements before the next general election, Mr Hunt unveiled that because inflation has fallen to its lowest level in the past two years, the government are in a good enough position to impose a series of financial measures that should help the general public slowly recover from the cost-of-living.
One of the chancellor’s announcements included cutting national insurance from 12% to 10% and offering businesses a tax cut to increase investment, which Mr Hunt described as the largest in modern history.
In addition, the chancellor also said the government will be investing £1bn to ensure that local housing allowance rates would cover the bottom 30% of market rents for the first time since 2020.
Within the statement, Mr Hunt said: ‘Because rent can constitute more than half the living costs of private renters on the lowest incomes, I’ve listened closely to many colleagues as well as the Institute of Fiscal Studies, the Resolution Foundation, Citizens Advice UK and the Joseph Rowntree Foundation who said that unfreezing the local housing allowance was an urgent priority.
‘I will then increase the local housing allowance rate to the 30th percentile of local market rents. This will give 1.6 million households an average of £800 of support next year.’
However, although this news may seem positive, experts from within the housing sector have said it is only a short-term fix and that the long-term solution should be for the government to invest in providing more social homes to reduce the need for temporary accommodation.
‘We welcome the government’s move to unfreeze housing benefits,’ said Carol Matthews CBE, chief executive of Riverside. ‘Maintaining the freeze on the housing allowance was driving more people into homelessness at a time when we have a record-high of 104,510 households living in temporary accommodation in England and councils collectively spending £1.7bn on temporary accommodation in the past financial year to keep families off the streets.’
Carol added: ‘Increasing spending on housing and homelessness might be necessary in short-term. However, the long-term solution to this challenge is for the Government to invest in providing more supported housing to reduce the need for emergency temporary accommodation, and to build new social housing which will give people more affordable housing options and stimulate the economy by creating more jobs.
‘There is a clear long-term need for the Government to commit to delivering more than 90,000 new homes a year for social rent and to ring-fence and increase long-term revenue funding for supported housing for people affected by homelessness. We will continue to urge all political parties to commit to build and fund more social and supported homes which are desperately needed across the country.’
Image: James Giddins
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